AB114,7,1515 (a) “Disability insurance policy” has the meaning given in s. 632.895 (1) (a).
AB114,7,1616 (b) “Pharmacist” has the meaning given in s. 450.01 (15).
AB114,7,1717 (c) “Pharmacy benefit manager” has the meaning given in s. 649.01 (6).
AB114,7,1818 (d) “Prescribed drug or device” has the meaning given in s. 450.01 (18).
AB114,7,1919 (e) “Prescription drug benefit” has the meaning given in s. 649.01 (8).
AB114,7,2020 (f) “Self-insured health plan” has the meaning given in s. 632.85 (1) (c).
AB114,8,2 21(2) Allowing disclosures. No disability insurance policy or self-insured
22health plan that provides a prescription drug benefit may include in a contract for
23pharmacy services, or allow a pharmacy benefit manager or another entity to include
24in a contract for pharmacy services, a provision that prohibits or penalizes, including
25by increased utilization review, reduced reimbursement, or other financial

1disincentives, a disclosure of any of the following by a pharmacist to an individual
2purchasing a prescribed drug or device:
AB114,8,33 (a) The cost of the prescribed drug or device to the individual.
AB114,8,64 (b) The availability of any therapeutically equivalent alternative prescribed
5drugs or devices or alternative methods of purchasing the prescribed drug or device,
6including paying cash, that are less expensive to the individual.
AB114,8,11 7(3) Cost sharing limitation. An insurer, self-insured health plan, or a
8pharmacy benefit manager may not require a person who is covered under a
9disability insurance policy or self-insured health plan to pay at the point of sale for
10a covered prescription drug an amount greater than the lowest of all of the following
AB114,8,1212 (a) The applicable copayment for the prescription drug.
AB114,8,1313 (b) The allowable claim amount for the prescription drug.
AB114,8,1714 (c) The amount a person who is covered under the disability insurance policy
15or plan would pay for the prescription drug if the person purchased the prescription
16drug without using a disability insurance policy or any other source of prescription
17drug benefits or discounts.
AB114,8,1918 (d) The amount the pharmacist or pharmacy is reimbursed for the prescription
19drug from the pharmacy benefit manager or insurer.
AB114,9,2 20(4) Choice of provider; penalty prohibited. An insurer, self-insured health
21plan, or pharmacy benefit manager is prohibited from requiring or penalizing a
22person who is covered under a disability insurance policy or self-insured health plan
23to use or for not using a specific retail, specific mail order, or other specific pharmacy
24provider within the network of pharmacy providers under the policy or plan. A

1prohibited penalty under this subsection includes an increase in premium,
2deductible, copayment, or coinsurance.
AB114,9,10 3(5) Drug substitution. (a) A disability insurance policy that offers a
4prescription drug benefit or self-insured health plan or a pharmacy benefit manager
5acting on behalf of a disability insurance policy or self-insured health plan may not
6require a person covered under the policy or plan to pay an increased cost-sharing
7amount for a newly prescribed drug or device if the substitution for the originally
8prescribed drug or device is suggested by the policy, plan, or pharmacy benefit
9manager and if the newly prescribed drug or device is therapeutically equivalent to
10the originally prescribed drug or device being substituted.
AB114,9,1611 (b) Every disability insurance policy that offers a prescription drug benefit,
12self-insured health plan, and pharmacy benefit manager shall develop a procedure
13to ensure that a policy or plan does not deny coverage to an insured or plan
14participant during a plan year or subject the insured or plan participant to new
15exclusions, limitations, deductibles, copayments, or coinsurance under a
16circumstance that satisfies all of the following:
AB114,9,1917 1. The prescribed drug or device was covered under the policy or plan for the
18insured or plan participant when the insured or plan participant either enrolled in
19coverage or renewed coverage, whichever is later.
AB114,9,2320 2. A health care provider who prescribed the prescribed drug or device states,
21in writing, that the prescribed drug or device is more suitable for the insured's or plan
22participant's condition than alternative drugs or devices that are covered under the
23policy or plan.
