1 of 1
HOUSE DOCKET, NO. 3340 FILED ON: 1/17/2025
HOUSE . . . . . . . . . . . . . . . No. 1125
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Michael S. Day
_________________
To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act relative to non-medical switching.
_______________
PETITION OF:
NAME:DISTRICT/ADDRESS :DATE ADDED:Michael S. Day31st Middlesex1/17/2025 1 of 25
HOUSE DOCKET, NO. 3340 FILED ON: 1/17/2025
HOUSE . . . . . . . . . . . . . . . No. 1125
By Representative Day of Stoneham, a petition (accompanied by bill, House, No. 1125) of
Michael S. Day relative to changes to health benefit plans that cause certain covered persons to
switch to less costly alternate prescription drugs. Financial Services.
[SIMILAR MATTER FILED IN PREVIOUS SESSION
SEE HOUSE, NO. 982 OF 2023-2024.]
The Commonwealth of Massachusetts
_______________
In the One Hundred and Ninety-Fourth General Court
(2025-2026)
_______________
An Act relative to non-medical switching.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 Section 1. Chapter 175 of the General Laws, as appearing in the 2022 Official Edition, is
2hereby amended by inserting after section 230 the following section:-
3 Section 231.
4 1. Definitions. For the purpose of this section:
5 a. “Commissioner” means the commissioner of insurance.
6 b. “Cost sharing” means any coverage limit, copayment, coinsurance, deductible, or
7other out-of-pocket expense requirement. 2 of 25
8 c. “Coverage exemption” means a determination made by a health carrier, health benefit
9plan, or utilization review organization to cover a prescription drug that is otherwise excluded
10from coverage.
11 d. “Coverage exemption determination” means a determination made by a health carrier,
12health benefit plan, or utilization review organization whether to cover a prescription drug that is
13otherwise excluded from coverage.
14 e. “Covered person” means the same as defined in section 1 of Chapter 176J.
15 f. “Discontinued health benefit plan” means a covered person’s existing health benefit
16plan that is discontinued by a health carrier during open enrollment for the next plan year.
17 g. “Formulary” means a complete list of prescription drugs eligible for coverage under a
18health benefit plan.
19 h. “Health benefit plan” means the same as defined in section 1 of Chapter 176 J.
20 i. “Health care professional” means the same as defined in section 1 of Chapter 176O.
21 j. “Health care services” means the same as defined in section 1 of Chapter 176O.
22 k. “Health carrier” means the same as defined in section 1 of Chapter 176O.
23 l. “Nonmedical switching” means a health benefit plan’s restrictive changes to the health
24benefit plan’s formulary after the current plan year has begun or during the open enrollment
25period for the upcoming plan year, causing a covered person who is medically stable on the
26covered person’s current prescribed drug, inclusive of changes to the drug dosage, as determined
27by the prescribing health care professional, to switch to a less costly alternate prescription drug. 3 of 25
28 m. “Open enrollment” means the yearly time period an individual can enroll in a health
29benefit plan.
30 n. “Utilization review” means the same as defined in section 1 of Chapter 176O.
31 o. “Utilization review organization” means the same as defined in section 1 1 of Chapter
32176O.
33 2. Nonmedical switching. With respect to a health carrier that has entered into a health
34benefit plan with a covered person that covers prescription drug benefits, all of the following
35apply:
36 a. A health carrier, health benefit plan, or utilization review organization shall not limit
37or exclude coverage of a prescription drug for any covered person who is medically stable on
38such drug as determined by the prescribing health care professional, if all of the following apply:
39 (1) The prescription drug was previously approved by the health carrier for coverage for
40the covered person.
41 (2) The covered person’s prescribing health care professional has prescribed the drug for
42the medical condition within the previous six months.
43 (3) The covered person continues to be an enrollee of the health benefit plan.
44 b. Coverage of a covered person’s prescription drug, as described in paragraph “a”, shall
45continue through the last day of the covered person’s eligibility under the health benefit plan,
46inclusive of any open enrollment period. 4 of 25
47 c. Prohibited limitations and exclusions referred to in paragraph “a” include but are not
48limited to the following:
49 (1) Limiting or reducing the maximum coverage of prescription drug benefits.
