103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB3761 Introduced , by Rep. Will Guzzardi SYNOPSIS AS INTRODUCED: 215 ILCS 5/155.37 215 ILCS 5/513b1215 ILCS 5/513b1.1 new215 ILCS 5/513b1.3 new215 ILCS 5/513b1.5 new215 ILCS 124/35 new Amends the Pharmacy Benefit Managers Article of the Illinois Insurance Code. Provides that a pharmacy benefit manager may not prohibit a pharmacy or pharmacist from selling a more affordable alternative to the covered person if a more affordable alternative is available. Provides that a pharmacy benefit manager shall not reimburse a pharmacy or pharmacist in this State an amount less than the amount that the pharmacy benefit manager reimburses a pharmacy benefit manager affiliate for providing the same pharmaceutical product. Provides that a pharmacy benefit manager is prohibited from conducting spread pricing in the State. Sets forth provisions concerning pharmacy network participation, fiduciary responsibility, and pharmacy benefit manager transparency. Provides that a pharmacy benefit manager shall report to the Director on a quarterly basis and that the report is confidential and not subject to disclosure under the Freedom of Information Act. Provides that the provisions apply to contracts entered into or renewed on or after July 1, 2023 (rather than July 1, 2022). Defines terms. Amends the Network Adequacy and Transparency Act. Sets forth provisions concerning pharmacy benefit manager network adequacy. Makes other changes. LRB103 30051 BMS 56474 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB3761 Introduced , by Rep. Will Guzzardi SYNOPSIS AS INTRODUCED: 215 ILCS 5/155.37 215 ILCS 5/513b1215 ILCS 5/513b1.1 new215 ILCS 5/513b1.3 new215 ILCS 5/513b1.5 new215 ILCS 124/35 new 215 ILCS 5/155.37 215 ILCS 5/513b1 215 ILCS 5/513b1.1 new 215 ILCS 5/513b1.3 new 215 ILCS 5/513b1.5 new 215 ILCS 124/35 new Amends the Pharmacy Benefit Managers Article of the Illinois Insurance Code. Provides that a pharmacy benefit manager may not prohibit a pharmacy or pharmacist from selling a more affordable alternative to the covered person if a more affordable alternative is available. Provides that a pharmacy benefit manager shall not reimburse a pharmacy or pharmacist in this State an amount less than the amount that the pharmacy benefit manager reimburses a pharmacy benefit manager affiliate for providing the same pharmaceutical product. Provides that a pharmacy benefit manager is prohibited from conducting spread pricing in the State. Sets forth provisions concerning pharmacy network participation, fiduciary responsibility, and pharmacy benefit manager transparency. Provides that a pharmacy benefit manager shall report to the Director on a quarterly basis and that the report is confidential and not subject to disclosure under the Freedom of Information Act. Provides that the provisions apply to contracts entered into or renewed on or after July 1, 2023 (rather than July 1, 2022). Defines terms. Amends the Network Adequacy and Transparency Act. Sets forth provisions concerning pharmacy benefit manager network adequacy. Makes other changes. LRB103 30051 BMS 56474 b LRB103 30051 BMS 56474 b A BILL FOR
103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB3761 Introduced , by Rep. Will Guzzardi SYNOPSIS AS INTRODUCED:
215 ILCS 5/155.37 215 ILCS 5/513b1215 ILCS 5/513b1.1 new215 ILCS 5/513b1.3 new215 ILCS 5/513b1.5 new215 ILCS 124/35 new 215 ILCS 5/155.37 215 ILCS 5/513b1 215 ILCS 5/513b1.1 new 215 ILCS 5/513b1.3 new 215 ILCS 5/513b1.5 new 215 ILCS 124/35 new
215 ILCS 5/155.37
215 ILCS 5/513b1
215 ILCS 5/513b1.1 new
215 ILCS 5/513b1.3 new
215 ILCS 5/513b1.5 new
215 ILCS 124/35 new
Amends the Pharmacy Benefit Managers Article of the Illinois Insurance Code. Provides that a pharmacy benefit manager may not prohibit a pharmacy or pharmacist from selling a more affordable alternative to the covered person if a more affordable alternative is available. Provides that a pharmacy benefit manager shall not reimburse a pharmacy or pharmacist in this State an amount less than the amount that the pharmacy benefit manager reimburses a pharmacy benefit manager affiliate for providing the same pharmaceutical product. Provides that a pharmacy benefit manager is prohibited from conducting spread pricing in the State. Sets forth provisions concerning pharmacy network participation, fiduciary responsibility, and pharmacy benefit manager transparency. Provides that a pharmacy benefit manager shall report to the Director on a quarterly basis and that the report is confidential and not subject to disclosure under the Freedom of Information Act. Provides that the provisions apply to contracts entered into or renewed on or after July 1, 2023 (rather than July 1, 2022). Defines terms. Amends the Network Adequacy and Transparency Act. Sets forth provisions concerning pharmacy benefit manager network adequacy. Makes other changes.
