Bill Text: IA HF2401 | 2023-2024 | 90th General Assembly | Amended
Bill Title: A bill for an act relating to pharmacy benefits managers, pharmacies, and prescription drug pricing, and providing applicability provisions. (Formerly HSB 640.)
Spectrum: Committee Bill
Status: (Engrossed - Dead) 2024-04-18 - Fiscal note. [HF2401 Detail]
Download: Iowa-2023-HF2401-Amended.html
House
File
2401
-
Reprinted
HOUSE
FILE
2401
BY
COMMITTEE
ON
COMMERCE
(SUCCESSOR
TO
HSB
640)
(As
Amended
and
Passed
by
the
House
March
12,
2024
)
A
BILL
FOR
An
Act
relating
to
pharmacy
benefits
managers,
pharmacies,
1
and
prescription
drug
pricing,
and
providing
applicability
2
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
HF
2401
(2)
90
nls/ko/md
H.F.
2401
DIVISION
I
1
PHARMACY
BENEFITS
MANAGERS
2
Section
1.
Section
510B.1,
Code
2024,
is
amended
by
adding
3
the
following
new
subsections:
4
NEW
SUBSECTION
.
11A.
“Pass-through
pricing”
means
a
5
model
of
prescription
drug
pricing
in
which
payments
made
6
by
a
third-party
payor
to
a
pharmacy
benefits
manager
for
7
prescription
drugs
are
equivalent
to
the
payments
the
pharmacy
8
benefits
manager
makes
to
the
dispensing
pharmacy
or
dispensing
9
health
care
provider
for
the
prescription
drugs,
including
any
10
professional
dispensing
fee.
11
NEW
SUBSECTION
.
21A.
“Spread
pricing”
means
a
model
of
12
prescription
drug
pricing
in
which
a
pharmacy
benefits
manager
13
charges
a
third-party
payor
more
for
prescription
drugs
14
dispensed
to
a
covered
person
than
the
amount
the
pharmacy
15
benefits
manager
reimburses
the
pharmacy
for
dispensing
the
16
prescription
drugs
to
a
covered
person.
17
Sec.
2.
Section
510B.4,
Code
2024,
is
amended
by
adding
the
18
following
new
subsection:
19
NEW
SUBSECTION
.
4.
A
pharmacy
benefits
manager,
health
20
carrier,
health
benefit
plan,
or
third-party
payor
shall
not
21
discriminate
against
a
pharmacy
or
a
pharmacist
with
respect
to
22
participation,
referral,
reimbursement
of
a
covered
service,
23
or
indemnification
if
a
pharmacist
is
acting
within
the
scope
24
of
the
pharmacist’s
license
and
the
pharmacy
is
operating
in
25
compliance
with
all
applicable
laws
and
rules.
26
Sec.
3.
NEW
SECTION
.
510B.8D
Pharmacy
benefits
manager
27
contracts
——
spread
pricing.
28
1.
All
contracts
executed,
amended,
adjusted,
or
renewed
29
on
or
after
July
1,
2024,
that
apply
to
prescription
drug
30
benefits
on
or
after
January
1,
2025,
between
a
pharmacy
31
benefits
manager
and
a
third-party
payor,
or
between
a
person
32
and
a
third-party
payor,
shall
include
all
of
the
following
33
requirements:
34
a.
The
pharmacy
benefits
manager
shall
use
pass-through
35
-1-
HF
2401
(2)
90
nls/ko/md
1/
12
H.F.
2401
pricing
unless
paragraph
“b”
applies.
1
b.
The
pharmacy
benefits
manager
may
use
direct
or
indirect
2
spread
pricing
only
if
the
difference
between
the
amount
the
3
third-party
payor
pays
the
pharmacy
benefits
manager
for
a
4
prescription
drug
and
the
amount
the
pharmacy
benefits
manager
5
reimburses
the
dispensing
pharmacy
or
dispensing
health
care
6
provider
for
the
prescription
drug
is
passed
through
by
the
7
pharmacy
benefits
manager
to
the
person
contracted
to
receive
8
third-party
payor
services.
9
c.
Payments
received
by
a
pharmacy
benefits
manager
for
10
services
provided
by
the
pharmacy
benefits
manager
to
a
11
third-party
payor
or
to
a
pharmacy
shall
be
used
or
distributed
12
pursuant
to
the
pharmacy
benefits
manager’s
contract
with
13
the
third-party
payor
or
with
the
pharmacy,
or
as
otherwise
14
required
by
law.
