H.F. 96 Section 1. NEW SECTION . 514F.9 Continuity of care —— 1 nonmedical switching. 2 1. Definitions. For the purpose of this section: 3 a. “Authorized representative” means the same as defined in 4 section 514J.102. 5 b. “Commissioner” means the commissioner of insurance. 6 c. “Cost sharing” means any coverage limit, copayment, 7 coinsurance, deductible, or other out-of-pocket expense 8 requirement. 9 d. “Coverage exemption” means a determination made by a 10 health carrier, health benefit plan, or utilization review 11 organization to cover a prescription drug that is otherwise 12 excluded from coverage. 13 e. “Coverage exemption determination” means a determination 14 made by a health carrier, health benefit plan, or utilization 15 review organization whether to cover a prescription drug that 16 is otherwise excluded from coverage. 17 f. “Covered person” means the same as defined in section 18 514J.102. 19 g. “Demonstrated bioavailability” means the same as defined 20 in section 155A.3. 21 h. “Discontinued health benefit plan” means a covered 22 person’s existing health benefit plan that is discontinued by a 23 health carrier during open enrollment for the next plan year. 24 i. “Formulary” means a complete list of prescription drugs 25 eligible for coverage under a health benefit plan. 26 j. “Generic name” means the same as defined in section 27 155A.3. 28 k. “Health benefit plan” means the same as defined in 29 section 514J.102. 30 l. “Health care professional” means the same as defined in 31 section 514J.102. 32 m. “Health care services” means the same as defined in 33 section 514J.102. 34 n. “Health carrier” means an entity subject to the 35 -1- LSB 1359YH (6) 90 ko/rn 1/ 9

H.F. 96 insurance laws and regulations of this state, or subject 1 to the jurisdiction of the commissioner, including an 2 insurance company offering sickness and accident plans, a 3 health maintenance organization, a nonprofit health service 4 corporation, a plan established pursuant to chapter 509A 5 for public employees, or any other entity providing a plan 6 of health insurance, health care benefits, or health care 7 services. “Health carrier” does not include the department 8 of human services, or a managed care organization acting 9 pursuant to a contract with the department of human services to 10 administer the medical assistance program under chapter 249A 11 or the healthy and well kids in Iowa (hawk-i) program under 12 chapter 514I. 13 o. “Interchangeable biological product” means the same as 14 defined in section 155A.3. 15 p. “Open enrollment” means the yearly time period during 16 which an individual can enroll in a health benefit plan. 17 q. “Utilization review” means the same as defined in section 18 514F.7. 19 r. “Utilization review organization” means the same as 20 defined in section 514F.7. 21 2. Nonmedical switching. With respect to a health carrier 22 that has entered into a health benefit plan with a covered 23 person that covers prescription drug benefits, all of the 24 following apply: 25 a. A health carrier, health benefit plan, or utilization 26 review organization shall not limit or exclude coverage of 27 a prescription drug for any covered person who is medically 28 stable on such drug as determined by the prescribing health 29 care professional, if all of the following apply: 30 (1) The prescription drug was previously approved by the 31 health carrier for coverage for the covered person. 32 (2) The covered person’s prescribing health care 33 professional has prescribed the drug for the covered person’s 34 medical condition within the previous six months. 35 -2- LSB 1359YH (6) 90 ko/rn 2/ 9

H.F. 96 (3) The covered person continues to be an enrollee of the 1 health benefit plan. 2 b. Coverage of a covered person’s prescription drug, as 3 described in paragraph “a” , shall continue through the last day 4 of the covered person’s eligibility under the health benefit 5 plan, inclusive of any open enrollment period. 6 c. Prohibited limitations and exclusions referred to in 7 paragraph “a” include but are not limited to the following: 8 (1) Limiting or reducing the maximum coverage of 9 prescription drug benefits. 10 (2) Increasing cost sharing for a covered prescription 11 drug. 12 (3) Moving a prescription drug to a more restrictive tier if 13 the health carrier uses a formulary with tiers. 14 (4) Removing a prescription drug from a formulary, unless 15 the United States food and drug administration has issued a 16 statement about the drug that calls into question the clinical 17 safety of the drug, or the manufacturer of the drug has 18 notified the United States food and drug administration of a 19 manufacturing discontinuance or potential discontinuance of the 20 drug as required by section 506C of the Federal Food, Drug, and 21 Cosmetic Act, as codified in 21 U.S.C. §356c. 22 d. This subsection shall not be construed to prohibit 23 a substitution, a formulary change, or a preference by a 24 health carrier for a prescribed drug product that has the same 25 generic name and demonstrated bioavailability, or that is an 26 interchangeable biological product. 27 3. Coverage exemption determination process. 28 a. To ensure continuity of care, a health carrier, health 29 plan, or utilization review organization shall provide a 30 covered person and prescribing health care professional 31 with access to a clear and convenient process to request a 32 coverage exemption determination. A health carrier, health 33 plan, or utilization review organization may use its existing 34 medical exceptions process to satisfy this requirement. The 35 -3- LSB 1359YH (6) 90 ko/rn 3/ 9

