1 of 1
HOUSE DOCKET, NO. 3592 FILED ON: 1/17/2025
HOUSE . . . . . . . . . . . . . . . No. 1296
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Sean Reid
_________________
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 to protect 340B providers.
_______________
PETITION OF:
NAME:DISTRICT/ADDRESS :DATE ADDED:Sean Reid11th Essex1/17/2025 1 of 30
HOUSE DOCKET, NO. 3592 FILED ON: 1/17/2025
HOUSE . . . . . . . . . . . . . . . No. 1296
By Representative Reid of Lynn, a petition (accompanied by bill, House, No. 1296) of Sean Reid
relative to 340B pharmacies. Financial Services.
The Commonwealth of Massachusetts
_______________
In the One Hundred and Ninety-Fourth General Court
(2025-2026)
_______________
An Act to protect 340B providers.
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 XX. Chapter 32A of the General Laws, as appearing in the 2020 Official
2Edition, is hereby amended by inserting after section 33, the following new section: -
3 Section 34.
4 (a) For purposes of this section:
5 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
6by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
742 U.S.C. 256b(a)(4).
8 (2) “340B entity” shall mean an entity participating or authorized to participate in the
9federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
10any pharmacy contracted with the participating entity to dispense drugs purchased through the
11340B drug discount program. 2 of 30
12 (3) “Health insurance issuer” shall mean the group insurance commission or a “carrier”
13as defined in section 1 of chapter 176O.
14 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
15or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
16covered entity for drugs. Third party includes Medicaid managed care organizations, employee
17benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
18or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
19self-pay patient.
20 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
21propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
22defined in 247 CMR 2.00.
23 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
24defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
25chapter 112.
26 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
27of chapter 175.
28 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
29issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
30following: 3 of 30
31 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
32drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
33claim is for a 340B drug.
34 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
35following that differ from such terms or conditions applied to non-340B entities on the basis that
36the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
37that a drug is a 340B drug including, without limitation, any of the following:
38 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
39Subsection, the term “other adjustment” includes placing any additional requirements,
40restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
41fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
42drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
43benefit manager, or other third-party payor.
44 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
45 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
46networks.
47 D. Requirements that a claim for a drug include any identification, billing modifier,
48attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
49unless it is required by the Centers for Medicare and Medicaid Services, the executive office of
50health and human services, or the division of medical assistance. 4 of 30
51 E. Any other restrictions, conditions, practices, or policies that are not imposed on non-
52340B entities.
53 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
54adjudication unless these actions are in the normal course of pharmacy business and not related
55to 340B drug pricing.
56 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
57patient’s choice to receive such drugs from the 340B entity, including the administration of such
58drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
59interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
60pharmacy benefit manager, or other third-party payor places any additional requirements,
61restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
62fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
63identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
64to be processed or resubmitted unless it is required by the Centers for Medicare and Medicaid
65Services, the executive office of health and human services, or the division of medical assistance.
66 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
67condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
68entity unless the data is required by the United States Department of Health and Human Services,
69Centers for Medicare and Medicaid Services, the executive office of health and human services,
70or the division of medical assistance.
71 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
72benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B 5 of 30
73entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
74340B entity, including the administration of the drug, in person or via direct delivery, mail, or
75other form of shipment, or creation of a restriction or additional charge on a patient who chooses
76to receive drugs from a 340B entity.
77 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
78340B drugs to any health insurance issuer, pharmacy benefit manager, or other third-party payor.
79 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
80manager, or other third party payor network on the basis that the 340B entity dispenses drugs
81subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
82reasons other than those that apply equally to non-340B entities.
83 (ix) Nothing in this section applies to the division of medical assistance as payor when
84Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
858(9k)).
86 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
87 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
88with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
89to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
90receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
91by the United States Department of Health and Human Services.
92 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
93340B entity. 6 of 30
94 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
95utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
96delivery of a 340B drug to, a
97 340B entity unless the data is required by the United States Department of Health and
98Human Services.
99 SECTION XX. Chapter 175 of the General Laws, as appearing in the 2020 Official
100Edition, is hereby amended by inserting after section 47TT, the following new section:-
101 Section 47UU.
102 (a) For purposes of this section:
103 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
104by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
10542 U.S.C. 256b(a)(4).
106 (2) “340B entity” shall mean an entity participating or authorized to participate in the
107federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
108any pharmacy contracted with the participating entity to dispense drugs purchased through the
109340B drug discount program.
110 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
111176O.
112 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
113or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
114covered entity for drugs. Third party includes Medicaid managed care organizations, employee 7 of 30
115benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
116or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
117self-pay patient.
