Connecticut 2019 Regular Session

Connecticut House Bill HB07174 Compare Versions

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7-General Assembly Substitute Bill No. 7174
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10+Referred to Committee on INSURANCE AND REAL ESTATE
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13+Introduced by:
14+(INS)
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1417 AN ACT CONCERNING PR ESCRIPTION DRUGS.
1518 Be it enacted by the Senate and House of Representatives in General
1619 Assembly convened:
1720
1821 Section 1. (NEW) (Effective October 1, 2019) (a) For the purposes of 1
1922 this section: 2
2023 (1) "Drug" has the same meaning as provided in section 21a-92 of 3
2124 the general statutes; 4
2225 (2) "Participating individual" means an individual resident of this 5
2326 state who is participating in the program; 6
2427 (3) "Participating pharmacist" means a pharmacist who is 7
2528 participating in the program; 8
2629 (4) "Participating pharmacy" means a pharmacy that is participating 9
2730 in the program; 10
2831 (5) "Pharmacist" has the same meaning as provided in section 38a-11
2932 479aaa of the general statutes; 12
3033 (6) "Pharmacy" has the same meaning as provided in section 38a-13
31-479aaa of the general statutes; 14
32-(7) "Pharmacy benefits manager" has the same meaning as provided 15
33-in section 38a-479aaa of the general statutes; 16 Substitute Bill No. 7174
34+479aaa of the general statutes; 14 Raised Bill No. 7174
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40+(7) "Pharmacy benefits manager" has the same meaning as provided 15
41+in section 38a-479aaa of the general statutes; 16
4042 (8) "Program" means the Connecticut Prescription Drug Program 17
4143 established by the Comptroller pursuant to subsection (b) of this 18
4244 section; and 19
4345 (9) "Program price" means the reimbursement rates and prescription 20
4446 drug prices established under the program. 21
4547 (b) The Comptroller shall, within available appropriations, establish 22
4648 the Connecticut Prescription Drug Program. The purposes of the 23
4749 program shall be to: (1) Purchase outpatient prescription drugs, 24
4850 replenish supplies of outpatient prescription drugs or reimburse 25
4951 participating pharmacies and participating pharmacists for outpatient 26
5052 prescription drugs in order to secure the lowest possible prices and 27
5153 greatest possible rebates for outpatient prescription drugs prescribed 28
5254 to participating individuals; (2) make outpatient prescription drugs 29
5355 available at the lowest possible cost to participating individuals; (3) 30
5456 maintain a list of the most cost-effective and therapeutically effective 31
5557 outpatient prescription drugs available to participating individuals; (4) 32
5658 purchase and provide discounted outpatient prescription drugs to 33
5759 participating individuals; and (5) coordinate a comprehensive 34
5860 pharmacy benefit for participating individuals. 35
5961 (c) (1) As part of the program, the Comptroller shall: (A) Establish 36
6062 eligibility criteria for individual residents of this state, as well as 37
6163 pharmacies and pharmacists, to participate in the program; (B) 38
6264 prescribe an application form for (i) individual residents of this state to 39
6365 become participating individuals, (ii) pharmacists to become 40
6466 participating pharmacists, and (iii) pharmacies to become participating 41
6567 pharmacies; (C) issue to participating individuals a prescription drug 42
6668 identification card containing the information necessary for claims 43
6769 processing; (D) establish a list of preferred outpatient prescription 44
6870 drugs for the program; (E) negotiate with pharmaceutical 45
69-manufacturers and other persons to secure discounts and rebates for 46
71+manufacturers and other persons to secure discounts and rebates for 46 Raised Bill No. 7174
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7077 outpatient prescription drugs; (F) establish program prices; (G) 47
7178 adjudicate pharmacy claims and reimburse participating pharmacies 48
72-and participating pharmacists at program prices; (H) develop a system 49 Substitute Bill No. 7174
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79+and participating pharmacists at program prices; (H) develop a system 49
7980 for allocating and distributing the operational costs of the program, as 50
8081 well as any rebates, to participating individuals; and (I) charge 51
8182 administrative fees to participating individuals, participating 52
