Florida 2022 Regular Session

Florida Senate Bill S1574 Latest Draft

Bill / Introduced Version Filed 01/06/2022

 Florida Senate - 2022 SB 1574  By Senator Cruz 18-01118B-22 20221574__ 1 A bill to be entitled 2 An act relating to prescription drug price 3 transparency; amending s. 499.012, F.S.; prohibiting 4 permits for prescription drug manufacturers and 5 nonresident prescription drug manufacturers and for 6 certain wholesale distributors of prescription drugs 7 from being renewed unless specified requirements are 8 met; authorizing the Department of Business and 9 Professional Regulation to suspend or revoke 10 manufacturer permits and wholesale distributor permits 11 under specified circumstances; amending s. 499.0121, 12 F.S.; defining the term price; providing reporting 13 requirements for certain entities that engage in 14 wholesale distributions of prescription drugs; 15 authorizing the department to request certain 16 documentation and information; requiring the 17 department to prescribe by rule specified timeframes; 18 authorizing the department to extend specified 19 timeframes; specifying what constitutes violations of 20 specified laws; providing penalties and fines for 21 violations; providing disposition of such fines; 22 creating s. 499.026, F.S.; providing definitions; 23 providing requirements for notifications by 24 manufacturers of prescription drug price increases 25 under certain circumstances; providing reporting 26 requirements; requiring the department to compile a 27 list of specified drugs; authorizing the department to 28 request certain documentation and information; 29 requiring the department to prescribe by rule 30 specified timeframes; authorizing the department to 31 extend specified timeframes; providing duties of the 32 department; specifying what constitutes violations of 33 specified laws; prohibiting certain prescription drugs 34 from being included in specified drug formularies; 35 providing an exception; providing penalties and fines 36 for violations; providing disposition of such fines; 37 requiring the department to adopt rules; amending s. 38 499.05, F.S.; requiring the department to adopt rules; 39 conforming provisions to changes made by the act; 40 amending s. 624.490, F.S.; providing definitions; 41 providing reporting requirements for registered 42 pharmacy benefit managers; authorizing the Office of 43 Insurance Regulation to request certain documentation 44 and information; requiring the Financial Services 45 Commission to prescribe by rule specified timeframes; 46 authorizing the office to extend specified timeframes; 47 requiring registered pharmacy benefit managers to 48 maintain a website for a specified purpose and to 49 update the information on the website under certain 50 circumstances; specifying what constitutes violations 51 of specified laws; providing penalties and fines for 52 violations; providing disposition of such fines; 53 creating ss. 627.42384 and 641.3131, F.S.; requiring 54 certain health insurers and health maintenance 55 organizations, respectively, to submit and update 56 contact information for single points of contact for a 57 specified use; requiring the office to maintain and 58 publish such points of contact; requiring such health 59 insurers and health maintenance organizations to 60 notify certain insureds and subscribers, respectively, 61 within a specified timeframe of drug formulary 62 changes; providing applicability; amending ss. 63 627.64741, 627.6572, and 641.314, F.S.; defining the 64 term net price; providing additional requirements 65 for contracts between pharmacy benefit managers and 66 individual health insurers, group health insurers, and 67 health maintenance organizations, respectively; 68 providing applicability; amending ss. 110.12315, 69 409.815, 409.91195, 409.912, and 499.067, F.S.; 70 conforming provisions to changes made by the act; 71 providing an effective date. 72 73 Be It Enacted by the Legislature of the State of Florida: 74 75 Section 1.Paragraph (f) is added to subsection (1) of 76 section 499.012, Florida Statutes, to read: 77 499.012Permit application requirements. 78 (1) 79 (f)1.A permit for a prescription drug manufacturer or 80 nonresident prescription drug manufacturer may not be renewed 81 unless the prescription drug manufacturer or nonresident 82 prescription drug manufacturer meets the requirements of s. 83 499.026. The department may suspend or revoke the permit of a 84 manufacturer that fails to comply with the requirements of s. 85 499.026. 86 2.A permit for a prescription drug wholesale distributor, 87 out-of-state prescription drug wholesale distributor, retail 88 pharmacy drug wholesale distributor, veterinary prescription 89 drug wholesale distributor, or limited prescription drug 90 veterinary wholesale distributor may not be renewed unless the 91 wholesale distributor meets the requirements of s. 499.0121(16). 92 The department may suspend or revoke the permit of a wholesale 93 distributor that fails to comply with the requirements of s. 94 499.0121(16). 95 Section 2.Subsection (16) is added to section 499.0121, 96 Florida Statutes, to read: 97 499.0121Storage and handling of prescription drugs; 98 recordkeeping; prescription drug price report requirements; 99 penalties for noncompliance.The department shall adopt rules to 100 implement this section as necessary to protect the public 101 health, safety, and welfare. Such rules shall include, but not 102 be limited to, requirements for the storage and handling of 103 prescription drugs and for the establishment and maintenance of 104 prescription drug distribution records. 105 (16)PRESCRIPTION DRUG PRICE REPORT AND PENALTIES FOR 106 NONCOMPLIANCE. 107 (a)As used in this subsection, the term price means the 108 manufacturers list price for a prescription drug to wholesalers 109 or direct purchasers in the United States, not including prompt 110 pay or other discounts, rebates, or reductions in price, for the 111 most recent month for which the information is available, as 112 reported in wholesale price guides or other publications of drug 113 or biological pricing data. 114 (b)By July 1 of each year, each prescription drug 115 wholesale distributor, out-of-state prescription drug wholesale 116 distributor, retail pharmacy drug wholesale distributor, 117 prescription drug wholesale distributor, veterinary prescription 118 drug wholesale distributor, or limited prescription drug 119 veterinary wholesale distributor, or each manufacturer or 120 repackager that engages in the wholesale distribution of 121 prescription drugs, shall submit a report to the department on 122 each prescription drug for which the price, during the previous 123 calendar year: 124 1.Was $100 or more for a 30-day supply or for a course of 125 treatment lasting less than 30 days; or 126 2.Increased by at least 10 percent over the previous 127 price. 128 (c)The report must include, at a minimum, the following 129 information: 130 1.The name and the price at the time of the report of each 131 prescription drug specified in paragraph (b) and the cumulative 132 percentage price increase during the previous calendar year. 133 2.The length of time the prescription drug has been on the 134 market. 135 3.The factors that contributed to the price increase. 136 4.The name of any generic version of the prescription drug 137 available on the market. 