118 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
119propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
120defined in 247 CMR 2.00.
121 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
122defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
123chapter 112.
124 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
125of chapter 175.
126 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
127issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
128following:
129 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
130drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
131claim is for a 340B drug.
132 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
133following that differ from such terms or conditions applied to non-340B entities on the basis that
134the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
135that a drug is a 340B drug including, without limitation, any of the following: 8 of 30
136 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
137Subsection, the term “other adjustment” includes placing any additional requirements,
138restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
139fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
140drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
141benefit manager, or other third-party payor.
142 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
143 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
144networks.
145 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
146network.
147 E. Requirements that a claim for a drug include any identification, billing modifier,
148attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
149unless it is required by the United States Department of Health and Human Services, Centers for
150Medicare and Medicaid Services, the executive office of health and human services, or the
151division of medical assistance.
152 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
153340B entities.
154 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
155adjudication unless these actions are in the normal course of pharmacy business and not related
156to 340B drug pricing. 9 of 30
157 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
158patient’s choice to receive such drugs from the 340B entity, including the administration of such
159drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
160interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
161pharmacy benefit manager, or other third-party payor places any additional requirements,
162restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
163fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
164identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
165to be processed or resubmitted unless it is required by the United States Department of Health
166and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
167and human services, or the division of medical assistance.
168 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
169condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
170entity unless the data is required by the United States Department of Health and Human Services,
171Centers for Medicare and Medicaid Services, the executive office of health and human services,
172or the division of medical assistance.
173 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
174benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
175entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
176340B entity, including the administration of the drug, in person or via direct delivery, mail, or
177other form of shipment, or creation of a restriction or additional charge on a patient who chooses
178to receive drugs from a 340B entity. 10 of 30
179 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
180340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
181 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
182manager, or other third party payor network on the basis that the 340B entity dispenses drugs
183subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
184reasons other than those that apply equally to non-340B entities.
185 (ix) Nothing in this section applies to the division of medical assistance as payor when
186Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
1878(9k)).
188 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
189 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
190with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
191to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
192receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
193by the United States Department of Health and Human Services.
194 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
195340B entity.
196 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
197utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
198delivery of a 340B drug to, a 340B entity unless the data is required by the United States
199Department of Health and Human Services. 11 of 30
200 SECTION XX. Chapter 176A of the General Laws, as appearing in the 2020 Official
201Edition, is hereby amended by inserting after section 39, the following new section:-
202 Section 40.
203 (a) For purposes of this section:
204 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
205by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
20642 U.S.C. 256b(a)(4).
207 (2) “340B entity” shall mean an entity participating or authorized to participate in the
208federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
209any pharmacy contracted with the participating entity to dispense drugs purchased through the
210340B drug discount program.
211 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
212176O.
213 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
214or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
215covered entity for drugs. Third party includes Medicaid managed care organizations, employee
216benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
217or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
218self-pay patient. 12 of 30
219 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
220propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
221defined in 247 CMR 2.00.
222 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
223defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
224chapter 112.
225 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
226of chapter 175.
227 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
228issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
229following:
230 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
231drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
232claim is for a 340B drug.
233 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
234following that differ from such terms or conditions applied to non-340B entities on the basis that
235the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
236that a drug is a 340B drug including, without limitation, any of the following:
237 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
238Subsection, the term “other adjustment” includes placing any additional requirements,
239restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or 13 of 30
240fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
241drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
242benefit manager, or other third-party payor.
243 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
244 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
245networks.
246 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
247network.
248 E. Requirements that a claim for a drug include any identification, billing modifier,
249attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
250unless it is required by the United States Department of Health and Human Services, Centers for
251Medicare and Medicaid Services, the executive office of health and human services, or the
252division of medical assistance.
253 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
254340B entities.
255 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
256adjudication unless these actions are in the normal course of pharmacy business and not related
257to 340B drug pricing.
258 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
259patient’s choice to receive such drugs from the 340B entity, including the administration of such
260drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or 14 of 30
261interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
262pharmacy benefit manager, or other third-party payor places any additional requirements,
263restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
264fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
265identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
266to be processed or resubmitted unless it is required by the United States Department of Health
267and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
268and human services, or the division of medical assistance.
269 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
270condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
271entity unless the data is required by the United States Department of Health and Human Services,
272Centers for Medicare and Medicaid Services, the executive office of health and human services,
273or the division of medical assistance.
274 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
275benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
276entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
277340B entity, including the administration of the drug, in person or via direct delivery, mail, or
278other form of shipment, or creation of a restriction or additional charge on a patient who chooses
279to receive drugs from a 340B entity.
