Amended IN Senate April 13, 2021 Amended IN Senate March 11, 2021 CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION Senate Bill No. 524Introduced by Senator SkinnerFebruary 17, 2021 An act to add Chapter 9.6 (commencing with Section 4450) to Division 2 of the Business and Professions Code, relating to health care coverage. LEGISLATIVE COUNSEL'S DIGESTSB 524, as amended, Skinner. Health care coverage: patient steering.Existing law provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and the regulation of health insurers by the Department of Insurance. Existing law requires a health care service plan contract or health insurance policy that provides coverage for outpatient prescription drugs to cover medically necessary prescription drugs.This bill would prohibit a health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from engaging in patient steering. steering, as specified. The bill would define patient steering to mean communicating to an enrollee or insured that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy, as specified, or offering group health care coverage contracts or policies that include provisions that limit access to only pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent. The bill would provide that these provisions do not apply to a fully integrated delivery system, and would also make related findings and declarations.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NO Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. The Legislature finds and declares all of the following:(a) When a health care service plan, health insurer, or pharmacy benefit manager requires a patient to use a specific pharmacy provider for services that otherwise could be provided by any pharmacy in the provider network, it unjustifiably limits patient choice and may put the patients health at risk.(b) Evidence shows that limiting access to pharmacy providers is designed to eliminate competition and can result in higher costs for the patient and for the health care system as a whole. It can result in patients losing connection with trusted providers and being unable to get the advice and consultation they need.(c) Therefore, it is necessary to limit the practice of patient steering, used by some health care service plans and health insurers, and their contracted pharmacy benefit managers, to those situations when it is used for established clinical or logistical reasons, and not for financial benefit to the plan or insurer, or their agents.SEC. 2. Chapter 9.6 (commencing with Section 4450) is added to Division 2 of the Business and Professions Code, to read: CHAPTER 9.6. Patient Steering4450. (a) A health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer shall not engage in patient steering.(b) Patient steering means either of the following:(1) Communicating to an enrollee or insured, verbally, electronically, or in writing, that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy or pharmacies if there are other pharmacies in the network that have the ability to dispense the medication or provide the services.(2) Offering or including in contract or policy designs for purchasers of group health care coverage provisions that limit enrollees or insureds access to only those pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent, or owned or operated by a corporate affiliate of the health care service plan, health insurer, or plans or insurers agent.(c) Patient steering does not include directing an enrollee or insured to a specific pharmacy for a specific prescription due to the need for special handling or clinical requirements that cannot be performed by other pharmacies in the provider network of the health care service plan, health insurer, or plans or insurers agent.(d) Nothing in this chapter shall prevent a health care service plan, or health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from offering enrollees or insureds financial incentives to use a particular pharmacy, including, but not limited to, reductions in copays or other financial incentives given to the enrollee or insured when the prescription is dispensed.(e) This chapter does not apply to a health care service plan that is part of a fully integrated delivery system where enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, primarily use pharmacies that are entirely owned and operated by the health care service plan, and the plans enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, may use any pharmacy in the health care service plans network that has the ability to dispense the medication or provide the services.
Amended IN Senate April 13, 2021 Amended IN Senate March 11, 2021 CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION Senate Bill No. 524Introduced by Senator SkinnerFebruary 17, 2021 An act to add Chapter 9.6 (commencing with Section 4450) to Division 2 of the Business and Professions Code, relating to health care coverage. LEGISLATIVE COUNSEL'S DIGESTSB 524, as amended, Skinner. Health care coverage: patient steering.Existing law provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and the regulation of health insurers by the Department of Insurance. Existing law requires a health care service plan contract or health insurance policy that provides coverage for outpatient prescription drugs to cover medically necessary prescription drugs.This bill would prohibit a health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from engaging in patient steering. steering, as specified. The bill would define patient steering to mean communicating to an enrollee or insured that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy, as specified, or offering group health care coverage contracts or policies that include provisions that limit access to only pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent. The bill would provide that these provisions do not apply to a fully integrated delivery system, and would also make related findings and declarations.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NO Local Program: NO
Amended IN Senate April 13, 2021 Amended IN Senate March 11, 2021
Amended IN Senate April 13, 2021
Amended IN Senate March 11, 2021
CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION
Senate Bill
No. 524
Introduced by Senator SkinnerFebruary 17, 2021
Introduced by Senator Skinner
February 17, 2021
An act to add Chapter 9.6 (commencing with Section 4450) to Division 2 of the Business and Professions Code, relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
SB 524, as amended, Skinner. Health care coverage: patient steering.
