SLS 19RS-347 REENGROSSED
2019 Regular Session
SENATE BILL NO. 164
BY SENATOR MORRISH
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
HEALTH/ACC INSURANCE. Provides relative to the administration of prescription drug
benefits. (8/1/19)
1 AN ACT
2 To amend and reenact R.S. 22:1006.1(A) and 1053(A) and (D) and R.S. 44:4.1(B)(11) and
3 R.S. 44:4.1(B)(11) as amended by Section 2 of Act 371 of the 2018 Regular Session,
4 to enact R.S. 22:1053 (B)(4) and (5) and (E), and Subpart P of Part III of Chapter 4
5 of Title 22 of the Louisiana Revised Statutes of 1950, to be comprised of R.S.
6 22:1260.41 through 1260.46, and to repeal R.S. 22:1657 and R.S. 22:1657 as
7 amended by Section 1 of Act 371 of the 2018 Regular Session, relative to the
8 administration of prescription drug benefits; to provide for prior authorization; to
9 provide for step therapy; to provide for licensure of pharmacy benefit managers; to
10 provide for prohibited conduct; to provide for consumer access to information; to
11 provide for an exception to the Public Records Law; and to provide for related
12 matters.
13 Be it enacted by the Legislature of Louisiana:
14 Section 1. R.S. 22:1006.1(A) and 1053(D) are hereby amended and reenacted and
15 R.S. 22:1053(E) and (F) and Subpart P of Part III of Chapter 4 of Title 22 of the Louisiana
16 Revised Statutes of 1950, comprised of R.S. 22:1260.41 through 1260.46, are hereby enacted
17 to read as follows:
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1 §1006.1. Prior authorization; forms required; criteria
2 A. As used in this Section:
3 (1) "Health benefit plan", "plan", "benefit", or "health insurance coverage"
4 means services consisting of medical care, provided directly, through insurance or
5 reimbursement, or otherwise, and including items and services paid for as medical
6 care under any hospital or medical service policy or certificate, hospital or medical
7 service plan contract, preferred provider organization, or health maintenance
8 organization contract offered by a health insurance issuer that may or may not be
9 administered by a pharmacy benefit manager. However, excepted benefits are not
10 included as a "health benefit plan".
11 (2) "Health insurance issuer" means any an entity that offers health insurance
12 coverage through a plan, policy, or certificate of insurance subject to state law that
13 regulates the business of insurance. "Health insurance issuer" shall also include a
14 health maintenance organization, as defined and licensed pursuant to Subpart I of
15 Part I of Chapter 2 of this Title.
16 (3) "Prior authorization" shall mean means a utilization management
17 criterion utilized to seek permission or waiver of a drug to be covered under a health
18 benefit plan that provides prescription drug benefits.
19 (4) "Prior authorization form" shall mean means a single uniform
20 prescription drug prior authorization form used by all health insurance issuers,
21 including any health insurance issuer pharmacy benefit managers, for the purpose of
22 obtaining prior authorization.
23 * * *
24 §1053. Requirement for coverage of step therapy or fail first protocols
25 A. Notwithstanding the provisions of R.S. 22:1047 to the contrary, any health
26 care coverage plan specific in Subsection DE of this Section which includes
27 prescription benefits as part of its policy or contract, which utilizes step therapy or
28 fail first protocols, and which is issued for delivery, delivered, renewed, or otherwise
29 contracted for in this state on or after January 1, 2011, shall comply with the
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1 provisions of the Section.
2 B. When medications for the treatment of any medical condition are restricted
3 for use by an insurer by a step therapy or fail first protocol, the prescribing physician
4 shall have access to a clear and convenient process to expeditiously request an
5 override of such restriction from the insurer. An override of such restriction shall be
6 expeditiously granted by the insurer under any of the following circumstances:
7 * * *
8 (4) The prescribing physician can demonstrate to the health coverage
9 plan that the preferred treatment required under the step therapy or fail first
10 protocol was discontinued due to lack of efficacy or effectiveness, diminished
11 effect, or an adverse event.
12 (5) The prescribing physician can demonstrate to the health coverage
13 plan, the criteria set forth in Paragraphs (B)(1) through (4) have been satisfied
14 under the insured's current or previous health coverage plan in the treatment
15 of the insured's disease or medical condition.
16 * * *
17 D. The provisions of this Section shall not be construed to prevent:
18 (1) A group health plan from requiring a patient to try a generic
19 equivalent of a prescription drug before providing coverage for the equivalent
20 brand-name prescription drug.
