Bill Text: IA HF464 | 2021-2022 | 89th General Assembly | Introduced

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Bill Title: A bill for an act relating to price transparency and cost-sharing for prescription drugs, and including applicability provisions.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2021-02-10 - Introduced, referred to Commerce. H.J. 337. [HF464 Detail]

Download: Iowa-2021-HF464-Introduced.html

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House File 464 - Introduced
HOUSE FILE 464
BY MASCHER
A BILL FOR
An Act relating to price transparency and cost-sharing for
prescription drugs, and including applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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Section 1. NEW SECTION . 510D.1 Definitions.
As used in this chapter, unless the context otherwise
requires:
1. “Commissioner” means the commissioner of insurance.
2. “Dispenser” means the same as defined in 21 U.S.C.
§360eee(3).
3. “Established name” means the same as defined in 21 C.F.R.
§299.4.
4. “Health benefit plan” means the same as defined in
section 514J.102.
5. “Pharmaceutical drug manufacturer” or “manufacturer” means
any person engaged in the business of producing, preparing,
converting, processing, packaging, labeling, or distributing
a prescription drug. “Pharmaceutical drug manufacturer” or
“manufacturer” does not include a wholesale distributor or a
dispenser.
6. “Prescription drug” means the same as defined in 21
U.S.C. §360eee(12).
7. “Wholesale acquisition cost” or “cost” means a
manufacturer’s list price for a prescription drug for
wholesalers or direct purchasers in the United States, not
including prompt pay or other discounts, rebates, or reductions
in price, for the most recent month for which the information
is available, as reported in wholesale price guides or other
publications of drug or biological pricing data.
8. “Wholesale distributor” means the same as defined in 21
U.S.C. §360eee(29).
Sec. 2. NEW SECTION . 510D.2 Pharmaceutical drug
manufacturers —— annual report.
Each manufacturer shall provide an annual report by
February 15 to the commissioner, in a format prescribed
by the commissioner, that contains the current wholesale
acquisition cost for each prescription drug manufactured by the
manufacturer that was sold to a person in this state in the
immediately preceding calendar year. Within thirty calendar
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days of receipt, the commissioner shall publish the information
received by the commissioner on a publicly accessible internet
site.
Sec. 3. NEW SECTION . 510D.3 Wholesale acquisition cost
increase —— report.
1. If a prescription drug sold to a person in this state
has a wholesale acquisition cost of one hundred dollars or more
for a thirty-day supply and the cost increases forty percent
or more over the three preceding consecutive calendar years,
or increases fifteen percent or more in the preceding calendar
year, the manufacturer of the prescription drug shall file a
report with the commissioner within thirty calendar days of
the date on which the forty or the fifteen percent increase in
the cost occurs. The report shall be in the form and manner
prescribed by the commissioner and shall include all of the
following information:
a. The established name of the prescription drug.
b. All brand names, generic names, proprietary names, and
nonproprietary names for the prescription drug, as applicable.
c. The aggregate manufacturer-level research and development
costs related to the prescription drug for the most recent
calendar year for which third-party independent audit data for
manufacturer-level research and development costs is available.
d. All established names, brand names, generic names,
proprietary names, and nonproprietary names for each
prescription drug manufactured by the manufacturer that
received approval from the United States food and drug
administration in the immediately preceding three consecutive
calendar years.
e. All established names, brand names, generic names,
proprietary names, and nonproprietary names for each
prescription drug manufactured by the manufacturer for which
a patent or exclusivity expired in the immediately preceding
three consecutive calendar years.
f. A statement detailing the factor or factors that played
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any role in the increase in cost of the prescription drug
and an explanation for the factor or factors’ impact on the
increase in cost of the prescription drug.
2. All information and data a manufacturer submits to the
commissioner must be consistent in detail and quality with the
information and data submitted in the manufacturer’s annual
report filed with the United States securities and exchange
commission on form 10-k.
