Senate
File
563
-
Reprinted
SENATE
FILE
563
BY
COMMITTEE
ON
HUMAN
RESOURCES
(SUCCESSOR
TO
SF
347)
(As
Amended
and
Passed
by
the
Senate
April
10,
2019
)
A
BILL
FOR
An
Act
relating
to
pharmacy
benefit
managers
and
information
1
related
to
the
management
of
prescription
drug
benefits,
and
2
including
applicability
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
SF
563
(3)
88
ko/lh/mb
S.F.
563
Section
1.
NEW
SECTION
.
510C.1
Definitions.
1
As
used
in
this
chapter
unless
the
context
otherwise
2
requires:
3
1.
“Administrative
fees”
means
a
fee
or
payment,
other
than
4
a
rebate,
under
a
contract
between
a
pharmacy
benefit
manager
5
and
a
pharmaceutical
drug
manufacturer
in
connection
with
the
6
pharmacy
benefit
manager’s
management
of
a
health
carrier’s
7
prescription
drug
benefit,
that
is
paid
by
a
pharmaceutical
8
drug
manufacturer
to
a
pharmacy
benefit
manager
or
is
retained
9
by
the
pharmacy
benefit
manager.
10
2.
“Aggregate
retained
rebate
percentage”
means
the
11
percentage
of
all
rebates
received
by
a
pharmacy
benefit
12
manager
that
is
not
passed
on
to
the
pharmacy
benefit
manager’s
13
health
carrier
clients.
14
3.
“Commissioner”
means
the
commissioner
of
insurance.
15
4.
“Covered
person”
means
the
same
as
defined
in
section
16
514J.102.
17
5.
“Formulary”
means
a
complete
list
of
prescription
drugs
18
eligible
for
coverage
under
a
health
benefit
plan.
19
6.
“Health
benefit
plan”
means
the
same
as
defined
in
20
section
514J.102.
21
7.
“Health
carrier”
means
the
same
as
defined
in
section
22
514J.102.
23
8.
“Health
carrier
administrative
service
fee”
means
a
fee
24
or
payment
under
a
contract
between
a
pharmacy
benefit
manager
25
and
a
health
carrier
in
connection
with
the
pharmacy
benefit
26
manager’s
administration
of
the
health
carrier’s
prescription
27
drug
benefit
that
is
paid
by
a
health
carrier
to
a
pharmacy
28
benefit
manager
or
is
otherwise
retained
by
a
pharmacy
benefit
29
manager.
30
9.
“Pharmacy
benefit
manager”
means
a
person
who,
pursuant
31
to
a
contract
or
other
relationship
with
a
health
carrier,
32
either
directly
or
through
an
intermediary,
manages
a
33
prescription
drug
benefit
provided
by
the
health
carrier.
34
10.
“Prescription
drug
benefit”
means
a
health
benefit
35
-1-
SF
563
(3)
88
ko/lh/mb
1/
4
S.F.
563
plan
providing
for
third-party
payment
or
prepayment
for
1
prescription
drugs.
2
11.
“Rebate”
means
all
discounts
and
other
negotiated
price
3
concessions
paid
directly
or
indirectly
by
a
pharmaceutical
4
manufacturer
or
other
entity,
other
than
a
covered
person,
5
in
the
prescription
drug
supply
chain
to
a
pharmacy
benefit
6
manager,
and
which
may
be
based
on
any
of
the
following:
7
a.
A
pharmaceutical
manufacturer’s
list
price
for
a
8
prescription
drug.
9
b.
Utilization.
10
c.
To
maintain
a
net
price
for
a
prescription
drug
for
11
a
specified
period
of
time
for
the
pharmacy
benefit
manager
12
in
the
event
the
pharmaceutical
manufacturer’s
list
price
13
increases.
14
d.
Reasonable
estimates
of
the
volume
of
a
prescribed
drug
15
that
will
be
dispensed
by
a
pharmacy
to
covered
persons.
16
Sec.
2.
NEW
SECTION
.
510C.2
Annual
report
to
the
17
commissioner.
18
1.
