1 of 1
SENATE DOCKET, NO. 1970 FILED ON: 1/17/2025
SENATE . . . . . . . . . . . . . . No. 779
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Jason M. Lewis
_________________
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 :Jason M. LewisFifth Middlesex 1 of 30
SENATE DOCKET, NO. 1970 FILED ON: 1/17/2025
SENATE . . . . . . . . . . . . . . No. 779
By Mr. Lewis, a petition (accompanied by bill, Senate, No. 779) of Jason M. Lewis for
legislation to protect 340B providers in the drug discount program. 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 1. Chapter 32A of the General Laws, as appearing in the 2022 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 340B entity unless the data is required by the United States
97Department of Health and Human Services.
98 SECTION 2. Chapter 175 of the General Laws, as so appearing, is hereby amended by
99inserting after section 47UU, the following new section:-
100 Section 47VV.
101 (a) For purposes of this section:
102 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
103by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
10442 U.S.C. 256b(a)(4).
105 (2) “340B entity” shall mean an entity participating or authorized to participate in the
106federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
107any pharmacy contracted with the participating entity to dispense drugs purchased through the
108340B drug discount program.
109 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
110176O.
111 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
112or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
113covered entity for drugs. Third party includes Medicaid managed care organizations, employee
114benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C 7 of 30
115or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
116self-pay patient.
117 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
118propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
119defined in 247 CMR 2.00.
120 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
121defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
122chapter 112.
123 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
124of chapter 175.
125 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
126issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
127following:
128 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
129drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
130claim is for a 340B drug.
131 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
132following that differ from such terms or conditions applied to non-340B entities on the basis that
133the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
134that a drug is a 340B drug including, without limitation, any of the following: 8 of 30
135 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
136Subsection, the term “other adjustment” includes placing any additional requirements,
137restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
138fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
139drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
140benefit manager, or other third-party payor.
141 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
142 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
143networks.
144 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
145network.
146 E. Requirements that a claim for a drug include any identification, billing modifier,
147attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
148unless it is required by the United States Department of Health and Human Services, Centers for
149Medicare and Medicaid Services, the executive office of health and human services, or the
150division of medical assistance.
151 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
152340B entities.
153 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
154adjudication unless these actions are in the normal course of pharmacy business and not related
155to 340B drug pricing. 9 of 30
156 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
157patient’s choice to receive such drugs from the 340B entity, including the administration of such
158drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
159interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
160pharmacy benefit manager, or other third-party payor places any additional requirements,
161restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
162fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
163identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
164to be processed or resubmitted unless it is required by the United States Department of Health
165and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
166and human services, or the division of medical assistance.
167 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
168condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
169entity unless the data is required by the United States Department of Health and Human Services,
170Centers for Medicare and Medicaid Services, the executive office of health and human services,
171or the division of medical assistance.
172 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
173benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
174entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
175340B entity, including the administration of the drug, in person or via direct delivery, mail, or
176other form of shipment, or creation of a restriction or additional charge on a patient who chooses
177to receive drugs from a 340B entity. 10 of 30
178 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
179340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
180 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
181manager, or other third party payor network on the basis that the 340B entity dispenses drugs
182subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
183reasons other than those that apply equally to non-340B entities.
184 (ix) Nothing in this section applies to the division of medical assistance as payor when
185Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
1868(9k)).
187 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
188 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
189with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
190to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
191receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
192by the United States Department of Health and Human Services.
193 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
194340B entity.
195 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
196utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
197delivery of a 340B drug to, a 340B entity unless the data is required by the United States
198Department of Health and Human Services. 11 of 30
199 SECTION 3. Chapter 176A of the General Laws, as so appearing, is hereby amended by
200inserting after section 39, the following new section:-
201 Section 40.
202 (a) For purposes of this section:
203 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
204by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
20542 U.S.C. 256b(a)(4).
206 (2) “340B entity” shall mean an entity participating or authorized to participate in the
207federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
208any pharmacy contracted with the participating entity to dispense drugs purchased through the
209340B drug discount program.
210 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
211176O.
212 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
213or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
214covered entity for drugs. Third party includes Medicaid managed care organizations, employee
215benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
216or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
217self-pay patient. 12 of 30
218 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
219propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
220defined in 247 CMR 2.00.
