Bill Text: FL S1550 | 2023 | Regular Session | Comm Sub
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Prescription Drugs
Spectrum: Slight Partisan Bill (Republican 4-2)
Status: (Passed) 2023-05-04 - Chapter No. 2023-29, companion bill(s) passed, see CS/SB 1552 (Ch. 2023-30) [S1550 Detail]
Download: Florida-2023-S1550-Comm_Sub.html
Bill Title: Prescription Drugs
Spectrum: Slight Partisan Bill (Republican 4-2)
Status: (Passed) 2023-05-04 - Chapter No. 2023-29, companion bill(s) passed, see CS/SB 1552 (Ch. 2023-30) [S1550 Detail]
Download: Florida-2023-S1550-Comm_Sub.html
Florida Senate - 2023 CS for CS for SB 1550
By the Committees on Fiscal Policy; and Health Policy; and
Senators Brodeur, Rodriguez, Wright, and Perry
594-03810-23 20231550c2
1 A bill to be entitled
2 An act relating to prescription drugs; providing a
3 short title; amending s. 499.005, F.S.; specifying
4 additional prohibited acts related to the Florida Drug
5 and Cosmetic Act; amending s. 499.012, F.S.; providing
6 that prescription drug manufacturer and nonresident
7 prescription drug manufacturer permitholders are
8 subject to specified requirements; creating s.
9 499.026, F.S.; defining terms; requiring certain drug
10 manufacturers to notify the Department of Business and
11 Professional Regulation of reportable drug price
12 increases on a specified form on the effective date of
13 such increase; providing requirements for the form;
14 providing construction; requiring such manufacturers
15 to submit certain reports to the department by a
16 specified date each year; providing requirements for
17 the reports; authorizing the department to request
18 certain additional information from the manufacturer
19 before approving the report; requiring the department
20 to submit the forms and reports to the Agency for
21 Health Care Administration to be posted on the
22 agency’s website; prohibiting the agency from posting
23 on its website certain submitted information that is
24 marked as a trade secret; requiring the agency to
25 compile all information from the submitted forms and
26 reports and make it available to the Governor and the
27 Legislature upon request; prohibiting manufacturers
28 from claiming a public records exemption for trade
29 secrets for certain information provided in such forms
30 or reports; providing that department employees remain
31 protected from liability for releasing the forms and
32 reports as public records; authorizing the department,
33 in consultation with the agency, to adopt rules;
34 providing for emergency rulemaking; amending s.
35 624.307, F.S.; requiring the Division of Consumer
36 Services of the Department of Financial Services to
37 designate an employee as the primary contact for
38 consumer complaints involving pharmacy benefit
39 managers; requiring the division to refer certain
40 complaints to the Office of Insurance Regulation;
41 amending s. 624.490, F.S.; revising the definition of
42 the term “pharmacy benefit manager”; amending s.
43 624.491, F.S.; revising provisions related to pharmacy
44 audits; amending s. 626.88, F.S.; revising the
45 definition of the term “administrator”; defining the
46 term “pharmacy benefit manager”; amending s. 626.8805,
47 F.S.; providing a grandfathering provision for certain
48 pharmacy benefit managers operating as administrators;
49 providing a penalty for certain persons who do not
50 hold a certificate of authority to act as an
51 administrator on or after a specified date; requiring
52 the office to submit a report detailing specified
53 information to the Governor and the Legislature by a
54 specified date; providing additional requirements for
55 pharmacy benefit managers applying for a certificate
56 of authority to act as an administrator; exempting
57 pharmacy benefit managers from certain fees; amending
58 s. 626.8814, F.S.; requiring pharmacy benefit managers
59 to identify certain ownership affiliations to the
60 office; requiring pharmacy benefit managers to report
61 any change in such information to the office within a
62 specified timeframe; creating s. 626.8825, F.S.;
63 defining terms; providing requirements for certain
64 contracts between a pharmacy benefit manager and a
65 pharmacy benefits plan or program; requiring pharmacy
66 benefits plans and programs, beginning on a specified
67 date, to annually submit a certain attestation to the
68 office; providing requirements for certain contracts
69 between a pharmacy benefit manager and a participating
70 pharmacy; requiring the Financial Services Commission
71 to adopt rules; specifying requirements for certain
72 administrative appeal procedures that such contracts
73 with participating pharmacies must include; requiring
74 pharmacy benefit managers to submit reports on
75 submitted appeals to the office every 90 days;
76 creating s. 626.8827, F.S.; specifying prohibited
77 practices for pharmacy benefit managers; creating s.
78 626.8828, F.S.; authorizing the office to investigate
79 administrators that are pharmacy benefit managers and
80 certain applicants; requiring the office to review
81 certain referrals and investigate them under certain
82 circumstances; providing for biennial reviews of
83 pharmacy benefit managers; requiring the office to
84 submit an annual report of its examinations to the
85 Governor and the Legislature by a specified date;
86 providing requirements for the report, including
87 specified additional requirements for the biennial
88 reports; authorizing the office to conduct additional
89 examinations; requiring the office to conduct an
90 examination under certain circumstances; providing
91 procedures and requirements for such examinations;
92 defining the terms “contracts” and “knowing and
93 willful”; providing that independent professional
94 examiners under contract with the office may conduct
95 examinations of pharmacy benefit managers; requiring
96 the commission to adopt specified rules; specifying
97 provisions that apply to such investigations and
98 examinations; providing recordkeeping requirements for
99 pharmacy benefit managers; authorizing the office to
100 order the production of such records and other
101 specified information; authorizing the office to take
102 statements under oath; requiring pharmacy benefit
103 managers and applicants subjected to an investigation
104 or examination to pay the associated expenses;
105 specifying covered expenses; providing for collection
106 of such expenses; providing for the deposit of certain
107 moneys into the Insurance Regulatory Trust Fund;
108 authorizing the office to pay examiners,
109 investigators, and other persons from such fund;
110 providing administrative penalties; providing grounds
111 for administrative action against a certificate of
112 authority; amending s. 626.89, F.S.; requiring
113 pharmacy benefit managers to notify the office of
114 specified complaints, settlements, or discipline
115 within a specified timeframe; requiring pharmacy
116 benefit managers to annually submit a certain
117 attestation statement to the office; amending s.
118 627.42393, F.S.; providing that certain step-therapy
119 protocol requirements apply to a pharmacy benefit
120 manager acting on behalf of a health insurer; amending
121 ss. 627.64741 and 627.6572, F.S.; conforming
122 provisions to changes made by the act; amending s.
123 641.31, F.S.; providing that certain step-therapy
124 protocol requirements apply to a pharmacy benefit
125 manager acting on behalf of a health maintenance
126 organization; amending s. 641.314, F.S.; conforming a
127 provision to changes made by the act; providing
128 legislative intent, construction, and severability;
129 providing appropriations and authorizing positions;
130 providing an effective date.
131
132 Be It Enacted by the Legislature of the State of Florida:
133
134 Section 1. This act may be cited as the “Prescription Drug
135 Reform Act.”
136 Section 2. Subsection (29) is added to section 499.005,
137 Florida Statutes, to read:
138 499.005 Prohibited acts.—It is unlawful for a person to
139 perform or cause the performance of any of the following acts in
140 this state:
141 (29) Failure to accurately complete and timely submit
142 reportable drug price increase forms, reports, and documents as
143 required by s. 499.026 and rules adopted thereunder.
144 Section 3. Subsection (16) is added to section 499.012,
145 Florida Statutes, to read:
146 499.012 Permit application requirements.—
147 (16) A permit for a prescription drug manufacturer or a
148 nonresident prescription drug manufacturer is subject to the
149 requirements of s. 499.026.
150 Section 4. Section 499.026, Florida Statutes, is created to
151 read:
152 499.026 Notification of manufacturer prescription drug
153 price increases.—
154 (1) As used in this section, the term:
155 (a) “Course of therapy” means the recommended daily dose
156 units of a prescription drug pursuant to its prescribing label
157 for 30 days or the recommended daily dose units of a
158 prescription drug pursuant to its prescribing label for a normal
159 course of treatment which is less than 30 days.
160 (b) “Manufacturer” means a person holding a prescription
161 drug manufacturer permit or a nonresident prescription drug
162 manufacturer permit under s. 499.01.
163 (c) “Prescription drug” has the same meaning as in s.
164 499.003 and includes biological products but is limited to those
165 prescription drugs and biological products intended for human
166 use.
167 (d) “Reportable drug price increase” means, for a
168 prescription drug with a wholesale acquisition cost of at least
169 $100 for a course of therapy before the effective date of an
170 increase:
171 1. Any increase of 15 percent or more of the wholesale
172 acquisition cost during the preceding 12-month period; or
173 2. Any cumulative increase of 30 percent or more of the
174 wholesale acquisition cost during the preceding 3 calendar
175 years. In calculating the 30 percent threshold, the manufacturer
176 must base the calculation on the wholesale acquisition cost in
177 effect at the end of the 3-year period as compared to the
178 wholesale acquisition cost in effect at the beginning of the
179 same 3-year period.