LRB103 30051 BMS 56474 b LRB103 30051 BMS 56474 b
LRB103 30051 BMS 56474 b
A BILL FOR
HB3761LRB103 30051 BMS 56474 b HB3761 LRB103 30051 BMS 56474 b
HB3761 LRB103 30051 BMS 56474 b
1 AN ACT concerning regulation.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The Illinois Insurance Code is amended by
5 changing Sections 155.37 and 513b1 and by adding Sections
6 513b1.1, 513b1.3, and 513b1.5 as follows:
7 (215 ILCS 5/155.37)
8 Sec. 155.37. Drug formulary; notice.
9 (a) As used in this Section:
10 "Brand name drug" means a prescription drug marketed under
11 a proprietary name or registered trademark name.
12 "Formulary" means a list of prescription drugs that is
13 developed by clinical and pharmacy experts and represents the
14 carrier's medically appropriate and cost-effective
15 prescription drugs approved for use.
16 "Generic drug" means a prescription drug, whether
17 identified by its chemical, proprietary, or nonproprietary
18 name, that is not a brand name drug and is therapeutically
19 equivalent to a brand name drug in dosage, safety, strength,
20 method of consumption, quality, performance, and intended use.
21 (b) Insurance companies that transact the kinds of
22 insurance authorized under Class 1(b) or Class 2(a) of Section
23 4 of this Code and provide coverage for prescription drugs
103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB3761 Introduced , by Rep. Will Guzzardi SYNOPSIS AS INTRODUCED:
215 ILCS 5/155.37 215 ILCS 5/513b1215 ILCS 5/513b1.1 new215 ILCS 5/513b1.3 new215 ILCS 5/513b1.5 new215 ILCS 124/35 new 215 ILCS 5/155.37 215 ILCS 5/513b1 215 ILCS 5/513b1.1 new 215 ILCS 5/513b1.3 new 215 ILCS 5/513b1.5 new 215 ILCS 124/35 new
215 ILCS 5/155.37
215 ILCS 5/513b1
215 ILCS 5/513b1.1 new
215 ILCS 5/513b1.3 new
215 ILCS 5/513b1.5 new
215 ILCS 124/35 new
Amends the Pharmacy Benefit Managers Article of the Illinois Insurance Code. Provides that a pharmacy benefit manager may not prohibit a pharmacy or pharmacist from selling a more affordable alternative to the covered person if a more affordable alternative is available. Provides that a pharmacy benefit manager shall not reimburse a pharmacy or pharmacist in this State an amount less than the amount that the pharmacy benefit manager reimburses a pharmacy benefit manager affiliate for providing the same pharmaceutical product. Provides that a pharmacy benefit manager is prohibited from conducting spread pricing in the State. Sets forth provisions concerning pharmacy network participation, fiduciary responsibility, and pharmacy benefit manager transparency. Provides that a pharmacy benefit manager shall report to the Director on a quarterly basis and that the report is confidential and not subject to disclosure under the Freedom of Information Act. Provides that the provisions apply to contracts entered into or renewed on or after July 1, 2023 (rather than July 1, 2022). Defines terms. Amends the Network Adequacy and Transparency Act. Sets forth provisions concerning pharmacy benefit manager network adequacy. Makes other changes.
LRB103 30051 BMS 56474 b LRB103 30051 BMS 56474 b
LRB103 30051 BMS 56474 b
A BILL FOR
215 ILCS 5/155.37
215 ILCS 5/513b1
215 ILCS 5/513b1.1 new
215 ILCS 5/513b1.3 new
215 ILCS 5/513b1.5 new
215 ILCS 124/35 new
LRB103 30051 BMS 56474 b
HB3761 LRB103 30051 BMS 56474 b
HB3761- 2 -LRB103 30051 BMS 56474 b HB3761 - 2 - LRB103 30051 BMS 56474 b
HB3761 - 2 - LRB103 30051 BMS 56474 b
1 through the use of a drug formulary must notify insureds of any
2 change in the formulary. A company may comply with this
3 Section by posting changes in the formulary on its website.
4 (c) If a generic equivalent for a brand name drug is
5 approved by the U.S. Food and Drug Administration, then
6 insurance companies with plans that provide coverage for
7 prescription drugs through the use of a drug formulary that
8 are amended, delivered, issued, or renewed in this State on or
9 after January 1, 2024 shall:
10 (1) immediately make the generic equivalent available
11 on the formulary to the brand name drug; or
12 (2) move the brand name drug to a formulary tier that
13 reduces an enrollee's cost.