15
2.
Unless
otherwise
prohibited
by
law,
subsection
1
shall
16
supersede
any
contractual
terms
to
the
contrary
in
any
contract
17
executed,
amended,
adjusted,
or
renewed
on
or
after
July
1,
18
2024,
that
applies
to
prescription
drug
benefits
on
or
after
19
January
1,
2025,
between
a
pharmacy
benefits
manager
and
a
20
third-party
payor,
or
between
a
person
and
a
third-party
payor.
21
Sec.
4.
NEW
SECTION
.
510B.8E
Appeals
and
disputes.
22
1.
A
pharmacy
benefits
manager
shall
provide
a
reasonable
23
process
to
allow
a
pharmacy
to
appeal
a
maximum
allowable
cost
24
or
reimbursement
rate
for
a
specific
prescription
drug
for
any
25
of
the
following
reasons:
26
a.
The
pharmacy
benefits
manager
violated
section
510B.8A.
27
b.
The
maximum
allowable
cost
or
the
reimbursement
rate
is
28
below
the
pharmacy
acquisition
cost.
29
2.
The
appeals
process
must
include
all
of
the
following:
30
a.
A
dedicated
telephone
number
at
which
a
pharmacy
may
31
contact
the
pharmacy
benefits
manager
and
speak
directly
with
32
an
individual
who
is
involved
with
the
appeals
process.
33
b.
A
dedicated
electronic
mail
address
or
internet
site
for
34
the
purpose
of
submitting
an
appeal
directly
to
the
pharmacy
35
-2-
HF
2401
(2)
90
nls/ko/md
2/
12
H.F.
2401
benefits
manager.
1
c.
A
period
of
no
less
than
thirty
business
days
after
the
2
date
of
a
pharmacy’s
initial
submission
of
a
clean
claim
during
3
which
the
pharmacy
may
initiate
an
appeal.
4
3.
The
pharmacy
benefits
manger
shall
respond
to
an
appeal
5
within
seven
business
days
after
the
date
on
which
the
pharmacy
6
benefits
manager
receives
the
appeal.
7
a.
If
a
pharmacy’s
appeal
is
found
to
be
substantiated,
the
8
pharmacy
benefits
manager
shall
do
all
of
the
following:
9
(1)
Adjust
the
maximum
allowable
cost
or
the
reimbursement
10
rate
of
the
prescription
drug
that
is
the
subject
of
the
appeal
11
and
provide
the
national
drug
code
number
that
the
adjustment
12
is
based
on
to
the
appealing
pharmacy.
13
(2)
Permit
the
appealing
pharmacy
to
reverse
and
resubmit
14
the
claim
that
is
the
subject
of
the
appeal.
15
(3)
Make
the
adjustment
pursuant
to
subparagraph
(1)
16
applicable
to
all
of
the
following:
17
(a)
Each
pharmacy
that
is
under
common
ownership
with
the
18
pharmacy
that
submitted
the
appeal.
19
(b)
Each
pharmacy
in
the
state
that
demonstrates
the
20
inability
to
purchase
the
prescription
drug
for
less
than
the
21
established
maximum
allowable
cost
or
reimbursement
rate.
22
b.
If
a
pharmacy’s
appeal
is
found
to
be
unsubstantiated,
23
the
pharmacy
benefits
manager
shall
do
all
of
the
following:
24
(1)
Provide
the
appealing
pharmacy
the
national
drug
25
code
number
and
the
name
of
a
wholesale
distributor
licensed
26
pursuant
to
section
155A.17
from
which
the
pharmacy
can
obtain
27
the
prescription
drug
at
or
below
the
maximum
allowable
cost
28
or
reimbursement
rate.
29
(2)
If
the
prescription
drug
identified
by
the
national
drug
30
code
number
provided
by
the
pharmacy
benefits
manager
pursuant
31
to
subparagraph
(1)
is
not
available
below
the
pharmacy
32
acquisition
cost
from
the
wholesale
distributor
from
whom
the
33
pharmacy
purchases
the
majority
of
its
prescription
drugs
for
34
resale,
the
pharmacy
benefits
manager
shall
adjust
the
maximum
35
-3-
HF
2401
(2)
90
nls/ko/md
3/
12
H.F.