8283 pharmacists and participating pharmacies to cover the operational 53
8384 costs of the program, and deposit such fees in the account established 54
8485 under section 2 of this act. 55
8586 (2) As part of the program, the Comptroller may: (A) Purchase 56
8687 outpatient prescription drugs on behalf of participating individuals; or 57
8788 (B) cooperate with other states or regional consortia to purchase 58
8889 outpatient prescription drugs on behalf of participating individuals. 59
8990 (3) The Comptroller may enter into a contract with a pharmacy 60
9091 benefits manager to perform the Comptroller's duties under 61
9192 subdivisions (1) and (2) of this subsection, provided the Comptroller 62
9293 shall require the pharmacy benefits manager to charge such pharmacy 63
9394 benefits manager's lowest available rate to perform such duties. 64
9495 (d) The Comptroller may adopt regulations, in accordance with 65
9596 chapter 54 of the general statutes, to implement the provisions of this 66
9697 section. 67
9798 Sec. 2. (NEW) (Effective October 1, 2019) There is established an 68
9899 account to be known as the "Connecticut prescription drug program 69
99100 account" which shall be a separate, nonlapsing account within the 70
100101 General Fund. The account shall contain any moneys required by law 71
101102 to be deposited in the account. Moneys in the account shall be 72
102103 expended by the Comptroller for the purposes of the Connecticut 73
103104 Prescription Drug Program established pursuant to section 1 of this 74
104105 act. 75
105106 Sec. 3. (NEW) (Effective October 1, 2019) (a) Each pharmaceutical 76
106107 manufacturer doing business in this state that manufactures a brand 77
107-name prescription drug and enters into an agreement with another 78
108-pharmaceutical manufacturer for the purpose of delaying or 79
109-preventing such other manufacturer from introducing a generic 80 Substitute Bill No. 7174
108+name prescription drug and enters into an agreement with another 78 Raised Bill No. 7174
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114+pharmaceutical manufacturer for the purpose of delaying or 79
115+preventing such other manufacturer from introducing a generic 80
116116 substitute for such drug into the marketplace shall, not later than thirty 81
117117 days after entering into such agreement, send notice to the Insurance 82
118118 Commissioner, in a form and manner prescribed by the commissioner, 83
119119 disclosing the name of such drug. 84
120120 (b) (1) The commissioner shall, not later than thirty days after 85
121121 receiving a notice pursuant to subsection (a) of this section, send notice 86
122122 to each health carrier, as defined in section 38a-1080 of the general 87
123123 statutes, and pharmacy benefits manager, as defined in section 38a-88
124124 479aaa of the general statutes, doing business in this state. Such notice 89
125125 shall, at a minimum: 90
126126 (A) Disclose the name of the brand name prescription drug that is 91
127127 the subject of the notice the commissioner received pursuant to 92
128128 subsection (a) of this section; and 93
129129 (B) Instruct such health carrier, if such health carrier includes such 94
130130 drug on such health carrier's drug formulary or list of covered drugs, 95
131131 or pharmacy benefits manager, if such pharmacy benefits manager 96
132132 administers a prescription drug benefit that includes such drug, to 97
133133 immediately reduce the cost of such drug to covered individuals by an 98
134134 amount that is equal to fifty per cent of the manufacturer's wholesale 99
135135 list price for such drug. 100
136-(2) For the purposes of this subsection, "manufacturer's wholesale 101
136+(2) For the purposes of this subdivision, "manufacturer's wholesale 101
137137 list price" has the same meaning as provided in section 21a-126 of the 102
138138 general statutes. 103
139139 (c) The provisions of this section shall apply to the maximum extent 104
140140 permitted by applicable law. 105
141141 (d) The commissioner may adopt regulations, in accordance with 106
142142 chapter 54 of the general statutes, to implement the provisions of this 107
143-section. 108
144-Sec. 4. Subdivision (3) of subsection (m) of section 5-259 of the 109
145-general statutes is repealed and the following is substituted in lieu 110 Substitute Bill No. 7174
143+section. 108 Raised Bill No. 7174
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149+Sec. 4. Subdivision (3) of subsection (m) of section 5-259 of the 109
150+general statutes is repealed and the following is substituted in lieu 110