138 5.The total sales revenue for the prescription drug during 139 the previous calendar year. 140 6.The introductory price of the prescription drug when it 141 was approved by the United States Food and Drug Administration 142 and the cumulative yearly increase, by calendar year, in the 143 price of the drug during the previous 5 years or during the 144 number of years the drug has been on the market, whichever is 145 less. 146 7.Any prompt pay or discount, rebate, or reduction in 147 price provided by the reporting wholesale distributor or 148 manufacturer or repackager that engages in the wholesale 149 distribution of prescription drugs when selling a prescription 150 drug to a manufacturer, pharmacy, pharmacy benefit manager, and 151 other entities. 152 8.The documentation necessary to support the information 153 reported under this paragraph. 154 (d)The department may make a written request to the 155 reporting wholesale distributor, manufacturer, or repackager for 156 supporting documentation or additional information concerning 157 the report. The department shall prescribe by rule the 158 timeframes for the departments request for documentation or 159 information and for the response by the reporting wholesale 160 distributor, manufacturer, or repackager. The department may 161 extend the timeframe, if necessary, for the response by the 162 wholesale distributor, manufacturer, or repackager. 163 (e)A wholesale distributor, or a manufacturer or 164 repackager that engages in the wholesale distribution of 165 prescription drugs, violates this subsection if the wholesale 166 distributor, manufacturer, or repackager: 167 1.Fails to timely submit the report required under this 168 subsection; 169 2.Fails to provide information required under this 170 subsection; 171 3.Fails to timely respond to a written request by the 172 department with regard to the report required under this 173 subsection; or 174 4.Provides inaccurate or incomplete information in the 175 report required under this subsection. 176 (f)1.The department may deny an application for a renewal 177 permit or registration or suspend or revoke a registration 178 certificate or a permit of a prescription drug wholesale 179 distributor, or a manufacturer or repackager that engages in the 180 wholesale distribution of prescription drugs, for violating this 181 subsection. 182 2.a.The department may also impose an administrative fine, 183 not to exceed $5,000 per violation per day, for a violation of 184 this subsection or a rule adopted to administer this subsection. 185 Each day the violation continues constitutes a separate 186 violation, and each such separate violation is subject to a 187 separate fine. 188 b.In determining the amount of fine to be levied for a 189 violation of this subsection, the department must consider the 190 following factors: 191 (I)The severity of the violation. 192 (II)Any action taken by the permittee to correct the 193 violation or to remedy complaints. 194 (III)Any previous violation. 195 c.All fines collected under this subparagraph shall be 196 deposited into the Public Medical Assistance Trust Fund 197 administered by the Agency for Health Care Administration, to be 198 used to help the uninsured pay for health care. 199 Section 3.Section 499.026, Florida Statutes, is created to 200 read: 201 499.026Prescription drug price transparency. 202 (1)As used in this section, the term: 203 (a)Agency means the Agency for Health Care 204 Administration. 205 (b)Division means the Division of Consumer Services of 206 the Department of Agriculture and Consumer Services. 207 (c)Drug means a prescription drug. 208 (d)Health insurer means a health insurer issuing major 209 medical coverage through an individual or group policy or a 210 health maintenance organization issuing major medical coverage 211 through an individual or group contract, regulated under chapter 212 627 or chapter 641. 213 (e)Medicaid means the Agency for Health Care 214 Administration Medicaid program. 215 (f)Office means the Office of Insurance Regulation of 216 the Financial Services Commission. 217 (g)Price means the manufacturers list price for a drug 218 to wholesalers or direct purchasers in the United States, not 219 including prompt pay or other discounts, rebates, or reductions 220 in price, for the most recent month for which the information is 221 available, as reported in wholesale price guides or other 222 publications of drug or biological pricing data. 223 (2)(a)At least 120 days before the effective date of any 224 single manufacturer increase of at least 10 percent in the price 225 of a drug, a manufacturer must provide notice of the upcoming 226 drug price increase to: 227 1.The department, the Department of Health, the agency, 228 the division, and the office. 229 2.Every health insurer that covers the drug. The 230 manufacturer shall use the contact list published by the office 231 under ss. 627.42384 and 641.3131 to provide notice to health 232 insurers. Notification shall be presumed to occur on the date 233 that the manufacturer attempts to communicate with the 234 applicable point of contact published by the office. 235 (b)The notices must include, at a minimum, the following 236 information: 237 1.The name and current price of the drug. 238 2.The date that the increase will become effective. 239 3.The dollar amount of the intended increase in the price 240 of the drug. 241 4.The percentage price increase. 242 5.A statement of whether the price increase is 243 necessitated by a change or improvement of the drug and, if so, 244 a description of the change or improvement. 245 6.A description of any other factors that contributed to 246 the price increase. 247 7.The documentation necessary to support the information 248 reported under subparagraphs 5. and 6. 249 (3)(a)By July 1 of each year, a manufacturer shall submit 250 a report to the department, the Department of Health, the 251 agency, the division, and the office on each drug for which the 252 price, during the previous calendar year: 253 1.Was $100 or more for a 30-day supply or for a course of 254 treatment lasting less than 30 days; or 255 2.Increased by at least 10 percent over the previous price 256 in a single manufacturer price. 257 (b)The report must include, at a minimum, the following 258 information: 259 1.The name and the price at the time of the report of each 260 drug specified in paragraph (a) and the cumulative percentage 261 price increase during the previous calendar year. 262 2.The length of time the drug has been on the market. 263 3.The factors that contributed to the price increase. 264 4. The name of any generic version of the drug available on 265 the market. 266 5.The research and development costs associated with the 267 drug that were paid using public funds. 268 6.The direct costs incurred by the manufacturer to 269 manufacture, market, and distribute the drug and to ensure 270 ongoing safety and effectiveness research associated with the 271 drug. 272 7.The total sales revenue for the drug during the previous 273 calendar year. 274 8.The manufacturers profit attributable to the drug 275 during the previous calendar year. 276 9.The introductory price of the drug when it was approved 277 by the United States Food and Drug Administration and the 278 cumulative yearly increase, by calendar year, in the price of 279 the drug during the previous 5 years or during the number of 280 years the drug has been on the market, whichever is less. 281 10.The 10 highest prices paid for the drug during the 282 previous year in other countries. 283 11.The documentation necessary to support the information 284 reported under this paragraph. 