180 (e) “Wholesale acquisition cost” means, with respect to a
181 prescription drug or biological product, the manufacturer’s list
182 price for the prescription drug or biological product to
183 wholesalers or direct purchasers in the United States, not
184 including prompt pay or other discounts, rebates, or reductions
185 in price, for the most recent month for which the information is
186 available, as reported in wholesale price guides or other
187 publications of drug or biological product pricing data.
188 (2) On the effective date of a manufacturer’s reportable
189 drug price increase, the manufacturer must provide notification
190 of each reportable drug price increase to the department on a
191 form prescribed by the department. The form must require the
192 manufacturer to specify all of the following:
193 (a) The proprietary and nonproprietary names of the
194 prescription drug, as applicable.
195 (b) The wholesale acquisition cost before the reportable
196 drug price increase.
197 (c) The dollar amount of the reportable drug price
198 increase.
199 (d) The percentage amount of the reportable drug price
200 increase from the wholesale acquisition cost before the
201 reportable drug price increase.
202 (e) Whether a change or an improvement in the prescription
203 drug necessitates the reportable drug price increase.
204 (f) If a change or an improvement in the prescription drug
205 necessitates the reportable drug price increase as reported in
206 paragraph (e), the manufacturer must describe the change or
207 improvement.
208 (g) The intended uses of the prescription drug.
209
210 This subsection does not prohibit a manufacturer from notifying
211 other parties, such as pharmacy benefit managers, of a drug
212 price increase before the effective date of the drug price
213 increase.
214 (3) By April 1 of each year, each manufacturer shall submit
215 a report to the department on a form prescribed by the
216 department. A report is not deemed to be submitted until
217 approved by the department. The report must include all of the
218 following:
219 (a) A list of all prescription drugs affected by a
220 reportable drug price increase during the previous calendar year
221 and both the dollar amount of each reportable drug price
222 increase and the percentage increase of each reportable drug
223 price increase relative to the previous wholesale acquisition
224 cost of the prescription drug. The prescription drugs must be
225 identified using their proprietary names and nonproprietary
226 names, as applicable.
227 (b) If more than one form has been filed under this section
228 for previous reportable drug price increases, the percentage
229 increase of the prescription drug from the earliest form filed
230 to the most recent form filed.
231 (c) The intended uses of each prescription drug listed in
232 the report and whether the prescription drug manufacturer
233 benefits from market exclusivity for such drug.
234 (d) The length of time the prescription drug has been
235 available for purchase.
236 (e) A listing of the factors contributing to each
237 reportable drug price increase. As used in this section, the
238 term “factors” means any of the following: research and
239 development; manufacturing costs; advertising and marketing;
240 whether the drug has more competitive value; an increased rate
241 of inflation or other economic dynamics; changes in market
242 dynamics; supporting regulatory and safety commitments;
243 operating patient assistance and educational programs; rebate
244 increases, including any rebate increase requested by a pharmacy
245 benefit manager; Medicaid, Medicare, or 340B Drug Pricing
246 Program offsets; profit; or other factors. An estimated
247 percentage of the influence of each listed factor must be
248 provided to equal 100 percent.
249 (f) A description of the justification for each factor
250 referenced in paragraph (e) must be provided with such
251 specificity as to explain the need or justification for each
252 reportable drug price increase. The department may request
253 additional information from a manufacturer relating to the need
254 or justification for any reportable drug price increase before
255 approving the manufacturer’s report.
256 (g) Any action that the manufacturer has filed to extend a
257 patent report after the first extension has been granted.
258 (4)(a) The department shall submit all forms and reports
259 submitted by manufacturers to the Agency for Health Care
260 Administration, to be posted on the agency’s website pursuant to
261 s. 408.062. The agency may not post on its website any of the
262 information provided pursuant to paragraph (2)(f), paragraph
263 (3)(f), or paragraph (3)(g) which is marked as a trade secret.
264 The agency shall compile all information from the forms and
265 reports submitted by manufacturers and make it available upon
266 request to the Governor, the President of the Senate, and the
267 Speaker of the House of Representatives.
268 (b) Except for information provided pursuant to paragraph
269 (2)(f), paragraph (3)(f), or paragraph (3)(g), a manufacturer
270 may not claim a public records exemption for a trade secret
271 under s. 119.0715 for any information required by the department
272 under this section. Department employees remain protected from
273 liability for release of forms and reports pursuant to s.
274 119.0715(4).
275 (5) The department, in consultation with the Agency for
276 Health Care Administration, shall adopt rules to implement this
277 section.
278 (a) The department shall adopt necessary emergency rules
279 pursuant to s. 120.54(4) to implement this section. If an
280 emergency rule adopted under this section is held to be
281 unconstitutional or an invalid exercise of delegated legislative
282 authority and becomes void, the department may adopt an
283 emergency rule pursuant to this section to replace the rule that
284 has become void. If the emergency rule adopted to replace the
285 void emergency rule is also held to be unconstitutional or an
286 invalid exercise of delegated legislative authority and becomes
287 void, the department must follow the nonemergency rulemaking
288 procedures of the Administrative Procedure Act to replace the
289 rule that has become void.
290 (b) For emergency rules adopted under this section, the
291 department need not make the findings required under s.
292 120.54(4)(a). Emergency rules adopted under this section are
293 also exempt from:
294 1. Sections 120.54(3)(b) and 120.541. Challenges to
295 emergency rules adopted under this section are subject to the
296 time schedules provided in s. 120.56(5).
297 2. Section 120.54(4)(c) and remain in effect until replaced
298 by rules adopted under the nonemergency rulemaking procedures of
299 the Administrative Procedure Act.
300 Section 5. Paragraph (a) of subsection (10) of section
301 624.307, Florida Statutes, is amended, and paragraph (b) of that
302 subsection is republished, to read:
303 624.307 General powers; duties.—
304 (10)(a) The Division of Consumer Services shall perform the
305 following functions concerning products or services regulated by
306 the department or office:
307 1. Receive inquiries and complaints from consumers.
308 2. Prepare and disseminate information that the department
309 deems appropriate to inform or assist consumers.
310 3. Provide direct assistance to and advocacy for consumers
311 who request such assistance or advocacy.
312 4. With respect to apparent or potential violations of law
313 or applicable rules committed by a person or an entity licensed
314 by the department or office, report apparent or potential
315 violations to the office or to the appropriate division of the
316 department, which may take any additional action it deems
317 appropriate.
318 5. Designate an employee of the division as the primary
319 contact for consumers on issues relating to sinkholes.
320 6. Designate an employee of the division as the primary
321 contact for consumers and pharmacies on issues relating to
322 pharmacy benefit managers. The division must refer to the office
323 any consumer complaint that alleges conduct that may constitute
324 a violation of part VII of chapter 626 or for which a pharmacy
325 benefit manager does not respond in accordance with paragraph
326 (b).
327 (b) Any person licensed or issued a certificate of
328 authority by the department or the office shall respond, in
329 writing, to the division within 20 days after receipt of a
330 written request for documents and information from the division
331 concerning a consumer complaint. The response must address the
332 issues and allegations raised in the complaint and include any
333 requested documents concerning the consumer complaint not
334 subject to attorney-client or work-product privilege. The
335 division may impose an administrative penalty for failure to
336 comply with this paragraph of up to $2,500 per violation upon
337 any entity licensed by the department or the office and $250 for
338 the first violation, $500 for the second violation, and up to
339 $1,000 for the third or subsequent violation upon any individual
340 licensed by the department or the office.
341 Section 6. Subsection (1) of section 624.490, Florida
342 Statutes, is amended to read:
343 624.490 Registration of pharmacy benefit managers.—
344 (1) As used in this section, the term “pharmacy benefit
345 manager” has the same meaning as in s. 626.88 means a person or
346 entity doing business in this state which contracts to
347 administer prescription drug benefits on behalf of a health
348 insurer or a health maintenance organization to residents of
349 this state.
350 Section 7. Subsections (1) and (5) of section 624.491,
351 Florida Statutes, are amended to read:
352 624.491 Pharmacy audits.—
353 (1) A pharmacy benefits plan or program as defined in s.
354 626.8825 health insurer or health maintenance organization
355 providing pharmacy benefits through a major medical individual
356 or group health insurance policy or a health maintenance
357 contract, respectively, must comply with the requirements of
358 this section when the pharmacy benefits plan or program health
359 insurer or health maintenance organization or any person or
360 entity acting on behalf of the pharmacy benefits plan or program
361 health insurer or health maintenance organization, including,
362 but not limited to, a pharmacy benefit manager as defined in s.