14 (d) Nothing in this Section shall interfere with a
15 pharmacist complying with the Pharmacy Practice Act.
16 (e) The Department may adopt rules to implement this
17 Section.
18 (Source: P.A. 92-440, eff. 8-17-01; 92-651, eff. 7-11-02.)
19 (215 ILCS 5/513b1)
20 Sec. 513b1. Pharmacy benefit manager contracts.
21 (a) As used in this Section:
22 "340B drug discount program" means the program established
23 under Section 340B of the federal Public Health Service Act,
24 42 U.S.C. 256b.
25 "340B entity" means a covered entity as defined in 42
HB3761 - 2 - LRB103 30051 BMS 56474 b
HB3761- 3 -LRB103 30051 BMS 56474 b HB3761 - 3 - LRB103 30051 BMS 56474 b
HB3761 - 3 - LRB103 30051 BMS 56474 b
1 U.S.C. 256b(a)(4) authorized to participate in the 340B drug
2 discount program.
3 "340B pharmacy" means any pharmacy used to dispense 340B
4 drugs for a covered entity, whether entity-owned or external.
5 "Biological product" has the meaning ascribed to that term
6 in Section 19.5 of the Pharmacy Practice Act.
7 "Covered person" means a member, policyholder, subscriber,
8 enrollee, beneficiary, dependent, or other individual
9 participating in a health benefit plan.
10 "Health benefit plan" means a policy, contract,
11 certificate, or agreement entered into, offered, or issued by
12 an insurer to provide, deliver, arrange for, pay for, or
13 reimburse any of the costs of physical, mental, or behavioral
14 health care services.
15 "Maximum allowable cost" means the maximum amount that a
16 pharmacy benefit manager will reimburse a pharmacy for the
17 cost of a drug.
18 "Maximum allowable cost list" means a list of drugs for
19 which a maximum allowable cost has been established by a
20 pharmacy benefit manager.
21 "Pharmacy benefit manager" means a person, business, or
22 entity, including a wholly or partially owned or controlled
23 subsidiary of a pharmacy benefit manager, that provides claims
24 processing services or other prescription drug or device
25 services, or both, for health benefit plans.
26 "Retail price" means the price an individual without
HB3761 - 3 - LRB103 30051 BMS 56474 b
HB3761- 4 -LRB103 30051 BMS 56474 b HB3761 - 4 - LRB103 30051 BMS 56474 b
HB3761 - 4 - LRB103 30051 BMS 56474 b
1 prescription drug coverage would pay at a retail pharmacy, not
2 including a pharmacist dispensing fee.
3 "Spread pricing" means the model of prescription drug
4 pricing in which the pharmacy benefits manager charges a
5 health benefit plan a contracted price for prescription drugs,
6 and the contracted price for the prescription drugs differs
7 from the amount the pharmacy benefits manager directly or
8 indirectly pays the pharmacist or pharmacy for pharmacist
9 services.
10 "Third-party payer" means any entity that pays for
11 prescription drugs on behalf of a patient other than a health
12 care provider or sponsor of a plan subject to regulation under
13 Medicare Part D, 42 U.S.C. 1395w-101, et seq.
14 (b) A contract between a health insurer and a pharmacy
15 benefit manager must require that the pharmacy benefit
16 manager:
17 (1) Update maximum allowable cost pricing information
18 at least every 7 calendar days.
19 (2) Maintain a process that will, in a timely manner,
20 eliminate drugs from maximum allowable cost lists or
21 modify drug prices to remain consistent with changes in
22 pricing data used in formulating maximum allowable cost
23 prices and product availability.
24 (3) Provide access to its maximum allowable cost list
25 to each pharmacy or pharmacy services administrative
26 organization subject to the maximum allowable cost list.
HB3761 - 4 - LRB103 30051 BMS 56474 b
HB3761- 5 -LRB103 30051 BMS 56474 b HB3761 - 5 - LRB103 30051 BMS 56474 b
HB3761 - 5 - LRB103 30051 BMS 56474 b
1 Access may include a real-time pharmacy website portal to
2 be able to view the maximum allowable cost list. As used in
3 this Section, "pharmacy services administrative
4 organization" means an entity operating within the State
5 that contracts with independent pharmacies to conduct
6 business on their behalf with third-party payers. A
7 pharmacy services administrative organization may provide
8 administrative services to pharmacies and negotiate and
9 enter into contracts with third-party payers or pharmacy
10 benefit managers on behalf of pharmacies.