280 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
281340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor. 15 of 30
282 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
283manager, or other third party payor network on the basis that the 340B entity dispenses drugs
284subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
285reasons other than those that apply equally to non-340B entities.
286 (ix) Nothing in this section applies to the division of medical assistance as payor when
287Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
2888(9k)).
289 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
290 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
291with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
292to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
293receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
294by the United States Department of Health and Human Services.
295 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
296340B entity.
297 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
298utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
299delivery of a 340B drug to, a 340B entity unless the data is required by the United States
300Department of Health and Human Services.
301 SECTION XX. Chapter 176B of the General Laws, as appearing in the 2020 Official
302Edition, is hereby further amended by inserting after section 26 the following new section: - 16 of 30
303 Section 27.
304 (a) For purposes of this section:
305 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
306by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
30742 U.S.C. 256b(a)(4).
308 (2) “340B entity” shall mean an entity participating or authorized to participate in the
309federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
310any pharmacy contracted with the participating entity to dispense drugs purchased through the
311340B drug discount program.
312 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
313176O.
314 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
315or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
316covered entity for drugs. Third party includes Medicaid managed care organizations, employee
317benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
318or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
319self-pay patient.
320 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
321propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
322defined in 247 CMR 2.00. 17 of 30
323 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
324defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
325chapter 112.
326 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
327of chapter 175.
328 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
329issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
330following:
331 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
332drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
333claim is for a 340B drug.
334 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
335following that differ from such terms or conditions applied to non-340B entities on the basis that
336the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
337that a drug is a 340B drug including, without limitation, any of the following:
338 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
339Subsection, the term “other adjustment” includes placing any additional requirements,
340restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
341fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
342drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
343benefit manager, or other third-party payor. 18 of 30
344 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
345 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
346networks.
347 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
348network.
349 E. Requirements that a claim for a drug include any identification, billing modifier,
350attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
351unless it is required by the United States Department of Health and Human Services, Centers for
352Medicare and Medicaid Services, the executive office of health and human services, or the
353division of medical assistance.
354 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
355340B entities.
356 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
357adjudication unless these actions are in the normal course of pharmacy business and not related
358to 340B drug pricing.
359 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
360patient’s choice to receive such drugs from the 340B entity, including the administration of such
361drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
362interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
363pharmacy benefit manager, or other third-party payor places any additional requirements,
364restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or 19 of 30
365fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
366identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
367to be processed or resubmitted unless it is required by the United States Department of Health
368and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
369and human services, or the division of medical assistance.
370 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
371condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
372entity unless the data is required by the United States Department of Health and Human Services,
373Centers for Medicare and Medicaid Services, the executive office of health and human services,
374or the division of medical assistance.
375 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
376benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
377entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
378340B entity, including the administration of the drug, in person or via direct delivery, mail, or
379other form of shipment, or creation of a restriction or additional charge on a patient who chooses
380to receive drugs from a 340B entity.
381 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
382340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
383 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
384manager, or other third party payor network on the basis that the 340B entity dispenses drugs
385subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
386reasons other than those that apply equally to non-340B entities. 20 of 30
387 (ix) Nothing in this section applies to the division of medical assistance as payor when
388Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
3898(9k)).
390 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
391 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
392with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
393to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
394receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
395by the United States Department of Health and Human Services.
396 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
397340B entity.
398 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
399utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
400delivery of a 340B drug to, a 340B entity unless the data is required by the United States
401Department of Health and Human Services.
402 SECTION XX. Chapter 176G of the General Laws, as appearing in the 2020 Official
403Edition, is hereby further amended by inserting after section 34 the following new section:-
404 Section 35.
405 (a) For purposes of this section: 21 of 30
406 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
407by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
40842 U.S.C. 256b(a)(4).
409 (2) “340B entity” shall mean an entity participating or authorized to participate in the
410federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
411any pharmacy contracted with the participating entity to dispense drugs purchased through the
412340B drug discount program.
413 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
414176O.
415 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
416or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
417covered entity for drugs. Third party includes Medicaid managed care organizations, employee
418benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
419or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
420self-pay patient.
421 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
422propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
423defined in 247 CMR 2.00.
424 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
425defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
426chapter 112. 22 of 30
427 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
428of chapter 175.
429 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
430issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
431following:
432 (i)Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
433drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
434claim is for a 340B drug.
435 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
436following that differ from such terms or conditions applied to non-340B entities on the basis that
437the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
438that a drug is a 340B drug including, without limitation, any of the following:
439 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
440Subsection, the term “other adjustment” includes placing any additional requirements,
441restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
442fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
443drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
444benefit manager, or other third-party payor.