285 (4)(a)Before reviewing the data in the report filed under 286 subsection (3), the department, in consultation with the 287 Department of Health, the agency, and the office, shall compile 288 a list of drugs that have a significant cost to the state or 289 that are designated as being critical to public health. Such 290 drugs may be sourced from the Medicaid drug utilization data and 291 drug spending data, the divisions drug spending data, and the 292 drug spending data of health insurers and health plans and their 293 pharmacy benefit managers. 294 (b)After receiving the report required under subsection 295 (3), the department: 296 1.May make a written request to the manufacturer for 297 supporting documentation or additional information concerning 298 the report. The department shall prescribe by rule the 299 timeframes for the departments request for documentation or 300 information and for the manufacturers response to the request. 301 The department may extend the timeframe, if necessary, for the 302 manufacturers response. 303 2.Shall review the costs and the factors contributing to 304 each drug price or drug price increase in the report. 305 3.Shall review the price and price increase of each drug 306 on the list compiled under paragraph (a) and each drug on the 307 lists reported by wholesale distributors and other entities 308 engaged in wholesale distribution of prescription drugs and by 309 registered pharmacy benefit managers under ss. 499.0121(16) and 310 624.490(6)(b), respectively, to make sure that any drug on the 311 compiled and reported lists which fits the criterion in 312 subparagraph (3)(a)1. or subparagraph (3)(a)2. is also reported 313 by the drugs manufacturer under subsection (3). 314 4.Shall, in consultation with the Department of Health, 315 the division, and the office, determine whether the manufacturer 316 has violated this section. 317 (5)A manufacturer violates this section if the 318 manufacturer: 319 (a)Fails to timely submit notices or reports required 320 under this section; 321 (b)Fails to provide information required under this 322 section; 323 (c)Fails to timely respond to a written request by the 324 department with regard to the notices or report required under 325 this section; or 326 (d)Provides inaccurate or incomplete information in the 327 notices or report required under this section. 328 (6)A drug for which the manufacturer does not comply with 329 the notification or reporting requirements under this section 330 may not be included in the Medicaids and state group health 331 insurances drug formularies unless the drug is the most 332 clinically appropriate, clinically effective, and lowest net 333 cost drug. 334 (7)(a)The department may deny an application for a renewal 335 permit or suspend or revoke a permit of a prescription drug 336 manufacturer or nonresident prescription drug manufacturer for 337 violating this section. 338 (b)1.The department may also impose an administrative 339 fine, not to exceed $5,000 per violation per day, for a 340 violation of this section or a rule adopted under this section. 341 Each day the violation continues constitutes a separate 342 violation, and each such separate violation is subject to a 343 separate fine. 344 2.In determining the amount of fine to be levied for a 345 violation of this section, the department, in consultation with 346 the Department of Health, the agency, the division, and the 347 office, must consider the following factors: 348 a.The severity of the violation. 349 b.Any action taken by the permittee to correct the 350 violation or to remedy complaints. 351 c.Any previous violation. 352 3.All fines collected under this section shall be 353 deposited into the Public Medical Assistance Trust Fund 354 administered by the agency, to be used to help the uninsured pay 355 for health care. 356 (8)The department shall adopt rules to administer this 357 section. 358 Section 4.Paragraph (m) of subsection (1) of section 359 499.05, Florida Statutes, is amended, and paragraph (o) is added 360 to that subsection, to read: 361 499.05Rules. 362 (1)The department shall adopt rules to implement and 363 enforce this chapter with respect to: 364 (m)Wholesale distributor reporting requirements of s. 365 499.0121(14) and (16) s. 499.0121(14). 366 (o)Manufacturer notification and reporting requirements of 367 s. 499.026(2) and (3). 368 Section 5.Subsection (6) of section 624.490, Florida 369 Statutes, is renumbered as subsection (7), and a new subsection 370 (6) is added to that section, to read: 371 624.490Registration of pharmacy benefit managers; 372 prescription drug price report and public access requirements; 373 penalties for noncompliance. 374 (6)(a)As used in this subsection, the term: 375 1.Negotiated price means the value at which a 376 prescription drug is sold by a prescription drug manufacturer, 377 prescription drug wholesale distributor, or pharmacy, under a 378 prescription drug benefits coverage administered by a pharmacy 379 benefit manager, before any tax or cost is added and any 380 discount, rebate, or reduction in price, including a rebate 381 offered to the pharmacy benefit manager, is subtracted. 382 2.Net price means the value at which a prescription drug 383 is sold by a prescription drug manufacturer, prescription drug 384 wholesale distributor, or pharmacy, under a prescription drug 385 benefits coverage administered by a pharmacy benefit manager, 386 after all taxes and other costs are added and all discounts, 387 rebates, and reductions in price are subtracted, including any 388 rebate offered to the pharmacy benefit manager which is passed 389 on to the health insurer or health maintenance organization. 390 3.Rebate offered to a pharmacy benefit manager means a 391 direct payment by a prescription drug manufacturer, prescription 392 drug wholesale distributor, or pharmacy to a pharmacy benefit 393 manager for a prescription drug dispensed to an insured or 394 subscriber. Such payment serves an incentive for the pharmacy 395 benefit manager to promote use of the prescription drug, and the 396 pharmacy benefit manager may choose to keep the payment or to 397 pass it on, in full or in part, to the health insurer or health 398 maintenance organization. 399 (b)1.By July 1 of each year, a registered pharmacy benefit 400 manager shall submit a report to the office on each prescription 401 drug for which the negotiated price, during the previous 402 calendar year: 403 a.Was $100 or more for a 30-day supply or for a course of 404 treatment lasting less than 30 days; or 405 b.Increased by at least 10 percent over the previous 406 negotiated price. 407 2.The report must include, at a minimum, the following 408 information: 409 a.The name and the negotiated price at the time of the 410 report of each prescription drug specified in subparagraph 1. 411 and the cumulative percentage negotiated price increase during 412 the previous calendar year. 413 b. The name of any generic version of the prescription drug 414 available on the market. 415 c.The total sales revenue of the pharmacy benefit manager 416 for the prescription drug during the previous calendar year. 417 d.The documentation necessary to support the information 418 reported under this paragraph. 419 3.The office may make a written request to the pharmacy 420 benefit manager for supporting documentation or additional 421 information concerning the report. The commission shall 422 prescribe by rule the timeframes for the offices request for 423 documentation or information and for the pharmacy benefit 424 managers response to the request. The office may extend the 425 timeframe, if necessary, for the pharmacy benefit managers 426 response. 