Bill Text: IA HF423 | 2023-2024 | 90th General Assembly | Enrolled
Bill Title: A bill for an act relating to contract pharmacies and covered entities that participate in the 340B drug program. (Formerly HSB 137.) Effective date: 07/01/2023.
Spectrum: Committee Bill
Status: (Passed) 2023-04-28 - Signed by Governor. H.J. 952. [HF423 Detail]
Download: Iowa-2023-HF423-Enrolled.html
House
File
423
-
Enrolled
House
File
423
AN
ACT
RELATING
TO
CONTRACT
PHARMACIES
AND
COVERED
ENTITIES
THAT
PARTICIPATE
IN
THE
340B
DRUG
PROGRAM.
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
Section
1.
Section
507B.4,
subsection
3,
Code
2023,
is
amended
by
adding
the
following
new
paragraph:
NEW
PARAGRAPH
.
u.
340B
drug
program.
Any
violation
of
chapter
510D
by
a
group
health
plan,
a
health
carrier
that
offers
group
or
individual
health
insurance
coverage,
a
third-party
administrator,
or
a
pharmacy
benefits
manager.
Sec.
2.
NEW
SECTION
.
510D.1
Definitions.
As
used
in
this
chapter,
unless
the
context
otherwise
requires:
1.
“340B
program”
means
the
program
created
pursuant
to
the
Veterans
Health
Care
Act
of
1992,
Pub.
L.
No.
102-585,
§602,
and
codified
as
section
340B
of
the
federal
Public
Health
Services
Act.
2.
“Commissioner”
means
the
commissioner
of
insurance.
3.
“Contract
pharmacy”
means
a
pharmacy
that
has
executed
a
contract
with
a
covered
entity
to
dispense
covered
outpatient
drugs,
purchased
by
the
covered
entity
through
the
340B
program,
to
eligible
patients
of
the
covered
entity.
House
File
423,
p.
2
4.
“Covered
entity”
means
the
same
as
defined
in
42
U.S.C.
§256b(a)(4).
5.
“Group
health
plan”
means
the
same
as
defined
in
section
513B.2.
6.
“Medicaid
managed
care
organization”
means
an
entity
acting
pursuant
to
a
contract
with
the
department
of
health
and
human
services
to
administer
the
medical
assistance
program
under
chapter
249A,
and
that
meets
the
definition
of
“health
maintenance
organization”
under
section
514B.1.
7.
“Pharmacy
benefits
manager”
means
the
same
as
defined
in
section
510B.1.
8.
“Similarly
situated
entity
or
pharmacy”
means
an
entity
or
pharmacy
located
in
Iowa
that
is
of
a
generally
comparable
size,
and
that
operates
in
a
market
with
similar
demographic
characteristics,
including
population
size,
density,
distribution,
and
vital
statistics,
and
reasonably
similar
economic
and
geographic
conditions.
9.
“Third-party
administrator”
means
the
same
as
defined
in
section
510.11.
Sec.
3.
NEW
SECTION
.
510D.2
340B
drug
program
——
contract
pharmacies
and
covered
entities.
1.
Group
health
plans,
health
carriers
that
offer
group
or
individual
health
insurance
coverage,
third-party
administrators,
and
pharmacy
benefits
managers
shall
not
discriminate
against
a
covered
entity
or
a
contract
pharmacy
by
reimbursing
the
covered
entity
or
the
contract
pharmacy
for
a
prescription
drug
or
a
dispensing
fee
in
an
amount
less
than
the
group
health
plan,
health
carrier,
third-party
administrator,
or
pharmacy
benefits
manager
reimburses
a
similarly
situated
entity
or
pharmacy
that
is
not
a
covered
entity
or
a
contract
pharmacy.
2.
a.
Group
health
plans,
health
carriers
that
offer
group
or
individual
health
insurance
coverage,
third-party
administrators,
and
pharmacy
benefits
managers
shall
not,
on
the
basis
that
an
entity
is
a
covered
entity
or
that
a
pharmacy
is
a
contract
pharmacy,
or
that
a
covered
entity
or
contract
pharmacy
participate
in
the
340B
program,
impose
any
of
the
following
contractual
terms
and
conditions
on
the
covered
entity
or
the
contract
pharmacy
that
differ
from
those
House
File
423,
p.
3
imposed
on
a
similarly
situated
entity
or
pharmacy
that
is
not
a
covered
entity
or
a
contract
pharmacy:
(1)
Fees
or
other
assessments
that
are
not
required
by
state
law
or
the
Iowa
administrative
code.
(2)
Chargebacks,
clawbacks,
or
other
reimbursement
adjustments
that
are
not
required
by
state
law
or
the
Iowa
administrative
code.
(3)
Professional
dispensing
fees
that
are
not
required
by
state
law
or
the
Iowa
administrative
code.