50 (2) Increasing cost sharing for a covered prescription drug.
51 (3) Moving a prescription drug to a more restrictive tier if the health carrier uses a
52formulary with tiers.
53 (4) Removing a prescription drug from a formulary, unless the United States food and
54drug administration has issued a statement about the drug that calls into question the clinical
55safety of the drug, or the manufacturer of the drug has notified the United States food and drug
56administration of a manufacturing discontinuance or potential discontinuance of the drug as
57required by section 506C of the Federal Food, Drug, and Cosmetic Act, as codified in 21 U.S.C.
58§356c.
59 3. Coverage exemption determination process.
60 a. To ensure continuity of care, a health carrier, health plan, or utilization review
61organization shall provide a covered person and prescribing health care professional with access
62to a clear and convenient process to request a coverage exemption determination. A health
63carrier, health plan, or utilization review organization may use its existing medical exceptions
64process to satisfy this requirement. The process used shall be easily accessible on the internet site
65of the health carrier, health benefit plan, or utilization review organization.
66 b. A health carrier, health benefit plan, or utilization review organization shall respond to
67a coverage exemption determination request within seventy-two hours of receipt. In cases where 5 of 25
68exigent circumstances exist, a health carrier, health benefit plan, or utilization review
69organization shall respond within twenty-four hours of receipt. If a response by a health carrier,
70health benefit plan, or utilization review organization is not received within the applicable time
71period, the coverage exemption shall be deemed granted.
72 (1) A coverage exemption shall be expeditiously granted for a discontinued health
73benefit plan if a covered person enrolls in a comparable plan offered by the same health carrier,
74and all of the following conditions apply:
75 (a) The covered person is medically stable on a prescription drug as determined by the
76prescribing health care professional.
77 (b) The prescribing health care professional continues to prescribe the drug for the
78covered person for the medical condition.
79 (c) In comparison to the discontinued health benefit plan, the new health benefit plan
80does any of the following:
81 (i) Limits or reduces the maximum coverage of prescription drug benefits.
82 (ii) Increases cost sharing for the prescription drug.
83 (iii) Moves the prescription drug to a more restrictive tier if the health carrier uses a
84formulary with tiers.
85 (iv) Excludes the prescription drug from the formulary.
86 c. Upon granting of a coverage exemption for a drug prescribed by a covered person’s
87prescribing health care professional, a health carrier, health benefit plan, or utilization review 6 of 25
88organization shall authorize coverage no more restrictive than that offered in a discontinued
89health benefit plan, or than that offered prior to implementation of restrictive changes to the
90health benefit plan’s formulary after the current plan year began.
91 d. If a determination is made to deny a request for a coverage exemption, the health
92carrier, health benefit plan, or utilization review organization shall provide the covered person or
93the covered person’s authorized representative and the authorized person’s prescribing health
94care professional with the reason for denial and information regarding the procedure to appeal
95the denial. Any determination to deny a coverage exemption may be appealed by a covered
96person or the covered person’s authorized representative.
97 e. A health carrier, health benefit plan, or utilization review organization shall uphold or
98reverse a determination to deny a coverage exemption within seventy-two hours of receipt of an
99appeal of denial. In cases where exigent circumstances exist, a health carrier, health benefit plan,
100or utilization review organization shall uphold or reverse a determination to deny a coverage
101exemption within twenty-four hours of receipt. If the determination to deny a coverage
102exemption is not upheld or reversed on appeal within the applicable time period, the denial shall
103be deemed reversed and the coverage exemption shall be deemed approved.
104 f. If a determination to deny a coverage exemption is upheld on appeal, the health
105carrier, health benefit plan, or utilization review organization shall provide the covered person or
106covered person’s authorized representative and the covered person’s prescribing health care
107professional with the reason for upholding the denial on appeal and information regarding the
108procedure to request external review of the denial pursuant to chapter 514J. Any denial of a
109request for a coverage exemption that is upheld on appeal shall be considered a final adverse 7 of 25
110determination for purposes of chapter 514J and is eligible for a request for external review by a
111covered person or the covered person’s authorized representative pursuant to chapter 514J.