427 (c)A registered pharmacy benefit manager shall maintain a 428 website that provides public access to the net price of each 429 prescription drug. The registered pharmacy benefit manager shall 430 update the net price of a prescription drug on the website at 431 least 90 days before the net price of the prescription drug 432 changes. 433 (d)A registered pharmacy benefit manager violates this 434 subsection if the registered pharmacy benefit manager: 435 1.Fails to timely submit the report required under 436 paragraph (b); 437 2.Fails to provide information required under paragraph 438 (b); 439 3.Fails to timely respond to a written request by the 440 office with regard to the report required under paragraph (b); 441 4.Provides inaccurate or incomplete information in the 442 report required under paragraph (b); or 443 5.Fails to maintain a website for access to net prices of 444 prescription drugs or to update the net prices on the website, 445 as required under paragraph (c). 446 (e)1.The office may deny an application for renewal 447 registration or suspend or revoke a registration certificate of 448 a pharmacy benefit manager for violating this subsection. 449 2.a.The office may also impose an administrative fine, not 450 to exceed $5,000 per violation per day, for a violation of this 451 subsection or a rule adopted to administer this subsection. Each 452 day the violation continues constitutes a separate violation, 453 and each such separate violation is subject to a separate fine. 454 b.In determining the amount of fine to be levied for a 455 violation of this subsection, the office must consider the 456 following factors: 457 (I)The severity of the violation. 458 (II)Any action taken by the pharmacy benefit manager to 459 correct the violation or to remedy complaints. 460 (III)Any previous violation. 461 c.All fines collected under this subsection shall be 462 deposited into the Public Medical Assistance Trust Fund 463 administered by the Agency for Health Care Administration, to be 464 used to help the uninsured pay for health care. 465 Section 6.Section 627.42384, Florida Statutes, is created 466 to read: 467 627.42384Formulary changes resulting from drug price 468 increases. 469 (1)A health insurer issuing a major medical individual or 470 group policy shall submit, and update as necessary, contact 471 information for a single point of contact for use by 472 prescription drug manufacturers to comply with s. 499.026. The 473 office shall maintain and publish on its website a list of such 474 points of contact. 475 (2)A health insurer issuing a major medical individual or 476 group policy must provide written notice to each affected 477 insured and each prescribing health care provider at least 90 478 days before making a drug formulary change that results from a 479 prescription drug price increase reported by a drug manufacturer 480 under s. 499.026(2). 481 (3)This section applies to policies entered into or 482 renewed on or after January 1, 2023. 483 Section 7.Paragraph (b) of subsection (1) of section 484 627.64741, Florida Statutes, is redesignated as paragraph (c), 485 subsection (5) is amended, a new paragraph (b) is added to 486 subsection (1), and paragraphs (c) through (f) are added to 487 subsection (2) of that section, to read: 488 627.64741Pharmacy benefit manager contracts. 489 (1)As used in this section, the term: 490 (b)Net price means the value at which a prescription 491 drug is sold by a prescription drug manufacturer, prescription 492 drug wholesale distributor, or pharmacy, under a prescription 493 drug benefits coverage administered by a pharmacy benefit 494 manager, after all taxes and other costs are added and all 495 discounts, rebates, and reductions in price are subtracted, 496 including any rebate offered to the pharmacy benefit manager 497 which is passed on to the health insurer. 498 (2)A contract between a health insurer and a pharmacy 499 benefit manager must require that the pharmacy benefit manager: 500 (c)Maintain a website that provides public access to the 501 net price of each covered prescription drug and update the net 502 price of a covered prescription drug on the website at least 90 503 days before the net price of the covered prescription drug 504 changes. 505 (d)Provide written notice to each affected insured and 506 each prescribing health care provider at least 90 days before 507 making a change in the drug formulary or in the net price of a 508 covered prescription drug, including a change that results from 509 a price increase of a covered prescription drug reported by a 510 drug manufacturer under s. 499.026(2). 511 (e)Inform an affected insured, in writing, of the net 512 price of each covered prescription drug for which the insured 513 has made a payment. 514 (f)Provide in writing to each insured and each prescribing 515 health care provider the address of the pharmacy benefit 516 managers website where the list of the net prices of all 517 prescription drugs is posted. 518 (5)This section applies to contracts entered into or 519 renewed on or after July 1, 2022 July 1, 2018. 520 Section 8.Paragraph (b) of subsection (1) of section 521 627.6572, Florida Statutes, is redesignated as paragraph (c), 522 subsection (5) is amended, a new paragraph (b) is added to 523 subsection (1), and paragraphs (c) through (f) are added to 524 subsection (2) of that section, to read: 525 627.6572Pharmacy benefit manager contracts. 526 (1)As used in this section, the term: 527 (b)Net price means the value at which a prescription 528 drug is sold by a prescription drug manufacturer, prescription 529 drug wholesale distributor, or pharmacy, under a prescription 530 drug benefits coverage administered by a pharmacy benefit 531 manager, after all taxes and other costs are added and all 532 discounts, rebates, and reductions in price are subtracted, 533 including any rebate offered to the pharmacy benefit manager 534 which is passed on to the health insurer. 535 (2)A contract between a health insurer and a pharmacy 536 benefit manager must require that the pharmacy benefit manager: 537 (c)Maintain a website that provides public access to the 538 net price of each covered prescription drug and update the net 539 price of a covered prescription drug on the website at least 90 540 days before the net price of the covered prescription drug 541 changes. 542 (d)Provide written notice to each affected insured and 543 each prescribing health care provider at least 90 days before 544 making a change in the drug formulary or in the net price of a 545 covered prescription drug, including a change that results from 546 a price increase of a covered prescription drug reported by a 547 drug manufacturer under s. 499.026(2). 548 (e)Inform an insured, in writing, of the net price of each 549 covered prescription drug for which the insured has made a 550 payment. 551 (f)Provide in writing to each insured and each prescribing 552 health care provider the address of the pharmacy benefit 553 managers website where the list of the net prices of all 554 covered prescription drugs is posted. 555 (5)This section applies to contracts entered into or 556 renewed on or after July 1, 2022 July 1, 2018. 557 Section 9.Section 641.3131, Florida Statutes, is created 558 to read: 559 641.3131Formulary changes resulting from drug price 560 increases. 