2401
allowable
cost
or
the
reimbursement
rate
above
the
appealing
1
pharmacy’s
pharmacy
acquisition
cost,
and
permit
the
pharmacy
2
to
reverse
and
resubmit
each
claim
affected
by
the
pharmacy’s
3
inability
to
procure
the
prescription
drug
at
a
cost
that
is
4
equal
to
or
less
than
the
previously
appealed
maximum
allowable
5
cost
or
the
reimbursement
rate.
The
adjustment
to
the
maximum
6
allowable
cost
or
the
reimbursement
rate
shall
be
applicable
7
to
all
of
the
following:
8
(a)
Each
pharmacy
that
is
under
common
ownership
with
the
9
pharmacy
that
submitted
the
appeal.
10
(b)
Each
pharmacy
in
the
state
that
demonstrates
the
11
inability
to
purchase
the
prescription
drug
for
less
than
the
12
established
maximum
allowable
cost
or
reimbursement
rate.
13
Sec.
5.
APPLICABILITY.
This
division
of
this
Act
applies
14
to
pharmacy
benefits
managers
that
manage
a
prescription
drug
15
benefit
in
the
state
on
or
after
July
1,
2024.
16
DIVISION
II
17
PHARMACY
SERVICES
ADMINISTRATIVE
ORGANIZATIONS
AND
WHOLESALE
18
DISTRIBUTION
——
REPORT
19
Sec.
6.
PHARMACY
SERVICES
ADMINISTRATIVE
ORGANIZATIONS
AND
20
WHOLESALE
DISTRIBUTION
OF
PRESCRIPTION
DRUGS
——
REPORT.
Before
21
January
1,
2025,
the
commissioner
or
the
commissioner’s
22
designee
shall
review
pharmacy
services
administrative
23
organizations
and
the
wholesale
distribution
of
prescription
24
drugs,
and
submit
a
report
to
the
general
assembly
containing
25
findings
and
recommendations
based
on
the
review.
The
report
26
shall
contain,
at
a
minimum,
all
of
the
following:
27
1.
A
description
and
analysis
of
the
prescription
drug
28
wholesale
distribution
supply
chain,
including
an
analysis
of
29
the
concentration
of
the
market
for
the
wholesale
distribution
30
of
prescription
drugs,
margins
in
the
wholesale
distribution
of
31
prescription
drugs,
and
the
availability
of
competition
in
the
32
wholesale
distribution
of
prescription
drugs.
33
2.
A
description
of
the
role
that
pharmacy
services
34
administrative
organizations
serve
in
the
prescription
drug
35
-4-
HF
2401
(2)
90
nls/ko/md
4/
12
H.F.
2401
supply
chain.
1
3.
A
description
and
analysis
of
the
relationships
between
2
pharmacy
services
administrative
organizations,
prescription
3
drug
wholesalers,
and
retail
pharmacies,
including
standard
4
contracting
terms,
fees
charged
to
pharmacies,
and
contractual
5
restrictions
and
limitations
applicable
to
retail
pharmacies.
6
DIVISION
III
7
PHARMACY
BENEFITS
MANAGER
REVERSE
AUCTIONS
8
Sec.
7.
NEW
SECTION
.
8A.319
Pharmacy
benefits
manager
9
reverse
auctions.
10
1.
This
section
may
be
cited
as
“The
Iowa
Competitive
11
Pharmacy
Benefits
Managers
Marketplace
Act”
.
12
2.
As
used
in
this
section,
unless
the
context
otherwise
13
requires:
14
a.
“Market
check”
means
a
technology-driven
evaluation
of
an
15
incumbent
pharmacy
benefits
manager’s
prescription
drug
pricing
16
based
on
benchmark
comparators
derived
from
pharmacy
benefits
17
manager
reverse
auction
processes
conducted
in
the
United
18
States
over
the
immediately
preceding
twelve
months.
19
b.
“Participant
bidding
agreement”
means
an
online
20
agreement
that
details
common
definitions,
prescription
drug
21
classifications,
rules,
data
access
and
use
rights,
and
other
22
optimal
contract
terms
that
benefit
the
state
and
that
all
23
bidders
must
accept
as
a
prerequisite
for
participation
in
a
24
pharmacy
benefits
manager
reverse
auction.