112 4. Limitations. This section shall not be construed to do any of the following:
113 a. Prevent a health care professional from prescribing another drug covered by the health
114carrier that the health care professional deems medically necessary for the covered person.
115 b. Prevent a health carrier from doing any of the following:
116 (1) Adding a prescription drug to its formulary.
117 (2) Removing a prescription drug from its formulary if the drug manufacturer has
118removed the drug for sale in the United States.
119 (3) Requiring a pharmacist to effect a substitution of a generic or interchangeable
120biological drug product pursuant to section 12EE Chapter 112.
121 5. Enforcement. The commissioner may take any enforcement action under the
122commissioner’s authority to enforce compliance with this section.
123 6. Applicability. This section is applicable to a health benefit plan that is delivered,
124issued for delivery, continued, or renewed in this state on or after January 1, 2026.
125 Section 2. Chapter 176A of the General Laws, as appearing in the 2022 Official Edition,
126is hereby amended by inserting after section 38 the following section:-
127 Section 39.
128 1. Definitions. For the purpose of this section: 8 of 25
129 a. “Commissioner” means the commissioner of insurance.
130 b. “Cost sharing” means any coverage limit, copayment, coinsurance, deductible, or
131other out-of-pocket expense requirement.
132 c. “Coverage exemption” means a determination made by a health carrier, health benefit
133plan, or utilization review organization to cover a prescription drug that is otherwise excluded
134from coverage.
135 d. “Coverage exemption determination” means a determination made by a health carrier,
136health benefit plan, or utilization review organization whether to cover a prescription drug that is
137otherwise excluded from coverage.
138 e. “Covered person” means the same as defined in section 1 of Chapter 176I.
139 f. “Discontinued health benefit plan” means a covered person’s existing health benefit
140plan that is discontinued by a health carrier during open enrollment for the next plan year.
141 g. “Formulary” means a complete list of prescription drugs eligible for coverage under a
142health benefit plan.
143 h. “Health benefit plan” means the same as defined in section 1 of Chapter 176I.
144 i. “Health care professional” means the same as defined in section 1 of Chapter 176O.
145 j. “Health care services” means the same as defined in section 1 of Chapter 176O.
146 k. “Health carrier” means the same as defined in section 1 of Chapter 176O. 9 of 25
147 l. “Nonmedical switching” means a health benefit plan’s restrictive changes to the health
148benefit plan’s formulary after the current plan year has begun or during the open enrollment
149period for the upcoming plan year, causing a covered person who is medically stable on the
150covered person’s current prescribed drug, inclusive of changes to the drug dosage, as determined
151by the prescribing health care professional, to switch to a less costly alternate prescription drug.
152 m. “Open enrollment” means the yearly time period an individual can enroll in a health
153benefit plan.
154 n. “Utilization review” means the same as defined in section 1 of Chapter 176O.
155 o. “Utilization review organization” means the same as defined in section 1 of Chapter
156176O.
157 2. Nonmedical switching. With respect to a health carrier that has entered into a health
158benefit plan with a covered person that covers prescription drug benefits, all of the following
159apply:
160 a. A health carrier, health benefit plan, or utilization review organization shall not limit
161or exclude coverage of a prescription drug for any covered person who is medically stable on
162such drug as determined by the prescribing health care professional, if all of the following apply:
163 (1) The prescription drug was previously approved by the health carrier for coverage for
164the covered person.
165 (2) The covered person’s prescribing health care professional has prescribed the drug for
166the medical condition within the previous six months.
167 (3) The covered person continues to be an enrollee of the health benefit plan. 10 of 25
168 b. Coverage of a covered person’s prescription drug, as described in paragraph “a”, shall
169continue through the last day of the covered person’s eligibility under the health benefit plan,
170inclusive of any open enrollment period.
171 c. Prohibited limitations and exclusions referred to in paragraph “a” include but are not
172limited to the following:
173 (1) Limiting or reducing the maximum coverage of prescription drug benefits.
174 (2) Increasing cost sharing for a covered prescription drug.
175 (3) Moving a prescription drug to a more restrictive tier if the health carrier uses a
176formulary with tiers.