11 (4) Provide a process by which a contracted pharmacy
12 can appeal the provider's reimbursement for a drug subject
13 to maximum allowable cost pricing. The appeals process
14 must, at a minimum, include the following:
15 (A) A requirement that a contracted pharmacy has
16 14 calendar days after the applicable fill date to
17 appeal a maximum allowable cost if the reimbursement
18 for the drug is less than the net amount that the
19 network provider paid to the supplier of the drug.
20 (B) A requirement that a pharmacy benefit manager
21 must respond to a challenge within 14 calendar days of
22 the contracted pharmacy making the claim for which the
23 appeal has been submitted.
24 (C) A telephone number and e-mail address or
25 website to network providers, at which the provider
26 can contact the pharmacy benefit manager to process
HB3761 - 5 - LRB103 30051 BMS 56474 b
HB3761- 6 -LRB103 30051 BMS 56474 b HB3761 - 6 - LRB103 30051 BMS 56474 b
HB3761 - 6 - LRB103 30051 BMS 56474 b
1 and submit an appeal.
2 (D) A requirement that, if an appeal is denied,
3 the pharmacy benefit manager must provide the reason
4 for the denial and the name and the national drug code
5 number from national or regional wholesalers.
6 (E) A requirement that, if an appeal is sustained,
7 the pharmacy benefit manager must make an adjustment
8 in the drug price effective the date the challenge is
9 resolved and make the adjustment applicable to all
10 similarly situated network pharmacy providers, as
11 determined by the managed care organization or
12 pharmacy benefit manager.
13 (5) Allow a plan sponsor contracting with a pharmacy
14 benefit manager an annual right to audit compliance with
15 the terms of the contract by the pharmacy benefit manager,
16 including, but not limited to, full disclosure of any and
17 all rebate amounts secured, whether product specific or
18 generalized rebates, that were provided to the pharmacy
19 benefit manager by a pharmaceutical manufacturer.
20 (6) Allow a plan sponsor contracting with a pharmacy
21 benefit manager to request that the pharmacy benefit
22 manager disclose the actual amounts paid by the pharmacy
23 benefit manager to the pharmacy.
24 (7) Provide notice to the party contracting with the
25 pharmacy benefit manager of any consideration that the
26 pharmacy benefit manager receives from the manufacturer
HB3761 - 6 - LRB103 30051 BMS 56474 b
HB3761- 7 -LRB103 30051 BMS 56474 b HB3761 - 7 - LRB103 30051 BMS 56474 b
HB3761 - 7 - LRB103 30051 BMS 56474 b
1 for dispense as written prescriptions once a generic or
2 biologically similar product becomes available.
3 (c) In order to place a particular prescription drug on a
4 maximum allowable cost list, the pharmacy benefit manager
5 must, at a minimum, ensure that:
6 (1) if the drug is a generically equivalent drug, it
7 is listed as therapeutically equivalent and
8 pharmaceutically equivalent "A" or "B" rated in the United
9 States Food and Drug Administration's most recent version
10 of the "Orange Book" or have an NR or NA rating by
11 Medi-Span, Gold Standard, or a similar rating by a
12 nationally recognized reference;
13 (2) the drug is available for purchase by each
14 pharmacy in the State from national or regional
15 wholesalers operating in Illinois; and
16 (3) the drug is not obsolete.
17 (d) A pharmacy benefit manager is prohibited from limiting
18 a pharmacist's ability to disclose to a covered person:
19 (1) whether the cost-sharing obligation exceeds the
20 retail price for a covered prescription drug, and the
21 availability of a more affordable alternative drug, if one
22 is available in accordance with Section 42 of the Pharmacy
23 Practice Act; or .
24 (2) any health care information that the pharmacy or
25 pharmacist deems appropriate regarding:
26 (i) the nature of treatment, risks, or
HB3761 - 7 - LRB103 30051 BMS 56474 b
HB3761- 8 -LRB103 30051 BMS 56474 b HB3761 - 8 - LRB103 30051 BMS 56474 b
HB3761 - 8 - LRB103 30051 BMS 56474 b
1 alternatives thereto, if such disclosure is consistent
2 with the permissible practice of pharmacy under the
3 Pharmacy Practice Act;
4 (ii) the availability of alternative therapies,
5 consultations, or tests if such disclosure is
6 consistent with the permissible practice of pharmacy
7 under the Pharmacy Practice Act;
8 (iii) the decision of utilization reviewers or
9 similar persons to authorize or deny services;
10 (iv) the process that is used to authorize or deny
11 health care services or benefits; or
12 (v) information on financial incentives and
13 structures used by the insurer.