21 (2) A practitioner from prescribing a prescription drug that the
22 practitioner has determined to be medically necessary.
23 E. As used in this Section, a "health coverage plan" shall mean any hospital,
24 health, or medical expense insurance policy, hospital or medical service contract,
25 employee welfare benefit plan, contract or agreement with a health maintenance
26 organization or a preferred provider organization, health and accident insurance
27 policy, or any other insurance contract of this type, including a group insurance plan
28 and the Office of Group Benefits programs that may or may not be administered
29 by a pharmacy benefit manager.
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1 * * *
2 SUBPART P. PHARMACY BENEF IT MANAGERS
3 §1260.41. Short title
4 This Subpart shall be known and may be cited as the "Louisiana
5 Pharmacy Benefit Manager Licensure and Regulation Act". This Subpart shall
6 not be construed to contain the exclusive laws regulating the business of
7 pharmacy benefit managers.
8 §1260.42. Findings and purpose
9 A. The legislature finds that it is necessary to establish standards and
10 criteria for the regulation and licensure of pharmacy benefit managers. For
11 purposes of this Subpart, "pharmacy benefit manager" shall have the same
12 meaning as defined in R.S. 22:1641(8).
13 B. The purposes of this Subpart are:
14 (1) To promote, preserve, and protect the health, safety, and welfare of
15 the public through effective licensure and regulation of pharmacy benefit
16 managers.
17 (2) To provide for powers and duties of the commissioner of insurance.
18 (3) To provide for penalties and fines.
19 §1260.43. Pharmacy benefit manager; licensure
20 A. A person or organization shall not establish or operate as a pharmacy
21 benefit manager in this state for health benefit plans without obtaining a license
22 from the commissioner of insurance pursuant to R.S. 22:1651.
23 B. As a condition of licensure, each pharmacy benefit manager shall
24 obtain a surety bond of no less than one million dollars.
25 §1260.44. Enforcement
26 A. The commissioner of insurance shall have enforcement authority
27 relative to pharmacy benefit managers as provided for under this Title.
28 B. The commissioner may examine or audit the books and records of a
29 pharmacy benefit manager in accordance with R.S. 22:1981 et seq. All
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1 information or data acquired during an examination conducted pursuant to this
2 Section shall be considered proprietary, confidential, and not subject to
3 disclosure pursuant to R.S. 44:1 et seq.
4 §1260.45. Pharmacy benefit manager; prohibited conduct
5 A. No pharmacy benefit manager or other entity that administers
6 prescription drug benefits in Louisiana shall prohibit, by contract, a pharmacy
7 or pharmacist from informing a patient of all relevant options when acquiring
8 their prescription medication, including but not limited to the cost and clinical
9 efficacy of a more affordable alternative if one is available and the ability to pay
10 cash if a cash payment for the same drug is less than an insurance copayment
11 or deductible payment amount.
12 B. Any provision of a contract that violates the provisions of this Section
13 shall be unenforceable and shall be deemed an unfair or deceptive act and
14 practice pursuant to R.S. 22:1961 et seq.
15 §1260.46. Consumer access to information
16 A. Effective January 1, 2020, the commissioner of insurance shall
17 provide a dedicated location on the department's website for pharmacy benefit
18 manager information and links.
19 B. For each of a pharmacy benefit manager's contractual or other
20 relationships with a health benefit plan or health insurance issuer, the
21 pharmacy benefit manager shall provide the department with the health benefit
22 plan's formulary and provide timely notification of formulary changes and
23 product exclusions. The information provided pursuant to this Subsection shall
24 be made available in a centralized location on the department's website in a
25 format that allows for consumer access, including links to pharmacy benefit
26 manager websites.