177 (4) Removing a prescription drug from a formulary, unless the United States food and
178drug administration has issued a statement about the drug that calls into question the clinical
179safety of the drug, or the manufacturer of the drug has notified the United States food and drug
180administration of a manufacturing discontinuance or potential discontinuance of the drug as
181required by section 506C of the Federal Food, Drug, and Cosmetic Act, as codified in 21 U.S.C.
182§356c.
183 3. Coverage exemption determination process.
184 a. To ensure continuity of care, a health carrier, health plan, or utilization review
185organization shall provide a covered person and prescribing health care professional with access
186to a clear and convenient process to request a coverage exemption determination. A health
187carrier, health plan, or utilization review organization may use its existing medical exceptions 11 of 25
188process to satisfy this requirement. The process used shall be easily accessible on the internet site
189of the health carrier, health benefit plan, or utilization review organization.
190 b. A health carrier, health benefit plan, or utilization review organization shall respond to
191a coverage exemption determination request within seventy-two hours of receipt. In cases where
192exigent circumstances exist, a health carrier, health benefit plan, or utilization review
193organization shall respond within twenty-four hours of receipt. If a response by a health carrier,
194health benefit plan, or utilization review organization is not received within the applicable time
195period, the coverage exemption shall be deemed granted.
196 (1) A coverage exemption shall be expeditiously granted for a discontinued health
197benefit plan if a covered person enrolls in a comparable plan offered by the same health carrier,
198and all of the following conditions apply:
199 (a) The covered person is medically stable on a prescription drug as determined by the
200prescribing health care professional.
201 (b) The prescribing health care professional continues to prescribe the drug for the
202covered person for the medical condition.
203 (c) In comparison to the discontinued health benefit plan, the new health benefit plan
204does any of the following:
205 (i) Limits or reduces the maximum coverage of prescription drug benefits.
206 (ii) Increases cost sharing for the prescription drug.
207 (iii) Moves the prescription drug to a more restrictive tier if the health carrier uses a
208formulary with tiers. 12 of 25
209 (iv) Excludes the prescription drug from the formulary.
210 c. Upon granting of a coverage exemption for a drug prescribed by a covered person’s
211prescribing health care professional, a health carrier, health benefit plan, or utilization review
212organization shall authorize coverage no more restrictive than that offered in a discontinued
213health benefit plan, or than that offered prior to implementation of restrictive changes to the
214health benefit plan’s formulary after the current plan year began.
215 d. If a determination is made to deny a request for a coverage exemption, the health
216carrier, health benefit plan, or utilization review organization shall provide the covered person or
217the covered person’s authorized representative and the authorized person’s prescribing health
218care professional with the reason for denial and information regarding the procedure to appeal
219the denial. Any determination to deny a coverage exemption may be appealed by a covered
220person or the covered person’s authorized representative.
221 e. A health carrier, health benefit plan, or utilization review organization shall uphold or
222reverse a determination to deny a coverage exemption within seventy-two hours of receipt of an
223appeal of denial. In cases where exigent circumstances exist, a health carrier, health benefit plan,
224or utilization review organization shall uphold or reverse a determination to deny a coverage
225exemption within twenty-four hours of receipt. If the determination to deny a coverage
226exemption is not upheld or reversed on appeal within the applicable time period, the denial shall
227be deemed reversed and the coverage exemption shall be deemed approved.
228 f. If a determination to deny a coverage exemption is upheld on appeal, the health
229carrier, health benefit plan, or utilization review organization shall provide the covered person or
230covered person’s authorized representative and the covered person’s prescribing health care 13 of 25
231professional with the reason for upholding the denial on appeal and information regarding the
232procedure to request external review of the denial pursuant to chapter 514J. Any denial of a
233request for a coverage exemption that is upheld on appeal shall be considered a final adverse
234determination for purposes of chapter 514J and is eligible for a request for external review by a
235covered person or the covered person’s authorized representative pursuant to chapter 514J.
236 4. Limitations. This section shall not be construed to do any of the following:
237 a. Prevent a health care professional from prescribing another drug covered by the health
238carrier that the health care professional deems medically necessary for the covered person.
239 b. Prevent a health carrier from doing any of the following:
240 (1) Adding a prescription drug to its formulary.