14 (e) A health insurer or pharmacy benefit manager shall not
15 require an insured to make a payment for a prescription drug at
16 the point of sale in an amount that exceeds the lesser of:
17 (1) the applicable cost-sharing amount; or
18 (2) the retail price of the drug in the absence of
19 prescription drug coverage.
20 (f) Unless required by law, a contract between a pharmacy
21 benefit manager or third-party payer and a 340B entity or 340B
22 pharmacy shall not contain any provision that:
23 (1) distinguishes between drugs purchased through the
24 340B drug discount program and other drugs when
25 determining reimbursement or reimbursement methodologies,
26 or contains otherwise less favorable payment terms or
HB3761 - 8 - LRB103 30051 BMS 56474 b
HB3761- 9 -LRB103 30051 BMS 56474 b HB3761 - 9 - LRB103 30051 BMS 56474 b
HB3761 - 9 - LRB103 30051 BMS 56474 b
1 reimbursement methodologies for 340B entities or 340B
2 pharmacies when compared to similarly situated non-340B
3 entities;
4 (2) imposes any fee, chargeback, or rate adjustment
5 that is not similarly imposed on similarly situated
6 pharmacies that are not 340B entities or 340B pharmacies;
7 (3) imposes any fee, chargeback, or rate adjustment
8 that exceeds the fee, chargeback, or rate adjustment that
9 is not similarly imposed on similarly situated pharmacies
10 that are not 340B entities or 340B pharmacies;
11 (4) prevents or interferes with an individual's choice
12 to receive a covered prescription drug from a 340B entity
13 or 340B pharmacy through any legally permissible means,
14 except that nothing in this paragraph shall prohibit the
15 establishment of differing copayments or other
16 cost-sharing amounts within the benefit plan for covered
17 persons who acquire covered prescription drugs from a
18 nonpreferred or nonparticipating provider;
19 (5) excludes a 340B entity or 340B pharmacy from a
20 pharmacy network on any basis that includes consideration
21 of whether the 340B entity or 340B pharmacy participates
22 in the 340B drug discount program;
23 (6) prevents a 340B entity or 340B pharmacy from using
24 a drug purchased under the 340B drug discount program; or
25 (7) any other provision that discriminates against a
26 340B entity or 340B pharmacy by treating the 340B entity
HB3761 - 9 - LRB103 30051 BMS 56474 b
HB3761- 10 -LRB103 30051 BMS 56474 b HB3761 - 10 - LRB103 30051 BMS 56474 b
HB3761 - 10 - LRB103 30051 BMS 56474 b
1 or 340B pharmacy differently than non-340B entities or
2 non-340B pharmacies for any reason relating to the
3 entity's participation in the 340B drug discount program.
4 As used in this subsection, "pharmacy benefit manager" and
5 "third-party payer" do not include pharmacy benefit managers
6 and third-party payers acting on behalf of a Medicaid program.
7 (g) A violation of this Section by a pharmacy benefit
8 manager constitutes an unfair or deceptive act or practice in
9 the business of insurance under Section 424.
10 (h) A provision that violates subsection (f) in a contract
11 between a pharmacy benefit manager or a third-party payer and
12 a 340B entity that is entered into, amended, or renewed after
13 July 1, 2022 shall be void and unenforceable.
14 (i) A pharmacy benefit manager may not prohibit a pharmacy
15 or pharmacist from selling a more affordable alternative to
16 the covered person if a more affordable alternative is
17 available.
18 (j) A pharmacy benefit manager shall not reimburse a
19 pharmacy or pharmacist in this State an amount less than the
20 amount that the pharmacy benefit manager reimburses a pharmacy
21 benefit manager affiliate for providing the same
22 pharmaceutical product.
