Second Regular Session
Seventy-third General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 22-0243.02 Christy Chase x2008
HOUSE BILL 22-1122
House Committees Senate Committees
Health & Insurance
A BILL FOR AN ACT
C
ONCERNING PROHIBITING CERT AIN PRACTICES BY ENTITIES101
OBLIGATED TO PAY FOR PR ESCRIPTION DRUG BENEFITS .102
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov
.)
For contracts between a pharmacy benefit manager (PBM) and a
pharmacy entered into or renewed on or after January 1, 2023, section 1
of the bill prohibits the PBM or its representative from reimbursing a
pharmacy for a prescription drug in an amount less than the national
average drug acquisition cost for the prescription drug.
Section 2 enacts the "Colorado 340B Prescription Drug Program
HOUSE SPONSORSHIP
Will, Lontine
SENATE SPONSORSHIP
Jaquez Lewis,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing statute.
Dashes through the words indicate deletions from existing statute. Anti-discrimination Act" (act), which prohibits health insurers, PBMs,
and other third-party payers (third-party payers) from discriminating
against entities, including pharmacies, participating in the federal 340B
drug pricing program (340B covered entity). Specifically, the bill
prohibits a third-party payer from:
! Refusing to reimburse a 340B covered entity for dispensing
340B drugs, imposing additional requirements or
restrictions on 340B covered entities, or reimbursing a
340B covered entity for a 340B drug at a rate lower than
the amount paid for the same drug to pharmacies that are
not 340B covered entities;
! Assessing a fee, charge back, or other adjustment against
a 340B covered entity, or restricting a 340B covered
entity's access to the third-party payer's pharmacy network,
because the covered entity participates in the 340B drug
pricing program;
! Requiring a 340B covered entity to contract with a specific
pharmacy or health coverage plan in order to access the
third-party payer's pharmacy network;
! Imposing a restriction or an additional charge on a patient
who obtains a prescription drug from a 340B covered
entity; or
! Restricting the methods by which a 340B covered entity
may dispense or deliver 340B drugs.
Section 2 makes a violation of the act an unfair or deceptive act or
practice in the business of insurance and authorizes the commissioner of
insurance to adopt rules to implement the act.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 10-16-122.1, add2
(3.5), (5)(a.5), and (5)(h) as follows:3
10-16-122.1. Contracts between PBMs and pharmacies -4
carrier submit list of PBMs - prohibited practices - exception - short5
title - definitions. (3.5) F
OR ANY CONTRACT BETWEEN A PBM AND A6