25
c.
“Pharmacy
benefits
manager”
means
the
same
as
defined
in
26
section
510B.1.
27
d.
“Pharmacy
benefits
manager
reverse
auction”
means
an
28
automated,
transparent,
and
competitive
bidding
process
29
conducted
online
that
starts
with
an
opening
round
of
bids
30
and
allows
qualified
pharmacy
benefits
manager
bidders
to
31
counteroffer
a
lower
price
for
as
many
rounds
of
bidding
32
as
determined
by
the
department
for
a
multiple
health
plan
33
prescription
drug
purchasing
group.
34
e.
“Price”
means
the
projected
cost
of
a
pharmacy
benefits
35
-5-
HF
2401
(2)
90
nls/ko/md
5/
12
H.F.
2401
manager’s
bid
to
provide
prescription
drug
benefits
to
allow
1
direct
comparison
of
the
comparably
calculated
costs
of
2
competing
pharmacy
benefits
managers’
proposals
over
the
3
duration
of
the
pharmacy
benefits
manager’s
services
contract.
4
f.
“Real-time”
means
within
no
more
than
one
hour.
5
g.
“Self-funded
private
sector
health
plan”
means
any
6
self-funded
private
sector
employer
or
multi-employer
health
7
plan.
8
h.
“Self-funded
public
sector
health
plan”
means
any
group
9
benefit
plan
under
chapter
509A.
10
3.
Consistent
with
section
8A.311,
and
notwithstanding
any
11
other
law
to
the
contrary,
the
department
shall
enter
into
a
12
contract
for
the
services
of
a
pharmacy
benefits
manager
for
13
the
administration
of
benefits
of
self-funded
public
sector
14
health
plans
in
compliance
with
this
section.
15
4.
Prior
to
November
1,
2024,
the
department
shall
16
procure,
through
solicitation
of
proposals
from
qualified
17
professional
services
vendors,
all
of
the
following
based
on
18
price,
capabilities,
and
other
factors
deemed
relevant
by
the
19
department:
20
a.
A
technology
platform
with
the
capabilities
to
conduct
21
a
pharmacy
benefits
manager
reverse
auction.
The
department
22
shall
ensure
that
the
technology
platform
possesses,
at
a
23
minimum,
the
capacity
to
do
all
of
the
following:
24
(1)
Conduct
an
automated,
online,
reverse
auction
of
25
pharmacy
benefits
manager
services
using
a
software
application
26
and
high-performance
data
infrastructure
to
intake,
cleanse,
27
and
normalize
pharmacy
benefits
manager
data
with
development
28
methods
and
information
security
standards
that
have
been
29
validated
by
receiving
service
organization
control
2
and
30
national
institute
of
standards
and
technology
certification,
31
or
successor
information
technology
security
certifications,
as
32
identified
by
the
office
of
the
chief
information
officer.
33
(2)
Automate
repricing
of
diverse
and
complex
pharmacy
34
benefits
managers’
prescription
drug
pricing
proposals
to
allow
35
-6-
HF
2401
(2)
90
nls/ko/md
6/
12
H.F.
2401
direct
comparison
by
the
state
of
the
comparably
calculated
1
costs
of
pharmacy
benefits
managers’
bids
using
one
hundred
2
percent
of
annual
prescription
drug
claims
data
available
3
for
state-funded
health
plans,
or
a
multiple
health
plan
4
prescription
drug
purchasing
group,
and
using
code-based
5
classification
of
drugs
from
nationally
accepted
drug
sources.
6
(3)
Simultaneously
evaluate
in
real-time
diverse
and
7
complex
multiple
proposals
from
full-service
pharmacy
benefits
8
managers,
including
average
wholesale
price,
guaranteed
9
net
cost,
and
national
average
drug
acquisition
cost
10
pricing
models,
as
well
as
proposals
from
pharmacy
benefits
11
administrators
and
specialty
drug
and
rebate
carve-out
service
12
providers.
13
(4)
Produce
an
automated
report
and
analysis
of
pharmacy
14
benefits
managers’
bids,
including
ranking
of
pharmacy
benefits
15
managers’
bids
based
on
comparative
costs
and
qualitative
16
aspects
of
the
bids
in
real-time
following
the
close
of
each
17
round
of
reverse
auction
bidding.