23 (k) A pharmacy benefit manager shall not:
24 (1) condition payment, reimbursement, or network
25 participation on any type of accreditation, certification,
26 or credentialing standard beyond those required by the
HB3761 - 10 - LRB103 30051 BMS 56474 b
HB3761- 11 -LRB103 30051 BMS 56474 b HB3761 - 11 - LRB103 30051 BMS 56474 b
HB3761 - 11 - LRB103 30051 BMS 56474 b
1 State Board of Pharmacy or applicable State or federal
2 law;
3 (2) prohibit or otherwise restrict a pharmacist or
4 pharmacy from offering prescription delivery services to
5 any covered person; or
6 (3) require any additional requirement for a
7 prescription claim that is more restrictive than the
8 standards established under the Illinois Food, Drug and
9 Cosmetic Act; the Pharmacy Practice Act; or the Illinois
10 Controlled Substances Act.
11 (l) A pharmacy benefit manager is prohibited from
12 conducting spread pricing in this State.
13
14 (m) (i) This Section applies to contracts entered into or
15 renewed on or after July 1, 2023 2022.
16 (n) (j) This Section applies to any group or individual
17 policy of accident and health insurance or managed care plan
18 that provides coverage for prescription drugs and that is
19 amended, delivered, issued, or renewed on or after July 1,
20 2020.
21 (Source: P.A. 101-452, eff. 1-1-20; 102-778, eff. 7-1-22;
22 revised 8-19-22.)
23 (215 ILCS 5/513b1.1 new)
24 Sec. 513b1.1. Pharmacy network participation.
25 (a) As used in this Section:
HB3761 - 11 - LRB103 30051 BMS 56474 b
HB3761- 12 -LRB103 30051 BMS 56474 b HB3761 - 12 - LRB103 30051 BMS 56474 b
HB3761 - 12 - LRB103 30051 BMS 56474 b
1 "Claims processing services" means the administrative
2 services performed in connection with the processing and
3 adjudicating of claims relating to pharmacist services that
4 include:
5 (1) receiving payments for pharmacist services; or
6 (2) making payments to a pharmacist or pharmacy for
7 pharmacist services.
8 "Pharmacy benefit manager affiliate" means a pharmacy or
9 pharmacist that directly or indirectly, through one or more
10 intermediaries, owns or controls, is owned or controlled by,
11 or is under common ownership or control with a pharmacy
12 benefit manager. "Pharmacy benefit manager affiliate" includes
13 any mail-order pharmacy that is directly or indirectly owned
14 or controlled by a pharmacy benefit manager.
15 (b) A pharmacy benefit manager shall not:
16 (1) prohibit or limit a participant or beneficiary of
17 pharmacy services under a health benefit plan from
18 selecting a pharmacy or pharmacist of his or her choice if
19 the pharmacy or pharmacist is willing and agrees to accept
20 the same terms and conditions that the pharmacy benefit
21 manager has established for at least one of the networks
22 of pharmacies that the pharmacy benefit manager has
23 established to serve patients within this State;
24 (2) prohibit a pharmacy from participating in any
25 given network of pharmacies within the State if the
26 pharmacy is licensed by the Department of Financial and
HB3761 - 12 - LRB103 30051 BMS 56474 b
HB3761- 13 -LRB103 30051 BMS 56474 b HB3761 - 13 - LRB103 30051 BMS 56474 b
HB3761 - 13 - LRB103 30051 BMS 56474 b
1 Professional Regulation and agrees to the same terms and
2 conditions, including the terms of reimbursement, that the
3 pharmacy benefit manager has established for other
4 pharmacies participating within the network that the
5 pharmacy wishes to join;
6 (3) charge a participant or beneficiary of a pharmacy
7 benefits plan or program that the pharmacy benefit manager
8 serves a different copayment obligation or additional fee
9 for using any pharmacy within a given network of
10 pharmacies established by the pharmacy benefit manager to
11 serve patients within this State;
12 (4) impose a monetary advantage, incentive, or penalty
13 under a health benefit plan that would affect or influence
14 a beneficiary's choice among those pharmacies or
15 pharmacists who have agreed to participate in the plan
16 according to the terms offered by the insurer;
17 (5) require a participant or beneficiary to use or
18 otherwise obtain services exclusively from a mail-order
19 pharmacy or one or more pharmacy benefit manager
20 affiliates;
21 (6) impose upon a beneficiary any copayment obligation
22 or other limitation, restriction, or condition, including
23 the number of days of a drug supply for which coverage will
24 be allowed, that is more costly or more restrictive than
25 that which would be imposed upon the beneficiary if such
26 services were purchased from a pharmacy benefit manager
HB3761 - 13 - LRB103 30051 BMS 56474 b
HB3761- 14 -LRB103 30051 BMS 56474 b HB3761 - 14 - LRB103 30051 BMS 56474 b
HB3761 - 14 - LRB103 30051 BMS 56474 b
1 affiliate or any other pharmacy within a given network of
2 pharmacies established by the pharmacy benefit manager to
3 serve patients within this State;
4 (7) require participation in additional networks for a
5 pharmacy to enroll in an individual network;
6 (8) include in any manner on any material, including,
7 but not limited to, mail and identifications cards, the
8 name of any pharmacy, hospital, or other providers unless
9 it specifically lists all pharmacies, hospitals, and
10 providers participating in the given network of pharmacies
11 established by the pharmacy benefit manager to serve
12 patients within this State; or
13 (9) share, transfer, or otherwise utilize patient
14 information or pharmacy service data collected pursuant to
15 the provision of claims processing services for the
16 purpose of referring a participant or beneficiary to a
17 pharmacy benefit manager affiliate.