363 626.88 s. 624.490(1), audits the records of a pharmacy licensed
364 under chapter 465. The person or entity conducting such audit
365 must:
366 (a) Except as provided in subsection (3), notify the
367 pharmacy at least 7 calendar days before the initial onsite
368 audit for each audit cycle.
369 (b) Not schedule an onsite audit during the first 3
370 calendar days of a month unless the pharmacist consents
371 otherwise.
372 (c) Limit the duration of the audit period to 24 months
373 after the date a claim is submitted to or adjudicated by the
374 entity.
375 (d) In the case of an audit that requires clinical or
376 professional judgment, conduct the audit in consultation with,
377 or allow the audit to be conducted by, a pharmacist.
378 (e) Allow the pharmacy to use the written and verifiable
379 records of a hospital, physician, or other authorized
380 practitioner, which are transmitted by any means of
381 communication, to validate the pharmacy records in accordance
382 with state and federal law.
383 (f) Reimburse the pharmacy for a claim that was
384 retroactively denied for a clerical error, typographical error,
385 scrivener’s error, or computer error if the prescription was
386 properly and correctly dispensed, unless a pattern of such
387 errors exists, fraudulent billing is alleged, or the error
388 results in actual financial loss to the entity.
389 (g) Provide the pharmacy with a copy of the preliminary
390 audit report within 120 days after the conclusion of the audit.
391 (h) Allow the pharmacy to produce documentation to address
392 a discrepancy or audit finding within 10 business days after the
393 preliminary audit report is delivered to the pharmacy.
394 (i) Provide the pharmacy with a copy of the final audit
395 report within 6 months after the pharmacy’s receipt of the
396 preliminary audit report.
397 (j) Calculate any recoupment or penalties based on actual
398 overpayments and not according to the accounting practice of
399 extrapolation.
400 (5) A pharmacy benefits plan or program health insurer or
401 health maintenance organization that, under terms of a contract,
402 transfers to a pharmacy benefit manager the obligation to pay a
403 pharmacy licensed under chapter 465 for any pharmacy benefit
404 claims arising from services provided to or for the benefit of
405 an insured or subscriber remains responsible for a violation of
406 this section.
407 Section 8. Subsection (1) of section 626.88, Florida
408 Statutes, is amended, and subsection (6) is added to that
409 section, to read:
410 626.88 Definitions.—For the purposes of this part, the
411 term:
412 (1) “Administrator” means is any person who directly or
413 indirectly solicits or effects coverage of, collects charges or
414 premiums from, or adjusts or settles claims on residents of this
415 state in connection with authorized commercial self-insurance
416 funds or with insured or self-insured programs which provide
417 life or health insurance coverage or coverage of any other
418 expenses described in s. 624.33(1); or any person who, through a
419 health care risk contract as defined in s. 641.234 with an
420 insurer or health maintenance organization, provides billing and
421 collection services to health insurers and health maintenance
422 organizations on behalf of health care providers; or a pharmacy
423 benefit manager. The term does not include, other than any of
424 the following persons:
425 (a) An employer or wholly owned direct or indirect
426 subsidiary of an employer, on behalf of such employer’s
427 employees or the employees of one or more subsidiary or
428 affiliated corporations of such employer.
429 (b) A union on behalf of its members.
430 (c) An insurance company which is either authorized to
431 transact insurance in this state or is acting as an insurer with
432 respect to a policy lawfully issued and delivered by such
433 company in and pursuant to the laws of a state in which the
434 insurer was authorized to transact an insurance business.
435 (d) A health care services plan, health maintenance
436 organization, professional service plan corporation, or person
437 in the business of providing continuing care, possessing a valid
438 certificate of authority issued by the office, and the sales
439 representatives thereof, if the activities of such entity are
440 limited to the activities permitted under the certificate of
441 authority.
442 (e) An entity that is affiliated with an insurer and that
443 only performs the contractual duties, between the administrator
444 and the insurer, of an administrator for the direct and assumed
445 insurance business of the affiliated insurer. The insurer is
446 responsible for the acts of the administrator and is responsible
447 for providing all of the administrator’s books and records to
448 the insurance commissioner, upon a request from the insurance
449 commissioner. For purposes of this paragraph, the term “insurer”
450 means a licensed insurance company, health maintenance
451 organization, prepaid limited health service organization, or
452 prepaid health clinic.
453 (f) A nonresident entity licensed in its state of domicile
454 as an administrator if its duties in this state are limited to
455 the administration of a group policy or plan of insurance and no
456 more than a total of 100 lives for all plans reside in this
457 state.
458 (g) An insurance agent licensed in this state whose
459 activities are limited exclusively to the sale of insurance.
460 (h) A person appointed as a managing general agent in this
461 state, whose activities are limited exclusively to the scope of
462 activities conveyed under such appointment.
463 (i) An adjuster licensed in this state whose activities are
464 limited to the adjustment of claims.
465 (j) A creditor on behalf of such creditor’s debtors with
466 respect to insurance covering a debt between the creditor and
467 its debtors.
468 (k) A trust and its trustees, agents, and employees acting
469 pursuant to such trust established in conformity with 29 U.S.C.
470 s. 186.
471 (l) A trust exempt from taxation under s. 501(a) of the
472 Internal Revenue Code, a trust satisfying the requirements of
473 ss. 624.438 and 624.439, or any governmental trust as defined in
474 s. 624.33(3), and the trustees and employees acting pursuant to
475 such trust, or a custodian and its agents and employees,
476 including individuals representing the trustees in overseeing
477 the activities of a service company or administrator, acting
478 pursuant to a custodial account which meets the requirements of
479 s. 401(f) of the Internal Revenue Code.
480 (m) A financial institution which is subject to supervision
481 or examination by federal or state authorities or a mortgage
482 lender licensed under chapter 494 who collects and remits
483 premiums to licensed insurance agents or authorized insurers
484 concurrently or in connection with mortgage loan payments.
485 (n) A credit card issuing company which advances for and
486 collects premiums or charges from its credit card holders who
487 have authorized such collection if such company does not adjust
488 or settle claims.
489 (o) A person who adjusts or settles claims in the normal
490 course of such person’s practice or employment as an attorney at
491 law and who does not collect charges or premiums in connection
492 with life or health insurance coverage.
493 (p) A person approved by the department who administers
494 only self-insured workers’ compensation plans.
495 (q) A service company or service agent and its employees,
496 authorized in accordance with ss. 626.895-626.899, serving only
497 a single employer plan, multiple-employer welfare arrangements,
498 or a combination thereof.
499 (r) Any provider or group practice, as defined in s.
500 456.053, providing services under the scope of the license of
501 the provider or the member of the group practice.
502 (s) Any hospital providing billing, claims, and collection
503 services solely on its own and its physicians’ behalf and
504 providing services under the scope of its license.
505 (t) A corporation not for profit whose membership consists
506 entirely of local governmental units authorized to enter into
507 risk management consortiums under s. 112.08.
508
509 A person who provides billing and collection services to health
510 insurers and health maintenance organizations on behalf of
511 health care providers shall comply with the provisions of ss.
512 627.6131, 641.3155, and 641.51(4).
513 (6) “Pharmacy benefit manager” means a person or an entity
514 doing business in this state which contracts to administer
515 prescription drug benefits on behalf of a pharmacy benefits plan
516 or program as defined in s. 626.8825. The term includes, but is
517 not limited to, a person or an entity that performs one or more
518 of the following services on behalf of such plan or program:
519 (a) Pharmacy claims processing.
520 (b) Administration or management of a pharmacy discount
521 card program and performance of any other service listed in this
522 subsection.
523 (c) Managing pharmacy networks or pharmacy reimbursement.
524 (d) Paying or managing claims for pharmacist services
525 provided to covered persons.
526 (e) Developing or managing a clinical formulary, including
527 utilization management or quality assurance programs.
528 (f) Pharmacy rebate administration.
529 (g) Managing patient compliance, therapeutic intervention,
530 or generic substitution programs.
531 (h) Administration or management of a mail-order pharmacy
532 program.
533 Section 9. Present subsections (3) through (6) of section
534 626.8805, Florida Statutes, are redesignated as subsections (4)
535 through (7), respectively, a new subsection (3) and subsection
536 (8) are added to that section, and subsection (1) and present
537 subsection (3) of that section are amended, to read:
538 626.8805 Certificate of authority to act as administrator.—
539 (1) It is unlawful for any person to act as or hold himself
540 or herself out to be an administrator in this state without a
541 valid certificate of authority issued by the office pursuant to
542 ss. 626.88-626.894. A pharmacy benefit manager that is
543 registered with the office under s. 624.490 as of June 30, 2023,
544 may continue to operate until January 1, 2024, as an
545 administrator without a certificate of authority and is not in
546 violation of the requirement to possess a valid certificate of
547 authority as an administrator during that timeframe. To qualify
548 for and hold authority to act as an administrator in this state,
549 an administrator must otherwise be in compliance with this code
550 and with its organizational agreement. The failure of any
551 person, excluding a pharmacy benefit manager, to hold such a
552 certificate while acting as an administrator shall subject such
553 person to a fine of not less than $5,000 or more than $10,000
554 for each violation. A person who, on or after January 1, 2024,
555 does not hold a certificate of authority to act as an
556 administrator while operating as a pharmacy benefit manager is
557 subject to a fine of $10,000 per violation per day. By January
558 15, 2024, the office shall submit to the Governor, the President
559 of the Senate, and the Speaker of the House of Representatives a
560 report detailing whether each pharmacy benefit manager operating
561 in this state on January 1, 2024, obtained a certificate of
562 authority on or before that date as required by this section.