152151 thereof (Effective October 1, 2019): 111
153152 (3) (A) [(i)] For the purposes of this subdivision: 112
154153 (i) "Nonstate public employer" means (I) a municipality or other 113
155154 political subdivision of the state, including a board of education, quasi-114
156155 public agency or public library, as defined in section 11-24a, or (II) the 115
157156 Teachers' Retirement Board; and 116
158157 (ii) "Qualified private employer" means a self-insured private 117
159158 employer doing business in this state. 118
160159 (B) The Comptroller shall offer nonstate public employers and 119
161160 qualified private employers the option to purchase prescription drugs 120
162161 for their employees, employees' dependents and retirees under the 121
163162 purchasing authority of the state pursuant to section 1 of public act 09-122
164163 206, subject to the provisions of subparagraph [(E)] (F) of this 123
165-subdivision. 124
166-[(ii) For purposes of this subdivision, "nonstate public employer" 125
167-means (I) a municipality or other political subdivision of the state, 126
168-including a board of education, quasi-public agency or public library, 127
169-as defined in section 11-24a, or (II) the Teachers' Retirement Board.] 128
164+subdivision. [(ii) For purposes of this subdivision, "nonstate public 124
165+employer" means (I) a municipality or other political subdivision of the 125
166+state, including a board of education, quasi-public agency or public 126
167+library, as defined in section 11-24a, or (II) the Teachers' Retirement 127
168+Board.] 128
170169 [(B)] (C) The Comptroller shall establish procedures to determine (i) 129
171170 the eligibility requirements for, (ii) the enrollment procedures for, (iii) 130
172171 the duration of, (iv) requirements regarding payment for, and (v) the 131
173172 procedures for withdrawal from and termination of, the purchasing of 132
174173 prescription drugs for nonstate public employers and qualified private 133
175174 employers under subparagraph [(A)] (B) of this subdivision. 134
176175 [(C)] (D) The Comptroller may offer to nonstate public employers 135
177176 and qualified private employers that choose to purchase prescription 136
178177 drugs pursuant to subparagraph [(A)] (B) of this subdivision the 137
179178 option to purchase stop loss coverage from an insurer at a rate 138
180-negotiated by the Comptroller. 139 Substitute Bill No. 7174
179+negotiated by the Comptroller. 139 Raised Bill No. 7174
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187185 [(D)] (E) Two or more nonstate public employers or qualified 140
188186 private employers may join together for the purpose of purchasing 141
189187 prescription drugs for their employees, employees' dependents and 142
190188 retirees. Such arrangement shall not constitute a multiple employer 143
191189 welfare arrangement, as defined in Section 3 of the Employee 144
192190 Retirement Income Security Act of 1974, as amended from time to 145
193191 time. 146
194192 [(E)] (F) (i) The Comptroller shall offer nonstate public employers 147
195193 and qualified private employers the option to purchase prescription 148
196194 drugs through the plan set forth in the State Employees' Bargaining 149
197195 Agent Coalition's collective bargaining agreement with the state only if 150
198196 the Health Care Cost Containment Committee, established in 151
199197 accordance with the ratified agreement between the state and said 152
200198 coalition pursuant to subsection (f) of section 5-278, has indicated in 153
201199 writing to the Comptroller that allowing such nonstate public 154
202200 employers and qualified private employers such option is consistent 155
203201 with said coalition's collective bargaining agreement. 156
204202 (ii) Such writing shall not be required if the Comptroller establishes 157
205203 a separate prescription drugs purchasing plan or plans for nonstate 158
206204 public employers and qualified private employers. 159
207205 (iii) Nonstate public employers and qualified private employers that 160
208206 purchase prescription drugs pursuant to this subdivision shall pay the 161
209207 full cost of their own claims and prescription drugs. 162
210208 Sec. 5. Section 38a-477cc of the general statutes is repealed and the 163
211209 following is substituted in lieu thereof (Effective October 1, 2019): 164
212210 (a) [On and after January 1, 2018, no] No contract for pharmacy 165
213211 services entered into in the state between a health carrier, as defined in 166