AB114,14 24Section 14. 632.865 (title) and (1) of the statutes are repealed.
AB114,15 25Section 15. 632.865 (2) of the statutes is renumbered 649.30 (1).
1Section 16. Chapter 649 of the statutes is created to read:
AB114,10,32 Chapter 649
3 pharmacy benefit managers
AB114,10,4 4649.01 Definitions. In this chapter:
AB114,10,5 5(1) “Health benefit plan” has the meaning given in s. 632.745 (11).
AB114,10,6 6(2) “Health care provider” has the meaning given in s. 146.81 (1).
AB114,10,9 7(3) “Maximum allowable cost” means the maximum amount that a pharmacy
8benefit manager will pay a pharmacist or pharmacy toward the cost of a prescribed
9drug or device.
AB114,10,10 10(4) “Pharmacist" has the meaning given in s. 450.01 (15).
AB114,10,11 11(5) “Pharmacy" means an entity licensed under s. 450.06 or 450.065.
AB114,10,19 12(6) “Pharmacy benefit manager" means an entity doing business in this state
13that contracts to provide claims processing services, to otherwise administer or
14manage prescription drug benefits, or both on behalf of any insurer or other entity
15that provides prescription drug benefits to residents of this state. “Pharmacy benefit
16manager” does not include a health care provider except for a health care provider
17that is required to obtain a license under s. 450.06, 450.065, or 450.071 and does not
18include an entity that provides claims processing services or other administration of
19prescription drug only for the Medical Assistance program under subch. IV of ch. 49.
AB114,10,20 20(7) “Prescribed drug or device" has the meaning given in s. 450.01 (18).
AB114,10,22 21(8) “Prescription drug benefit" means coverage of or payment or assistance for
22prescribed drugs or devices.
AB114,10,24 23(9) “Registrant" means a pharmacy benefit manager that is registered under
24this chapter.
1649.05 Registration of pharmacy benefit managers. (1) (a) Except as
2provided in par. (b), no person may perform any activities of a pharmacy benefit
3manager in this state without first registering with the commissioner under this
AB114,11,65 (b) A pharmacy benefit manager that is an insurer with a current certificate
6of authority issued under s. 601.04 is not required to register under this section.
AB114,11,87 (c) 1. Any pharmacy benefit manager that is required to obtain a license under
8s. 450.06, 450.065, or 450.071 shall also register under this chapter.
AB114,11,129 2. If the pharmacy examining board revokes a license that had been granted
10under s. 450.06, 450.065, or 450.071 to a registrant, the registrant shall notify the
11commissioner of the revocation. The commissioner shall revoke the registration
12under this chapter.
AB114,11,14 13(2) An applicant for registration as a pharmacy benefit manager shall do all
14of the following:
AB114,11,1615 (a) File with the commissioner an application on a form that the commissioner
AB114,11,1717 (b) Pay any registration fee set by the commissioner.
AB114,11,22 18(3) The commissioner shall register any pharmacy benefit manager that meets
19the requirements of this chapter and any requirements the commissioner requires
20of applicants. Registration under this section is valid for one year unless registration
21is suspended or revoked. The commissioner may refuse to register any pharmacy
22benefit manager for which a previous registration was suspended or revoked.
AB114,11,24 23649.10 Powers and duties of the commissioner. (1) The commissioner
24may do any of the following:
AB114,11,2525 (a) Promulgate rules necessary to carry out the intent of this chapter.
1(b) Use authority granted under ss. 601.41, 601.42, 601.43, 601.44, 601.61,
2601.62, 601.63, and 601.64 to enforce this chapter, s. 628.36, and ch. 632 as it relates
3to pharmacy benefit managers.
AB114,12,7 4(2) The commissioner shall promulgate rules regarding all of the following
5using as a model the prescription drug benefit management model act of the National
6Association of Insurance Commissioners for the 2nd quarter of 2018 to the extent the
7model act does not conflict with this chapter or ch. 632:
AB114,12,138 (a) Requirements for the development and maintenance of prescription drug
9formularies and other pharmacy benefit manager procedures, except that the
10commissioner may not allow a health benefit plan, self-insured health plan, or
11pharmacy benefit manager to require a consumer to obtain a prescription drug at a
12mail order pharmacy because the prescription drug requires special handling,
13provider coordination, or patient education.
