AB68: Bill Text

AB68,1540,10 1. The name, address, telephone number, and federal employer identification number of the applicant.

AB68,1540,12 2. The name, business address, and telephone number of a contact person for the applicant.

AB68,1540,13 3. The fee under s. 601.31 (1) (nw).

AB68,1540,14 4. Evidence of financial responsibility of at least $1,000,000.

AB68,1540,15 5. Any other information required by the commissioner.

AB68,1540,17 (b) The term of a license issued under par. (a) shall be 2 years from the date of issuance.

AB68,1540,21 (3) Disclosure to the commissioner. (a) A pharmacy services administrative organization shall disclose to the commissioner the extent of any ownership or control of the pharmacy services administrative organization by an entity that does any of the following:

AB68,1540,22 1. Provides pharmacy services.

AB68,1540,23 2. Provides prescription drug or device services.

AB68,1540,25 3. Manufactures, sells, or distributes prescription drugs, biologicals, or medical devices.

AB68,1541,3 (b) A pharmacy services administrative organization shall notify the commissioner in writing within 5 days of any material change in its ownership or control relating to an entity described in par. (a).

AB68,1541,4 (4) Rules. The commissioner may promulgate rules to implement this section.

AB68,2959 Section 2959 . 632.865 (1) (a) of the statutes is renumbered 632.865 (1) (aw).

AB68,2960 Section 2960 . 632.865 (1) (ae) and (ak) of the statutes are created to read:

AB68,1541,7 632.865 (1) (ae) “Health benefit plan” has the meaning given in s. 632.745 (11).

AB68,1541,8 (ak) “Health care provider” has the meaning given in s. 146.81 (1).

AB68,2961 Section 2961 . 632.865 (1) (c) of the statutes is renumbered 632.865 (1) (c) (intro.) and amended to read:

AB68,1541,13 632.865 (1) (c) (intro.) “Pharmacy benefit manager" means an entity doing business in this state that contracts to administer or manage prescription drug benefits on behalf of any of the following:

AB68,1541,14 1. An insurer or other.

AB68,1541,16 3. Another entity that provides prescription drug benefits to residents of this state.

AB68,2962 Section 2962 . 632.865 (1) (c) 2. of the statutes is created to read:

AB68,1541,18 632.865 (1) (c) 2. A cooperative, as defined in s. 185.01 (2).

AB68,2963 Section 2963 . 632.865 (1) (dm) of the statutes is created to read:

AB68,1541,20 632.865 (1) (dm) “Prescription drug" has the meaning given in s. 450.01 (20).

AB68,2964 Section 2964. 632.865 (2m) of the statutes is created to read:

AB68,1541,25 632.865 (2m) Fiduciary duty and disclosures to health benefit plan sponsors. (a) A pharmacy benefit manager owes a fiduciary duty to the health benefit plan sponsor to act according to the health benefit plan sponsor's instructions and in the best interests of the health benefit plan sponsor.

AB68,1542,3 (b) A pharmacy benefit manager shall annually provide, no later than the date and using the method prescribed by the commissioner by rule, the health benefit plan sponsor all of the following information from the previous calendar year:

AB68,1542,5 1. The indirect profit received by the pharmacy benefit manager from owning any interest in a pharmacy or service provider.

AB68,1542,7 2. Any payment made by the pharmacy benefit manager to a consultant or broker who works on behalf of the health benefit plan sponsor.

AB68,1542,11 3. From the amounts received from all drug manufacturers, the amounts retained by the pharmacy benefit manager, and not passed through to the health benefit plan sponsor, that are related to the health benefit plan sponsor's claims or bona fide service fees.

AB68,1542,16 4. The amounts, including pharmacy access and audit recovery fees, received from all pharmacies that are in the pharmacy benefit manager's network or have a contract to be in the network and, from these amounts, the amount retained by the pharmacy benefit manager and not passed through to the health benefit plan sponsor.

AB68,2965 Section 2965 . 632.865 (3) to (7) of the statutes are created to read:

AB68,1542,20 632.865 (3) License required. No person may perform any activities of a pharmacy benefit manager without being licensed by the commissioner as an administrator or pharmacy benefit manager under s. 633.14.

AB68,1543,2 (4) Accreditation for network participation. A pharmacy benefit manager or a representative of a pharmacy benefit manager shall provide to a pharmacy, within 30 days of receipt of a written request from the pharmacy, a written notice of any certification or accreditation requirements used by the pharmacy benefit manager or its representative as a determinant of network participation. A pharmacy benefit manager or a representative of a pharmacy benefit manager may change its accreditation requirements no more frequently than once every 12 months.

AB68,1543,5 (5) Retroactive claim reduction. Unless required otherwise by federal law, a pharmacy benefit manager may not retroactively deny or reduce a pharmacist's or pharmacy's claim after adjudication of the claim unless any of the following is true:

AB68,1543,6 (a) The original claim was submitted fraudulently.

AB68,1543,9 (b) The payment for the original claim was incorrect. Recovery for an incorrect payment under this paragraph is limited to the amount that exceeds the allowable claim.