Existing law provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and the regulation of health insurers by the Department of Insurance. Existing law requires a health care service plan contract or health insurance policy that provides coverage for outpatient prescription drugs to cover medically necessary prescription drugs.This bill would prohibit a health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from engaging in patient steering. steering, as specified. The bill would define patient steering to mean communicating to an enrollee or insured that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy, as specified, or offering group health care coverage contracts or policies that include provisions that limit access to only pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent. The bill would provide that these provisions do not apply to a fully integrated delivery system, and would also make related findings and declarations.
Existing law provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and the regulation of health insurers by the Department of Insurance. Existing law requires a health care service plan contract or health insurance policy that provides coverage for outpatient prescription drugs to cover medically necessary prescription drugs.
This bill would prohibit a health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from engaging in patient steering. steering, as specified. The bill would define patient steering to mean communicating to an enrollee or insured that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy, as specified, or offering group health care coverage contracts or policies that include provisions that limit access to only pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent. The bill would provide that these provisions do not apply to a fully integrated delivery system, and would also make related findings and declarations.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. The Legislature finds and declares all of the following:(a) When a health care service plan, health insurer, or pharmacy benefit manager requires a patient to use a specific pharmacy provider for services that otherwise could be provided by any pharmacy in the provider network, it unjustifiably limits patient choice and may put the patients health at risk.(b) Evidence shows that limiting access to pharmacy providers is designed to eliminate competition and can result in higher costs for the patient and for the health care system as a whole. It can result in patients losing connection with trusted providers and being unable to get the advice and consultation they need.(c) Therefore, it is necessary to limit the practice of patient steering, used by some health care service plans and health insurers, and their contracted pharmacy benefit managers, to those situations when it is used for established clinical or logistical reasons, and not for financial benefit to the plan or insurer, or their agents.SEC. 2. Chapter 9.6 (commencing with Section 4450) is added to Division 2 of the Business and Professions Code, to read: CHAPTER 9.6. Patient Steering4450. (a) A health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer shall not engage in patient steering.(b) Patient steering means either of the following:(1) Communicating to an enrollee or insured, verbally, electronically, or in writing, that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy or pharmacies if there are other pharmacies in the network that have the ability to dispense the medication or provide the services.(2) Offering or including in contract or policy designs for purchasers of group health care coverage provisions that limit enrollees or insureds access to only those pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent, or owned or operated by a corporate affiliate of the health care service plan, health insurer, or plans or insurers agent.(c) Patient steering does not include directing an enrollee or insured to a specific pharmacy for a specific prescription due to the need for special handling or clinical requirements that cannot be performed by other pharmacies in the provider network of the health care service plan, health insurer, or plans or insurers agent.(d) Nothing in this chapter shall prevent a health care service plan, or health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from offering enrollees or insureds financial incentives to use a particular pharmacy, including, but not limited to, reductions in copays or other financial incentives given to the enrollee or insured when the prescription is dispensed.(e) This chapter does not apply to a health care service plan that is part of a fully integrated delivery system where enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, primarily use pharmacies that are entirely owned and operated by the health care service plan, and the plans enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, may use any pharmacy in the health care service plans network that has the ability to dispense the medication or provide the services.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. The Legislature finds and declares all of the following:(a) When a health care service plan, health insurer, or pharmacy benefit manager requires a patient to use a specific pharmacy provider for services that otherwise could be provided by any pharmacy in the provider network, it unjustifiably limits patient choice and may put the patients health at risk.(b) Evidence shows that limiting access to pharmacy providers is designed to eliminate competition and can result in higher costs for the patient and for the health care system as a whole. It can result in patients losing connection with trusted providers and being unable to get the advice and consultation they need.(c) Therefore, it is necessary to limit the practice of patient steering, used by some health care service plans and health insurers, and their contracted pharmacy benefit managers, to those situations when it is used for established clinical or logistical reasons, and not for financial benefit to the plan or insurer, or their agents.