563 (3) An applicant that is a pharmacy benefit manager must
564 also submit all of the following:
565 (a) A complete biographical statement on forms prescribed
566 by the commission.
567 (b) An independent background report as prescribed by the
568 commission.
569 (c) A full set of fingerprints of all of the individuals
570 referenced in paragraph (2)(c) to the office or to a vendor,
571 entity, or agency authorized by s. 943.053(13). The office,
572 vendor, entity, or agency, as applicable, shall forward the
573 fingerprints to the Department of Law Enforcement for state
574 processing, and the Department of Law Enforcement shall forward
575 the fingerprints to the Federal Bureau of Investigation for
576 national processing in accordance with s. 943.053 and 28 C.F.R.
577 s. 20.
578 (d) A self-disclosure of any administrative, civil, or
579 criminal complaints, settlements, or discipline of the
580 applicant, or any of the applicant’s affiliates, which relate to
581 a violation of the insurance laws, including pharmacy benefit
582 manager laws, in any state.
583 (e) A statement attesting to compliance with the network
584 requirements in s. 626.8825 beginning January 1, 2024.
585 (4)(a)(3) The applicant shall make available for inspection
586 by the office copies of all contracts relating to services
587 provided by the administrator to insurers or other persons using
588 the services of the administrator.
589 (b) An applicant that is a pharmacy benefit manager shall
590 also make available for inspection by the office:
591 1. Copies of all contract templates with any pharmacy as
592 defined in s. 465.003; and
593 2. Copies of all subcontracts to support its operations.
594 (8) A pharmacy benefit manager is exempt from fees
595 associated with the initial application and the annual filing
596 fees in s. 626.89.
597 Section 10. Section 626.8814, Florida Statutes, is amended
598 to read:
599 626.8814 Disclosure of ownership or affiliation.—
600 (1) Each administrator shall identify to the office any
601 ownership interest or affiliation of any kind with any insurance
602 company responsible for providing benefits directly or through
603 reinsurance to any plan for which the administrator provides
604 administrative services.
605 (2) Pharmacy benefit managers shall also identify to the
606 office any ownership affiliation of any kind with any pharmacy
607 which, either directly or indirectly, through one or more
608 intermediaries:
609 (a) Has an investment or ownership interest in a pharmacy
610 benefit manager holding a certificate of authority issued under
611 this part;
612 (b) Shares common ownership with a pharmacy benefit manager
613 holding a certificate of authority issued under this part; or
614 (c) Has an investor or a holder of an ownership interest
615 which is a pharmacy benefit manager holding a certificate of
616 authority issued under this part.
617 (3) A pharmacy benefit manager shall report any change in
618 information required by subsection (2) to the office in writing
619 within 60 days after the change occurs.
620 Section 11. Section 626.8825, Florida Statutes, is created
621 to read:
622 626.8825 Pharmacy benefit manager transparency and
623 accountability.—
624 (1) DEFINITIONS.—As used in this section, the term:
625 (a) “Adjudication transaction fee” means a fee charged by
626 the pharmacy benefit manager to the pharmacy for electronic
627 claim submissions.
628 (b) “Affiliated pharmacy” means a pharmacy that, either
629 directly or indirectly through one or more intermediaries:
630 1. Has an investment or ownership interest in a pharmacy
631 benefit manager holding a certificate of authority issued under
632 this part;
633 2. Shares common ownership with a pharmacy benefit manager
634 holding a certificate of authority issued under this part; or
635 3. Has an investor or a holder of an ownership interest
636 which is a pharmacy benefit manager holding a certificate of
637 authority issued under this part.
638 (c) “Brand name or generic effective rate” means the
639 contractual rate set forth by a pharmacy benefit manager for the
640 reimbursement of covered brand name or generic drugs, calculated
641 using the total payments in the aggregate, by drug type, during
642 the performance period. The effective rates are typically
643 calculated as a discount from industry benchmarks, such as
644 average wholesale price or wholesale acquisition cost.
645 (d) “Covered person” means a person covered by,
646 participating in, or receiving the benefit of a pharmacy
647 benefits plan or program.
648 (e) “Direct and indirect remuneration fees” means price
649 concessions that are paid to the pharmacy benefit manager by the
650 pharmacy retrospectively and that cannot be calculated at the
651 point of sale. The term may also include discounts, chargebacks
652 or rebates, cash discounts, free goods contingent on a purchase
653 agreement, upfront payments, coupons, goods in kind, free or
654 reduced-price services, grants, or other price concessions or
655 similar benefits from manufacturers, pharmacies, or similar
656 entities.
657 (f) “Dispensing fee” means a fee intended to cover
658 reasonable costs associated with providing the drug to a covered
659 person. This cost includes the pharmacist’s services and the
660 overhead associated with maintaining the facility and equipment
661 necessary to operate the pharmacy.
662 (g) “Effective rate guarantee” means the minimum ingredient
663 cost reimbursement a pharmacy benefit manager guarantees it will
664 pay for pharmacist services during the applicable measurement
665 period.
666 (h) “Erroneous claims” means pharmacy claims submitted in
667 error, including, but not limited to, unintended, incorrect,
668 fraudulent, or test claims.
669 (i) “Group purchasing organization” means an entity
670 affiliated with a pharmacy benefit manager or a pharmacy
671 benefits plan or program which uses purchasing volume aggregates
672 as leverage to negotiate discounts and rebates for covered
673 prescription drugs with pharmaceutical manufacturers,
674 distributors, and wholesale vendors.
675 (j) “Incentive payment” means a retrospective monetary
676 payment made as a reward or recognition by the pharmacy benefits
677 plan or program or pharmacy benefit manager to a pharmacy for
678 meeting or exceeding predefined pharmacy performance metrics as
679 related to quality measures, such as Healthcare Effectiveness
680 Data and Information Set measures.
681 (k) “Maximum allowable cost appeal pricing adjustment”
682 means a retrospective positive payment adjustment made to a
683 pharmacy by the pharmacy benefits plan or program or by the
684 pharmacy benefit manager pursuant to an approved maximum
685 allowable cost appeal request submitted by the same pharmacy to
686 dispute the amount reimbursed for a drug based on the pharmacy
687 benefit manager’s listed maximum allowable cost price.
688 (l) “Monetary recoupments” means rescinded or recouped
689 payments from a pharmacy or provider by the pharmacy benefits
690 plan or program or by the pharmacy benefit manager.
691 (m) “Network” means a group of pharmacies that agree to
692 provide pharmacist services to covered persons on behalf of a
693 pharmacy benefits plan or program or a group of pharmacy
694 benefits plans or programs in exchange for payment for such
695 services. The term includes a pharmacy that generally dispenses
696 outpatient prescription drugs to covered persons.
697 (n) “Network reconciliation offsets” means a process during
698 annual payment reconciliation between a pharmacy benefit manager
699 and a pharmacy which allows the pharmacy benefit manager to
700 offset an amount for overperformance or underperformance of
701 contractual guarantees across guaranteed line items, channels,
702 networks, or payors, as applicable.
703 (o) “Participation contract” means any agreement between a
704 pharmacy benefit manager and pharmacy for the provision and
705 reimbursement of pharmacist services and any exhibits,
706 attachments, amendments, or addendums to such agreement.
707 (p) “Pass-through pricing model” means a payment model used
708 by a pharmacy benefit manager in which the payments made by the
709 pharmacy benefits plan or program to the pharmacy benefit
710 manager for the covered outpatient drugs are:
711 1. Equivalent to the payments the pharmacy benefit manager
712 makes to a dispensing pharmacy or provider for such drugs,
713 including any contracted professional dispensing fee between the
714 pharmacy benefit manager and its network of pharmacies. Such
715 dispensing fee would be paid if the pharmacy benefits plan or
716 program was making the payments directly.
717 2. Passed through in their entirety by the pharmacy
718 benefits plan or program or by the pharmacy benefit manager to
719 the pharmacy or provider that dispenses the drugs, and the
720 payments are made in a manner that is not offset by any
721 reconciliation.
722 (q) “Pharmacist” has the same meaning as in s. 465.003.