3. a. Information provided by a pharmaceutical drug
manufacturer to the commissioner pursuant to this section
that may reveal any of the following as related to a specific
prescription drug or class of prescription drugs shall
be considered a confidential record, and be recognized
and protected as a trade secret pursuant to section 22.7,
subsection 3:
(1) The amount the manufacturer charges a specific health
carrier, specific pharmacy benefit manager, or a specific
dispenser.
(2) The dollar value of the rebates the manufacturer
provides a specific health carrier, specific pharmacy benefit
manager, or a specific dispenser.
(3) The identity of a specific health carrier, specific
pharmacy benefit manager, or a specific dispenser.
b. Within sixty calendar days of receipt of the information
pursuant to this section, the commissioner shall publish all
nonconfidential information received by the commissioner on the
same publicly accessible internet site referenced in section
510D.2.
Sec. 4. NEW SECTION . 510D.4 Rules.
The commissioner shall adopt rules pursuant to chapter 17A
as necessary to administer this chapter.
Sec. 5. NEW SECTION . 510D.5 Enforcement.
The commissioner may take any action within the
commissioner’s authority to enforce compliance with this
chapter.
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Sec. 6. NEW SECTION . 510E.1 Definitions.
As used in this chapter unless the context otherwise
requires:
1. “Commissioner” means the commissioner of insurance.
2. “Covered person” means the same as defined in section
514J.102.
3. “Health benefit plan” means the same as defined in
section 514J.102.
4. “Health care professional” means the same as defined in
section 514J.102.
5. “Health carrier” means the same as defined in section
514J.102.
6. “Pharmaceutical drug manufacturer” or “manufacturer” means
any person engaged in the business of producing, preparing,
converting, processing, packaging, labeling, or distributing
a prescription drug. “Pharmaceutical drug manufacturer” or
“manufacturer” does not include a wholesale distributor or a
dispenser.
7. “Prescription drug” means the same as defined in 21
U.S.C. §360eee(12).
8. “Prescription drug benefit” means a health benefit
plan providing for third-party payment or prepayment for
prescription drugs.
9. “Specialty drug” means a prescription drug that a health
carrier has designated as a specialty drug and that has either
of the following characteristics:
a. The United States food and drug administration has
designated the prescription drug an orphan drug.
b. The manufacturer of the prescription drug or the United
States food and drug administration restricts distribution of
the prescription drug to a limited number of distributors.
10. “Utilization review” means the same as defined in
section 514F.7.
11. “Utilization review organization” means the same as
defined in section 514F.7.
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Sec. 7. NEW SECTION . 510E.2 Health carriers —— annual
report.
1. Each health carrier shall submit an annual report
by February 1 to the commissioner, in the form and manner
prescribed by the commissioner, that contains the following
information for the immediately preceding calendar year, across
all of the health carrier’s health benefit plans that offer a
prescription drug benefit:
a. The brand name of the twenty-five prescription drugs most
frequently covered by the prescription drug benefits offered
by the health carrier.
b. The percent increase in annual spending by the health
carrier to provide all prescription drug benefits offered by
the health carrier.
c. The percent increase in premiums paid by covered persons
attributable to all prescription drug benefits offered by the
health carrier.
d. The percentage of specialty drugs included in all
prescription drug benefits offered by the health carrier that
are subject to utilization review conducted by a utilization
review organization.
e. The percent decrease in premiums paid by covered persons
attributable to specialty drugs that are subject to utilization
review conducted by a utilization review organization that
are included in all prescription drug benefits offered by the
health carrier.
2. Any information a health carrier provides to the
commissioner pursuant to subsection 1 that may reveal any of
the following shall be considered a confidential record, and be
recognized and protected as a trade secret pursuant to section
22.7:
a. The identity of a specific health benefit plan.
b. The identity of the specific price charged by a specific
manufacturer, pharmacy benefit manager, or dispenser for a
specific prescription drug or class of prescription drugs.
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c. The dollar value of the rebates a specific manufacturer,
a specific pharmacy benefit manager, or a specific dispenser
provides to the health carrier.