18
(5)
Perform
real-time,
electronic,
line-by-line,
19
claim-by-claim
review
of
one
hundred
percent
of
invoiced
20
pharmacy
benefits
managers’
prescription
drug
claims,
and
21
identify
all
deviations
from
the
specific
terms
of
the
pharmacy
22
benefits
manager’s
services
contract
that
resulted
from
the
23
reserve
auction
process.
24
b.
Related
services
from
the
operator
of
the
technology
25
platform
identified
in
paragraph
“a”
,
which
at
a
minimum
shall
26
include
all
of
the
following:
27
(1)
Evaluation
of
the
qualifications
of
pharmacy
benefits
28
manager
bidders.
29
(2)
Pharmacy
benefits
manager
reverse
auction
services
to
30
support
the
department
in
comparing
pricing
for
the
pharmacy
31
benefits
manager
procurement.
32
(3)
Related
professional
services.
33
5.
The
department
shall
not
award
a
contract
for
the
34
technology
platform
and
technology
operator
services
to
a
35
-7-
HF
2401
(2)
90
nls/ko/md
7/
12
H.F.
2401
vendor
that
is
a
pharmacy
benefits
manager
or
to
a
vendor
that
1
is
managed
by,
or
a
subsidiary
or
affiliate
of,
a
pharmacy
2
benefits
manager.
3
6.
The
vendor
awarded
the
contract
by
the
department
shall
4
not
outsource
any
part
of
the
pharmacy
benefits
manager
reverse
5
auction
or
any
part
of
the
automated,
real-time,
electronic,
6
line-by-line,
claim-by-claim
review
of
invoiced
pharmacy
7
benefits
manager
prescription
drug
claims.
8
7.
With
technical
assistance
and
support
provided
by
the
9
technology
platform
operator,
the
department
shall
specify
the
10
terms
of
the
participant
bidding
agreement.
The
terms
of
the
11
participant
bidding
agreement
shall
not
be
modified
except
by
12
specific
consent
of
the
department.
13
8.
a.
The
technology
platform
used
to
conduct
the
reverse
14
auction
shall
be
repurposed
over
the
duration
of
the
pharmacy
15
benefits
manager’s
services
contract
as
an
automated
pharmacy
16
claims
adjudication
engine
to
perform
real-time,
electronic,
17
line-by-line,
claim-by-claim
review
of
one
hundred
percent
of
18
invoiced
pharmacy
benefits
manager’s
prescription
drug
claims,
19
and
to
identify
all
deviations
from
the
specific
terms
of
the
20
pharmacy
benefits
manager’s
services
contract.
21
b.
The
department
shall
reconcile
the
electronically
22
adjudicated
pharmacy
claims,
as
described
in
paragraph
“a”
,
23
with
pharmacy
benefits
manager’s
invoices
on
a
monthly
or
24
quarterly
basis
to
ensure
that
state
payments
shall
not
exceed
25
the
terms
specified
in
any
pharmacy
benefits
manager’s
services
26
contract.
27
c.
If
following
state
payment
to
the
pharmacy
benefits
28
manager
on
the
basis
of
the
reconciliation
under
paragraph
29
“b”
the
pharmacy
benefits
manager
asserts
that
the
department
30
paid
less
than
the
amount
owed,
the
pharmacy
benefits
manager
31
may
seek
resolution
through
a
mutually
acceptable
dispute
32
resolution
process
that
the
parties
agreed
to
in
the
terms
of
33
the
services
contract
under
subsection
9,
paragraph
“a”
.
34
9.
a.
The
first
pharmacy
benefits
manager
reverse
auction
35
-8-
HF
2401
(2)
90
nls/ko/md
8/
12
H.F.
2401
shall
be
completed
and
the
services
contract
shall
be
awarded
1
to
the
winning
pharmacy
benefits
manager
with
an
effective
date
2
beginning
July
1,
2025.
Subsequent
contracts
must
be
awarded
3
no
later
than
three
months
prior
to
termination
or
expiration
4
of
the
current
pharmacy
benefits
manager’s
services
contract
5
for
a
covered
group,
such
as
the
state
employees
benefits
6
group,
that
includes
only
active
employees
and
dependents,
but
7
does
not
include
retiree
participants
in
a
Medicare
part
D
8
employer
group
waiver
program
pursuant
to
the
federal
Medicare
9
Prescription
Drug,
Improvement,
and
Modernization
Act
of
2003,
10
Pub.