221 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
222defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
223chapter 112.
224 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
225of chapter 175.
226 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
227issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
228following:
229 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
230drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
231claim is for a 340B drug.
232 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
233following that differ from such terms or conditions applied to non-340B entities on the basis that
234the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
235that a drug is a 340B drug including, without limitation, any of the following:
236 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
237Subsection, the term “other adjustment” includes placing any additional requirements,
238restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or 13 of 30
239fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
240drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
241benefit manager, or other third-party payor.
242 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
243 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
244networks.
245 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
246network.
247 E. Requirements that a claim for a drug include any identification, billing modifier,
248attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
249unless it is required by the United States Department of Health and Human Services, Centers for
250Medicare and Medicaid Services, the executive office of health and human services, or the
251division of medical assistance.
252 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
253340B entities.
254 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
255adjudication unless these actions are in the normal course of pharmacy business and not related
256to 340B drug pricing.
257 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
258patient’s choice to receive such drugs from the 340B entity, including the administration of such
259drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or 14 of 30
260interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
261pharmacy benefit manager, or other third-party payor places any additional requirements,
262restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
263fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
264identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
265to be processed or resubmitted unless it is required by the United States Department of Health
266and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
267and human services, or the division of medical assistance.
268 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
269condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
270entity unless the data is required by the United States Department of Health and Human Services,
271Centers for Medicare and Medicaid Services, the executive office of health and human services,
272or the division of medical assistance.
273 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
274benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
275entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
276340B entity, including the administration of the drug, in person or via direct delivery, mail, or
277other form of shipment, or creation of a restriction or additional charge on a patient who chooses
278to receive drugs from a 340B entity.
279 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
280340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor. 15 of 30
281 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
282manager, or other third party payor network on the basis that the 340B entity dispenses drugs
283subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
284reasons other than those that apply equally to non-340B entities.
285 (ix) Nothing in this section applies to the division of medical assistance as payor when
286Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
2878(9k)).
288 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
289 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
290with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
291to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
292receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
293by the United States Department of Health and Human Services.
294 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
295340B entity.
296 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
297utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
298delivery of a 340B drug to, a 340B entity unless the data is required by the United States
299Department of Health and Human Services.
300 SECTION 4. Chapter 176B of the General Laws, as so appearing, is hereby further
301amended by inserting after section 26 the following new section: - 16 of 30
302 Section 27.
303 (a) For purposes of this section:
304 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
305by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
30642 U.S.C. 256b(a)(4).
307 (2) “340B entity” shall mean an entity participating or authorized to participate in the
308federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
309any pharmacy contracted with the participating entity to dispense drugs purchased through the
310340B drug discount program.
311 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
312176O.
313 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
314or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
315covered entity for drugs. Third party includes Medicaid managed care organizations, employee
316benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
317or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
318self-pay patient.
319 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
320propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
321defined in 247 CMR 2.00. 17 of 30
322 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
323defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
324chapter 112.
325 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
326of chapter 175.
327 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
328issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
329following:
330 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
331drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
332claim is for a 340B drug.
333 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
334following that differ from such terms or conditions applied to non-340B entities on the basis that
335the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
336that a drug is a 340B drug including, without limitation, any of the following:
337 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
338Subsection, the term “other adjustment” includes placing any additional requirements,
339restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
340fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
341drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
342benefit manager, or other third-party payor. 18 of 30
343 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
344 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
345networks.
346 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
347network.
348 E. Requirements that a claim for a drug include any identification, billing modifier,
349attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
350unless it is required by the United States Department of Health and Human Services, Centers for
351Medicare and Medicaid Services, the executive office of health and human services, or the
352division of medical assistance.
353 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
354340B entities.
355 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
356adjudication unless these actions are in the normal course of pharmacy business and not related
357to 340B drug pricing.
358 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
359patient’s choice to receive such drugs from the 340B entity, including the administration of such
360drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
361interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
362pharmacy benefit manager, or other third-party payor places any additional requirements,
363restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or 19 of 30
364fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
365identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
366to be processed or resubmitted unless it is required by the United States Department of Health
367and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
368and human services, or the division of medical assistance.