PHARMACY ENTERED INTO OR RENEWED ON OR AFTER JANUARY 1, 2023,7
A PBM OR THE REPRESENTATIVE OF A PBM SHALL NOT REIMBURSE A8
PHARMACY FOR A PRESCRIPTION DRUG IN AN AMOUNT THAT IS LESS THAN :9
(a) T
HE NATIONAL AVERAGE DRUG ACQUISITION COST FOR THE10
HB22-1122-2- PRESCRIPTION DRUG AT THE TIME THE DRUG IS ADMINISTERED OR1
DISPENSED, PLUS A PROFESSIONAL DISPENSING FEE; OR2
(b) I
F THE NATIONAL AVERAGE DRUG ACQUISITION COST IS NOT3
AVAILABLE AT THE TIME A PRESCRIPTION DRUG IS ADMINISTERED OR4
DISPENSED, THE WHOLESALE ACQUISITION COST OF THE DRUG , PLUS A5
PROFESSIONAL DISPENSING FEE.6
(5) As used in this section and section 10-16-122.9, unless the7
context otherwise requires:8
(a.5) "N
ATIONAL AVERAGE DRUG ACQUISITION COST " MEANS THE9
DRUG PRICING BENCHMARK DEVELOPED BY THE FEDERAL CENTERS FOR10
MEDICARE AND MEDICAID SERVICES IN THE UNITED STATES DEPARTMENT11
OF HEALTH AND HUMAN SERVICES , WHICH BENCHMARK IS BASED ON DATA12
COLLECTED FROM A MONTHLY NATIONWIDE SURVEY OF RETAIL13
COMMUNITY PHARMACY OUTPATIENT DRUG PRICES .14
(h) "W
HOLESALE ACQUISITION COST " HAS THE MEANING SET15
FORTH IN 42 U.S.C. SEC. 1395w-3a (c)(6)(B).16
SECTION 2. In Colorado Revised Statutes, add part 15 to article17
16 of title 10 as follows:18
PART 1519
340B PRESCRIPTION DRUG PROGRAM 20
ANTI-DISCRIMINATION ACT 21
10-16-1501. Short title. T
HE SHORT TITLE OF THIS PART 15 IS THE22
"C
OLORADO 340B PRESCRIPTION DRUG PROGRAM ANTI-DISCRIMINATION23
A
CT".24
10-16-1502. Legislative declaration. (1) T
HE GENERAL25
ASSEMBLY DECLARES THAT THE PURPOSE OF THIS PART 15 IS TO:26
(a) P
ROHIBIT A PHARMACY BENEFIT MANAGER OR CARRIER FROM27
HB22-1122
-3- IMPOSING FEES, CHARGE BACKS, OR OTHER ADJUSTMENTS ON COVERED1
ENTITIES OR CONTRACT PHARMACIES BASED ON THEIR PARTICIPATION IN2
THE 340B DRUG PRICING PROGRAM;3
(b) P
ROHIBIT A PHARMACY BENEFIT MANAGER OR CARRIER FROM4
REQUIRING A CLAIM FOR A DRUG TO INCLUDE A MODIFIER TO INDICATE5
THAT THE DRUG IS A 340B DRUG UNLESS THE CLAIM IS FOR PAYMENT ,6
DIRECTLY OR INDIRECTLY, BY THE MEDICAID PROGRAM; AND7
(c) P
ROVIDE FOR POWERS AND DUTIES OF THE COMMISSIONER AND8
THE DIVISION.9
10-16-1503. Definitions. A
S USED IN THIS PART 15, UNLESS THE10
CONTEXT OTHERWISE REQUIRES :11
(1) "340B
COVERED ENTITY" MEANS A COVERED ENTITY , AS12
DEFINED IN SECTION 340B (a)(4) OF THE FEDERAL "PUBLIC HEALTH13
S
ERVICE ACT", 42 U.S.C. SEC. 256b (a)(4), AS AMENDED. "340B COVERED14
ENTITY" INCLUDES A PHARMACY UNDER CONTRACT WITH A 340B COVERED15
ENTITY TO DISPENSE DRUGS ON BEHALF OF THE ENTITY .16
(2) "340B
DRUG" MEANS A DRUG PURCHASED THROUGH THE 340B17
DRUG PRICING PROGRAM BY A 340B COVERED ENTITY.18
(3) "340B
DRUG PRICING PROGRAM" OR "340B PROGRAM" MEANS19
THE PROGRAM DESCRIBED IN 42 U.S.C. SEC. 256b.20
(4) "C