561 (1)A health maintenance organization issuing a major 562 medical or other comprehensive coverage contract shall submit, 563 and update as necessary, contact information for a single point 564 of contact for use by prescription drug manufacturers to comply 565 with s. 499.026. The office shall maintain and publish on its 566 website a list of such points of contact. 567 (2)A health maintenance organization issuing a major 568 medical or other comprehensive coverage contract must provide 569 written notice to each affected subscriber and each prescribing 570 health care provider at least 90 days before making a drug 571 formulary change that results from a prescription drug price 572 increase reported by a drug manufacturer under s. 499.026(2). 573 (3)This section applies to contracts entered into or 574 renewed on or after January 1, 2023. 575 Section 10.Paragraph (b) of subsection (1) of section 576 641.314, Florida Statutes, is redesignated as paragraph (c), 577 subsection (5) is amended, a new paragraph (b) is added to 578 subsection (1), and paragraphs (c) through (f) are added to 579 subsection (2) of that section, to read: 580 641.314Pharmacy benefit manager contracts. 581 (1)As used in this section, the term: 582 (b)Net price means the value at which a prescription 583 drug is sold by a prescription drug manufacturer, prescription 584 drug wholesale distributor, or pharmacy, under a prescription 585 drug benefits coverage administered by a pharmacy benefit 586 manager, after all taxes and other costs are added and all 587 discounts, rebates, and reductions in price are subtracted, 588 including any rebate offered to the pharmacy benefit manager 589 which is passed on to the health maintenance organization. 590 (2)A contract between a health maintenance organization 591 and a pharmacy benefit manager must require that the pharmacy 592 benefit manager: 593 (c)Maintain a website that provides public access to the 594 net price of each covered prescription drug and update the net 595 price of a covered prescription drug on the website at least 90 596 days before the net price of the covered prescription drug 597 changes. 598 (d)Provide written notice to each affected subscriber and 599 each prescribing health care provider at least 90 days before 600 making a change in the drug formulary or in the net price of a 601 covered prescription drug, including a change that results from 602 a price increase of a covered prescription drug reported by a 603 drug manufacturer under s. 499.026(2). 604 (e)Inform a subscriber in writing of the net price of each 605 covered prescription drug for which the subscriber has made a 606 payment. 607 (f)Provide in writing to each subscriber and each 608 prescribing health care provider the address of the pharmacy 609 benefit managers website where the list of the net prices of 610 all prescription drugs is posted. 611 (5)This section applies to contracts entered into or 612 renewed on or after July 1, 2022 July 1, 2018. 613 Section 11.Subsections (3) and (4) and paragraph (a) of 614 subsection (9) of section 110.12315, Florida Statutes, are 615 amended to read: 616 110.12315Prescription drug program.The state employees 617 prescription drug program is established. This program shall be 618 administered by the Department of Management Services, according 619 to the terms and conditions of the plan as established by the 620 relevant provisions of the annual General Appropriations Act and 621 implementing legislation, subject to the following conditions: 622 (3)The department shall maintain the generic, preferred 623 brand name, and the nonpreferred brand name lists of drugs and 624 supplies to be used in the administration of the state 625 employees prescription drug program. These lists may not 626 include a prescription drug for which the prescription drug 627 manufacturer does not comply with the requirements of s. 499.026 628 unless the prescription drug is the most clinically appropriate, 629 clinically effective, and lowest net-cost prescription drug. 630 (4)The department shall maintain a list of maintenance 631 drugs and supplies. The list may not include a drug for which 632 the prescription drug manufacturer does not comply with the 633 requirements of s. 499.026 unless the prescription drug is the 634 most clinically appropriate, clinically effective, and lowest 635 net-cost prescription drug. 636 (a)Preferred provider organization health plan members may 637 have prescriptions for maintenance drugs and supplies filled up 638 to three times as a supply for up to 30 days through a retail 639 pharmacy; thereafter, prescriptions for the same maintenance 640 drug or supply must be filled for up to 90 days either through 641 the departments contracted mail order pharmacy or through a 642 retail pharmacy. 643 (b)Health maintenance organization health plan members may 644 have prescriptions for maintenance drugs and supplies filled for 645 up to 90 days either through a mail order pharmacy or through a 646 retail pharmacy. 647 (9)(a)Beginning with the 2020 plan year, the department 648 must implement formulary management for prescription drugs and 649 supplies. Such management practices must require prescription 650 drugs to be subject to formulary inclusion or exclusion and, 651 beginning with the 2023 plan year, must require a prescription 652 drug for which the prescription drug manufacturer does not 653 comply with the requirements of s. 499.026 to be subject to 654 formulary exclusion, but may not restrict access to the most 655 clinically appropriate, clinically effective, and lowest net 656 cost prescription drugs and supplies. Drugs excluded from the 657 formulary must be available for inclusion if a physician, 658 advanced practice registered nurse, or physician assistant 659 prescribing a pharmaceutical clearly states on the prescription 660 that the excluded drug is medically necessary. Prescription 661 drugs and supplies first made available in the marketplace after 662 January 1, 2020, may not be covered by the prescription drug 663 program until specifically included in the list of covered 664 prescription drugs and supplies. 665 Section 12.Paragraph (n) of subsection (2) of section 666 409.815, Florida Statutes, is amended to read: 667 409.815Health benefits coverage; limitations. 668 (2)BENCHMARK BENEFITS.In order for health benefits 669 coverage to qualify for premium assistance payments for an 670 eligible child under ss. 409.810-409.821, the health benefits 671 coverage, except for coverage under Medicaid and Medikids, must 672 include the following minimum benefits, as medically necessary. 673 (n)Prescribed drugs. 674 1.Coverage shall include drugs prescribed for the 675 treatment of illness or injury when prescribed by a licensed 676 health practitioner acting within the scope of his or her 677 practice. 678 2.Prescribed drugs may be limited to generics if available 679 and brand name products if a generic substitution is not 680 available, unless the prescribing licensed health practitioner 681 indicates that a brand name is medically necessary. 682 3.Prescribed drugs covered under this section shall 683 include all prescribed drugs covered under the Florida Medicaid 684 program. 685 4.Prescribed drugs may not include a prescription drug for 686 which the manufacturer does not comply with the requirements of 687 s. 499.026 unless the prescription drug is the most clinically 688 appropriate, clinically effective, and lowest net-cost 689 prescription drug or unless a physician, advanced practice 690 registered nurse, or physician assistant prescribing the drug 691 clearly states on the prescription that the excluded drug is 692 medically necessary. 