214212 section 38a-591a, or pharmacy benefits manager, as defined in section 167
215213 38a-479aaa, and a pharmacy or pharmacist shall: 168
216214 (1) On and after January 1, 2018, contain a provision prohibiting or 169
217-penalizing, including through increased utilization review, reduced 170 Substitute Bill No. 7174
215+penalizing, including through increased utilization review, reduced 170 Raised Bill No. 7174
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224221 payments or other financial disincentives, a pharmacist's disclosure to 171
225222 an individual purchasing prescription medication of information 172
226-regarding: [(1) the] (A) The cost of the prescription medication to the 173
227-individual; [,] or [(2) the] (B) The availability of any therapeutically 174
228-equivalent alternative medications or alternative methods of 175
229-purchasing the prescription medication, including, but not limited to, 176
230-paying a cash price, that are less expensive than the cost of the 177
231-prescription medication to the individual; [.] and 178
232-(2) On and after January 1, 2020, contain a provision permitting the 179
233-health carrier or pharmacy benefits manager to recoup, directly or 180
234-indirectly, from a pharmacy or pharmacist any portion of a claim that 181
235-such health carrier or pharmacy benefits manager has paid to the 182
236-pharmacy or pharmacist, unless such recoupment is permitted under 183
237-section 38a-479iii or required by applicable law. 184
238-(b) (1) On and after January 1, 2018, no health carrier or pharmacy 185
239-benefits manager shall require an individual to make a payment at the 186
240-point of sale for a covered prescription medication in an amount 187
241-greater than the lesser of: 188
242-[(1) the] (A) The applicable copayment for such prescription 189
243-medication; [, (2) the] (B) The allowable claim amount for the 190
244-prescription medication; [,] or [(3) the] (C) The amount an individual 191
245-would pay for the prescription medication if the individual purchased 192
246-the prescription medication without using a health benefit plan, as 193
247-defined in section 38a-591a, or any other source of prescription 194
248-medication benefits or discounts. 195
249-(2) For the purposes of this subsection, "allowable claim amount" 196
250-means the amount the health carrier or pharmacy benefits manager 197
251-has agreed to pay the pharmacy for the prescription medication. 198
252-(c) Any provision of a contract that violates the provisions of this 199
253-section shall be void and unenforceable. Any general business practice 200
254-that violates the provisions of this section shall constitute an unfair 201 Substitute Bill No. 7174
223+regarding: 173
224+[(1) the] (A) The cost of the prescription medication to the 174
225+individual; [,] or 175
226+[(2) the] (B) The availability of any therapeutically equivalent 176
227+alternative medications or alternative methods of purchasing the 177
228+prescription medication, including, but not limited to, paying a cash 178
229+price, that are less expensive than the cost of the prescription 179
230+medication to the individual; [.] and 180
231+(2) On and after January 1, 2020, contain a provision permitting the 181
232+health carrier or pharmacy benefits manager to recoup, directly or 182
233+indirectly, from a pharmacy or pharmacist any portion of a claim that 183
234+such health carrier or pharmacy benefits manager has paid to the 184
235+pharmacy or pharmacist, unless such recoupment is permitted under 185
236+section 38a-479iii or required by applicable law. 186
237+(b) (1) On and after January 1, 2018, no health carrier or pharmacy 187
238+benefits manager shall require an individual to make a payment at the 188
239+point of sale for a covered prescription medication in an amount 189
240+greater than the lesser of: 190
241+[(1) the] (A) The applicable copayment for such prescription 191
242+medication; [,] 192
243+[(2) the] (B) The allowable claim amount for the prescription 193
244+medication; [,] or 194
245+[(3) the] (C) The amount an individual would pay for the 195
246+prescription medication if the individual purchased the prescription 196
247+medication without using a health benefit plan, as defined in section 197
248+38a-591a, or any other source of prescription medication benefits or 198
249+discounts. 199
250+(2) For the purposes of this subsection, "allowable claim amount" 200 Raised Bill No. 7174
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261-trade practice pursuant to chapter 735a. The inva lidity or 202