AB114,12,1714 (b) Information that the pharmacy benefit manager is required to provide to
15a person who is covered or who seeks to be covered under a health benefit plan or
16self-insured health plan, a prescriber of prescription drugs, or a pharmacist or
AB114,12,1918 (c) Requirements and procedures for a medical exceptions approval process
19that is standardized among pharmacy benefit managers.
AB114,12,2020 (d) Requirements for nondiscrimination in prescription drug benefit design.
AB114,12,2221 (e) Requirements for record keeping and reporting by a pharmacy benefit
AB114,12,2423 (f) Responsibilities for the pharmacy benefit manager in oversight and
1(g) Required disclosures by a health benefit plan or self-insured health plan
2or a pharmacy benefit manager.
AB114,13,6 3649.20 Suspension or revocation of registration; penalty. (1) The
4commissioner, after a hearing, may suspend or revoke the registration of a
5registrant, if the registrant or an officer, director, or employee of the registrant does
6any of the following:
AB114,13,97 (a) Knowingly makes or causes to be made a false statement or
8misrepresentation of a material fact in an application for registration under s.
AB114,13,1110 (b) Obtains or attempts to obtain a registration under s. 649.05 through
11misrepresentation or fraud.
AB114,13,1612 (c) Misappropriates or converts for the registrant's own use or improperly
13withholds insurance premiums or contributions held in a fiduciary capacity, except
14for any interest earnings received by the pharmacy benefit manager and disclosed
15to the pharmacist, pharmacy, or health benefit plan sponsor with which the
16pharmacy benefit manager has a contract to provide services.
AB114,13,1817 (d) Commits fraudulent, coercive, or dishonest practices in the transaction of
18business as a pharmacy benefit manager.
AB114,13,2119 (e) Uses, or knowingly permits the use of, any advertisement, promotion,
20solicitation, representation, proposal, or offer that is untrue, deceptive, or
AB114,13,2422 (f) Has a license or registration suspended, revoked, or not renewed in any
23other state, district, territory, or province that impacts business conducted in this
1(g) Knowingly violates a requirement of this chapter or ch. 632 or a rule
2promulgated under this chapter or ch. 632.
AB114,14,5 3(2) Any person who performs the activities of a pharmacy benefit manager in
4this state without a valid registration under s. 649.05 is subject to a forfeiture of $500
5for each day of violation.
AB114,14,6 6649.30 Pricing transparency; prohibitions; contracts.
AB114,14,8 7(2) Prohibitions. A pharmacy benefit manager or a representative of a
8pharmacy benefit manager may not do any of the following:
AB114,14,129 (a) Unless approved by the commissioner, charge a pharmacist or pharmacy a
10fee related to the adjudication of a claim, including a fee for receiving and processing
11a pharmacy claim, developing or managing claims processing services in a pharmacy
12benefit manager network, or participating in a pharmacy benefit manager network.
AB114,14,1613 (b) Unless approved by the commissioner after consulting with the pharmacy
14examining board, require pharmacist or pharmacy accreditation standards or
15certification requirements in addition to, more stringent than, or inconsistent with
16any requirements of the pharmacy examining board.
AB114,14,2117 (c) Reimburse a pharmacy or pharmacist in this state an amount less than the
18amount that the pharmacy benefit manager reimburses an affiliate of the pharmacy
19benefit manager for providing the same services. To comply with this paragraph, the
20pharmacy benefit manager shall compare the amounts calculated on a per-unit
21basis using the same generic product identifier or generic code number.
AB114,14,2422 (d) After termination of a pharmacy or pharmacist from a pharmacy benefit
23network, fail to make payments to a pharmacist or pharmacy for services that were
24properly rendered and provided before termination.
1(e) Prohibit, restrict, or limit a pharmacy or pharmacist from disclosing
2information to the commissioner, law enforcement, or a state or federal
3governmental official that is investigating or examining a complaint or conducting
4a review of a pharmacy benefit manager's compliance with the requirements under
5this section.