241 (2) Removing a prescription drug from its formulary if the drug manufacturer has
242removed the drug for sale in the United States.
243 (3) Requiring a pharmacist to effect a substitution of a generic or interchangeable
244biological drug product pursuant to section section 12EE of Chapter 112.
245 5. Enforcement. The commissioner may take any enforcement action under the
246commissioner’s authority to enforce compliance with this section.
247 6. Applicability. This section is applicable to a health benefit plan that is delivered,
248issued for delivery, continued, or renewed in this state on or after January 1, 2026.
249 Section 3. Chapter 176B of the General Laws, as appearing in the 2022 Official Edition,
250is hereby amended by inserting after section 25 the following section:- 14 of 25
251 Section 26.
252 1. Definitions. For the purpose of this section:
253 a. “Commissioner” means the commissioner of insurance.
254 b. “Cost sharing” means any coverage limit, copayment, coinsurance, deductible, or
255other out-of-pocket expense requirement.
256 c. “Coverage exemption” means a determination made by a health carrier, health benefit
257plan, or utilization review organization to cover a prescription drug that is otherwise excluded
258from coverage.
259 d. “Coverage exemption determination” means a determination made by a health carrier,
260health benefit plan, or utilization review organization whether to cover a prescription drug that is
261otherwise excluded from coverage.
262 e. “Covered person” means the same as defined in section 1 of Chapter 176I.
263 f. “Discontinued health benefit plan” means a covered person’s existing health benefit
264plan that is discontinued by a health carrier during open enrollment for the next plan year.
265 g. “Formulary” means a complete list of prescription drugs eligible for coverage under a
266health benefit plan.
267 h. “Health benefit plan” means the same as defined in section 1 of Chapter 176I.
268 i. “Health care professional” means the same as defined in section 1 of Chapter 176O.
269 j. “Health care services” means the same as defined in section 1 of Chapter 176O. 15 of 25
270 k. “Health carrier” means the same as defined in section 1 of Chapter 176O.
271 l. “Nonmedical switching” means a health benefit plan’s restrictive changes to the health
272benefit plan’s formulary after the current plan year has begun or during the open enrollment
273period for the upcoming plan year, causing a covered person who is medically stable on the
274covered person’s current prescribed drug, inclusive of changes to the drug dosage, as determined
275by the prescribing health care professional, to switch to a less costly alternate prescription drug.
276 m. “Open enrollment” means the yearly time period an individual can enroll in a health
277benefit plan.
278 n. “Utilization review” means the same as defined in section 1 of Chapter 176O.
279 o. “Utilization review organization” means the same as defined in section 1 of Chapter
280176O.
281 2. Nonmedical switching. With respect to a health carrier that has entered into a health
282benefit plan with a covered person that covers prescription drug benefits, all of the following
283apply:
284 a. A health carrier, health benefit plan, or utilization review organization shall not limit
285or exclude coverage of a prescription drug for any covered person who is medically stable on
286such drug as determined by the prescribing health care professional, if all of the following apply:
287 (1) The prescription drug was previously approved by the health carrier for coverage for
288the covered person.
289 (2) The covered person’s prescribing health care professional has prescribed the drug for
290the medical condition within the previous six months. 16 of 25
291 (3) The covered person continues to be an enrollee of the health benefit plan.
292 b. Coverage of a covered person’s prescription drug, as described in paragraph “a”, shall
293continue through the last day of the covered person’s eligibility under the health benefit plan,
294inclusive of any open enrollment period.
295 c. Prohibited limitations and exclusions referred to in paragraph “a” include but are not
296limited to the following:
297 (1) Limiting or reducing the maximum coverage of prescription drug benefits.
298 (2) Increasing cost sharing for a covered prescription drug.
299 (3) Moving a prescription drug to a more restrictive tier if the health carrier uses a
300formulary with tiers.
301 (4) Removing a prescription drug from a formulary, unless the United States food and
302drug administration has issued a statement about the drug that calls into question the clinical
303safety of the drug, or the manufacturer of the drug has notified the United States food and drug
304administration of a manufacturing discontinuance or potential discontinuance of the drug as
305required by section 506C of the Federal Food, Drug, and Cosmetic Act, as codified in 21 U.S.C.
