Revision: March 8, 2016, midnight
\t \t\tHB 1664-FN - AS INTRODUCED
2016 SESSION
\t16-2664
\t01/10
HOUSE BILL\t1664-FN
AN ACT\trelative to pharmacy benefit managers.
SPONSORS:\tRep. Luneau, Merr. 10; Rep. Myler, Merr. 10; Rep. Butler, Carr. 7; Sen. Feltes, Dist 15
COMMITTEE:\tHealth, Human Services and Elderly Affairs
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ANALYSIS
\tThis bill establishes procedures for contracts between pharmacy benefit managers and contracted pharmacies.
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Explanation:\tMatter added to current law appears in bold italics.
\t\tMatter removed from current law appears [in brackets and struckthrough.]
\t\tMatter which is either (a) all new or (b) repealed and reenacted appears in regular type.
\t16-2664
\t01/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Sixteen
AN ACT\trelative to pharmacy benefit managers.
Be it Enacted by the Senate and House of Representatives in General Court convened:
\t1 New Subdivision; Pharmacy Benefit Managers. Amend RSA 318 by inserting after section 66 the following new subdivision:
Pharmacy Benefit Managers
\t318:67 Definitions. In this subdivision:
\t\tI. “Contracted pharmacy” or “pharmacy” means a pharmacy participating in the network of a pharmacy benefit manager through a direct contract or through a contract with a pharmacy services administration organization or group purchasing organization.
\t\tII. “Drug product reimbursement” means the amount paid by a pharmacy benefit manager to a contracted pharmacy for the cost of the drug dispensed to a patient and does not include a dispensing or professional fee.
\t318:68 Contracts Between Pharmacy Benefit Managers and Contracted Pharmacies; Appeals.
\t\tI. All contracts between a pharmacy benefit manager and a contracted pharmacy shall include:
\t\t\t(a) The sources used by the pharmacy benefit manager to calculate the drug product reimbursement paid for covered drugs available under the pharmacy health benefit plan administered by the pharmacy benefit manager.
\t\t\t(b) A process to appeal, investigate, and resolve disputes regarding the maximum allowable cost pricing. The process shall include the following provisions:
\t\t\t\t(1) The right to appeal shall be limited to 30 days following the
initial claim;
\t\t\t\t(2) The appeal shall be investigated and resolved within 10 days;
\t\t\t\t(3) If the appeal is denied, the pharmacy benefit manager shall provide the reason for the denial and identify the national drug code of a drug product that may be purchased by contracted pharmacies at a price at or below the maximum allowable cost.
\t\t\t(c) Within one year from the effective date of this subdivision, a process to provide for retroactive reimbursements.
\t\tII. For every drug for which the pharmacy benefit manager establishes a maximum allowable cost to determine the drug product reimbursement the pharmacy benefit manager shall:
\t\t\t(a) Include in the contract with the pharmacy information identifying the national drug pricing compendia or sources used to obtain the drug price data.
\t\t\t(b) Make available to a contracted pharmacy the drugs subject to maximum allowable cost and the actual maximum allowable cost for each drug.
\t\t\t(c) Review and make necessary adjustments to the maximum allowable cost for every drug at least every 14 days.
\t\t\t(d) Make available to a contracted pharmacy weekly updates to the list of drugs subject to maximum allowable cost and the actual maximum allowable cost for each drug,
\t2 Effective Date. This act shall take effect January 1, 2017.
\t\t\t\t\t\t\t\t\t\t\t16-2664
\t\t\t\t\t\t\t\t\t\t\t12/22/15
HB 1664-FN- FISCAL NOTE
AN ACT\trelative to pharmacy benefit managers.
FISCAL IMPACT:
The Departments of Health and Human Services and Administrative Services state this bill, as introduced, may increase state expenditures by an indeterminable amount in FY 2017 and each year thereafter. There will be no impact on state, county and local revenue or on county and local expenditures.
METHODOLOGY:
The Department of Health and Human Services states this bill establishes requirements for contracts between pharmacy benefit managers (PBM) and contracted pharmacies including sources used by the PBM to calculate drug reimbursement, an appeal process for disputes on drug pricing, and a process for retroactive reimbursement. PBMs that establish maximum allowable costs are required to include in contracts the source for the price, drugs subject to the maximum price, weekly updates on drugs subject to the maximum limits, and a provision to adjust the maximum cost every 14 days. The Department assumes this bill would not apply to fee for service Medicaid prescription drugs since the PBM administering the pharmacy benefit does not contract with pharmacies. In order to participate in the Medicaid program, pharmacies sign a provider agreement with the Department. The agreement does not specify the reimbursement amount, but requires pharmacies accept as payment in full, the amount paid by the Medicaid program. Under Medicaid Care Management the Managed Care Organizations (MCOs) are permitted to contract with subcontractors to administer the benefit. The Department states both of the MCOs have contracted with PBMs and these PBMs contract with individual pharmacies. The Department assumes some of the contract requirements would be administratively burdensome and would result in an increase in the captitated rate paid to the Medicaid MCOs. The Department cannot determine what the impact would be because it is not involved in the contracts between the MCOs and PBMs or the contracts between the PBMs and the pharmacies.
The Department of Administrative Services states this bill would establish and make available an appeals process to pharmacies relative to their contracts with pharmacy benefit managers and the maximum allowable cost of a prescription drug. The Department indicates, although the bill could result in higher prices for prescription drugs, the Department has no way of determining the potential cost to the State's Health Benefit plan.
The Office of Professional Licensure and Certification, Board of Pharmacy states this bill has no operational or financial impact on the Board of Pharmacy.