262-unenforceability of any contract provision under this subsection shall 203
263-not affect any other provision of the contract. 204
264-(d) The Insurance Commissioner may: [, (1) pursuant to the 205
265-provisions of chapter 697, enforce] 206
266-(1) Enforce the provisions of this section [,] pursuant to chapter 697; 207
267-and 208
268-(2) [upon] Upon request, audit a contract for pharmacy services for 209
269-compliance with the provisions of this section. 210
270-Sec. 6. (Effective from passage) (a) There is established a task force to 211
271-study drug reimportation. Such study shall include, but need not be 212
272-limited to, an examination of the feasibility of implementing a drug 213
273-reimportation program for the purpose of lowering the cost of 214
274-prescription drugs and health insurance in this state. 215
275-(b) The task force shall consist of the following members: 216
276-(1) Two appointed by the speaker of the House of Representatives; 217
277-(2) Two appointed by the president pro tempore of the Senate; 218
278-(3) One appointed by the majority leader of the House of 219
279-Representatives; 220
280-(4) One appointed by the majority leader of the Senate; 221
281-(5) One appointed by the minority leader of the House of 222
282-Representatives; 223
283-(6) One appointed by the minority leader of the Senate; 224
284-(7) The Attorney General, or the Attorney General's designee; 225
285-(8) The Comptroller, or the Comptroller's designee; 226 Substitute Bill No. 7174
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256+means the amount the health carrier or pharmacy benefits manager 201
257+has agreed to pay the pharmacy for the prescription medication. 202
258+(c) Any provision of a contract that violates the provisions of this 203
259+section shall be void and unenforceable. Any general business practice 204
260+that violates the provisions of this section shall constitute an unfair 205
261+trade practice pursuant to chapter 735a. The invalidity or 206
262+unenforceability of any contract provision under this subsection shall 207
263+not affect any other provision of the contract. 208
264+(d) The Insurance Commissioner may: [, (1) pursuant to the 209
265+provisions of chapter 697, enforce] 210
266+(1) Enforce the provisions of this section [,] pursuant to chapter 697; 211
267+and 212
268+(2) [upon] Upon request, audit a contract for pharmacy services for 213
269+compliance with the provisions of this section. 214
270+Sec. 6. (Effective from passage) (a) There is established a task force to 215
271+study drug reimportation. Such study shall include, but need not be 216
272+limited to, an examination of the feasibility of implementing a drug 217
273+reimportation program for the purpose of lowering the cost of 218
274+prescription drugs and health insurance in this state. 219
275+(b) The task force shall consist of the following members: 220
276+(1) Two appointed by the speaker of the House of Representatives; 221
277+(2) Two appointed by the president pro tempore of the Senate; 222
278+(3) One appointed by the majority leader of the House of 223
279+Representatives; 224
280+(4) One appointed by the majority leader of the Senate; 225
281+(5) One appointed by the minority leader of the House of 226
282+Representatives; 227 Raised Bill No. 7174
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292-(9) The Insurance Commissioner, or the commissioner's designee; 227
293-(10) The Commissioner of Public Health, or the commissioner's 228
294-designee; 229
295-(11) The Commissioner of Social Services, or the commissioner's 230
296-designee; 231
297-(12) The executive director of the Office of Health Strategy, or the 232
298-executive director's designee; 233
299-(13) The Healthcare Advocate, or the Healthcare Advocate's 234
300-designee; and 235
301-(14) Two persons appointed by the Governor. 236
302-(c) Any member of the task force appointed under subdivision (1), 237
303-(2), (3), (4), (5) or (6) of subsection (b) of this section may be a member 238
304-of the General Assembly. 239
305-(d) All appointments to the task force shall be made not later than 240
306-thirty days after the effective date of this section. Any vacancy shall be 241
307-filled by the appointing authority. 242
308-(e) The speaker of the House of Representatives and the president 243
309-pro tempore of the Senate shall select the chairpersons of the task force 244
310-from among the members of the task force. Such chairpersons shall 245
311-schedule the first meeting of the task force, which shall be held not 246
312-later than sixty days after the effective date of this section. 247