693 Section 13.Subsection (8) of section 409.91195, Florida 694 Statutes, is amended to read: 695 409.91195Medicaid Pharmaceutical and Therapeutics 696 Committee.There is created a Medicaid Pharmaceutical and 697 Therapeutics Committee within the agency for the purpose of 698 developing a Medicaid preferred drug list. 699 (8)The committee shall develop its preferred drug list 700 recommendations by considering the clinical efficacy, safety, 701 and cost-effectiveness of a product and the manufacturers 702 prescription drug price transparency, as required under s. 703 499.012. 704 Section 14.Paragraph (a) of subsection (5) of section 705 409.912, Florida Statutes, is amended to read: 706 409.912Cost-effective purchasing of health care.The 707 agency shall purchase goods and services for Medicaid recipients 708 in the most cost-effective manner consistent with the delivery 709 of quality medical care. To ensure that medical services are 710 effectively utilized, the agency may, in any case, require a 711 confirmation or second physicians opinion of the correct 712 diagnosis for purposes of authorizing future services under the 713 Medicaid program. This section does not restrict access to 714 emergency services or poststabilization care services as defined 715 in 42 C.F.R. s. 438.114. Such confirmation or second opinion 716 shall be rendered in a manner approved by the agency. The agency 717 shall maximize the use of prepaid per capita and prepaid 718 aggregate fixed-sum basis services when appropriate and other 719 alternative service delivery and reimbursement methodologies, 720 including competitive bidding pursuant to s. 287.057, designed 721 to facilitate the cost-effective purchase of a case-managed 722 continuum of care. The agency shall also require providers to 723 minimize the exposure of recipients to the need for acute 724 inpatient, custodial, and other institutional care and the 725 inappropriate or unnecessary use of high-cost services. The 726 agency shall contract with a vendor to monitor and evaluate the 727 clinical practice patterns of providers in order to identify 728 trends that are outside the normal practice patterns of a 729 providers professional peers or the national guidelines of a 730 providers professional association. The vendor must be able to 731 provide information and counseling to a provider whose practice 732 patterns are outside the norms, in consultation with the agency, 733 to improve patient care and reduce inappropriate utilization. 734 The agency may mandate prior authorization, drug therapy 735 management, or disease management participation for certain 736 populations of Medicaid beneficiaries, certain drug classes, or 737 particular drugs to prevent fraud, abuse, overuse, and possible 738 dangerous drug interactions. The Pharmaceutical and Therapeutics 739 Committee shall make recommendations to the agency on drugs for 740 which prior authorization is required. The agency shall inform 741 the Pharmaceutical and Therapeutics Committee of its decisions 742 regarding drugs subject to prior authorization. The agency is 743 authorized to limit the entities it contracts with or enrolls as 744 Medicaid providers by developing a provider network through 745 provider credentialing. The agency may competitively bid single 746 source-provider contracts if procurement of goods or services 747 results in demonstrated cost savings to the state without 748 limiting access to care. The agency may limit its network based 749 on the assessment of beneficiary access to care, provider 750 availability, provider quality standards, time and distance 751 standards for access to care, the cultural competence of the 752 provider network, demographic characteristics of Medicaid 753 beneficiaries, practice and provider-to-beneficiary standards, 754 appointment wait times, beneficiary use of services, provider 755 turnover, provider profiling, provider licensure history, 756 previous program integrity investigations and findings, peer 757 review, provider Medicaid policy and billing compliance records, 758 clinical and medical record audits, and other factors. Providers 759 are not entitled to enrollment in the Medicaid provider network. 760 The agency shall determine instances in which allowing Medicaid 761 beneficiaries to purchase durable medical equipment and other 762 goods is less expensive to the Medicaid program than long-term 763 rental of the equipment or goods. The agency may establish rules 764 to facilitate purchases in lieu of long-term rentals in order to 765 protect against fraud and abuse in the Medicaid program as 766 defined in s. 409.913. The agency may seek federal waivers 767 necessary to administer these policies. 768 (5)(a)The agency shall implement a Medicaid prescribed 769 drug spending-control program that includes the following 770 components: 771 1.A Medicaid preferred drug list, which shall be a listing 772 of cost-effective therapeutic options recommended by the 773 Medicaid Pharmacy and Therapeutics Committee established 774 pursuant to s. 409.91195 and adopted by the agency for each 775 therapeutic class on the preferred drug list. At the discretion 776 of the committee, and when feasible, the preferred drug list 777 should include at least two products in a therapeutic class. The 778 agency may post the preferred drug list and updates to the list 779 on an Internet website without following the rulemaking 780 procedures of chapter 120. Drugs for which the manufacturer does 781 not comply with the requirements of s. 499.026 are excluded from 782 the preferred list, unless the drug is the most clinically 783 appropriate, clinically effective, and lowest net-cost 784 prescription drug. Antiretroviral agents are excluded from the 785 preferred drug list. The agency shall also limit the amount of a 786 prescribed drug dispensed to no more than a 34-day supply unless 787 the drug products smallest marketed package is greater than a 788 34-day supply, or the drug is determined by the agency to be a 789 maintenance drug in which case a 100-day maximum supply may be 790 authorized. The agency may seek any federal waivers necessary to 791 implement these cost-control programs and to continue 792 participation in the federal Medicaid rebate program, or 793 alternatively to negotiate state-only manufacturer rebates. The 794 agency may adopt rules to administer this subparagraph. The 795 agency shall continue to provide unlimited contraceptive drugs 796 and items. The agency must establish procedures to ensure that: 797 a.There is a response to a request for prior authorization 798 by telephone or other telecommunication device within 24 hours 799 after receipt of a request for prior authorization; and 800 b.A 72-hour supply of the drug prescribed is provided in 801 an emergency or when the agency does not provide a response 802 within 24 hours as required by sub-subparagraph a. 803 2.A provider of prescribed drugs is reimbursed in an 804 amount not to exceed the lesser of the actual acquisition cost 805 based on the Centers for Medicare and Medicaid Services National 806 Average Drug Acquisition Cost pricing files plus a professional 807 dispensing fee, the wholesale acquisition cost plus a 808 professional dispensing fee, the state maximum allowable cost 809 plus a professional dispensing fee, or the usual and customary 810 charge billed by the provider. 