SSB 3079 (LSB 5286XD (3) 90)

SENATE/HOUSE FILE _____

BY  (PROPOSED DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES BILL)

A BILL FOR

An Act relating to the regulation of pharmacy benefits managers.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 510B.1, subsection 10, paragraph b, Code 2024, is amended to read as follows:
   b.  National average drug acquisition cost.
    Sec. 2.  Section 510B.4, subsection 1, Code 2024, is amended to read as follows:
   1.  A pharmacy benefits manager shall exercise good faith and fair dealing in the performance of the pharmacy benefits manager’s contractual obligations toward a third-party payor or a pharmacy.
    Sec. 3.  NEW SECTION.  510B.4A  Retaliation prohibited.
   A pharmacy benefits manager shall not retaliate against a pharmacy based on the pharmacy’s exercise of any right or remedy under this chapter, including but not limited to filing a complaint with the commissioner or cooperating with the commissioner pursuant to the commissioner’s authority under this chapter. Retaliation prohibited by this section shall include but is not limited to all of the following:
   1.  Terminating or refusing to renew a contract with the pharmacy.
   2.  Subjecting the pharmacy to increased audits.
   3.  Withholding or failing to promptly pay the pharmacy any money owed by the pharmacy benefits manager to the pharmacy.
    Sec. 4.  Section 510B.7, Code 2024, is amended to read as follows:
   510B.7  Pharmacy networks fees.
   A pharmacy benefits manager shall not assess, charge, or collect any form of remuneration that passes from a pharmacy or a pharmacist in a pharmacy network to the pharmacy benefits manager including but not limited to claim processing fees, performance-based fees, network participation fees, or accreditation fees.
    Sec. 5.  Section 510B.8A, subsection 2, paragraph b, Code 2024, is amended to read as follows:
   b.  Update the maximum allowable cost list within seven calendar days from the date of an increase of ten percent or more in the pharmacy national average drug acquisition cost of a prescription drug on the list by one or more wholesale distributors doing business in the state.
    Sec. 6.  Section 510C.2, subsection 2, paragraph a, unnumbered paragraph 1, Code 2024, is amended to read as follows:
   A pharmacy benefits manager shall provide the information pursuant to subsection 1 to the commissioner in a format approved by the commissioner that does not directly or indirectly publicly disclose any of the following:
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the regulation of pharmacy benefits managers (PBMs). Under current law, a PBM owes a duty of good faith and fair dealing to third-party payors. The bill expands that duty to pharmacies.
   The bill prohibits retaliation by a PBM against a pharmacy based on the pharmacy’s exercise of any right or remedy, or on the pharmacy’s cooperation with the commissioner. Prohibited retaliation includes terminating or refusing to renew a contract with a pharmacy, subjecting a pharmacy to increased audits, or withholding or failing to promptly pay the pharmacy any money owed by the PBM.
   Current law prohibits a PBM from assessing, charging, or collecting any form of renumeration that passes from a pharmacist in a pharmacy network to the PBM. Under the bill, a PBM is prohibited from assessing, charging, or collecting any form of renumeration that passes from any pharmacist, regardless of whether the pharmacist is in a pharmacy network.
   Under current law, for each maximum allowable cost list that a PBM uses, a PBM shall update the maximum allowable cost list within seven days from the date of an increase of 10 percent or more in the pharmacy acquisition cost of a prescription drug on the list. Under the bill, for each maximum allowable cost list that a PBM uses, a PBM shall update the maximum allowable cost list within seven days from the date of an increase of 10 percent or more in the national average drug acquisition cost of a prescription drug on the list.
   The bill requires that the annual report provided by a PBM to the commissioner of insurance regarding prescription drug benefits provided to covered persons of each third-party payor with whom the PBM has contracted during the prior calendar year be in a format that does not publicly disclose the identity of a specific third-party payor, the price charged by a specific pharmaceutical manufacturer for prescription drugs, or the amount of rebates provided for prescription drugs.