306§356c.
307 3. Coverage exemption determination process.
308 a. To ensure continuity of care, a health carrier, health plan, or utilization review
309organization shall provide a covered person and prescribing health care professional with access
310to a clear and convenient process to request a coverage exemption determination. A health
311carrier, health plan, or utilization review organization may use its existing medical exceptions 17 of 25
312process to satisfy this requirement. The process used shall be easily accessible on the internet site
313of the health carrier, health benefit plan, or utilization review organization.
314 b. A health carrier, health benefit plan, or utilization review organization shall respond to
315a coverage exemption determination request within seventy-two hours of receipt. In cases where
316exigent circumstances exist, a health carrier, health benefit plan, or utilization review
317organization shall respond within twenty-four hours of receipt. If a response by a health carrier,
318health benefit plan, or utilization review organization is not received within the applicable time
319period, the coverage exemption shall be deemed granted.
320 (1) A coverage exemption shall be expeditiously granted for a discontinued health
321benefit plan if a covered person enrolls in a comparable plan offered by the same health carrier,
322and all of the following conditions apply:
323 (a) The covered person is medically stable on a prescription drug as determined by the
324prescribing health care professional.
325 (b) The prescribing health care professional continues to prescribe the drug for the
326covered person for the medical condition.
327 (c) In comparison to the discontinued health benefit plan, the new health benefit plan
328does any of the following:
329 (i) Limits or reduces the maximum coverage of prescription drug benefits.
330 (ii) Increases cost sharing for the prescription drug.
331 (iii) Moves the prescription drug to a more restrictive tier if the health carrier uses a
332formulary with tiers. 18 of 25
333 (iv) Excludes the prescription drug from the formulary.
334 c. Upon granting of a coverage exemption for a drug prescribed by a covered person’s
335prescribing health care professional, a health carrier, health benefit plan, or utilization review
336organization shall authorize coverage no more restrictive than that offered in a discontinued
337health benefit plan, or than that offered prior to implementation of restrictive changes to the
338health benefit plan’s formulary after the current plan year began.
339 d. If a determination is made to deny a request for a coverage exemption, the health
340carrier, health benefit plan, or utilization review organization shall provide the covered person or
341the covered person’s authorized representative and the authorized person’s prescribing health
342care professional with the reason for denial and information regarding the procedure to appeal
343the denial. Any determination to deny a coverage exemption may be appealed by a covered
344person or the covered person’s authorized representative.
345 e. A health carrier, health benefit plan, or utilization review organization shall uphold or
346reverse a determination to deny a coverage exemption within seventy-two hours of receipt of an
347appeal of denial. In cases where exigent circumstances exist, a health carrier, health benefit plan,
348or utilization review organization shall uphold or reverse a determination to deny a coverage
349exemption within twenty-four hours of receipt. If the determination to deny a coverage
350exemption is not upheld or reversed on appeal within the applicable time period, the denial shall
351be deemed reversed and the coverage exemption shall be deemed approved.
352 f. If a determination to deny a coverage exemption is upheld on appeal, the health
353carrier, health benefit plan, or utilization review organization shall provide the covered person or
354covered person’s authorized representative and the covered person’s prescribing health care 19 of 25
355professional with the reason for upholding the denial on appeal and information regarding the
356procedure to request external review of the denial pursuant to chapter 514J. Any denial of a
357request for a coverage exemption that is upheld on appeal shall be considered a final adverse
358determination for purposes of chapter 514J and is eligible for a request for external review by a
359covered person or the covered person’s authorized representative pursuant to chapter 514J.
360 4. Limitations. This section shall not be construed to do any of the following:
361 a. Prevent a health care professional from prescribing another drug covered by the health
362carrier that the health care professional deems medically necessary for the covered person.
363 b. Prevent a health carrier from doing any of the following:
364 (1) Adding a prescription drug to its formulary.
365 (2) Removing a prescription drug from its formulary if the drug manufacturer has
366removed the drug for sale in the United States.
367 (3) Requiring a pharmacist to effect a substitution of a generic or interchangeable
368biological drug product pursuant to section 12EE of Chapter 112.