811 3.The agency shall develop and implement a process for 812 managing the drug therapies of Medicaid recipients who are using 813 significant numbers of prescribed drugs each month. The 814 management process may include, but is not limited to, 815 comprehensive, physician-directed medical-record reviews, claims 816 analyses, and case evaluations to determine the medical 817 necessity and appropriateness of a patients treatment plan and 818 drug therapies. The agency may contract with a private 819 organization to provide drug-program-management services. The 820 Medicaid drug benefit management program shall include 821 initiatives to manage drug therapies for HIV/AIDS patients, 822 patients using 20 or more unique prescriptions in a 180-day 823 period, and the top 1,000 patients in annual spending. The 824 agency shall enroll any Medicaid recipient in the drug benefit 825 management program if he or she meets the specifications of this 826 provision and is not enrolled in a Medicaid health maintenance 827 organization. 828 4.The agency may limit the size of its pharmacy network 829 based on need, competitive bidding, price negotiations, 830 credentialing, or similar criteria. The agency shall give 831 special consideration to rural areas in determining the size and 832 location of pharmacies included in the Medicaid pharmacy 833 network. A pharmacy credentialing process may include criteria 834 such as a pharmacys full-service status, location, size, 835 patient educational programs, patient consultation, disease 836 management services, and other characteristics. The agency may 837 impose a moratorium on Medicaid pharmacy enrollment if it is 838 determined that it has a sufficient number of Medicaid 839 participating providers. The agency must allow dispensing 840 practitioners to participate as a part of the Medicaid pharmacy 841 network regardless of the practitioners proximity to any other 842 entity that is dispensing prescription drugs under the Medicaid 843 program. A dispensing practitioner must meet all credentialing 844 requirements applicable to his or her practice, as determined by 845 the agency. 846 5.The agency shall develop and implement a program that 847 requires Medicaid practitioners who issue written prescriptions 848 for medicinal drugs to use a counterfeit-proof prescription pad 849 for Medicaid prescriptions. The agency shall require the use of 850 standardized counterfeit-proof prescription pads by prescribers 851 who issue written prescriptions for Medicaid recipients. The 852 agency may implement the program in targeted geographic areas or 853 statewide. 854 6.The agency may enter into arrangements that require 855 manufacturers of generic drugs prescribed to Medicaid recipients 856 to provide rebates of at least 15.1 percent of the average 857 manufacturer price for the manufacturers generic products. 858 These arrangements shall require that if a generic-drug 859 manufacturer pays federal rebates for Medicaid-reimbursed drugs 860 at a level below 15.1 percent, the manufacturer must provide a 861 supplemental rebate to the state in an amount necessary to 862 achieve a 15.1-percent rebate level. 863 7.The agency may establish a preferred drug list as 864 described in this subsection, and, pursuant to the establishment 865 of such preferred drug list, negotiate supplemental rebates from 866 manufacturers that are in addition to those required by Title 867 XIX of the Social Security Act and at no less than 14 percent of 868 the average manufacturer price as defined in 42 U.S.C. s. 1936 869 on the last day of a quarter unless the federal or supplemental 870 rebate, or both, equals or exceeds 29 percent. There is no upper 871 limit on the supplemental rebates the agency may negotiate. The 872 agency may determine that specific products, brand-name or 873 generic, are competitive at lower rebate percentages. Agreement 874 to pay the minimum supplemental rebate percentage guarantees a 875 manufacturer that the Medicaid Pharmaceutical and Therapeutics 876 Committee will consider a product for inclusion on the preferred 877 drug list. However, a pharmaceutical manufacturer is not 878 guaranteed placement on the preferred drug list by simply paying 879 the minimum supplemental rebate. Agency decisions will be made 880 on the clinical efficacy of a drug and recommendations of the 881 Medicaid Pharmaceutical and Therapeutics Committee, as well as 882 the price of competing products minus federal and state rebates. 883 The agency may contract with an outside agency or contractor to 884 conduct negotiations for supplemental rebates. For the purposes 885 of this section, the term supplemental rebates means cash 886 rebates. Value-added programs as a substitution for supplemental 887 rebates are prohibited. The agency may seek any federal waivers 888 to implement this initiative. 889 8.a.The agency may implement a Medicaid behavioral drug 890 management system. The agency may contract with a vendor that 891 has experience in operating behavioral drug management systems 892 to implement this program. The agency may seek federal waivers 893 to implement this program. 894 b.The agency, in conjunction with the Department of 895 Children and Families, may implement the Medicaid behavioral 896 drug management system that is designed to improve the quality 897 of care and behavioral health prescribing practices based on 898 best practice guidelines, improve patient adherence to 899 medication plans, reduce clinical risk, and lower prescribed 900 drug costs and the rate of inappropriate spending on Medicaid 901 behavioral drugs. The program may include the following 902 elements: 903 (I)Provide for the development and adoption of best 904 practice guidelines for behavioral health-related drugs such as 905 antipsychotics, antidepressants, and medications for treating 906 bipolar disorders and other behavioral conditions; translate 907 them into practice; review behavioral health prescribers and 908 compare their prescribing patterns to a number of indicators 909 that are based on national standards; and determine deviations 910 from best practice guidelines. 911 (II)Implement processes for providing feedback to and 912 educating prescribers using best practice educational materials 913 and peer-to-peer consultation. 914 (III)Assess Medicaid beneficiaries who are outliers in 915 their use of behavioral health drugs with regard to the numbers 916 and types of drugs taken, drug dosages, combination drug 917 therapies, and other indicators of improper use of behavioral 918 health drugs. 919 (IV)Alert prescribers to patients who fail to refill 920 prescriptions in a timely fashion, are prescribed multiple same 921 class behavioral health drugs, and may have other potential 922 medication problems. 923 (V)Track spending trends for behavioral health drugs and 924 deviation from best practice guidelines. 925 (VI)Use educational and technological approaches to 926 promote best practices, educate consumers, and train prescribers 927 in the use of practice guidelines. 928 (VII)Disseminate electronic and published materials. 929 (VIII)Hold statewide and regional conferences. 930 (IX)Implement a disease management program with a model 931 quality-based medication component for severely mentally ill 932 individuals and emotionally disturbed children who are high 933 users of care. 934 9.The agency shall implement a Medicaid prescription drug 935 management system. 