L.
No.
108-173.
11
b.
In
the
event
an
eligible
covered
group
that
includes
12
retiree
participants
in
a
Medicare
part
D
employer
group
13
waiver
program
pursuant
to
the
federal
Medicare
Prescription
14
Drug,
Improvement,
and
Modernization
Act
of
2003,
Pub.
L.
No.
15
108-173,
opts
to
use
the
processes
and
procedures
under
this
16
section,
the
relevant
pharmacy
benefits
manager
reverse
auction
17
shall
be
completed
and
the
pharmacy
benefits
manager
services
18
contract
shall
be
awarded
to
the
winning
pharmacy
benefits
19
manager
no
later
than
six
months
prior
to
termination
or
20
expiration
of
the
pharmacy
benefits
manager’s
services
contract
21
currently
covering
the
retiree
employer
group
waiver
program
22
participants.
23
10.
The
department
may
perform
a
market
check
for
providing
24
pharmacy
benefits
manager
services
during
the
term
of
the
25
current
pharmacy
benefits
manager’s
services
contract
in
order
26
to
ensure
continuing
competitiveness
of
incumbent
prescription
27
drug
pricing
during
the
term
of
a
pharmacy
benefits
manager’s
28
services
contract.
29
11.
To
ensure
that
the
department
does
not
incur
additional
30
expenditures
associated
with
the
pharmacy
benefits
manager
31
reverse
auction,
ongoing
electronic
review
and
validation
32
of
pharmacy
benefits
managers’
claims,
and
periodic
market
33
checks,
the
department
shall
implement
a
no-pay
option
that
34
obligates
the
winning
pharmacy
benefits
manager,
rather
than
35
-9-
HF
2401
(2)
90
nls/ko/md
9/
12
H.F.
2401
the
state,
to
pay
the
cost
of
the
technology
platform
and
1
related
technology
platform
operator
services
by
assessing
the
2
pharmacy
benefits
manager
a
per-prescription
fee
in
an
amount
3
agreed
to
by
the
department
and
the
technology
operator,
and
4
requiring
the
pharmacy
benefits
manager
to
pay
the
fees
to
the
5
technology
operator
over
the
duration
of
the
pharmacy
benefits
6
manager’s
services
contract.
The
obligation
of
the
winning
7
pharmacy
benefits
manager
to
pay
the
per-prescription
fee
shall
8
be
incorporated
as
a
term
of
the
participant
bidding
agreement
9
and
the
pharmacy
benefits
manager’s
services
contract
awarded
10
to
the
pharmacy
benefits
manager
reverse
auction
winner.
11
12.
All
of
the
following
shall
be
incorporated
as
terms
of
12
the
participant
bidding
agreement
and
the
pharmacy
benefits
13
manager’s
services
contract
awarded
to
the
pharmacy
benefits
14
manager
reverse
auction
winner:
15
a.
The
department
shall
require
an
average
acquisition
16
cost
reimbursement
methodology
for
pharmacy
ingredient
cost
17
reimbursement
of
all
prescription
drugs
covered
by
a
pharmacy
18
benefits
manager.
19
b.
A
reasonable
professional
service
fee
shall
be
provided
20
to
a
pharmacist
for
the
pharmacist’s
time
and
service
included
21
in
dispensing
prescription
drugs
covered
by
a
pharmacy
benefits
22
manager.
23
c.
A
covered
person
shall
not
be
prohibited
from
filling
a
24
prescription
drug
order
at
any
pharmacy
in
the
state
provided
25
that
the
pharmacy
accepts
the
same
terms
and
conditions
as
the
26
pharmacies
participating
in
the
covered
person’s
health
benefit
27
plan’s
network.
28
d.
With
the
exception
of
incentives
in
value-based
programs
29
established
by
a
health
carrier
or
a
pharmacy
benefits
manager
30
to
promote
the
use
of
higher
quality
pharmacies,
a
pharmacy
31
benefits
manager
shall
not
impose
different
cost-sharing
or
32
additional
fees
on
a
covered
person
based
on
the
pharmacy
at
33
which
the
covered
person
fills
a
prescription
drug
order.