AB68,1543,10 (c) The pharmacy services were not rendered by the pharmacist or pharmacy.

AB68,1543,12 (d) In making the claim or performing the service that is the basis for the claim, the pharmacist or pharmacy violated state or federal law.

AB68,1543,14 (e) The reduction is permitted in a contract between a pharmacy and a pharmacy benefit manager and is related to a quality program.

AB68,1543,15 (6) Audits of pharmacies or pharmacists. (a) Definitions. In this subsection:

AB68,1543,18 1. “Audit” means a review of the accounts and records of a pharmacy or pharmacist by or on behalf of an entity that finances or reimburses the cost of health care services or prescription drugs.

AB68,1543,22 2. “Entity” means a defined network plan, as defined in s. 609.01 (1b), insurer, self-insured health plan, or pharmacy benefit manager or a person acting on behalf of a defined network plan, insurer, self-insured health plan, or pharmacy benefit manager.

AB68,1543,23 3. “Self-insured health plan” has the meaning given in s. 632.85 (1) (c).

AB68,1543,25 (b) Procedures. An entity conducting an on-site or desk audit of pharmacist or pharmacy records shall do all of the following:

AB68,1544,3 1. If the audit is an audit on the premises of the pharmacist or pharmacy, notify the pharmacist or pharmacy in writing of the audit at least 2 weeks before conducting the audit.

AB68,1544,6 2. Refrain from auditing a pharmacist or pharmacy within the first 5 business days of a month unless the pharmacist or pharmacy consents to an audit during that time.

AB68,1544,8 3. If the audit involves clinical or professional judgment, conduct the audit by or in consultation with a pharmacist licensed in any state.

AB68,1544,10 4. Limit the audit review to no more than 250 separate prescriptions. For purposes of this subdivision, a refill of a prescription is not a separate prescription.

AB68,1544,12 5. Limit the audit review to claims submitted no more than 2 years before the date of the audit, unless required otherwise by state or federal law.

AB68,1544,18 6. Allow the pharmacist or pharmacy to use authentic and verifiable records of a hospital, physician, or other health care provider to validate the pharmacist's or pharmacy's records relating to delivery of a prescription drug and use any valid prescription that complies with requirements of the pharmacy examining board to validate claims in connection with a prescription, refill of a prescription, or change in prescription.

AB68,1544,21 7. Allow the pharmacy or pharmacist to document the delivery of a prescription drug or pharmacist services to an enrollee under a health benefit plan using either paper or electronic signature logs.

AB68,1544,24 8. Before leaving the pharmacy after concluding the on-site portion of an audit, provide to the representative of the pharmacy or the pharmacist a complete list of the pharmacy records reviewed.

AB68,1545,2 (c) Results of audit. An entity that has conducted an audit of a pharmacist or pharmacy shall do all of the following:

AB68,1545,10 1. Deliver to the pharmacist or pharmacy a preliminary report of the audit within 60 days after the date the auditor departs from an on-site audit or the pharmacy or pharmacist submits paperwork for a desk audit. A preliminary report under this subdivision shall include claim-level information for any discrepancy reported, the estimated total amount of claims subject to recovery, and contact information for the entity or person that completed the audit so the pharmacist or pharmacy subject to the audit may review audit results, procedures, and discrepancies.

AB68,1545,13 2. Allow a pharmacist or pharmacy that is the subject of an audit to provide documentation to address any discrepancy found in the audit within 30 days after the date the pharmacist or pharmacy receives the preliminary report.

AB68,1545,19 3. Deliver to the pharmacist or pharmacy a final audit report, which may be delivered electronically, within 90 days of the date the pharmacist or pharmacy receives the preliminary report or the date of the final appeal of the audit, whichever is later. The final audit report under this subdivision shall include any response provided to the auditor by the pharmacy or pharmacist and consider and address the pharmacy's or pharmacist's response.

AB68,1545,22 4. Refrain from assessing a recoupment or other penalty on a pharmacist or pharmacy until the appeal process is exhausted and the final report under subd. 3. is delivered to the pharmacist or pharmacy.

AB68,1545,24 5. Refrain from accruing or charging interest between the time the notice of the audit is given under par. (b) 1. and the final report under subd. 3. has been delivered.

AB68,1545,25 6. Exclude dispensing fees from calculations of overpayments.

AB68,1546,4 7. Establish and follow a written appeals process that allows a pharmacy or pharmacist to appeal the final report of an audit and allow the pharmacy or pharmacist as part of the appeal process to arrange for, at the cost of the pharmacy or pharmacist, an independent audit.

AB68,1546,8 8. Refrain from subjecting the pharmacy or pharmacist to a recoupment or recovery for a clerical or record-keeping error in a required document or record, including a typographical or computer error, unless the error resulted in an overpayment to the pharmacy or pharmacist.

AB68,1546,14 (d) Confidentiality of audit. Information obtained in an audit under this subsection is confidential and may not be shared unless the information is required to be shared under state or federal law and except that the audit may be shared with the entity on whose behalf the audit is performed. An entity conducting an audit may have access to the previous audit reports on a particular pharmacy only if the audit is conducted by the same entity.