369 5. Enforcement. The commissioner may take any enforcement action under the
370commissioner’s authority to enforce compliance with this section.
371 6. Applicability. This section is applicable to a health benefit plan that is delivered,
372issued for delivery, continued, or renewed in this state on or after January 1, 2026.
373 Section 4. Chapter 176G of the General Laws, as appearing in the 2022 Official Edition,
374is hereby amended by inserting after section 33 the following section:- 20 of 25
375 Section 34.
376 1. Definitions. For the purpose of this section:
377 a. “Commissioner” means the commissioner of insurance.
378 b. “Cost sharing” means any coverage limit, copayment, coinsurance, deductible, or
379other out-of-pocket expense requirement.
380 c. “Coverage exemption” means a determination made by a health carrier, health benefit
381plan, or utilization review organization to cover a prescription drug that is otherwise excluded
382from coverage.
383 d. “Coverage exemption determination” means a determination made by a health carrier,
384health benefit plan, or utilization review organization whether to cover a prescription drug that is
385otherwise excluded from coverage.
386 e. “Covered person” means the same as defined in section 1 of Chapter 176J.
387 f. “Discontinued health benefit plan” means a covered person’s existing health benefit
388plan that is discontinued by a health carrier during open enrollment for the next plan year.
389 g. “Formulary” means a complete list of prescription drugs eligible for coverage under a
390health benefit plan.
391 h. “Health benefit plan” means the same as defined in section 1 of Chapter 176J.
392 i. “Health care professional” means the same as defined in section 1 of Chapter 176O.
393 j. “Health care services” means the same as defined in section 1 of Chapter 176O. 21 of 25
394 k. “Health carrier” means the same as defined in section 1 of Chapter 176O.
395 l. “Nonmedical switching” means a health benefit plan’s restrictive changes to the health
396benefit plan’s formulary after the current plan year has begun or during the open enrollment
397period for the upcoming plan year, causing a covered person who is medically stable on the
398covered person’s current prescribed drug, inclusive of changes to the drug dosage, as determined
399by the prescribing health care professional, to switch to a less costly alternate prescription drug.
400 m. “Open enrollment” means the yearly time period an individual can enroll in a health
401benefit plan.
402 n. “Utilization review” means the same as defined in section 1 of Chapter 176O.
403 o. “Utilization review organization” means the same as defined in section 1 of Chapter
404176O.
405 2. Nonmedical switching. With respect to a health carrier that has entered into a health
406benefit plan with a covered person that covers prescription drug benefits, all of the following
407apply:
408 a. A health carrier, health benefit plan, or utilization review organization shall not limit
409or exclude coverage of a prescription drug for any covered person who is medically stable on
410such drug as determined by the prescribing health care professional, if all of the following apply:
411 (1) The prescription drug was previously approved by the health carrier for coverage for
412the covered person.
413 (2) The covered person’s prescribing health care professional has prescribed the drug for
414the medical condition within the previous six months. 22 of 25
415 (3) The covered person continues to be an enrollee of the health benefit plan.
416 b. Coverage of a covered person’s prescription drug, as described in paragraph “a”, shall
417continue through the last day of the covered person’s eligibility under the health benefit plan,
418inclusive of any open enrollment period.
419 c. Prohibited limitations and exclusions referred to in paragraph “a” include but are not
420limited to the following:
421 (1) Limiting or reducing the maximum coverage of prescription drug benefits.
422 (2) Increasing cost sharing for a covered prescription drug.
423 (3) Moving a prescription drug to a more restrictive tier if the health carrier uses a
424formulary with tiers.
425 (4) Removing a prescription drug from a formulary, unless the United States food and
426drug administration has issued a statement about the drug that calls into question the clinical
427safety of the drug, or the manufacturer of the drug has notified the United States food and drug
428administration of a manufacturing discontinuance or potential discontinuance of the drug as
429required by section 506C of the Federal Food, Drug, and Cosmetic Act, as codified in 21 U.S.C.
430§356c.
431 3. Coverage exemption determination process.