445 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
446 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
447networks. 23 of 30
448 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
449network.
450 E. Requirements that a claim for a drug include any identification, billing modifier,
451attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
452unless it is required by the United States Department of Health and Human Services, Centers for
453Medicare and Medicaid Services, the executive office of health and human services, or the
454division of medical assistance.
455 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
456340B entities.
457 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
458adjudication unless these actions are in the normal course of pharmacy business and not related
459to 340B drug pricing.
460 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
461patient’s choice to receive such drugs from the 340B entity, including the administration of such
462drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
463interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
464pharmacy benefit manager, or other third-party payor places any additional requirements,
465restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
466fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
467identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
468to be processed or resubmitted unless it is required by the United States Department of Health 24 of 30
469and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
470and human services, or the division of medical assistance.
471 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
472condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
473entity unless the data is required by the United States Department of Health and Human Services,
474Centers for Medicare and Medicaid Services, the executive office of health and human services,
475or the division of medical assistance.
476 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
477benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
478entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
479340B entity, including the administration of the drug, in person or via direct delivery, mail, or
480other form of shipment, or creation of a restriction or additional charge on a patient who chooses
481to receive drugs from a 340B entity.
482 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
483340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
484 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
485manager, or other third party payor network on the basis that the 340B entity dispenses drugs
486subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
487reasons other than those that apply equally to non-340B entities.
488 (ix) Nothing in this section applies to the division of medical assistance as payor when
489Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
4908(9k)). 25 of 30
491 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
492 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
493with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
494to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
495receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
496by the United States Department of Health and Human Services.
497 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
498340B entity.
499 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
500utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
501delivery of a 340B drug to, a 340B entity unless the data is required by the United States
502Department of Health and Human Services.
503 SECTION XX. Chapter 176I of the General Laws, as appearing in the 2020 Official
504Edition, is hereby amended by inserting after section 14 the following new section: -
505 Section 15.
506 (a) For purposes of this section:
507 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
508by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
50942 U.S.C. 256b(a)(4).
510 (2) “340B entity” shall mean an entity participating or authorized to participate in the
511federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or 26 of 30
512any pharmacy contracted with the participating entity to dispense drugs purchased through the
513340B drug discount program.
514 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
515176O.
516 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
517or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
518covered entity for drugs. Third party includes Medicaid managed care organizations, employee
519benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
520or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
521self-pay patient.
522 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
523propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
524defined in 247 CMR 2.00.
525 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
526defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
527chapter 112.
528 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
529of chapter 175.
530 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
531issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
532following: 27 of 30
533 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
534drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
535claim is for a 340B drug.
536 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
537following that differ from such terms or conditions applied to non-340B entities on the basis that
538the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
539that a drug is a 340B drug including, without limitation, any of the following:
540 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
541Subsection, the term “other adjustment” includes placing any additional requirements,
542restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
543fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
544drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
545benefit manager, or other third-party payor.
546 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
547 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
548networks.
549 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
550network.
551 E. Requirements that a claim for a drug include any identification, billing modifier,
552attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
553unless it is required by the United States Department of Health and Human Services, Centers for 28 of 30
554Medicare and Medicaid Services, the executive office of health and human services, or the
555division of medical assistance.
556 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
557340B entities.
558 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
559adjudication unless these actions are in the normal course of pharmacy business and not related
560to 340B drug pricing.
561 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
562patient’s choice to receive such drugs from the 340B entity, including the administration of such
563drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
564interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
565pharmacy benefit manager, or other third-party payor places any additional requirements,
566restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
567fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
568identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
569to be processed or resubmitted unless it is required by the United States Department of Health
570and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
571and human services, or the division of medical assistance.
572 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
573condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
574entity unless the data is required by the United States Department of Health and Human Services, 29 of 30
575Centers for Medicare and Medicaid Services, the executive office of health and human services,
576or the division of medical assistance.
577 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
578benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
579entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
580340B entity, including the administration of the drug, in person or via direct delivery, mail, or
581other form of shipment, or creation of a restriction or additional charge on a patient who chooses
582to receive drugs from a 340B entity.
583 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
584340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
585 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
586manager, or other third party payor network on the basis that the 340B entity dispenses drugs
587subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
588reasons other than those that apply equally to non-340B entities.
589 (ix) Nothing in this section applies to the division of medical assistance as payor when
590Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
5918(9k)).
592 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
593 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
594with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
595to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to 30 of 30
596receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
597by the United States Department of Health and Human Services.
598 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
599340B entity.
600 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
601utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
602delivery of a 340B drug to, a 340B entity unless the data is required by the United States
603Department of Health and Human Services.