723 (r) “Pharmacist services” means products, goods, and
724 services or any combination of products, goods, and services
725 provided as part of the practice of the profession of pharmacy
726 as defined in s. 465.003 or otherwise covered by a pharmacy
727 benefits plan or program.
728 (s) “Pharmacy” has the same meaning as in s. 465.003.
729 (t) “Pharmacy benefit manager” has the same meaning as in
730 s. 626.88.
731 (u) “Pharmacy benefits plan or program” means a plan or
732 program that pays for, reimburses, covers the cost of, or
733 provides access to discounts on pharmacist services provided by
734 one or more pharmacies to covered persons who reside in, are
735 employed by, or receive pharmacist services from this state. The
736 term includes, but is not limited to, health maintenance
737 organizations, health insurers, self-insured employer health
738 plans, discount card programs, and government-funded health
739 plans, including the Statewide Medicaid Managed Care program
740 established pursuant to part IV of chapter 409 and the state
741 group insurance program pursuant to part I of chapter 110.
742 (v) “Rebate” means all payments that accrue to a pharmacy
743 benefit manager or its pharmacy benefits plan or program client
744 or an affiliated group purchasing organization, directly or
745 indirectly, from a pharmaceutical manufacturer, including, but
746 not limited to, discounts, administration fees, credits,
747 incentives, or penalties associated directly or indirectly in
748 any way with claims administered on behalf of a pharmacy
749 benefits plan or program client.
750 (w) “Spread pricing” is the practice in which a pharmacy
751 benefit manager charges a pharmacy benefits plan or program a
752 different amount for pharmacist services than the amount the
753 pharmacy benefit manager reimburses a pharmacy for such
754 pharmacist services.
755 (x) “Usual and customary price” means the amount charged to
756 cash customers for a pharmacist service exclusive of sales tax
757 or other amounts claimed.
758 (2) CONTRACTS BETWEEN A PHARMACY BENEFIT MANAGER AND A
759 PHARMACY BENEFITS PLAN OR PROGRAM.—In addition to any other
760 requirements in the Florida Insurance Code, all contractual
761 arrangements executed, amended, adjusted, or renewed on or after
762 July 1, 2023, which are applicable to pharmacy benefits covered
763 on or after January 1, 2024, between a pharmacy benefit manager
764 and a pharmacy benefits plan or program must:
765 (a) Use a pass-through pricing model, remaining consistent
766 with the prohibition in paragraph (3)(c).
767 (b) Exclude terms that allow for the direct or indirect
768 engagement in the practice of spread pricing unless the pharmacy
769 benefit manager passes along the entire amount of such
770 difference to the pharmacy benefits plan or program as allowable
771 under paragraph (a).
772 (c) Ensure that funds received in relation to providing
773 services for a pharmacy benefits plan or program or a pharmacy
774 are received by the pharmacy benefit manager in trust for the
775 pharmacy benefits plan or program or pharmacy, as applicable,
776 and are used or distributed only pursuant to the pharmacy
777 benefit manager’s contract with the pharmacy benefits plan or
778 program or with the pharmacy or as otherwise required by
779 applicable law.
780 (d) Require the pharmacy benefit manager to pass 100
781 percent of all prescription drug manufacturer rebates, including
782 nonresident manufacturer rebates, received to the pharmacy
783 benefits plan or program, if the contractual arrangement
784 delegates the negotiation of rebates to the pharmacy benefit
785 manager, for the sole purpose of offsetting defined cost sharing
786 and reducing premiums of covered persons. Any excess rebate
787 revenue after the pharmacy benefit manager and the pharmacy
788 benefits plan or program have taken all actions required under
789 this paragraph must be used for the sole purpose of offsetting
790 copayments and deductibles of covered persons. This paragraph
791 does not apply to contracts involving Medicaid managed care
792 plans.
793 (e) Include network adequacy requirements that meet or
794 exceed the Medicare Part D program standards for convenient
795 access to network pharmacies set forth in 42 C.F.R. s. 423.120,
796 and that:
797 1. Do not limit a network to solely include affiliated
798 pharmacies;
799 2. Require a pharmacy benefit manager to offer a provider
800 contract to licensed pharmacies physically located on the
801 physical site of providers that are:
802 a. Within the pharmacy benefits plan’s or program’s
803 geographic service area and that have been specifically
804 designated as essential providers by the Agency for Health Care
805 Administration pursuant to s. 409.975(1)(a);
806 b. Designated as a Cancer Center of Excellence under s.
807 381.925, regardless of the pharmacy benefits plan’s or program’s
808 geographic service area;
809 c. Organ transplant hospitals, regardless of the pharmacy
810 benefits plan’s or program’s geographic service area;
811 d. Hospitals licensed as specialty children’s hospitals as
812 defined in s. 395.002; or
813 e. Regional perinatal intensive care centers as defined in
814 s. 383.16(2), regardless of the pharmacy benefits plan’s or
815 program’s geographic service area.
816
817 Such provider contracts must be solely for the administration or
818 dispensing of covered prescription drugs, including biological
819 products, that are administered through infusions, intravenously
820 injected, inhaled during a surgical procedure, or a covered
821 parenteral drug, as part of onsite outpatient care;
822 3. Do not require a covered person to receive a
823 prescription drug by United States mail, common carrier, local
824 courier, third-party company or delivery service, or pharmacy
825 direct delivery unless the prescription drug cannot be acquired
826 at any retail pharmacy in the pharmacy benefit manager’s network
827 for the covered person’s pharmacy benefits plan or program. This
828 subparagraph does not prohibit a pharmacy benefit manager from
829 operating mail order or delivery programs on an opt-in basis at
830 the sole discretion of a covered person;
831 4. Prohibit a requirement for a covered person to receive
832 pharmacist services from an affiliated pharmacy or an affiliated
833 health care provider for the in-person administration of covered
834 prescription drugs; offering or implementing pharmacy networks
835 that require or provide a promotional item or an incentive,
836 defined as anything other than a reduced cost-sharing amount or
837 enhanced quantity limit allowed under the benefit design for a
838 covered drug, to a covered person to use an affiliated pharmacy
839 or an affiliated health care provider for the in-person
840 administration of covered prescription drugs; or advertising,
841 marketing, or promoting an affiliated pharmacy to covered
842 persons. Subject to the foregoing, a pharmacy benefit manager
843 may include an affiliated pharmacy in communications to covered
844 persons regarding network pharmacies and prices, provided that
845 the pharmacy benefit manager includes information, such as links
846 to all nonaffiliated network pharmacies, in such communications
847 and that the information provided is accurate and of equal
848 prominence. This paragraph may not be construed to prohibit a
849 pharmacy benefit manager from entering into an agreement with an
850 affiliated pharmacy to provide pharmacist services to covered
851 persons.
852 (f) Prohibit the ability of a pharmacy benefit manager to
853 condition participation in one pharmacy network on participation
854 in any other pharmacy network or penalize a pharmacy for
855 exercising its prerogative not to participate in a specific
856 pharmacy network.
857 (g) Prohibit a pharmacy benefit manager from instituting a
858 network that requires a pharmacy to meet accreditation standards
859 inconsistent with or more stringent than applicable federal and
860 state requirements for licensure and operation as a pharmacy in
861 this state. However, a pharmacy benefit manager may specify
862 additional specialty networks that require enhanced standards
863 related to the safety and competency necessary to meet the
864 United States Food and Drug Administration’s limited
865 distribution requirements for dispensing any covered drug, on a
866 drug-by-drug basis, that requires extraordinary special
867 handling, provider coordination, clinical care or monitoring, or
868 patient education when such extraordinary requirements cannot be
869 met by a network pharmacy. For purposes of this paragraph, drugs
870 requiring extraordinary special handling include, but are not
871 limited to, drugs that are subject to a risk evaluation and
872 mitigation strategy approved by the United States Food and Drug
873 Administration; require special certification of a health care
874 provider to prescribe, receive, dispense, or administer; require
875 special handling due to the molecular complexity or cytotoxic
876 properties of a biologic or biosimilar product or drug; require
877 cold chain storage and shipping or specialized equipment to
878 dispense; or require other conditions of a similar gravity.
879 (h)1. At a minimum, require the pharmacy benefit manager or
880 pharmacy benefits plan or program to, upon revising its
881 formulary of covered prescription drugs during a plan year,
882 provide a 60-day continuity-of-care period in which the covered
883 prescription drug that is being revised from the formulary
884 continues to be provided at the same cost for the patient for a
885 period of 60 days. The 60-day continuity-of-care period
886 commences upon notification to the patient. This requirement
887 does not apply if the covered prescription drug:
888 a. Has been approved and made available over the counter by
889 the United States Food and Drug Administration and has entered
890 the commercial market as such;
891 b. Has been removed or withdrawn from the commercial market
892 by the manufacturer; or
893 c. Is subject to an involuntary recall by state or federal
894 authorities and is no longer available on the commercial market.