ONTRACT PHARMACY " MEANS A PHARMACY OPERATING21
UNDER CONTRACT WITH A 340B COVERED ENTITY TO PROVIDE DISPENSING22
SERVICES TO THE 340B COVERED ENTITY AS DESCRIBED IN 75 FED. REG.23
10272
(2010) OR ANY SUPERSEDING GUIDANCE .24
(5) (a) "D
RUG COVERAGE" MEANS COVERAGE OR PAYMENT FOR A 25
PRESCRIPTION DRUG DISPENSED BY A PHARMACY TO A PATIENT PURSUANT26
TO:27
HB22-1122
-4- (I) A HEALTH COVERAGE PLAN; 1
(II) A
MANAGED CARE ORGANIZATION , AS DEFINED IN SECTION2
25.5-5-403
(5); OR3
(III) A
NY OTHER CONTRACTUAL OR OTHER LEGAL OBLIGATION TO4
PROVIDE COVERAGE OR PAYMENT FOR A PRESCRIPTION DRUG DISPENSED5
BY A PHARMACY TO A PATIENT.6
(b) "D
RUG COVERAGE" DOES NOT INCLUDE:7
(I) R
EIMBURSEMENT FOR COVERED OUTPATIENT DRUGS , AS THAT8
TERM IS DEFINED IN SECTION 42 U.S.C. SEC. 1396r-8 (k)(2), ON A9
FEE-FOR-SERVICE BASIS UNDER THE MEDICAID PROGRAM ; OR10
(II) A
NY AMOUNTS PAID BY AN INDIVIDUAL ON THE INDIVIDUAL 'S11
OWN BEHALF OR ON BEHALF OF ANOTHER INDIVIDUAL WITHOUT A12
CONTRACTUAL OR LEGAL OBLIGATION TO DO SO .13
(6)
"MEDICAID PROGRAM" MEANS THE MEDICAL ASSISTANCE14
PROGRAM ESTABLISHED PURSUANT TO ARTICLES 4 TO 6 OF TITLE 25.5.15
(7) (a) "T
HIRD PARTY" MEANS:16
(I) A
CARRIER OR PHARMACY BENEFIT MANAGER THAT PROVIDES17
OR MANAGES DRUG COVERAGE UNDE R A HEALTH COVERAGE PLAN ;18
(II) A
SYSTEM OF HEALTH INSURANCE FOR STATE OR LOCAL19
GOVERNMENT EMPLOYEES , THEIR DEPENDENTS, AND RETIREES, INCLUDING20
A GROUP BENEFIT PLAN, AS DEFINED IN SECTION 24-50-603 (9), AND A21
GROUP HEALTH CARE PROGRAM DESIGNED PURSUANT TO SECTION22
24-51-1202;
OR23
(III) A
NY OTHER INSURER OR ENTITY THAT PROVIDES HEALTH24
COVERAGE, BENEFITS, OR COVERAGE OF PRESCRIPTION DRUGS AS PART OF25
COVERAGE REQUIRED UNDER THE "WORKERS' COMPENSATION ACT OF26
C
OLORADO", ARTICLES 40 TO 47 OF TITLE 8, OR WORKERS' COMPENSATION27
HB22-1122
-5- COVERAGE REQUIRED UNDER FEDERAL LAW .1
(b) "T
HIRD PARTY" DOES NOT INCLUDE AN INSURER THAT2
PROVIDES COVERAGE UNDER A POLICY OF PROPERTY AND CASUALTY3
INSURANCE.4
10-16-1504. Applicability. T
HIS PART 15 APPLIES TO ANY THIRD5
PARTY PROVIDING OR MANAGING DRUG COVERAGE UNDER A HEALTH6
COVERAGE PLAN IN THIS STATE.7
10-16-1505. Prohibition on 340B discrimination. (1) A
THIRD8
PARTY THAT REIMBURSES A 340B COVERED ENTITY FOR 340B DRUGS9
SHALL NOT:10
(a) R
EIMBURSE THE 340B COVERED ENTITY FOR A11
PHARMACY-DISPENSED DRUG AT A RATE LOWER THAN THE AMOUNT PAID12
FOR THE SAME DRUG TO PHARMACIES SIMILAR IN PRESCRIPTION VOLUME13
THAT ARE NOT 340B COVERED ENTITIES;14
(b) A
SSESS ANY FEE, CHARGE BACK, OR OTHER ADJUSTMENT15
AGAINST THE 340B COVERED ENTITY ON THE BASIS THAT THE 340B16
COVERED ENTITY PARTICIPATES IN THE 340B PROGRAM;17
(c) R
ESTRICT ACCESS TO THE THIRD PARTY'S PHARMACY NETWORK18
FOR ANY 340B COVERED ENTITY ON THE BASIS THAT THE 340B COVERED19