(4)
Restrictions
or
requirements
related
to
participation
in
standard
or
preferred
pharmacy
networks.
(5)
Requirements
related
to
the
frequency
or
scope
of
audits.
(6)
Requirements
related
to
inventory
management
systems
that
utilize
generally
accepted
accounting
principles.
(7)
Requirements
related
to
mandatory
disclosure
either
directly
or
through
a
third
party,
except
disclosures
required
by
federal
law,
of
prescription
orders
that
are
filled
with
covered
outpatient
drugs
obtained
through
the
340B
program.
b.
Paragraph
“a”
,
subparagraphs
(1)
and
(2),
shall
not
be
construed
to
prohibit
adjustments
for
overpayments
or
other
errors
associated
with
an
adjudicated
claim.
c.
Paragraph
“a”
,
subparagraph
(7),
shall
not
be
construed
to
prohibit
modifiers
or
other
identifiers
on
claims
to
identify
whether
a
drug
was
purchased
through
the
340B
program
or
to
prevent
duplication
of
rebates.
3.
Group
health
plans,
health
carriers
that
offer
group
or
individual
health
insurance
coverage,
third-party
administrators,
and
pharmacy
benefits
managers
shall
not
do
any
of
the
following
on
the
basis
that
an
entity
is
a
covered
entity
or
that
a
pharmacy
is
a
contract
pharmacy,
or
that
a
covered
entity
or
a
contract
pharmacy
participates
in
the
340B
program:
a.
Place
any
restrictions
or
impose
any
requirements
on
an
individual
that
chooses
to
obtain
a
covered
outpatient
drug
from
a
covered
entity
or
a
contract
pharmacy,
whether
in
person,
via
courier
or
the
United
States
post
office,
or
any
other
form
of
delivery.
b.
Refuse
to
contract
with
a
covered
entity
or
a
contract
House
File
423,
p.
4
pharmacy
based
on
any
criteria
that
is
not
applied
equally
to
a
contract
with
a
similarly
situated
entity
or
pharmacy
that
does
not
participate
in
the
340B
drug
program.
c.
Impose
any
restriction
or
condition
on
a
covered
entity
that
interferes
with
the
covered
entity’s
ability
to
maximize
the
value
of
the
discounts
obtained
by
the
covered
entity
through
the
covered
entity’s
participation
in
the
340B
drug
program.
Sec.
4.
NEW
SECTION
.
510D.3
Enforcement.
1.
The
commissioner
may
take
any
enforcement
action
under
the
commissioner’s
authority
to
enforce
compliance
with
this
chapter.
2.
After
notice
and
hearing,
the
commissioner
may
issue
any
order
or
impose
any
penalty
pursuant
to
section
507B.7
upon
a
finding
that
a
group
health
plan,
a
health
carrier
that
offers
group
or
individual
health
insurance
coverage,
a
third-party
administrator,
or
a
pharmacy
benefits
manager
violated
this
chapter.
3.
A
violation
of
this
chapter
shall
be
an
unfair
or
deceptive
act
or
practice
in
the
business
of
insurance
pursuant
to
section
507B.4,
subsection
3.
Sec.
5.
NEW
SECTION
.
510D.4
Rules.
The
commissioner
of
insurance
may
adopt
rules
as
necessary
to
implement
the
chapter.
Sec.
6.
NEW
SECTION
.
510D.5
Conflict
of
laws.
If
any
provision
of
this
chapter
is
inconsistent
or
in
conflict
with
applicable
state
or
federal
law
or
rule,
or
the
state
Medicaid
plan,
the
applicable
state
or
federal
law
or
rule,
or
the
state
Medicaid
plan,
shall
prevail
to
the
extent
necessary
to
eliminate
the
inconsistency
or
conflict.
Sec.
7.
NEW
SECTION
.
510D.6
Applicability.
This
chapter
shall
apply
to
covered
entities,
contract
pharmacies,
group
health
plans,
health
carriers
that
offer
group
or
individual
health
insurance
coverage,
third-party
administrators,
and
pharmacy
benefits
managers,
but
shall
not
apply
to
their
operations
under
a
contract
with
the
state
Medicaid
agency
or
a
Medicaid
managed
care
organization,
regardless
of
whether
the
covered
entity
or
contract
pharmacy
House
File
423,
p.
5
is
eligible
to
retain
the
340B
discounts
generated
by
the
covered
entities
and
contract
pharmacies.
______________________________
PAT
GRASSLEY
Speaker
of
the
House
______________________________
AMY
SINCLAIR
President
of
the
Senate
I
hereby
certify
that
this
bill
originated
in
the
House
and
is
known
as
House
File
423,
Ninetieth
General
Assembly.
______________________________
MEGHAN
NELSON
Chief
Clerk
of
the
House
Approved
_______________,
2023
______________________________
KIM
REYNOLDS
Governor