313-(f) The administrative staff of the joint standing committee of the 248
314-General Assembly having cognizance of matters relating to insurance 249
315-shall serve as administrative staff of the task force. 250
316-(g) Not later than January 1, 2020, the task force shall submit a 251
317-report on its findings and recommendations to the joint standing 252
318-committee of the General Assembly having cognizance of matters 253
319-relating to insurance, in accordance with the provisions of section 11-254 Substitute Bill No. 7174
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288+(6) One appointed by the minority leader of the Senate; 228
289+(7) The Attorney General, or the Attorney General's designee; 229
290+(8) The Comptroller, or the Comptroller's designee; 230
291+(9) The Insurance Commissioner, or the commissioner's designee; 231
292+(10) The Commissioner of Public Health, or the commissioner's 232
293+designee; 233
294+(11) The Commissioner of Social Services, or the commissioner's 234
295+designee; 235
296+(12) The executive director of the Office of Health Strategy, or the 236
297+executive director's designee; 237
298+(13) The Healthcare Advocate, or the Healthcare Advocate's 238
299+designee; and 239
300+(14) Two persons appointed by the Governor. 240
301+(c) Any member of the task force appointed under subdivision (1), 241
302+(2), (3), (4), (5) or (6) of subsection (b) of this section may be a member 242
303+of the General Assembly. 243
304+(d) All appointments to the task force shall be made not later than 244
305+thirty days after the effective date of this section. Any vacancy shall be 245
306+filled by the appointing authority. 246
307+(e) The speaker of the House of Representatives and the president 247
308+pro tempore of the Senate shall select the chairpersons of the task force 248
309+from among the members of the task force. Such chairpersons shall 249
310+schedule the first meeting of the task force, which shall be held not 250
311+later than sixty days after the effective date of this section. 251
312+(f) The administrative staff of the joint standing committee of the 252
313+General Assembly having cognizance of matters relating to insurance 253
314+shall serve as administrative staff of the task force. 254 Raised Bill No. 7174
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326-4a of the general statutes. The task force shall terminate on the date 255
327-that it submits such report or January 1, 2020, whichever is later. 256
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320+(g) Not later than January 1, 2020, the task force shall submit a 255
321+report on its findings and recommendations to the joint standing 256
322+committee of the General Assembly having cognizance of matters 257
323+relating to insurance, in accordance with the provisions of section 11-258
324+4a of the general statutes. The task force shall terminate on the date 259
325+that it submits such report or January 1, 2020, whichever is later.260
328326 This act shall take effect as follows and shall amend the following
329327 sections:
330328
331329 Section 1 October 1, 2019 New section
332330 Sec. 2 October 1, 2019 New section
333331 Sec. 3 October 1, 2019 New section
334332 Sec. 4 October 1, 2019 5-259(m)(3)
335333 Sec. 5 October 1, 2019 38a-477cc
336334 Sec. 6 from passage New section
337335
338-Statement of Legislative Commissioners:
339-In Section 3(b)(2), "subdivision" was changed to "subsection" for
340-accuracy.
341-
342-INS Joint Favorable Subst. -LCO
336+Statement of Purpose:
337+To: (1) Establish the "Connecticut Prescription Drug Program" and the
338+"Connecticut prescription drug program account"; (2) require
339+pharmaceutical manufacturers to send notice to the Insurance
340+Commissioner regarding "pay-for-delay" agreements, and require
341+health carriers and pharmacy benefits managers to reduce the cost of
342+brand name prescription drugs that are the subject of such agreements;
343+(3) require the Comptroller to offer qualified private employers the
344+option to purchase prescription drugs for their employees, employees'
345+dependents and retirees through the Comptroller's purchasing
346+authority; (4) prohibit any health carrier or pharmacy benefits manager
347+from recouping any portion of a claim that such carrier or manager has
348+paid to a pharmacy or pharmacist; and (5) establish a task force to
349+study drug reimportation.
350+[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline,
351+except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is
352+not underlined.]
343353