18 (c) A pharmacy licensed in or holding a nonresident
19 pharmacy permit in Illinois shall be prohibited from:
20 (1) transferring or sharing records relative to
21 prescription information containing patient identifiable
22 and prescriber identifiable data to or from an affiliate
23 for any commercial purpose; however, nothing shall be
24 construed to prohibit the exchange of prescription
25 information between a pharmacy and its affiliate for the
26 limited purposes of pharmacy reimbursement, formulary
HB3761 - 14 - LRB103 30051 BMS 56474 b
HB3761- 15 -LRB103 30051 BMS 56474 b HB3761 - 15 - LRB103 30051 BMS 56474 b
HB3761 - 15 - LRB103 30051 BMS 56474 b
1 compliance, pharmacy care, public health activities
2 otherwise authorized by law, or utilization review by a
3 health care provider; or
4 (2) presenting a claim for payment to any individual,
5 third-party payer, affiliate, or other entity for a
6 service furnished pursuant to a referral from an affiliate
7 or other person licensed under this Article.
8 (d) If a pharmacy licensed or holding a nonresident
9 pharmacy permit in this State has an affiliate, it shall
10 annually file with the Department a disclosure statement
11 identifying all such affiliates.
12 (e) This Section shall not be construed to prohibit a
13 pharmacy from entering into an agreement with an affiliate to
14 provide pharmacy care to patients if the pharmacy does not
15 receive referrals in violation of subsection (c) and the
16 pharmacy provides the disclosure statement required in
17 subsection (d).
18 (f) In addition to any other remedy provided by law, a
19 violation of this Section by a pharmacy shall be grounds for
20 disciplinary action by the Department.
21 (g) A pharmacist who fills a prescription that violates
22 subsection (c) shall not be liable under this Section.
23 (h) This Section does not apply to:
24 (1) any hospital or related institution; or
25 (2) any referrals by an affiliate for pharmacy
26 services and prescriptions to patients in skilled nursing
HB3761 - 15 - LRB103 30051 BMS 56474 b
HB3761- 16 -LRB103 30051 BMS 56474 b HB3761 - 16 - LRB103 30051 BMS 56474 b
HB3761 - 16 - LRB103 30051 BMS 56474 b
1 facilities, intermediate care facilities, continuing care
2 retirement communities, home health agencies, or hospices.
3 (215 ILCS 5/513b1.3 new)
4 Sec. 513b1.3. Fiduciary responsibility. A pharmacy benefit
5 manager is a fiduciary to a contracted health insurer and
6 shall:
7 (1) discharge that duty in accordance with federal and
8 State law;
9 (2) notify the covered entity in writing of any
10 activity, policy, or practice of the pharmacy benefit
11 manager that directly or indirectly presents any conflict
12 of interest and inability to comply with the duties
13 imposed by this Section, but in no event does this
14 notification exempt the pharmacy benefit manager from
15 compliance with all other Sections of this Code; and
16 (3) disclose all direct or indirect payments related
17 to the dispensation of prescription drugs or classes or
18 brands of drugs to the covered entity.
19 (215 ILCS 5/513b1.5 new)
20 Sec. 513b1.5. Pharmacy benefit manager transparency.
21 (a) A pharmacy benefit manager shall report to the
22 Director on a quarterly basis for each health care insurer the
23 following information:
24 (1) the aggregate amount of rebates received by the
HB3761 - 16 - LRB103 30051 BMS 56474 b
HB3761- 17 -LRB103 30051 BMS 56474 b HB3761 - 17 - LRB103 30051 BMS 56474 b
HB3761 - 17 - LRB103 30051 BMS 56474 b
1 pharmacy benefit manager;
2 (2) the aggregate amount of rebates distributed to the
3 appropriate health care insurer;
4 (3) the aggregate amount of rebates passed on to the
5 enrollees of each health care insurer at the point of sale
6 that reduced the enrollees' applicable deductible,
7 copayment, coinsurance, or other cost-sharing amount;
8 (4) the individual and aggregate amount paid by the
9 health care insurer to the pharmacy benefit manager for
10 pharmacist services itemized by pharmacy, by product, and
11 by goods and services; and
12 (5) the individual and aggregate amount a pharmacy
13 benefit manager paid for pharmacist services itemized by
14 pharmacy, by product, and by goods and services.