3. Prior to May 1 of each calendar year, the commissioner
shall publish the nonconfidential data received by the
commissioner pursuant to this section on the same publicly
accessible internet site referenced in section 510D.2. The
data shall be aggregated from all annual reports submitted
pursuant to subsection 1, and the information shall be
made available to the public in a format that complies with
subsection 2.
Sec. 8. NEW SECTION . 510E.3 Rules.
The commissioner shall adopt rules pursuant to chapter 17A
as necessary to administer this chapter.
Sec. 9. NEW SECTION . 510E.4 Enforcement.
The commissioner may take any action within the
commissioner’s authority to enforce compliance with this
chapter.
Sec. 10. NEW SECTION . 514M.1 Definitions.
1. “Carrier” means an entity subject to the insurance laws
and regulations of this state, or subject to the jurisdiction
of the commissioner, that offers at least one health plan in
this state.
2. “Cost-sharing requirement” means any copayment,
coinsurance, deductible, or other out-of-pocket expense
obligation required of or on behalf of an enrollee in order
for the enrollee to receive a specific health care service,
including a prescription drug, covered by the enrollee’s health
plan.
3. “Enrollee” means an individual who is eligible to obtain
health care services under a health plan.
4. “Health care services” means an item or service for the
prevention, treatment, cure, or healing of an illness, injury,
or physical disability.
5. “Health plan” means a policy, contract, certificate, or
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agreement offered or issued by a carrier to provide, deliver,
arrange for, pay for, or reimburse any of the costs of health
care services.
6. “Internal Revenue Code” means the Internal Revenue Code
as defined in section 422.3.
7. “Person” means a natural person, corporation, mutual
company, unincorporated association, partnership, joint
venture, limited liability corporation, trust, estate,
foundation, not-for-profit organization, government or
governmental subdivision, or government or governmental agency.
Sec. 11. NEW SECTION . 514M.2 Cost-sharing calculation.
1. A carrier shall include all cost-sharing amounts paid by
an enrollee, or by another person on behalf of the enrollee, as
part of the carrier’s calculation of an enrollee’s contribution
to the enrollee’s applicable cost-sharing requirement. This
requirement does not apply to cost-sharing amounts paid by an
enrollee, or by another person on behalf of an enrollee, for
a prescription drug for which a medically appropriate A-rated
generic equivalent is available to the enrollee.
2. Subsection 1 shall not apply to a state-regulated
high-deductible health plan to the extent it results in the
plan’s failure to qualify as a high-deductible health plan
pursuant to section 223 of the Internal Revenue Code.
Sec. 12. NEW SECTION . 514M.3 Severability.
If the provisions of subsection 1 conflict with a federal law
or regulation as applied to a specific carrier or in a specific
circumstance, the provisions shall remain in full force and
effect for all carriers and in all circumstances in which the
federal conflict does not exist.
Sec. 13. NEW SECTION . 514M.4 Applicability.
This chapter applies to all health plans delivered, issued
for delivery, continued, or renewed in this state on or after
January 1, 2022.
Sec. 14. RETROACTIVE APPLICABILITY.
1. The section of this Act that requires a pharmaceutical
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drug manufacturer to submit an annual report to the
commissioner containing the current wholesale acquisition
cost for each of the manufacturer’s prescription drugs is
retroactively applicable to all manufacturers that manufactured
any prescription drug that is sold to a person in this state on
or after January 1, 2021.
2. The section of this Act that requires a pharmaceutical
drug manufacturer to submit a report to the commissioner
containing information related to an increase in the wholesale
acquisition cost of a prescription drug manufactured by the
manufacturer is retroactively applicable to all manufacturers
that manufactured any prescription drug that is sold to a
person in this state on or after January 1, 2021.
3. The section of this Act that requires a health carrier
to submit an annual report to the commissioner related to
all of the health carrier’s health benefit plans that offer
a prescription drug benefit is retroactively applicable to
all health benefit plans providing for third-party payment
or prepayment of health or medical expenses that provide a
prescription drug benefit that have been delivered, issued
for delivery, continued, or renewed in this state on or after
January 1, 2021.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
This bill relates to price transparency and cost-sharing for
prescription drugs.