Each
pharmacy
benefit
manager
shall
provide
a
report
19
annually
by
February
15
to
the
commissioner
that
contains
20
all
of
the
following
information
regarding
prescription
drug
21
benefits
provided
to
covered
persons
of
each
health
carrier
22
with
whom
the
pharmacy
manager
has
contracted
during
the
prior
23
calendar
year:
24
a.
The
aggregate
dollar
amount
of
all
rebates
received
by
25
the
pharmacy
benefit
manager.
26
b.
The
aggregate
dollar
amount
of
all
administrative
fees
27
received
by
the
pharmacy
benefit
manager.
28
c.
The
aggregate
dollar
amount
of
all
health
carrier
29
administrative
service
fees
received
by
the
pharmacy
benefit
30
manager.
31
d.
The
aggregate
dollar
amount
of
all
rebates
received
by
32
the
pharmacy
benefit
manager
that
the
pharmacy
benefit
manager
33
did
not
pass
through
to
the
health
carrier.
34
e.
The
aggregate
amount
of
all
administrative
fees
received
35
-2-
SF
563
(3)
88
ko/lh/mb
2/
4
S.F.
563
by
the
pharmacy
benefit
manager
that
the
pharmacy
benefit
1
manager
did
not
pass
through
to
the
health
carrier.
2
f.
The
aggregate
retained
rebate
percentage
as
calculated
by
3
dividing
the
dollar
amount
in
paragraph
“d”
by
the
dollar
amount
4
in
paragraph
“a”
.
5
g.
Across
all
health
carrier
clients
with
whom
the
pharmacy
6
manager
was
contracted,
the
highest
and
the
lowest
aggregate
7
retained
rebate
percentages.
8
2.
a.
A
pharmacy
benefit
manager
shall
provide
the
9
information
pursuant
to
subsection
1
to
the
commissioner
in
a
10
format
approved
by
the
commissioner
that
does
not
directly
or
11
indirectly
disclose
any
of
the
following:
12
(1)
The
identity
of
a
specific
health
carrier.
13
(2)
The
price
charged
by
a
specific
pharmaceutical
14
manufacturer
for
a
specific
prescription
drug
or
for
a
class
15
of
prescription
drugs.
16
(3)
The
amount
of
rebates
provided
for
a
specific
17
prescription
drug
or
class
of
prescription
drugs.
18
b.
Information
provided
under
this
section
by
a
pharmacy
19
benefit
manager
to
the
commissioner
that
may
reveal
the
20
identity
of
a
specific
health
carrier,
the
price
charged
21
by
a
specific
pharmaceutical
manufacturer
for
a
specific
22
prescription
drug
or
class
of
prescription
drugs,
or
the
amount
23
of
rebates
provided
for
a
specific
prescription
drug
or
class
24
of
prescription
drugs
shall
be
considered
a
confidential
record
25
and
be
recognized
and
protected
as
a
trade
secret
pursuant
to
26
section
22.7,
subsection
3.
27
3.
The
commissioner
shall
publish,
within
sixty
calendar
28
days
of
receipt,
the
nonconfidential
information
received
by
29
the
commissioner
on
a
publicly
accessible
internet
site.
The
30
information
shall
be
made
available
to
the
public
in
a
format
31
that
complies
with
subsection
2,
paragraph
“a”
.
32
Sec.
3.
NEW
SECTION
.
510C.3
Rules.
33
The
commissioner
of
insurance
shall
adopt
rules
pursuant
to
34
chapter
17A
as
necessary
to
administer
this
chapter.
35
-3-
SF
563
(3)
88
ko/lh/mb
3/
4
S.F.
563
Sec.
4.
NEW
SECTION
.
510C.4
Enforcement.
1
The
commissioner
may
take
any
action
within
the
2
commissioner’s
authority
to
enforce
compliance
with
this
3
chapter.
4
Sec.
5.
NEW
SECTION
.
510C.5
Applicability.
5
This
chapter
is
applicable
to
a
health
benefit
plan
that
is
6
delivered,
issued
for
delivery,
continued,
or
renewed
in
this
7
state
on
or
after
January
1,
2020.
8
-4-
SF
563
(3)
88
ko/lh/mb
4/
4