AB114,15,10 6(3) Conflict of interest; business practices. (a) If a pharmacy benefit
7manager makes a formulary substitution in which the substitute drug costs more
8than the originally prescribed drug, the pharmacy benefit manager shall disclose to
9the health benefit plan sponsor the cost of the drugs and any benefit that accrues,
10directly or indirectly, to the pharmacy benefit manager related to the substitution.
AB114,15,1211 (b) A pharmacy benefit manager may not require that a pharmacy or
12pharmacist enter into one contract in order to enter into another contract.
AB114,15,1613 (c) A pharmacy benefit manager shall notify a health benefit plan sponsor in
14writing of any activity, policy, or practice of the pharmacy benefit manager that
15presents a conflict of interest, directly or indirectly, with any requirement of this
AB114,15,19 17(4) Retroactive claim reduction. A pharmacy benefit manager may not
18retroactively deny or reduce a pharmacist's or pharmacy's claim after adjudication
19of the claim unless any of the following is true:
AB114,15,2020 (a) The original claim was submitted fraudulently.
AB114,15,2221 (b) The payment for the original claim was incorrect because the pharmacy or
22pharmacist had already been paid for the pharmacy services.
AB114,15,2323 (c) The pharmacy services were not rendered by the pharmacist or pharmacy.
AB114,16,2 24649.35 Audits of pharmacies or pharmacists. (1) Definition. In this
25section, “entity” means a defined network plan, as defined in s. 609.01 (1b), insurer,

13rd-party payer, or pharmacy benefit manager or a person acting on behalf of a
2defined network plan, insurer, 3rd-party payer, or pharmacy benefit manager.
AB114,16,4 3(2) Audit procedure requirements. An entity conducting an audit of
4pharmacist or pharmacy records shall do all of the following:
AB114,16,75 (a) If the audit is an audit on the premises of the pharmacist or pharmacy, notify
6the pharmacist or pharmacy in writing of the audit at least 2 weeks before conducting
7the audit.
AB114,16,98 (b) Refrain from auditing a pharmacist or pharmacy within the first 7 days of
9a month unless the pharmacist or pharmacy consents to an audit during that time.
AB114,16,1210 (c) If the audit involves clinical or professional judgement, conduct the audit
11by or in consultation with a pharmacist licensed in this state or the pharmacy
12examining board.
AB114,16,1413 (d) Limit the audit review to claims submitted no more than 2 years before the
14date of the audit.
AB114,16,1615 (e) Audit each pharmacist or pharmacy under the same standards and
16parameters as other similarly situated pharmacists or pharmacies.
AB114,16,1817 (f) Establish a written appeals process that allows appeals of preliminary and
18final reports and allows for mediation if either party is dissatisfied with the appeal.
AB114,16,2319 (g) Allow the pharmacist or pharmacy to use records of a hospital, physician,
20or other health care provider to validate the pharmacist's or pharmacy's records and
21use any prescription that complies with requirements of the pharmacy examining
22board to validate claims in connection with a prescription, refill of a prescription, or
23change in prescription.
AB114,16,25 24(3) Results of audit. (a) An entity that has conducted an audit of a pharmacist
25or pharmacy shall do all of the following:
11. Deliver to the pharmacist or pharmacy a preliminary report of the audit
2within 60 days after date of the conclusion of the audit.
AB114,17,53 2. Allow a pharmacist or pharmacy that is the subject of an audit at least 30
4days after the date the pharmacist or pharmacy receives the preliminary report to
5provide documentation to address any discrepancy found in the audit.
AB114,17,86 3. Deliver to the pharmacist or pharmacy a final audit report within 90 days of
7the date the pharmacist or pharmacy receives the preliminary report or the date of
8the final appeal of the audit, whichever is later.
AB114,17,119 4. Refrain from assessing a recoupment or other penalty on a pharmacist or
10pharmacy until the appeal process is exhausted and the final report under subd. 3.
11is delivered to the pharmacist or pharmacy.