The bill requires a manufacturer to file an annual report
with the commissioner of insurance (commissioner) that
discloses the wholesale acquisition cost for all prescription
drugs manufactured by the manufacturer that were sold to a
person in this state in the immediately preceding calendar
year. The first report that is due covers all prescription
drugs sold to a person in this state on or after January 1,
2021. “Wholesale acquisition cost” or “cost” is defined in the
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bill as the manufacturer’s list price for a prescription drug
for wholesalers or direct purchasers in the United States, not
including prompt pay or other discounts, rebates, or reductions
in price, for the most recent month for which the information
is available, as reported in wholesale price guides or other
publications of drug or biological pricing data. Within 30
calendar days of receipt, the commissioner is required to
publish this information from the annual reports on a publicly
accessible internet site.
If a prescription drug sold to a person in this state
has a cost of $100 or more for a 30-day supply and the cost
increases 40 percent or more over the three preceding calendar
years, or increases 15 percent or more in the preceding
calendar year, the manufacturer of the prescription drug must
file a report with the commissioner within 30 calendar days
of the date on which the 40 or 15 percent increase in cost
occurs. This requirement is applicable to all manufacturers
that manufactured prescription drugs that are sold to a
person in this state on or after January 1, 2021. The report
must include the information detailed in the bill. Certain
information provided by a manufacturer, as detailed in the
bill, is considered a confidential record and is required
to be protected as a trade secret. Within 60 calendar days
of receipt, the commissioner is required to publish the
nonconfidential information on the same publicly accessible
internet site on which the manufacturer’s annual report
information is published.
The bill requires each health carrier to submit an annual
report by February 1 to the commissioner that contains
information as detailed in the bill across all of the health
carrier’s health benefit plans. This requirement is applicable
to all health benefit plans providing for third-party payment
or prepayment of health or medical expenses that provide a
prescription drug benefit that have been delivered, issued
for delivery, continued, or renewed in this state on or after
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January 1, 2021. “Health carrier” is defined in the bill as an
entity subject to the insurance laws and regulations of this
state, or subject to the jurisdiction of the commissioner,
including an insurance company offering sickness and accident
plans, a health maintenance organization, a nonprofit health
service corporation, a plan established pursuant to Code
chapter 509A for public employees, or any other entity
providing a plan of health insurance, health care benefits,
or health care services. Certain information provided by
a health carrier, as detailed in the bill, is considered a
confidential record and must be protected as a trade secret.
Prior to May 1 of each year, the commissioner must publish the
nonconfidential data received by the commissioner on the same
publicly accessible internet site on which the manufacturers’
information is published. The data must be aggregated from the
annual reports submitted by all health carriers.
The bill directs the commissioner to adopt rules as
necessary to administer the requirements outlined in the
bill and allows the commissioner to take any action within
the commissioner’s authority to enforce compliance with the
manufacturer and health carrier reporting requirements outlined
in the bill.
The bill also requires a carrier to include all cost-sharing
amounts paid by an enrollee of a health plan, or by another
person on behalf of an enrollee, as part of the carrier’s
calculation of an enrollee’s contribution to the enrollee’s
applicable cost-sharing requirement. “Cost-sharing
requirement” is defined in the bill as any copayment,
coinsurance, deductible, or other out-of-pocket expense
obligation required of or on behalf of an enrollee in order
for the enrollee to receive a specific health care service,
including a prescription drug, covered by the enrollee’s health
plan. This requirement applies to all health plans delivered,
issued for delivery, continued, or renewed in this state on
or after January 1, 2022. The bill excludes state-regulated
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high-deductible health plans (HDHP) from the requirement if it
will result in the plan not qualifying as an HDHP under section
223 of the Internal Revenue Code. The bill also prohibits
application of the requirement to a carrier or a circumstance
in a manner that will conflict with a federal law or a federal
regulation.
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