H.F. 96 process shall be easily accessible on the internet site of the 1 health carrier, health benefit plan, or utilization review 2 organization. 3 b. A health carrier, health benefit plan, or utilization 4 review organization shall respond to a coverage exemption 5 determination request within five calendar days of receipt. In 6 cases where exigent circumstances exist, the health carrier, 7 health benefit plan, or utilization review organization shall 8 respond within seventy-two hours of receipt. If a response by 9 the health carrier, health benefit plan, or utilization review 10 organization is not received within the applicable time period, 11 the coverage exemption shall be deemed granted. 12 c. A coverage exemption shall be expeditiously granted for a 13 discontinued health benefit plan if a covered person enrolls in 14 a comparable plan offered by the same health carrier, and all 15 of the following conditions apply: 16 (1) The covered person is medically stable on a prescription 17 drug as determined by the prescribing health care professional. 18 (2) The prescribing health care professional continues 19 to prescribe the drug for the covered person for the covered 20 person’s medical condition. 21 (3) In comparison to the discontinued health benefit plan, 22 the new health benefit plan does any of the following: 23 (a) Limits or reduces the maximum coverage of prescription 24 drug benefits. 25 (b) Increases cost sharing for the prescription drug. 26 (c) Moves the prescription drug to a more restrictive tier 27 if the health carrier uses a formulary with tiers. 28 (d) Excludes the prescription drug from the health benefit 29 plan’s formulary. 30 d. Upon granting of a coverage exemption for a drug 31 prescribed by a covered person’s prescribing health care 32 professional, a health carrier, health benefit plan, or 33 utilization review organization shall authorize coverage no 34 more restrictive than that offered in a discontinued health 35 -4- LSB 1359YH (6) 90 ko/rn 4/ 9

H.F. 96 benefit plan, or than that offered prior to implementation of 1 restrictive changes to the health benefit plan’s formulary 2 after the current plan year began. 3 e. If a determination is made to deny a request for a 4 coverage exemption, the health carrier, health benefit plan, 5 or utilization review organization shall provide the covered 6 person or the covered person’s authorized representative and 7 the authorized person’s prescribing health care professional 8 with the reason for denial and information regarding the 9 procedure to appeal the denial. Any determination to deny a 10 coverage exemption may be appealed by a covered person or the 11 covered person’s authorized representative. 12 f. A health carrier, health benefit plan, or utilization 13 review organization shall uphold or reverse a determination to 14 deny a coverage exemption within five calendar days of receipt 15 of an appeal of denial. In cases where exigent circumstances 16 exist, a health carrier, health benefit plan, or utilization 17 review organization shall uphold or reverse a determination to 18 deny a coverage exemption within seventy-two hours of receipt. 19 If the determination to deny a coverage exemption is not upheld 20 or reversed on appeal within the applicable time period, the 21 denial shall be deemed reversed and the coverage exemption 22 shall be deemed approved. 23 g. If a determination to deny a coverage exemption is 24 upheld on appeal, the health carrier, health benefit plan, 25 or utilization review organization shall provide the covered 26 person or the covered person’s authorized representative and 27 the covered person’s prescribing health care professional with 28 the reason for upholding the denial on appeal and information 29 regarding the procedure to request external review of the 30 denial pursuant to chapter 514J. Any denial of a request for a 31 coverage exemption that is upheld on appeal shall be considered 32 a final adverse determination for purposes of chapter 514J and 33 is eligible for a request for external review by a covered 34 person or the covered person’s authorized representative 35 -5- LSB 1359YH (6) 90 ko/rn 5/ 9