432 a. To ensure continuity of care, a health carrier, health plan, or utilization review
433organization shall provide a covered person and prescribing health care professional with access
434to a clear and convenient process to request a coverage exemption determination. A health
435carrier, health plan, or utilization review organization may use its existing medical exceptions 23 of 25
436process to satisfy this requirement. The process used shall be easily accessible on the internet site
437of the health carrier, health benefit plan, or utilization review organization.
438 b. A health carrier, health benefit plan, or utilization review organization shall respond to
439a coverage exemption determination request within seventy-two hours of receipt. In cases where
440exigent circumstances exist, a health carrier, health benefit plan, or utilization review
441organization shall respond within twenty-four hours of receipt. If a response by a health carrier,
442health benefit plan, or utilization review organization is not received within the applicable time
443period, the coverage exemption shall be deemed granted.
444 (1) A coverage exemption shall be expeditiously granted for a discontinued health
445benefit plan if a covered person enrolls in a comparable plan offered by the same health carrier,
446and all of the following conditions apply:
447 (a) The covered person is medically stable on a prescription drug as determined by the
448prescribing health care professional.
449 (b) The prescribing health care professional continues to prescribe the drug for the
450covered person for the medical condition.
451 (c) In comparison to the discontinued health benefit plan, the new health benefit plan
452does any of the following:
453 (i) Limits or reduces the maximum coverage of prescription drug benefits.
454 (ii) Increases cost sharing for the prescription drug.
455 (iii) Moves the prescription drug to a more restrictive tier if the health carrier uses a
456formulary with tiers. 24 of 25
457 (iv) Excludes the prescription drug from the formulary.
458 c. Upon granting of a coverage exemption for a drug prescribed by a covered person’s
459prescribing health care professional, a health carrier, health benefit plan, or utilization review
460organization shall authorize coverage no more restrictive than that offered in a discontinued
461health benefit plan, or than that offered prior to implementation of restrictive changes to the
462health benefit plan’s formulary after the current plan year began.
463 d. If a determination is made to deny a request for a coverage exemption, the health
464carrier, health benefit plan, or utilization review organization shall provide the covered person or
465the covered person’s authorized representative and the authorized person’s prescribing health
466care professional with the reason for denial and information regarding the procedure to appeal
467the denial. Any determination to deny a coverage exemption may be appealed by a covered
468person or the covered person’s authorized representative.
469 e. A health carrier, health benefit plan, or utilization review organization shall uphold or
470reverse a determination to deny a coverage exemption within seventy-two hours of receipt of an
471appeal of denial. In cases where exigent circumstances exist, a health carrier, health benefit plan,
472or utilization review organization shall uphold or reverse a determination to deny a coverage
473exemption within twenty-four hours of receipt. If the determination to deny a coverage
474exemption is not upheld or reversed on appeal within the applicable time period, the denial shall
475be deemed reversed and the coverage exemption shall be deemed approved.
476 f. If a determination to deny a coverage exemption is upheld on appeal, the health
477carrier, health benefit plan, or utilization review organization shall provide the covered person or
478covered person’s authorized representative and the covered person’s prescribing health care 25 of 25
479professional with the reason for upholding the denial on appeal and information regarding the
480procedure to request external review of the denial pursuant to chapter 514J. Any denial of a
481request for a coverage exemption that is upheld on appeal shall be considered a final adverse
482determination for purposes of chapter 514J and is eligible for a request for external review by a
483covered person or the covered person’s authorized representative pursuant to chapter 514J.
484 4. Limitations. This section shall not be construed to do any of the following:
485 a. Prevent a health care professional from prescribing another drug covered by the health
486carrier that the health care professional deems medically necessary for the covered person.
487 b. Prevent a health carrier from doing any of the following:
488 (1) Adding a prescription drug to its formulary.
489 (2) Removing a prescription drug from its formulary if the drug manufacturer has
490removed the drug for sale in the United States.
491 (3) Requiring a pharmacist to effect a substitution of a generic or interchangeable
492biological drug product pursuant to section 12EE of Chapter 112.
493 5. Enforcement. The commissioner may take any enforcement action under the
494commissioner’s authority to enforce compliance with this section.
495 6. Applicability. This section is applicable to a health benefit plan that is delivered,
496issued for delivery, continued, or renewed in this state on or after January 1, 2026.