ENTITY PARTICIPATES IN THE 340B PROGRAM;20
(d) R
EQUIRE THE 340B COVERED ENTITY TO ENTER INTO A21
CONTRACT WITH A SPECIFIC PHARMACY OR HEALTH COVERAGE PLAN TO22
PARTICIPATE IN THE THIRD PARTY'S PHARMACY NETWORK ;23
(e) C
REATE A RESTRICTION OR AN ADDITIONAL CHARGE ON A24
PATIENT WHO CHOOSES TO RECEIVE DRUGS FROM A 340B COVERED25
ENTITY; 26
(f) R
ESTRICT THE METHODS BY WHICH A 340B COVERED ENTITY27
HB22-1122
-6- MAY DISPENSE OR DELIVER 340B DRUGS;1
(g) R
EFUSE TO PROVIDE REIMBURSEMENT OR COVERAGE FOR 340B2
DRUGS; OR3
(h) C
REATE ANY ADDITIONAL REQUIREMENTS OR RESTRICTIONS ON4
A 340B COVERED ENTITY.5
(2) U
NLESS A CLAIM IS FOR PAYMENT, DIRECTLY OR INDIRECTLY,6
BY THE MEDICAID PROGRAM , A PHARMACY BENEFIT MANAGER OR ANY7
OTHER THIRD PARTY THAT REIMBURSES A 340B COVERED ENTITY FOR8
340B
DRUGS SHALL NOT REQUIRE A CLAIM FOR A 340B DRUG TO INCLUDE:9
(a) A
MODIFIER TO INDICATE THAT THE DRUG IS A 340B DRUG; OR10
(b) A
NY OTHER METHOD OF IDENTIFYING THE CLAIM FOR A 340B11
DRUG.12
(3) W
ITH RESPECT TO A PATIENT ELIGIBLE TO RECEIVE 340B13
DRUGS, A PHARMACY BENEFIT MANAGER OR ANY OTHER THIRD PARTY14
THAT MAKES PAYMENT FOR THE DRUGS SHALL NOT DISCRIMINATE15
AGAINST A 340B COVERED ENTITY IN A MANNER THAT PREVENTS OR16
INTERFERES WITH THE PATIENT'S CHOICE TO RECEIVE THE DRUGS FROM17
THE 340B COVERED ENTITY. 18
10-16-1506. Enforcement - rules. (1) A
THIRD PARTY THAT19
VIOLATES THIS PART 15 ENGAGES IN AN UNFAIR OR DECEPTIVE ACT OR20
PRACTICE IN THE BUSINESS OF INSURANCE UNDER SECTION 10-3-110421
(1)(tt),
AND THE ACT OF THE THIRD PARTY THAT VIOLATES THIS PART 15 22
IS VOID AND UNENFORCEABLE.23
(2) T
HE COMMISSIONER MAY ADOPT RULES AS NECESSARY TO24
IMPLEMENT THIS PART 15. 25
SECTION 3. In Colorado Revised Statutes, 10-3-1104, add26
(1)(tt) as follows:27
HB22-1122
-7- 10-3-1104. Unfair methods of competition - unfair or deceptive1
practices. (1) The following are defined as unfair methods of2
competition and unfair or deceptive acts or practices in the business of3
insurance:4
(tt) A
VIOLATION OF PART 15 OF ARTICLE 16 OF THIS TITLE 10.5
SECTION 4. Act subject to petition - effective date. This act6
takes effect at 12:01 a.m. on the day following the expiration of the7
ninety-day period after final adjournment of the general assembly; except8
that, if a referendum petition is filed pursuant to section 1 (3) of article V9
of the state constitution against this act or an item, section, or part of this10
act within such period, then the act, item, section, or part will not take11
effect unless approved by the people at the general election to be held in12
November 2022 and, in such case, will take effect on the date of the13
official declaration of the vote thereon by the governor.14
HB22-1122
-8-