STATE OF NEW YORK
        ________________________________________________________________________
                                          7191
                    IN SENATE
                                       (Prefiled)
                                     January 3, 2018
                                       ___________
        Introduced  by  Sen.  GRIFFO -- read twice and ordered printed, and when
          printed to be committed to the Committee on Health
        AN ACT to amend the public health law and the insurance law, in relation
          to contracts between pharmacies and pharmacy benefit managers
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section  1.  The  public health law is amended by adding a new section
     2  280-c to read as follows:
     3    § 280-c. Contracts between pharmacies and pharmacy  benefit  managers.
     4  1.  On  and  after January first, two thousand eighteen, no contract for
     5  pharmacy services entered into in the state between a  health  insurance
     6  carrier or a pharmacy benefit manager, as defined in section two hundred
     7  eighty-a  of  this  article,  and a pharmacy, pharmacist or a pharmacy's
     8  contracting agent, such as a pharmacy services administrative  organiza-
     9  tion,  shall  contain  a  provision prohibiting or penalizing, including
    10  through increased utilization review, reduced payments or  other  finan-
    11  cial  disincentives, a pharmacist's disclosure to an individual purchas-
    12  ing prescription medication of information regarding (a) the cost of the
    13  prescription medication to the individual, or (b)  the  availability  of
    14  any  therapeutically  equivalent  alternative medications or alternative
    15  methods of purchasing the prescription medication,  including,  but  not
    16  limited  to,  paying a cash price, that are less expensive than the cost
    17  of the prescription medication to the individual.
    18    2. On and after January first, two thousand eighteen, no health insur-
    19  ance carrier or pharmacy benefit manager shall require an individual  to
    20  make  a  payment at the point of sale for a covered prescription medica-
    21  tion in an amount greater than the lesser of (a) the  applicable  copay-
    22  ment  for  such  prescription medication, (b) the allowable claim amount
    23  for the prescription medication, or (c) the amount an  individual  would
    24  pay  for  the  prescription  medication  if the individual purchased the
    25  prescription medication without using a health benefit plan or any other
    26  source  of  prescription  medication  benefits  or  discounts.  For  the
    27  purposes  of this section, "allowable claim amount" means the amount the
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13660-02-7

        S. 7191                             2
     1  health insurance carrier or pharmacy benefit manager has agreed  to  pay
     2  the pharmacy for the prescription medication.
     3    3.  Any  provision  of a contract that violates the provisions of this
     4  section shall be void and unenforceable. Any general  business  practice
     5  that  violates the provisions of this section shall constitute an unfair
     6  trade practice pursuant to section three hundred forty  of  the  general
     7  business  law.  The  invalidity  or  unenforceability  of  any  contract
     8  provision under this subsection shall not affect any other provision  of
     9  such contract.
    10    4.  The superintendent, as defined in section one hundred seven of the
    11  insurance law, may enforce the provisions  of  this  section,  and  upon
    12  request,  audit a contract for pharmacy services for compliance with the
    13  provisions of this section.
    14    5. In any action brought under section  three  hundred  forty  of  the
    15  general  business  law, a defendant that sells, distributes or otherwise
    16  disposes of any drug or device, as defined in 21 USC 321 may not  assert
    17  as a defense that the defendant did not deal directly with the person on
    18  whose  behalf  the action is brought and may, in order to avoid duplica-
    19  tive liability, prove, as a partial or complete defense against a damage
    20  claim, that all or any part of an  alleged  overcharge  for  a  drug  or
    21  device  ultimately  was  passed on to another person by a purchaser or a
    22  seller in the chain of manufacture, production or  distribution  of  the
    23  drug or device that paid the alleged overcharge.
    24    §  2.  Section  3217-b of the insurance law is amended by adding a new
    25  subsection (l) to read as follows:
    26    (l) (1) No insurer subject to this article shall by contract,  written
    27  policy or written procedure prohibit or restrict any health care provid-
    28  er from disclosure of (i) billed or allowed amounts, reimbursement rates
    29  or  out-of-pocket  costs,  or  (ii)  any  data to the all payor database
    30  (APD). Such information may be used to  assist  consumers  and  institu-
    31  tional  purchasers  in  making informed decisions regarding their health
    32  care and informed choices among health care providers and allow  compar-
    33  isons  between  prices  paid  by  various health carriers to health care
    34  providers.
    35    (2) No contract entered into under this article between a health  care
    36  provider, or any agent or vendor retained by the health care provider to
    37  provide  data  or analytical services to evaluate and manage health care
    38  services provided to the insurer's plan participants,  and  the  insurer
    39  shall  contain  a  provision  prohibiting  disclosure  of  (i) billed or
    40  allowed amounts, reimbursement rates or out-of-pocket costs, or (ii) any
    41  data to the all payor database (APD). Such information may  be  used  to
    42  assist  consumers  and institutional purchasers in making informed deci-
    43  sions regarding their health care and informed choices among health care
    44  providers and allow comparisons between prices paid  by  various  health
    45  carriers to health care providers.
    46    (3)  If  a  contract  described  in  paragraph  one  or  two  of  this
    47  subsection, whichever is applicable,  contains  a  provision  prohibited
    48  under  the applicable paragraphs, such provision shall be void and unen-
    49  forceable. The invalidity or unenforceability of any contract  provision
    50  under  this  subsection  shall  not  affect  any other provision of such
    51  contract.
    52    § 3. Section 4325 of the insurance law is  amended  by  adding  a  new
    53  subsection (m) to read as follows:
    54    (m) (1) No corporation organized under this article shall by contract,
    55  written policy or written procedure prohibit or restrict any health care
    56  provider from disclosure of (i) billed or allowed amounts, reimbursement

        S. 7191                             3
     1  rates or out-of-pocket costs, or (ii) any data to the all payor database
     2  (APD).  Such  information  may  be used to assist consumers and institu-
     3  tional purchasers in making informed decisions  regarding  their  health
     4  care  and informed choices among health care providers and allow compar-
     5  isons between prices paid by various  health  carriers  to  health  care
     6  providers.
     7    (2) No contract or agreement entered into under this article between a
     8  health care provider, or any agent or vendor retained by the health care
     9  provider  to  provide data or analytical services to evaluate and manage
    10  health care services provided to the insurer's  plan  participants,  and
    11  the  insurer  shall  contain  a  provision prohibiting disclosure of (A)
    12  billed or allowed amounts, reimbursement rates or  out-of-pocket  costs,
    13  or (B) any data to the all payor database (APD). Such information may be
    14  used to assist consumers and institutional purchasers in making informed
    15  decisions  regarding their health care and informed choices among health
    16  care providers and allow comparisons  between  prices  paid  by  various
    17  health carriers to health care providers.
    18    (3)  If  a  contract  described  in  paragraph  one  or  two  of  this
    19  subsection, whichever is applicable,  contains  a  provision  prohibited
    20  under  the applicable paragraphs, such provision shall be void and unen-
    21  forceable. The invalidity or unenforceability of  any  policy  provision
    22  under  this  subsection  shall  not  affect  any other provision of such
    23  contract.
    24    § 4. This act shall take effect immediately and  shall  apply  to  all
    25  policies  and contracts issued, renewed, modified, altered or amended on
    26  or after such date.