H.F. 96 pursuant to chapter 514J. 1 4. Limitations. This section shall not be construed to do 2 any of the following: 3 a. Prevent a health care professional from prescribing 4 another drug covered by the health carrier that the health care 5 professional deems medically necessary for the covered person. 6 b. Prevent a health carrier from doing any of the following: 7 (1) Adding a prescription drug to its formulary. 8 (2) Removing a prescription drug from its formulary if the 9 drug manufacturer has removed the drug for sale in the United 10 States. 11 5. Enforcement. The commissioner may take any enforcement 12 action under the commissioner’s authority to enforce compliance 13 with this section. 14 Sec. 2. APPLICABILITY. This Act applies to a health benefit 15 plan that is delivered, issued for delivery, continued, or 16 renewed in this state on or after January 1, 2024. 17 EXPLANATION 18 The inclusion of this explanation does not constitute agreement with 19 the explanation’s substance by the members of the general assembly. 20 This bill relates to the continuity of care for a covered 21 person and nonmedical switching by health carriers, health 22 benefit plans, and utilization review organizations. 23 The bill provides that during a covered person’s 24 eligibility under a health benefit plan, inclusive of any open 25 enrollment period, a health plan carrier, health benefit plan, 26 or utilization review organization shall not limit or exclude 27 coverage of a prescription drug for the covered person if the 28 covered person is medically stable on the drug as determined 29 by the prescribing health care professional, the drug was 30 previously approved by the health carrier for coverage for 31 the person, and the covered person’s prescribing health care 32 professional has prescribed the drug for the person’s medical 33 condition within the previous six months. The bill includes, 34 as prohibited limitations or exclusions, reducing the maximum 35 -6- LSB 1359YH (6) 90 ko/rn 6/ 9

H.F. 96 coverage of prescription drug benefits, increasing cost sharing 1 for a covered drug, moving a drug to a more restrictive tier, 2 and removing a drug from a formulary. A prescription drug 3 may, however, be removed from a formulary if the United States 4 food and drug administration issues a statement regarding the 5 clinical safety of the drug, or the manufacturer of the drug 6 notifies the United States food and drug administration of 7 a manufacturing discontinuance or potential discontinuance 8 of the drug as required by section 506c of the Federal Food, 9 Drug, and Cosmetic Act. The bill shall not be construed to 10 prohibit a substitution, a formulary change, or a preference 11 by a health carrier for a prescribed drug product that has the 12 same generic name and demonstrated bioavailability, or that is 13 an interchangeable biological product. “Health benefit plan”, 14 “health carrier”, and “utilization review organization” are 15 defined in the bill. 16 The bill requires a covered person and prescribing health 17 care professional to have access to a process to request a 18 coverage exemption determination. The bill defines “coverage 19 exemption determination” as a determination made by a 20 health carrier, health benefit plan, or utilization review 21 organization whether to cover a prescription drug that is 22 otherwise excluded from coverage. 23 A coverage exemption determination request must be approved 24 or denied by the health carrier, health benefit plan, or 25 utilization review organization within five calendar days, 26 or within 72 hours if exigent circumstances exist. If a 27 determination is not received within the applicable time period 28 the coverage exemption is deemed granted. 29 The bill requires a coverage exemption to be expeditiously 30 granted for a health benefit plan that is discontinued for the 31 next plan year if a covered person enrolls in a comparable 32 plan offered by the same health carrier, and in comparison 33 to the discontinued health benefit plan, the new health 34 benefit plan limits or reduces the maximum coverage for a 35 -7- LSB 1359YH (6) 90 ko/rn 7/ 9

H.F. 96 prescription drug, increases cost sharing for the prescription 1 drug, moves the prescription drug to a more restrictive 2 tier, or excludes the prescription drug from the formulary. 3 If a coverage exemption is granted, the bill requires an 4 authorization of coverage that is no more restrictive than 5 that offered in the discontinued health benefit plan, or than 6 that offered prior to implementation of restrictive changes 7 to the health benefit plan’s formulary after the current plan 8 year began. If a determination is made to deny a request for 9 a coverage exemption, the reason for denial and the procedure 10 to appeal the denial must be provided to the requestor. Any 11 determination to deny a coverage exemption may be appealed to 12 the health carrier, health benefit plan, or utilization review 13 organization. A determination to uphold or reverse denial 14 of a coverage exemption must be made within five calendar 15 days of receipt of an appeal, or within 72 hours if exigent 16 circumstances exist. If a determination is not made within the 17 applicable time period, the denial is deemed reversed and the 18 coverage exemption is deemed approved. 19 If a determination to deny a coverage exemption is upheld on 20 appeal, the reason for upholding the denial and the procedure 21 to request external review of the denial pursuant to Code 22 chapter 514J must be provided to the individual who filed the 23 appeal. Any denial of a request for a coverage exemption that 24 is upheld on appeal is considered a final adverse determination 25 for purposes of Code chapter 514J and is eligible for a request 26 for external review by a covered person or the covered person’s 27 authorized representative pursuant to Code chapter 514J. 28 The bill shall not be construed to prevent a health care 29 professional from prescribing another drug covered by the 30 health carrier that the health care professional deems 31 medically necessary for the covered person. 32 The bill shall not be construed to prevent a health carrier 33 from adding a drug to its formulary, or from removing a drug 34 from its formulary if the drug manufacturer removes the drug 35 -8- LSB 1359YH (6) 90 ko/rn 8/ 9