936 a.The agency may contract with a vendor that has 937 experience in operating prescription drug management systems in 938 order to implement this system. Any management system that is 939 implemented in accordance with this subparagraph must rely on 940 cooperation between physicians and pharmacists to determine 941 appropriate practice patterns and clinical guidelines to improve 942 the prescribing, dispensing, and use of drugs in the Medicaid 943 program. The agency may seek federal waivers to implement this 944 program. 945 b.The drug management system must be designed to improve 946 the quality of care and prescribing practices based on best 947 practice guidelines, improve patient adherence to medication 948 plans, reduce clinical risk, and lower prescribed drug costs and 949 the rate of inappropriate spending on Medicaid prescription 950 drugs. The program must: 951 (I)Provide for the adoption of best practice guidelines 952 for the prescribing and use of drugs in the Medicaid program, 953 including translating best practice guidelines into practice; 954 reviewing prescriber patterns and comparing them to indicators 955 that are based on national standards and practice patterns of 956 clinical peers in their community, statewide, and nationally; 957 and determine deviations from best practice guidelines. 958 (II)Implement processes for providing feedback to and 959 educating prescribers using best practice educational materials 960 and peer-to-peer consultation. 961 (III)Assess Medicaid recipients who are outliers in their 962 use of a single or multiple prescription drugs with regard to 963 the numbers and types of drugs taken, drug dosages, combination 964 drug therapies, and other indicators of improper use of 965 prescription drugs. 966 (IV)Alert prescribers to recipients who fail to refill 967 prescriptions in a timely fashion, are prescribed multiple drugs 968 that may be redundant or contraindicated, or may have other 969 potential medication problems. 970 10.The agency may contract for drug rebate administration, 971 including, but not limited to, calculating rebate amounts, 972 invoicing manufacturers, negotiating disputes with 973 manufacturers, and maintaining a database of rebate collections. 974 11.The agency may specify the preferred daily dosing form 975 or strength for the purpose of promoting best practices with 976 regard to the prescribing of certain drugs as specified in the 977 General Appropriations Act and ensuring cost-effective 978 prescribing practices. 979 12.The agency may require prior authorization for 980 Medicaid-covered prescribed drugs. The agency may prior 981 authorize the use of a product: 982 a.For an indication not approved in labeling; 983 b.To comply with certain clinical guidelines; or 984 c.If the product has the potential for overuse, misuse, or 985 abuse. 986 987 The agency may require the prescribing professional to provide 988 information about the rationale and supporting medical evidence 989 for the use of a drug. The agency shall post prior 990 authorization, step-edit criteria and protocol, and updates to 991 the list of drugs that are subject to prior authorization on the 992 agencys Internet website within 21 days after the prior 993 authorization and step-edit criteria and protocol and updates 994 are approved by the agency. For purposes of this subparagraph, 995 the term step-edit means an automatic electronic review of 996 certain medications subject to prior authorization. 997 13.The agency, in conjunction with the Pharmaceutical and 998 Therapeutics Committee, may require age-related prior 999 authorizations for certain prescribed drugs. The agency may 1000 preauthorize the use of a drug for a recipient who may not meet 1001 the age requirement or may exceed the length of therapy for use 1002 of this product as recommended by the manufacturer and approved 1003 by the Food and Drug Administration. Prior authorization may 1004 require the prescribing professional to provide information 1005 about the rationale and supporting medical evidence for the use 1006 of a drug. 1007 14.The agency shall implement a step-therapy prior 1008 authorization approval process for medications excluded from the 1009 preferred drug list. Medications listed on the preferred drug 1010 list must be used within the previous 12 months before the 1011 alternative medications that are not listed. The step-therapy 1012 prior authorization may require the prescriber to use the 1013 medications of a similar drug class or for a similar medical 1014 indication unless contraindicated in the Food and Drug 1015 Administration labeling. The trial period between the specified 1016 steps may vary according to the medical indication. The step 1017 therapy approval process shall be developed in accordance with 1018 the committee as stated in s. 409.91195(7) and (8). A drug 1019 product may be approved without meeting the step-therapy prior 1020 authorization criteria if the prescribing physician provides the 1021 agency with additional written medical or clinical documentation 1022 that the product is medically necessary because: 1023 a.There is not a drug on the preferred drug list to treat 1024 the disease or medical condition which is an acceptable clinical 1025 alternative; 1026 b.The alternatives have been ineffective in the treatment 1027 of the beneficiarys disease; or 1028 c.Based on historic evidence and known characteristics of 1029 the patient and the drug, the drug is likely to be ineffective, 1030 or the number of doses have been ineffective. 1031 1032 The agency shall work with the physician to determine the best 1033 alternative for the patient. The agency may adopt rules waiving 1034 the requirements for written clinical documentation for specific 1035 drugs in limited clinical situations. 1036 15.The agency shall implement a return and reuse program 1037 for drugs dispensed by pharmacies to institutional recipients, 1038 which includes payment of a $5 restocking fee for the 1039 implementation and operation of the program. The return and 1040 reuse program shall be implemented electronically and in a 1041 manner that promotes efficiency. The program must permit a 1042 pharmacy to exclude drugs from the program if it is not 1043 practical or cost-effective for the drug to be included and must 1044 provide for the return to inventory of drugs that cannot be 1045 credited or returned in a cost-effective manner. The agency 1046 shall determine if the program has reduced the amount of 1047 Medicaid prescription drugs which are destroyed on an annual 1048 basis and if there are additional ways to ensure more 1049 prescription drugs are not destroyed which could safely be 1050 reused. 1051 Section 15.Subsection (9) of section 499.067, Florida 1052 Statutes, is amended to read: 1053 499.067Denial, suspension, or revocation of permit, 1054 certification, or registration. 1055 (9)(a)The department may deny, suspend, or revoke a permit 1056 under this part if it finds the permittee has not complied with 1057 the reporting requirements of, or knowingly made a false 1058 statement in a report required by, s. 499.0121(14). 1059 (b)The department may deny an application for a renewal 1060 permit or suspend or revoke a permit if it finds the permittee 1061 has not complied with the reporting requirements of, or 1062 knowingly made a false statement in a report required by, s. 1063 499.0121(16). 1064 (c)The department may deny an application for a renewal 1065 permit or suspend or revoke a permit if it finds the permittee 1066 has not complied with the notification or reporting requirements 1067 of, or knowingly made a false statement in a notice or report 1068 required by, s. 499.026(2) or (3), respectively. 1069 Section 16.This act shall take effect July 1, 2022.