895 2. Beginning January 1, 2024, and annually thereafter, the
896 pharmacy benefits plan or program shall submit to the office,
897 under the penalty of perjury, a statement attesting to its
898 compliance with the requirements of this subsection.
899 (3) CONTRACTS BETWEEN A PHARMACY BENEFIT MANAGER AND A
900 PARTICIPATING PHARMACY.—In addition to other requirements in the
901 Florida Insurance Code, a participation contract executed,
902 amended, adjusted, or renewed on or after July 1, 2023, that
903 applies to pharmacist services on or after January 1, 2024,
904 between a pharmacy benefit manager and one or more pharmacies or
905 pharmacists, must include, in substantial form, terms that
906 ensure compliance with all of the following requirements, and
907 that, except to the extent not allowed by law, shall supersede
908 any contractual terms in the participation contract to the
909 contrary:
910 (a) At the time of adjudication for electronic claims or
911 the time of reimbursement for nonelectronic claims, the pharmacy
912 benefit manager shall provide the pharmacy with a remittance,
913 including such detailed information as is necessary for the
914 pharmacy or pharmacist to identify the reimbursement schedule
915 for the specific network applicable to the claim and which is
916 the basis used by the pharmacy benefit manager to calculate the
917 amount of reimbursement paid. This information must include, but
918 is not limited to, the applicable network reimbursement ID or
919 plan ID as defined in the most current version of the National
920 Council for Prescription Drug Programs (NCPDP) Telecommunication
921 Standard Implementation Guide, or its nationally recognized
922 successor industry guide. The commission shall adopt rules to
923 implement this paragraph.
924 (b) The pharmacy benefit manager must ensure that any basis
925 of reimbursement information is communicated to a pharmacy in
926 accordance with the NCPDP Telecommunication Standard
927 Implementation Guide, or its nationally recognized successor
928 industry guide, when performing reconciliation for any effective
929 rate guarantee, and that such basis of reimbursement information
930 communicated is accurate, corresponds with the applicable
931 network rate, and may be relied upon by the pharmacy.
932 (c) A prohibition of financial clawbacks, reconciliation
933 offsets, or offsets to adjudicated claims. A pharmacy benefit
934 manager may not charge, withhold, or recoup direct or indirect
935 remuneration fees, dispensing fees, brand name or generic
936 effective rate adjustments through reconciliation, or any other
937 monetary charge, withholding, or recoupments as related to
938 discounts, multiple network reconciliation offsets, adjudication
939 transaction fees, and any other instance when a fee may be
940 recouped from a pharmacy. This prohibition does not apply to:
941 1. Any incentive payments provided by the pharmacy benefit
942 manager to a network pharmacy for meeting or exceeding
943 predefined quality measures, such as Healthcare Effectiveness
944 Data and Information Set measures; recoupment due to an
945 erroneous claim, fraud, waste, or abuse; a claim adjudicated in
946 error; a maximum allowable cost appeal pricing adjustment; or an
947 adjustment made as part of a pharmacy audit pursuant to s.
948 624.491.
949 2. Any recoupment that is returned to the state for
950 programs in chapter 409 or the state group insurance program in
951 s. 110.123.
952 (d) A pharmacy benefit manager may not unilaterally change
953 the terms of any participation contract.
954 (e) Unless otherwise prohibited by law, a pharmacy benefit
955 manager may not prohibit a pharmacy or pharmacist from:
956 1. Offering mail or delivery services on an opt-in basis at
957 the sole discretion of the covered person.
958 2. Mailing or delivering a prescription drug to a covered
959 person upon his or her request.
960 3. Charging a shipping or handling fee to a covered person
961 requesting a prescription drug be mailed or delivered if the
962 pharmacy or pharmacist discloses to the covered person before
963 the mailing or delivery the amount of the fee that will be
964 charged and that the fee may not be reimbursable by the covered
965 person’s pharmacy benefits plan or program.
966 (f) The pharmacy benefit manager must provide a pharmacy,
967 upon its request, a list of pharmacy benefits plans or programs
968 in which the pharmacy is a part of the network. Updates to the
969 list must be communicated to the pharmacy within 7 days. The
970 pharmacy benefit manager may not restrict the pharmacy or
971 pharmacist from disclosing this information to the public.
972 (g) The pharmacy benefit manager must ensure that the
973 Electronic Remittance Advice contains claim level payment
974 adjustments in accordance with the American National Standards
975 Institute Accredited Standards Committee, X12 format, and
976 includes or is accompanied by the appropriate level of detail
977 for the pharmacy to reconcile any debits or credits, including,
978 but not limited to, pharmacy NCPDP or NPI identifier, date of
979 service, prescription number, refill number, adjustment code, if
980 applicable, and transaction amount.
981 (h) The pharmacy benefit manager shall provide a reasonable
982 administrative appeal procedure to allow a pharmacy or
983 pharmacist to challenge the maximum allowable cost pricing
984 information and the reimbursement made under the maximum
985 allowable cost as defined in s. 627.64741 for a specific drug as
986 being below the acquisition cost available to the challenging
987 pharmacy or pharmacist.
988 1. The administrative appeal procedure must include a
989 telephone number and e-mail address, or a website, for the
990 purpose of submitting the administrative appeal. The appeal may
991 be submitted by the pharmacy or an agent of the pharmacy
992 directly to the pharmacy benefit manager or through a pharmacy
993 service administration organization. The pharmacy or pharmacist
994 must be given at least 30 business days after a maximum
995 allowable cost update or after an adjudication for an electronic
996 claim or reimbursement for a nonelectronic claim to file the
997 administrative appeal.
998 2. The pharmacy benefit manager must respond to the
999 administrative appeal within 30 business days after receipt of
1000 the appeal.
1001 3. If the appeal is upheld, the pharmacy benefit manager
1002 must:
1003 a. Update the maximum allowable cost pricing information to
1004 at least the acquisition cost available to the pharmacy;
1005 b. Permit the pharmacy or pharmacist to reverse and rebill
1006 the claim in question;
1007 c. Provide to the pharmacy or pharmacist the national drug
1008 code on which the increase or change is based; and
1009 d. Make the increase or change effective for each similarly
1010 situated pharmacy or pharmacist who is subject to the applicable
1011 maximum allowable cost pricing information.
1012 4. If the appeal is denied, the pharmacy benefit manager
1013 must provide to the pharmacy or pharmacist the national drug
1014 code and the name of the national or regional pharmaceutical
1015 wholesalers operating in this state which have the drug
1016 currently in stock at a price below the maximum allowable cost
1017 pricing information.
1018 5. Every 90 days, a pharmacy benefit manager shall report
1019 to the office the total number of appeals received and denied in
1020 the preceding 90-day period, with an explanation or reason for
1021 each denial, for each specific drug for which an appeal was
1022 submitted pursuant to this paragraph.
1023 Section 12. Section 626.8827, Florida Statutes, is created
1024 to read:
1025 626.8827 Pharmacy benefit manager prohibited practices.—In
1026 addition to other prohibitions in this part, a pharmacy benefit
1027 manager may not do any of the following:
1028 (1) Prohibit, restrict, or penalize in any way a pharmacy
1029 or pharmacist from disclosing to any person any information that
1030 the pharmacy or pharmacist deems appropriate, including, but not
1031 limited to, information regarding any of the following:
1032 (a) The nature of treatment, risks, or alternatives
1033 thereto.
1034 (b) The availability of alternate treatment, consultations,
1035 or tests.
1036 (c) The decision of utilization reviewers or similar
1037 persons to authorize or deny pharmacist services.
1038 (d) The process used to authorize or deny pharmacist
1039 services or benefits.
1040 (e) Information on financial incentives and structures used
1041 by the pharmacy benefits plan or program.
1042 (f) Information that may reduce the costs of pharmacist
1043 services.
1044 (g) Whether the cost-sharing obligation exceeds the retail
1045 price for a covered prescription drug and the availability of a
1046 more affordable alternative drug, pursuant to s. 465.0244.
1047 (2) Prohibit, restrict, or penalize in any way a pharmacy
1048 or pharmacist from disclosing information to the office, the
1049 Agency for Health Care Administration, Department of Management
1050 Services, law enforcement, or state and federal governmental
1051 officials, provided that the recipient of the information
1052 represents it has the authority, to the extent provided by state
1053 or federal law, to maintain proprietary information as
1054 confidential; and before disclosure of information designated as
1055 confidential, the pharmacist or pharmacy marks as confidential
1056 any document in which the information appears or requests
1057 confidential treatment for any oral communication of the
1058 information.
1059 (3) Communicate at the point-of-sale, or otherwise require,
1060 a cost-sharing obligation for the covered person in an amount
1061 that exceeds the lesser of:
1062 (a) The applicable cost-sharing amount under the applicable
1063 pharmacy benefits plan or program; or
1064 (b) The usual and customary price, as defined in s.