SECTION 1. The Legislature finds and declares all of the following:(a) When a health care service plan, health insurer, or pharmacy benefit manager requires a patient to use a specific pharmacy provider for services that otherwise could be provided by any pharmacy in the provider network, it unjustifiably limits patient choice and may put the patients health at risk.(b) Evidence shows that limiting access to pharmacy providers is designed to eliminate competition and can result in higher costs for the patient and for the health care system as a whole. It can result in patients losing connection with trusted providers and being unable to get the advice and consultation they need.(c) Therefore, it is necessary to limit the practice of patient steering, used by some health care service plans and health insurers, and their contracted pharmacy benefit managers, to those situations when it is used for established clinical or logistical reasons, and not for financial benefit to the plan or insurer, or their agents.
SECTION 1. The Legislature finds and declares all of the following:
### SECTION 1.
(a) When a health care service plan, health insurer, or pharmacy benefit manager requires a patient to use a specific pharmacy provider for services that otherwise could be provided by any pharmacy in the provider network, it unjustifiably limits patient choice and may put the patients health at risk.
(b) Evidence shows that limiting access to pharmacy providers is designed to eliminate competition and can result in higher costs for the patient and for the health care system as a whole. It can result in patients losing connection with trusted providers and being unable to get the advice and consultation they need.
(c) Therefore, it is necessary to limit the practice of patient steering, used by some health care service plans and health insurers, and their contracted pharmacy benefit managers, to those situations when it is used for established clinical or logistical reasons, and not for financial benefit to the plan or insurer, or their agents.
SEC. 2. Chapter 9.6 (commencing with Section 4450) is added to Division 2 of the Business and Professions Code, to read: CHAPTER 9.6. Patient Steering4450. (a) A health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer shall not engage in patient steering.(b) Patient steering means either of the following:(1) Communicating to an enrollee or insured, verbally, electronically, or in writing, that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy or pharmacies if there are other pharmacies in the network that have the ability to dispense the medication or provide the services.(2) Offering or including in contract or policy designs for purchasers of group health care coverage provisions that limit enrollees or insureds access to only those pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent, or owned or operated by a corporate affiliate of the health care service plan, health insurer, or plans or insurers agent.(c) Patient steering does not include directing an enrollee or insured to a specific pharmacy for a specific prescription due to the need for special handling or clinical requirements that cannot be performed by other pharmacies in the provider network of the health care service plan, health insurer, or plans or insurers agent.(d) Nothing in this chapter shall prevent a health care service plan, or health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from offering enrollees or insureds financial incentives to use a particular pharmacy, including, but not limited to, reductions in copays or other financial incentives given to the enrollee or insured when the prescription is dispensed.(e) This chapter does not apply to a health care service plan that is part of a fully integrated delivery system where enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, primarily use pharmacies that are entirely owned and operated by the health care service plan, and the plans enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, may use any pharmacy in the health care service plans network that has the ability to dispense the medication or provide the services.
SEC. 2. Chapter 9.6 (commencing with Section 4450) is added to Division 2 of the Business and Professions Code, to read:
### SEC. 2.
CHAPTER 9.6. Patient Steering4450. (a) A health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer shall not engage in patient steering.(b) Patient steering means either of the following:(1) Communicating to an enrollee or insured, verbally, electronically, or in writing, that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy or pharmacies if there are other pharmacies in the network that have the ability to dispense the medication or provide the services.(2) Offering or including in contract or policy designs for purchasers of group health care coverage provisions that limit enrollees or insureds access to only those pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent, or owned or operated by a corporate affiliate of the health care service plan, health insurer, or plans or insurers agent.(c) Patient steering does not include directing an enrollee or insured to a specific pharmacy for a specific prescription due to the need for special handling or clinical requirements that cannot be performed by other pharmacies in the provider network of the health care service plan, health insurer, or plans or insurers agent.(d) Nothing in this chapter shall prevent a health care service plan, or health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from offering enrollees or insureds financial incentives to use a particular pharmacy, including, but not limited to, reductions in copays or other financial incentives given to the enrollee or insured when the prescription is dispensed.(e) This chapter does not apply to a health care service plan that is part of a fully integrated delivery system where enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, primarily use pharmacies that are entirely owned and operated by the health care service plan, and the plans enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, may use any pharmacy in the health care service plans network that has the ability to dispense the medication or provide the services.