34
e.
A
pharmacy
benefits
manager
shall
not
require
a
covered
35
-10-
HF
2401
(2)
90
nls/ko/md
10/
12
H.F.
2401
person,
as
a
condition
of
payment
or
reimbursement,
to
purchase
1
pharmacy
services,
including
prescription
drugs,
exclusively
2
through
a
mail-order
pharmacy.
3
13.
a.
This
section
shall
apply
to
group
benefit
plans
4
under
chapter
509A.
This
section
shall
not
apply
to
nonprofit,
5
nongovernmental
health
maintenance
organizations
with
respect
6
to
managed
care
plans
that
provide
a
majority
of
covered
health
7
care
services
through
a
single
contracted
medical
group.
8
b.
(1)
Three
years
after
the
first
service
contract
is
9
awarded
to
a
pharmacy
benefits
manager
pursuant
to
subsection
10
9,
paragraph
“a”
,
any
self-funded
private
sector
health
plan
11
with
substantial
participation
by
Iowa
employees
and
the
12
employees’
dependents
shall
have
the
option
to
conduct
a
13
pharmacy
benefits
manager
reverse
auction
for
the
specific
14
self-funded
private
sector
health
plan
utilizing
the
technology
15
platform
and
technology
operator
services
selected
by
the
16
department
under
this
section.
The
department
may
charge
the
17
self-funded
private
sector
health
plan
a
fee,
as
established
18
by
the
department
by
rule,
sufficient
to
cover
any
incremental
19
cost
associated
with
the
pharmacy
benefits
manager
reverse
20
auction.
21
(2)
A
pharmacy
benefits
manager
selected
by
a
self-funded
22
private
sector
health
plan
as
a
result
of
a
pharmacy
benefits
23
manager
reverse
auction
conducted
pursuant
to
subparagraph
24
(1)
shall
be
assessed
a
per-prescription
fee,
pursuant
to
25
subsection
11,
in
an
amount
determined
by
the
department
by
26
rule.
27
c.
Any
self-funded
public
sector
health
plans
or
self-funded
28
private
sector
health
plans
that
opt
to
conduct
a
pharmacy
29
benefits
manager
reverse
auction
shall
retain
full
autonomy
30
over
determination
of
the
individual
health
plan’s
respective
31
prescription
drug
formularies
and
pharmacy
benefit
designs,
32
and
shall
not
be
required
to
adopt
a
common
prescription
drug
33
formulary
or
common
prescription
pharmacy
benefit
design.
34
d.
Any
pharmacy
benefits
manager
providing
services
to
the
35
-11-
HF
2401
(2)
90
nls/ko/md
11/
12
H.F.
2401
department,
to
a
self-funded
public
sector
health
plan,
or
1
to
a
self-funded
private
sector
health
plan
as
described
in
2
this
section
shall
provide
the
department,
each
participating
3
self-funded
public
sector
health
plan,
and
each
participating
4
self-funded
private
sector
health
plan
access
to
complete
5
pharmacy
claims
data
necessary
to
conduct
the
pharmacy
6
benefits
manager
reverse
auction
and
to
carry
out
applicable
7
administrative
and
management
duties.
8
14.
Notwithstanding
subsection
3,
the
department
may
elect
9
to
vacate
the
outcome
of
a
pharmacy
benefits
manager
reverse
10
auction
if
the
lowest-cost
pharmacy
benefits
manager’s
bid
11
is
not
less
than
the
projected
cost
trend
for
the
incumbent
12
pharmacy
benefits
manager’s
services
contract
as
verified
by
13
the
department.
The
department
may
utilize
a
consultant
to
14
conduct
the
verification.
The
cost
trend
shall
be
projected
15
by
the
technology
platform
operator
using
industry-recognized
16
data
sources
and
shall
be
subject
to
review
and
approval
by
17
the
department
in
advance
of
the
pharmacy
benefits
manager
18
reverse
auction.
Methodology
shall
be
applied
consistently
in
19
projection
of
cost
and
savings
to
the
state
with
regard
to
the
20
incumbent
pharmacy
benefits
manager’s
services
contract
and
21
competing
pharmacy
benefits
manager
reverse
auction
bids.
22
-12-
HF
2401
(2)
90
nls/ko/md
12/
12