15 (b) The report made to the Department required under this
16 Section is confidential and not subject to disclosure under
17 the Freedom of Information Act.
18 Section 10. The Network Adequacy and Transparency Act is
19 amended by adding Section 35 as follows:
20 (215 ILCS 124/35 new)
21 Sec. 35. Pharmacy benefit manager network adequacy.
22 (a) As used in this Section:
23 "Pharmacy benefit manager" has the meaning ascribed to
24 that term in Section 513b1 of the Illinois Insurance Code.
HB3761 - 17 - LRB103 30051 BMS 56474 b
HB3761- 18 -LRB103 30051 BMS 56474 b HB3761 - 18 - LRB103 30051 BMS 56474 b
HB3761 - 18 - LRB103 30051 BMS 56474 b
1 "Pharmacy benefit manager network" means the group or
2 groups of preferred providers of pharmacy services to a
3 network plan.
4 "Pharmacy benefit manager network plan" means an
5 individual or group policy of accident and health insurance
6 that either requires a covered person to use or creates
7 incentives, including financial incentives, for a covered
8 person to use providers of pharmacy services managed, owned,
9 under contract with, or employed by the insurer.
10 "Pharmacy services" means products, goods, and services or
11 any combination of products, goods, and services, provided as
12 a part of the practice of pharmacy. "Pharmacy services"
13 includes pharmacist care as defined in the Pharmacy Practice
14 Act.
15 (b) A pharmacy benefit manager shall provide a reasonably
16 adequate and accessible pharmacy benefit manager network for
17 the provision of prescription drugs for a health benefit plan
18 that shall provide for convenient patient access to pharmacies
19 within a reasonable distance from a patient's residence.
20 (c) Pharmacy benefit managers must file for review by the
21 Director a pharmacy benefit manager network plan describing
22 the pharmacy benefit manager network and the pharmacy benefit
23 manager network's accessibility in this State in the time and
24 manner required by rule issued by the Department.
25 (1) A mail-order pharmacy shall not be included in the
26 calculations determining pharmacy benefit manager network
HB3761 - 18 - LRB103 30051 BMS 56474 b
HB3761- 19 -LRB103 30051 BMS 56474 b HB3761 - 19 - LRB103 30051 BMS 56474 b
HB3761 - 19 - LRB103 30051 BMS 56474 b
1 adequacy.
2 (2) A pharmacy benefit manager network plan shall
3 comply with the following retail pharmacy network access
4 standards:
5 (A) at least 90% of covered individuals residing
6 in an urban service area live within 2 miles of a
7 retail pharmacy participating in the pharmacy benefit
8 manager's retail pharmacy network;
9 (B) at least 90% of covered individuals residing
10 in an urban service area live within 5 miles of a
11 retail pharmacy designated as a preferred
12 participating pharmacy in the pharmacy benefit
13 manager's retail pharmacy network;
14 (C) at least 90% of covered individuals residing
15 in a suburban service area live within 5 miles of a
16 retail pharmacy participating in the pharmacy benefit
17 manager's retail pharmacy network;
18 (D) at least 90% of covered individuals residing
19 in a suburban service area live within 7 miles of a
20 retail pharmacy designated as a preferred
21 participating pharmacy in the pharmacy benefit
22 manager's retail pharmacy network;
23 (E) at least 70% of covered individuals residing
24 in a rural service area live within 15 miles of a
25 retail pharmacy participating in the pharmacy benefit
26 manager's retail pharmacy network; and
HB3761 - 19 - LRB103 30051 BMS 56474 b
HB3761- 20 -LRB103 30051 BMS 56474 b HB3761 - 20 - LRB103 30051 BMS 56474 b
HB3761 - 20 - LRB103 30051 BMS 56474 b
1 (F) at least 70% of covered individuals residing
2 in a rural service area live within 18 miles of a
3 retail pharmacy designated as a preferred
4 participating pharmacy in the pharmacy benefit
5 manager's retail pharmacy network.
6 (d) The Director shall establish a process for the review
7 of the adequacy of the standards required under this Section.
HB3761 - 20 - LRB103 30051 BMS 56474 b