27 * * *
28 Section 2. R.S. 44:4.1(B)(11) is hereby amended and reenacted to read as follows:
29 §4.1. Exceptions
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1 * * *
2 B. The legislature further recognizes that there exist exceptions, exemptions,
3 and limitations to the laws pertaining to public records throughout the revised
4 statutes and codes of this state. Therefore, the following exceptions, exemptions, and
5 limitations are hereby continued in effect by incorporation into this Chapter by
6 citation:
7 * * *
8 (11) R.S. 22:2, 14, 31, 42.1, 88, 244, 263, 265, 461, 550.7, 571, 572, 572.1,
9 574, 618, 639, 691.4, 691.5, 691.6, 691.7, 691.8, 691.9, 691.9.1, 691.10, 691.38,
10 691.56, 732, 752, 753, 771, 834, 972(D), 976, 1008, 1019.2, 1203, 1260.44, 1460,
11 1464, 1466, 1488, 1546, 1559, 1566(D), 1644, 1656, 1723, 1796, 1801, 1808.3,
12 1927, 1929, 1983, 1984, 2036, 2045, 2056, 2085, 2091, 2293, 2303
13 * * *
14 Section 3. R.S. 44:4.1(B)(11) as amended by Section 2 of Act 371 of the 2018
15 Regular Session is hereby amended and reenacted to read as follows:
16 §4.1. Exceptions
17 * * *
18 B. The legislature further recognizes that there exist exceptions, exemptions,
19 and limitations to the laws pertaining to public records throughout the revised
20 statutes and codes of this state. Therefore, the following exceptions, exemptions, and
21 limitations are hereby continued in effect by incorporation into this Chapter by
22 citation:
23 * * *
24 (11) R.S. 22:2, 14, 31, 42.1, 88, 244, 263, 265, 461, 550.7, 571, 572, 572.1,
25 574, 618, 639, 691.4, 691.5, 691.6, 691.7, 691.8, 691.9, 691.9.1, 691.10, 691.38,
26 691.56, 732, 752, 753, 771, 834, 972(D), 1008, 1019.2, 1203, 1260.44, 1460, 1464,
27 1466, 1488, 1546, 1559, 1566(D), 1644, 1656, 1657.1, 1723, 1796, 1801, 1808.3,
28 1927, 1929, 1983, 1984, 2036, 2045, 2056, 2085, 2091, 2293, 2303
29 * * *
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1 Section 4. R.S. 22:1657 and R.S. 22:1657 as amended by Section 1 of Act 371 of
2 the 2018 Regular Session are hereby repealed.
3 Section 5. The provisions of Section 3 of this Act shall become effective on
4 January 1, 2020.
The original instrument was prepared by Christine Arbo Peck. The following
digest, which does not constitute a part of the legislative instrument, was
prepared by Cathy R. Wells.
DIGEST
SB 164 Reengrossed 2019 Regular Session Morrish
Present law provides for regulation of prior authorization procedures for prescription drugs.
Proposed law retains present law and makes technical changes.
Present law requires insurers to provide certain override procedures for physicians when step
therapy or fail first protocols are utilized. Proposed law retains present law and adds a
process for exemption from step therapy for patients who have clinical documentation that
a prescription drug was discontinued due to lack of efficacy or effectiveness, diminished
effect, or an adverse event. Proposed law provides that a plan shall not be prevented from
requiring a patient to try a generic drug. Proposed law provides that a practitioner shall not
be prevented from prescribing what he determines to be medically necessary.
Proposed law authorizes additional override of restrictions if:
(1)The prescribing physician can demonstrate to the health coverage plan that the
preferred treatment required under the step therapy or fail first protocol was
discontinued due to lack of efficacy or effectiveness, diminished effect, or an adverse
event.
(2)The prescribing physician can demonstrate to the health coverage plan that the
criteria set forth in current law have been satisfied under the insured's current or
previous health coverage plan in the treatment of the insured's disease or medical
condition.
Present law requires pharmacy benefit managers to be licensed by the commissioner of
insurance as third party administrators. Proposed law repeals present law and establishes
specific pharmacy benefit manager licensure and regulation authority for the commissioner
of insurance. Proposed law provides for findings and purpose, rulemaking, license authority,
and enforcement.
Present law prohibits pharmacy benefit managers from imposing contract provisions on
pharmacists that prevent the pharmacist from informing patients of all relevant options when
acquiring prescription drugs. Proposed law retains present law.
Present law establishes a dedicated location on the Department of Insurance's website for
certain information regarding pharmacy benefit managers. Present law implements the
website on January 1, 2020. Proposed law retains present law.
Effective August 1, 2019.
(Amends R.S. 22:1006.1(A) and 1053(D) and R.S. 44:4.1(B)(11) and 44:4.1(B) as amended
by Section 2 of Act 371 of the 2018 Regular Session; adds R.S. 22:1053(B)(4) and (5) and
(E), and 1260.41-1260.46; repeals R.S. 22:1657 and 1657 as amended by Section 1 of Act
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371 of the 2018 Regular Session)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Insurance to the original
bill
1. Makes technical changes.
Summary of Amendments Adopted by Senate
Senate Floor Amendments to engrossed bill
1. Adds additional override of restrictions if certain conditions are met.
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words in boldface type and underscored are additions.