1065 626.8825, of the pharmacist services.
1066 (4) Transfer or share records relative to prescription
1067 information containing patient-identifiable or prescriber
1068 identifiable data to an affiliated pharmacy for any commercial
1069 purpose other than the limited purposes of facilitating pharmacy
1070 reimbursement, formulary compliance, or utilization review on
1071 behalf of the applicable pharmacy benefits plan or program.
1072 (5) Fail to make any payment due to a pharmacy for an
1073 adjudicated claim with a date of service before the effective
1074 date of a pharmacy’s termination from a pharmacy benefit network
1075 unless payments are withheld because of actual fraud on the part
1076 of the pharmacy or except as otherwise required by law.
1077 (6) Terminate the contract of, penalize, or disadvantage a
1078 pharmacist or pharmacy due to a pharmacist or pharmacy:
1079 (a) Disclosing information about pharmacy benefit manager
1080 practices in accordance with this act;
1081 (b) Exercising any of its prerogatives under this part; or
1082 (c) Sharing any portion, or all, of the pharmacy benefit
1083 manager contract with the office pursuant to a complaint or a
1084 query regarding whether the contract is in compliance with this
1085 act.
1086 (7) Fail to comply with the requirements in s. 626.8825 or
1087 s. 624.491.
1088 Section 13. Section 626.8828, Florida Statutes, is created
1089 to read:
1090 626.8828 Investigations and examinations of pharmacy
1091 benefit managers; expenses; penalties.—
1092 (1) The office may investigate administrators who are
1093 pharmacy benefit managers and applicants for authorization as
1094 provided in ss. 624.307 and 624.317. The office shall review any
1095 referral made pursuant to s. 624.307(10) and shall investigate
1096 any referral that, as determined by the Commissioner of
1097 Insurance Regulation or his or her designee, reasonably
1098 indicates a possible violation of this part.
1099 (2)(a) The office shall examine the business and affairs of
1100 each pharmacy benefit manager at least biennially. The biennial
1101 examination of each pharmacy benefit manager must be a
1102 systematic review for the purpose of determining the pharmacy
1103 benefit manager’s compliance with all provisions of this part
1104 and all other laws or rules applicable to pharmacy benefit
1105 managers and must include a detailed review of the pharmacy
1106 benefit manager’s compliance with ss. 626.8825 and 626.8827. The
1107 first 2-year cycle for conducting biennial reviews begins
1108 January 1, 2025. By January 15, 2026, and each January 15
1109 thereafter, the office shall submit to the Governor, the
1110 President of the Senate, and the Speaker of the House of
1111 Representatives a report summarizing the results of the prior
1112 year’s examinations which includes detailed descriptions of any
1113 violations committed by each pharmacy benefit manager and
1114 detailed reporting of actions taken by the office against each
1115 pharmacy benefit manager for such violations. Beginning with the
1116 2027 report, and every 2 years thereafter, the report must
1117 document the office’s compliance with the examination timeframe
1118 requirements as provided in this paragraph. The office must
1119 specify the number and percentage of all examination completed
1120 within the timeframe.
1121 (b) The office also may conduct additional examinations as
1122 often as it deems advisable or necessary for the purpose of
1123 ascertaining compliance with this part and any other laws or
1124 rules applicable to pharmacy benefit managers or applicants for
1125 authorization.
1126 (c) If a referral made pursuant to s. 624.307(10)
1127 reasonably indicates a pattern or practice of violations of this
1128 part by a pharmacy benefit manager, the office must begin an
1129 examination of the pharmacy benefit manager or include findings
1130 related to such referral within an ongoing examination.
1131 (d) Based on the findings of an examination that a pharmacy
1132 benefit manager or an applicant for authorization has exhibited
1133 a pattern or practice of knowing and willful violations of s.
1134 626.8825 or s. 626.8827, the office may, pursuant to chapter
1135 120, order a pharmacy benefit manager to file all contracts
1136 between the pharmacy benefit manager and pharmacies or pharmacy
1137 benefits plans or programs and any policies, guidelines, rules,
1138 protocols, standard operating procedures, instructions, or
1139 directives that govern or guide the manner in which the pharmacy
1140 benefit manager or applicant conducts business related to such
1141 knowing and willful violations for review and inspection for the
1142 following 36-month period. Such documents are public records and
1143 are not trade secrets or otherwise exempt from s. 119.07(1). As
1144 used in this section, the term:
1145 1. “Contracts” means any contract to which s. 626.8825 is
1146 applicable.
1147 2. “Knowing and willful” means any act of commission or
1148 omission which is committed intentionally, as opposed to
1149 accidentally, and which is committed with knowledge of the act’s
1150 unlawfulness or with reckless disregard as to the unlawfulness
1151 of the act.
1152 (e) Examinations may be conducted by an independent
1153 professional examiner under contract to the office, in which
1154 case payment must be made directly to the contracted examiner by
1155 the pharmacy benefit manager examined in accordance with the
1156 rates and terms agreed to by the office and the examiner. The
1157 commission shall adopt rules providing for the types of
1158 independent professional examiners who may conduct examinations
1159 under this section, which types must include, but need not be
1160 limited to, independent certified public accountants, actuaries,
1161 investment specialists, information technology specialists, or
1162 others meeting criteria specified by commission rule. The rules
1163 must also require that:
1164 1. The rates charged to the pharmacy benefit manager being
1165 examined are consistent with rates charged by other firms in a
1166 similar profession and are comparable with the rates charged for
1167 comparable examinations.
1168 2. The firm selected by the office to perform the
1169 examination has no conflicts of interest which might affect its
1170 ability to independently perform its responsibilities for the
1171 examination.
1172 (3) In making investigations and examinations of pharmacy
1173 benefit managers and applicants for authorization, the office
1174 and such pharmacy benefit manager are subject to all of the
1175 following provisions:
1176 (a) Section 624.318, as to the conduct of examinations.
1177 (b) Section 624.319, as to examination and investigation
1178 reports.
1179 (c) Section 624.321, as to witnesses and evidence.
1180 (d) Section 624.322, as to compelled testimony.
1181 (e) Section 624.324, as to hearings.
1182 (f) Any other provision of chapter 624 applicable to the
1183 investigation or examination of a licensee under this part.
1184 (4)(a) A pharmacy benefit manager must maintain an accurate
1185 record of all contracts and records with all pharmacies and
1186 pharmacy benefits plans or programs for the duration of the
1187 contract, and for 5 years thereafter. Such contracts must be
1188 made available to the office and kept in a form accessible to
1189 the office.
1190 (b) The office may order any pharmacy benefit manager or
1191 applicant to produce any records, books, files, contracts,
1192 advertising and solicitation materials, or other information and
1193 may take statements under oath to determine whether the pharmacy
1194 benefit manager or applicant is in violation of the law or is
1195 acting contrary to the public interest.
1196 (5)(a) Notwithstanding s. 624.307(3), each pharmacy benefit
1197 manager and applicant for authorization must pay to the office
1198 the expenses of the examination or investigation. Such expenses
1199 include actual travel expenses, a reasonable living expense
1200 allowance, compensation of the examiner, investigator, or other
1201 person making the examination or investigation, and necessary
1202 costs of the office directly related to the examination or
1203 investigation. Such travel expenses and living expense
1204 allowances are limited to those expenses necessarily incurred on
1205 account of the examination or investigation and shall be paid by
1206 the examined pharmacy benefit manager or applicant together with
1207 compensation upon presentation by the office to such pharmacy
1208 benefit manager or applicant of such charges and expenses after
1209 a detailed statement has been filed by the examiner and approved
1210 by the office.
1211 (b) All moneys collected from pharmacy benefit managers and
1212 applicants for authorization pursuant to this subsection shall
1213 be deposited into the Insurance Regulatory Trust Fund, and the
1214 office may make deposits from time to time into such fund from
1215 moneys appropriated for the operation of the office.
1216 (c) Notwithstanding s. 112.061, the office may pay to the
1217 examiner, investigator, or person making such examination or
1218 investigation out of such trust fund the actual travel expenses,
1219 reasonable living expense allowance, and compensation in
1220 accordance with the statement filed with the office by the
1221 examiner, investigator, or other person, as provided in
1222 paragraph (a).
1223 (6) In addition to any other enforcement authority
1224 available to the office, the office shall impose an
1225 administrative fine of $5,000 for each violation of s. 626.8825
1226 or s. 626.8827. Each instance of a violation of such sections by
1227 a pharmacy benefit manager against each individual pharmacy or
1228 prescription benefits plan or program constitutes a separate
1229 violation. Notwithstanding any other provision of law, there is
1230 no limitation on aggregate fines issued pursuant to this
1231 section. The proceeds from any administrative fine shall be
1232 deposited into the General Revenue Fund.