CHAPTER 9.6. Patient Steering4450. (a) A health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer shall not engage in patient steering.(b) Patient steering means either of the following:(1) Communicating to an enrollee or insured, verbally, electronically, or in writing, that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy or pharmacies if there are other pharmacies in the network that have the ability to dispense the medication or provide the services.(2) Offering or including in contract or policy designs for purchasers of group health care coverage provisions that limit enrollees or insureds access to only those pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent, or owned or operated by a corporate affiliate of the health care service plan, health insurer, or plans or insurers agent.(c) Patient steering does not include directing an enrollee or insured to a specific pharmacy for a specific prescription due to the need for special handling or clinical requirements that cannot be performed by other pharmacies in the provider network of the health care service plan, health insurer, or plans or insurers agent.(d) Nothing in this chapter shall prevent a health care service plan, or health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from offering enrollees or insureds financial incentives to use a particular pharmacy, including, but not limited to, reductions in copays or other financial incentives given to the enrollee or insured when the prescription is dispensed.(e) This chapter does not apply to a health care service plan that is part of a fully integrated delivery system where enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, primarily use pharmacies that are entirely owned and operated by the health care service plan, and the plans enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, may use any pharmacy in the health care service plans network that has the ability to dispense the medication or provide the services.
CHAPTER 9.6. Patient Steering
CHAPTER 9.6. Patient Steering
4450. (a) A health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer shall not engage in patient steering.(b) Patient steering means either of the following:(1) Communicating to an enrollee or insured, verbally, electronically, or in writing, that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy or pharmacies if there are other pharmacies in the network that have the ability to dispense the medication or provide the services.(2) Offering or including in contract or policy designs for purchasers of group health care coverage provisions that limit enrollees or insureds access to only those pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent, or owned or operated by a corporate affiliate of the health care service plan, health insurer, or plans or insurers agent.(c) Patient steering does not include directing an enrollee or insured to a specific pharmacy for a specific prescription due to the need for special handling or clinical requirements that cannot be performed by other pharmacies in the provider network of the health care service plan, health insurer, or plans or insurers agent.(d) Nothing in this chapter shall prevent a health care service plan, or health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from offering enrollees or insureds financial incentives to use a particular pharmacy, including, but not limited to, reductions in copays or other financial incentives given to the enrollee or insured when the prescription is dispensed.(e) This chapter does not apply to a health care service plan that is part of a fully integrated delivery system where enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, primarily use pharmacies that are entirely owned and operated by the health care service plan, and the plans enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, may use any pharmacy in the health care service plans network that has the ability to dispense the medication or provide the services.
4450. (a) A health care service plan or a health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer shall not engage in patient steering.
(b) Patient steering means either of the following:
(1) Communicating to an enrollee or insured, verbally, electronically, or in writing, that they are required to have a prescription dispensed at, or pharmacy services provided by, a particular pharmacy or pharmacies if there are other pharmacies in the network that have the ability to dispense the medication or provide the services.
(2) Offering or including in contract or policy designs for purchasers of group health care coverage provisions that limit enrollees or insureds access to only those pharmacy providers that are owned or operated by the health care service plan, health insurer, or plans or insurers agent, or owned or operated by a corporate affiliate of the health care service plan, health insurer, or plans or insurers agent.
(c) Patient steering does not include directing an enrollee or insured to a specific pharmacy for a specific prescription due to the need for special handling or clinical requirements that cannot be performed by other pharmacies in the provider network of the health care service plan, health insurer, or plans or insurers agent.
(d) Nothing in this chapter shall prevent a health care service plan, or health insurer, including a self-insured employer plan, or the agent of a health care service plan or health insurer from offering enrollees or insureds financial incentives to use a particular pharmacy, including, but not limited to, reductions in copays or other financial incentives given to the enrollee or insured when the prescription is dispensed.
(e) This chapter does not apply to a health care service plan that is part of a fully integrated delivery system where enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, primarily use pharmacies that are entirely owned and operated by the health care service plan, and the plans enrollees, including enrollees in a self-insured employer plan administered by the health care service plan or its health insurer affiliate, may use any pharmacy in the health care service plans network that has the ability to dispense the medication or provide the services.