AB68,1546,18 (e) Cooperation with audit. If an entity is conducting an audit that is complying with this subsection in auditing a pharmacy or pharmacist, the pharmacy or pharmacist that is the subject of the audit may not interfere with or refuse to participate in the audit.

AB68,1546,21 (f) Payment of auditors. A pharmacy benefit manager or entity conducting an audit may not pay an auditor employed by or contracted with the pharmacy benefit manager or entity based on a percentage of the amount recovered in an audit.

AB68,1546,24 (g) Applicability. 1. This subsection does not apply to an investigative audit that is initiated as a result of a credible allegation of fraud or willful misrepresentation or criminal wrongdoing.

AB68,1547,3 2. If an entity conducts an audit to which a federal law applies that is in conflict with all or part of this subsection, the entity shall comply with this subsection only to the extent that it does not conflict with federal law.

AB68,1547,11 (7) Transparency reports. (a) Beginning on June 1, 2021, and annually thereafter, every pharmacy benefit manager shall submit to the commissioner a report that contains, from the previous calendar year, the aggregate rebate amount that the pharmacy benefit manager received from all pharmaceutical manufacturers but retained and did not pass through to health benefit plan sponsors and the percentage of the aggregate rebate amount that is retained rebates. Information required under this paragraph is limited to contracts held with pharmacies located in this state.

AB68,1547,13 (b) Reports under this subsection shall be considered a trade secret under the uniform trade secret act under s. 134.90.

AB68,1547,15 (c) The commissioner may not expand upon the reporting requirement under this subsection, except that the commissioner may effectuate this subsection.

AB68,2966 Section 2966. 632.8655 of the statutes is created to read:

AB68,1547,17 632.8655 Hospital drug cost reporting. (1) Definitions. In this section:

AB68,1547,19 (a) “Brand-name drug” means a prescription drug approved under 21 USC 355 (b) or 42 USC 262.

AB68,1547,21 (b) “Covered hospital” means an entity described in 42 USC 256b (a) (4) (L) to (N) that participates in the federal drug pricing program under 42 USC 256b.

AB68,1547,22 (c) “Generic drug” means a prescription drug approved under 21 USC 355 (j).

AB68,1548,2 (d) “Margin” means, for a covered hospital, the difference between the net cost of a brand-name drug or generic drug covered under the federal drug pricing program under 42 USC 256b and the net payment by the covered hospital for that brand-name drug or generic drug.

AB68,1548,4 (e) “Net payment” means the amount paid for a brand-name drug or generic drug after all discounts and rebates have been applied.

AB68,1548,9 (2) Hospital margin spending. By March 1 annually, each covered hospital operating in this state shall report to the commissioner the per unit margin for each drug covered under the federal drug pricing program under 42 USC 256b dispensed in the previous year multiplied by the number of units dispensed at that margin and how the margin revenue was used.

AB68,1548,15 (3) Public reporting. The commissioner shall publicly post covered hospital documentation of how each hospital spends the margin revenue. The commissioner shall analyze data collected under this section and publish annually a report including an analysis on hospital-specific margins and how that revenue is spent or allocated on a hospital-specific basis. The commissioner shall keep any trade secret or proprietary information confidential.

AB68,2967 Section 2967. 632.8665 of the statutes is created to read:

AB68,1548,18 632.8665 Prescription drug cost reporting. (1) Definitions. In this section:

AB68,1548,20 (a) “Brand-name drug” means a prescription drug approved under 21 USC 355 (b) or 42 USC 262.

AB68,1548,21 (b) “Generic drug” means a prescription drug approved under 21 USC 355 (j).

AB68,1548,24 (c) “Manufacturer” has the meaning given in s. 450.01 (12). “Manufacturer” does not include an entity that is engaged only in the dispensing, as defined in s. 450.01 (7), of a brand-name drug or generic drug.

AB68,1549,4 (d) “Manufacturer-sponsored assistance program” means a program offered by a manufacturer or an intermediary under contract with a manufacturer through which a brand-name drug or generic drug is provided to a patient at no charge or at a discount.

AB68,1549,5 (e) “Pharmacy benefit manager” has the meaning given in s. 632.865 (1) (c).

AB68,1549,9 (f) “Pharmacy services administrative organization” means an entity that provides contracting and other administrative services to a pharmacy to assist the pharmacy in interactions with a 3rd-party payer, pharmacy benefit manager, wholesale drug distributor, or other entity.

AB68,1549,13 (g) “Wholesale acquisition cost” means the most recently reported manufacturer list or catalog price for a brand-name drug or generic drug available to wholesalers or direct purchasers in the United States, before application of discounts, rebates, or reductions in price.

AB68,1549,19 (2) Price increase or introduction notice; justification report. (a) A manufacturer shall notify the commissioner if it is increasing the wholesale acquisition cost of a brand-name drug on the market in this state by more than 10 percent or by more than $10,000 during any 12-month period or if it intends to introduce to market in this state a brand-name drug that has an annual wholesale acquisition cost of $30,000 or more.