1233 (7) Failure by a pharmacy benefit manager to pay expenses
1234 incurred or administrative fines imposed under this section is
1235 grounds for the denial, suspension, or revocation of its
1236 certificate of authority.
1237 Section 14. Section 626.89, Florida Statutes, is amended to
1238 read:
1239 626.89 Annual financial statement and filing fee; notice of
1240 change of ownership; pharmacy benefit manager filings.—
1241 (1) Each authorized administrator shall annually file with
1242 the office a full and true statement of its financial condition,
1243 transactions, and affairs within 3 months after the end of the
1244 administrator’s fiscal year or within such extension of time as
1245 the office for good cause may have granted. The statement must
1246 be for the preceding fiscal year and must be in such form and
1247 contain such matters as the commission prescribes and must be
1248 verified by at least two officers of the administrator.
1249 (2) Each authorized administrator shall also file an
1250 audited financial statement performed by an independent
1251 certified public accountant. The audited financial statement
1252 must shall be filed with the office within 5 months after the
1253 end of the administrator’s fiscal year and be for the preceding
1254 fiscal year. An audited financial statement prepared on a
1255 consolidated basis must include a columnar consolidating or
1256 combining worksheet that must be filed with the statement and
1257 must comply with the following:
1258 (a) Amounts shown on the consolidated audited financial
1259 statement must be shown on the worksheet;
1260 (b) Amounts for each entity must be stated separately; and
1261 (c) Explanations of consolidating and eliminating entries
1262 must be included.
1263 (3) At the time of filing its annual statement, the
1264 administrator shall pay a filing fee in the amount specified in
1265 s. 624.501 for the filing of an annual statement by an insurer.
1266 (4) In addition, the administrator shall immediately notify
1267 the office of any material change in its ownership.
1268 (5) A pharmacy benefit manager shall also notify the office
1269 within 30 days after any administrative, civil, or criminal
1270 complaints, settlements, or discipline of the pharmacy benefit
1271 manager or any of its affiliates which relate to a violation of
1272 the insurance laws, including pharmacy benefit laws in any
1273 state.
1274 (6) A pharmacy benefit manager shall also annually submit
1275 to the office a statement attesting to its compliance with the
1276 network requirements of s. 626.8825.
1277 (7) The commission may by rule require all or part of the
1278 statements or filings required under this section to be
1279 submitted by electronic means in a computer-readable form
1280 compatible with the electronic data format specified by the
1281 commission.
1282 Section 15. Subsection (5) is added to section 627.42393,
1283 Florida Statutes, to read:
1284 627.42393 Step-therapy protocol.—
1285 (5) This section applies to a pharmacy benefit manager
1286 acting on behalf of a health insurer.
1287 Section 16. Subsections (2), (3), and (4) of section
1288 627.64741, Florida Statutes, are amended to read:
1289 627.64741 Pharmacy benefit manager contracts.—
1290 (2) In addition to the requirements of part VII of chapter
1291 626, a contract between a health insurer and a pharmacy benefit
1292 manager must require that the pharmacy benefit manager:
1293 (a) Update maximum allowable cost pricing information at
1294 least every 7 calendar days.
1295 (b) Maintain a process that will, in a timely manner,
1296 eliminate drugs from maximum allowable cost lists or modify drug
1297 prices to remain consistent with changes in pricing data used in
1298 formulating maximum allowable cost prices and product
1299 availability.
1300 (3) A contract between a health insurer and a pharmacy
1301 benefit manager must prohibit the pharmacy benefit manager from
1302 limiting a pharmacist’s ability to disclose whether the cost
1303 sharing obligation exceeds the retail price for a covered
1304 prescription drug, and the availability of a more affordable
1305 alternative drug, pursuant to s. 465.0244.
1306 (4) A contract between a health insurer and a pharmacy
1307 benefit manager must prohibit the pharmacy benefit manager from
1308 requiring an insured to make a payment for a prescription drug
1309 at the point of sale in an amount that exceeds the lesser of:
1310 (a) The applicable cost-sharing amount; or
1311 (b) The retail price of the drug in the absence of
1312 prescription drug coverage.
1313 Section 17. Subsections (2), (3), and (4) of section
1314 627.6572, Florida Statutes, are amended to read:
1315 627.6572 Pharmacy benefit manager contracts.—
1316 (2) In addition to the requirements of part VII of chapter
1317 626, a contract between a health insurer and a pharmacy benefit
1318 manager must require that the pharmacy benefit manager:
1319 (a) Update maximum allowable cost pricing information at
1320 least every 7 calendar days.
1321 (b) Maintain a process that will, in a timely manner,
1322 eliminate drugs from maximum allowable cost lists or modify drug
1323 prices to remain consistent with changes in pricing data used in
1324 formulating maximum allowable cost prices and product
1325 availability.
1326 (3) A contract between a health insurer and a pharmacy
1327 benefit manager must prohibit the pharmacy benefit manager from
1328 limiting a pharmacist’s ability to disclose whether the cost
1329 sharing obligation exceeds the retail price for a covered
1330 prescription drug, and the availability of a more affordable
1331 alternative drug, pursuant to s. 465.0244.
1332 (4) A contract between a health insurer and a pharmacy
1333 benefit manager must prohibit the pharmacy benefit manager from
1334 requiring an insured to make a payment for a prescription drug
1335 at the point of sale in an amount that exceeds the lesser of:
1336 (a) The applicable cost-sharing amount; or
1337 (b) The retail price of the drug in the absence of
1338 prescription drug coverage.
1339 Section 18. Paragraph (e) is added to subsection (46) of
1340 section 641.31, Florida Statutes, to read:
1341 641.31 Health maintenance contracts.—
1342 (46)
1343 (e) This subsection applies to a pharmacy benefit manager
1344 acting on behalf of a health maintenance organization.
1345 Section 19. Subsections (2), (3), and (4) of section
1346 641.314, Florida Statutes, are amended to read:
1347 641.314 Pharmacy benefit manager contracts.—
1348 (2) In addition to the requirements of part VII of chapter
1349 626, a contract between a health maintenance organization and a
1350 pharmacy benefit manager must require that the pharmacy benefit
1351 manager:
1352 (a) Update maximum allowable cost pricing information at
1353 least every 7 calendar days.
1354 (b) Maintain a process that will, in a timely manner,
1355 eliminate drugs from maximum allowable cost lists or modify drug
1356 prices to remain consistent with changes in pricing data used in
1357 formulating maximum allowable cost prices and product
1358 availability.
1359 (3) A contract between a health maintenance organization
1360 and a pharmacy benefit manager must prohibit the pharmacy
1361 benefit manager from limiting a pharmacist’s ability to disclose
1362 whether the cost-sharing obligation exceeds the retail price for
1363 a covered prescription drug, and the availability of a more
1364 affordable alternative drug, pursuant to s. 465.0244.
1365 (4) A contract between a health maintenance organization
1366 and a pharmacy benefit manager must prohibit the pharmacy
1367 benefit manager from requiring a subscriber to make a payment
1368 for a prescription drug at the point of sale in an amount that
1369 exceeds the lesser of:
1370 (a) The applicable cost-sharing amount; or
1371 (b) The retail price of the drug in the absence of
1372 prescription drug coverage.
1373 Section 20. (1) This act establishes requirements for
1374 pharmacy benefit managers as defined in s. 626.88, Florida
1375 Statutes, including, without limitation, pharmacy benefit
1376 managers in their performance of services for or otherwise on
1377 behalf of a pharmacy benefits plan or program as defined in s.
1378 626.8825, Florida Statutes, which includes coverage pursuant to
1379 Titles XVIII, XIX, or XXI of the Social Security Act, 42 U.S.C.
1380 ss. 1395 et seq., 1396 et seq., and 1397aa et seq., known as
1381 Medicare, Medicaid, or any other similar coverage under a state
1382 or Federal Government funded health plan, including the
1383 Statewide Medicaid Managed Care program established pursuant to
1384 part IV of chapter 409, Florida Statutes, and the state group
1385 insurance program pursuant to part I of chapter 110, Florida
1386 Statutes.
1387 (2) This act is not intended, nor may it be construed, to
1388 conflict with existing, relevant federal law.
1389 (3) If any provision of this act or its application to any
1390 person or circumstances is held invalid, the invalidity does not
1391 affect other provisions or applications of this act which can be
1392 given effect without the invalid provision or application, and
1393 to this end the provisions of this act are severable.
1394 Section 21. For the 2023-2024 fiscal year, the sum of
1395 $980,705 in recurring funds and $146,820 in nonrecurring funds
1396 from the Insurance Regulatory Trust Fund are appropriated to the
1397 Office of Insurance Regulation, and 10 full-time equivalent
1398 positions with associated salary rate of 644,877 are authorized,
1399 for the purpose of implementing this act.
1400 Section 22. This act shall take effect July 1, 2023.