369 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
370condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
371entity unless the data is required by the United States Department of Health and Human Services,
372Centers for Medicare and Medicaid Services, the executive office of health and human services,
373or the division of medical assistance.
374 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
375benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
376entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
377340B entity, including the administration of the drug, in person or via direct delivery, mail, or
378other form of shipment, or creation of a restriction or additional charge on a patient who chooses
379to receive drugs from a 340B entity.
380 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
381340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
382 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
383manager, or other third party payor network on the basis that the 340B entity dispenses drugs
384subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
385reasons other than those that apply equally to non-340B entities. 20 of 30
386 (ix) Nothing in this section applies to the division of medical assistance as payor when
387Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
3888(9k)).
389 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
390 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
391with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
392to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
393receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
394by the United States Department of Health and Human Services.
395 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
396340B entity.
397 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
398utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
399delivery of a 340B drug to, a 340B entity unless the data is required by the United States
400Department of Health and Human Services.
401 SECTION 5. Chapter 176G of the General Laws, as so appearing, is hereby further
402amended by inserting after section 34 the following new section:-
403 Section 35.
404 (a) For purposes of this section: 21 of 30
405 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
406by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
40742 U.S.C. 256b(a)(4).
408 (2) “340B entity” shall mean an entity participating or authorized to participate in the
409federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or
410any pharmacy contracted with the participating entity to dispense drugs purchased through the
411340B drug discount program.
412 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
413176O.
414 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
415or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
416covered entity for drugs. Third party includes Medicaid managed care organizations, employee
417benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
418or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
419self-pay patient.
420 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
421propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
422defined in 247 CMR 2.00.
423 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
424defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
425chapter 112. 22 of 30
426 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
427of chapter 175.
428 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
429issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
430following:
431 (i)Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
432drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
433claim is for a 340B drug.
434 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
435following that differ from such terms or conditions applied to non-340B entities on the basis that
436the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
437that a drug is a 340B drug including, without limitation, any of the following:
438 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
439Subsection, the term “other adjustment” includes placing any additional requirements,
440restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
441fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
442drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
443benefit manager, or other third-party payor.
444 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
445 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
446networks. 23 of 30
447 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
448network.
449 E. Requirements that a claim for a drug include any identification, billing modifier,
450attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
451unless it is required by the United States Department of Health and Human Services, Centers for
452Medicare and Medicaid Services, the executive office of health and human services, or the
453division of medical assistance.
454 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
455340B entities.
456 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
457adjudication unless these actions are in the normal course of pharmacy business and not related
458to 340B drug pricing.
459 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
460patient’s choice to receive such drugs from the 340B entity, including the administration of such
461drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
462interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
463pharmacy benefit manager, or other third-party payor places any additional requirements,
464restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
465fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
466identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
467to be processed or resubmitted unless it is required by the United States Department of Health 24 of 30
468and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
469and human services, or the division of medical assistance.
470 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
471condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
472entity unless the data is required by the United States Department of Health and Human Services,
473Centers for Medicare and Medicaid Services, the executive office of health and human services,
474or the division of medical assistance.
475 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
476benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
477entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
478340B entity, including the administration of the drug, in person or via direct delivery, mail, or
479other form of shipment, or creation of a restriction or additional charge on a patient who chooses
480to receive drugs from a 340B entity.
481 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
482340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
483 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
484manager, or other third party payor network on the basis that the 340B entity dispenses drugs
485subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
486reasons other than those that apply equally to non-340B entities.
487 (ix) Nothing in this section applies to the division of medical assistance as payor when
488Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
4898(9k)). 25 of 30
490 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
491 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
492with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
493to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to
494receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
495by the United States Department of Health and Human Services.
496 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
497340B entity.
498 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
499utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
500delivery of a 340B drug to, a 340B entity unless the data is required by the United States
501Department of Health and Human Services.
502 SECTION 6. Chapter 176I of the General Laws, as so appearing, is hereby amended by
503inserting after section 14 the following new section: -
504 Section 15.
505 (a) For purposes of this section:
506 (1) “340B drug” shall mean a drug that has been subject to any offer for reduced prices
507by a manufacturer pursuant to 42 U.S.C. 256b and is purchased by a covered entity as defined by
50842 U.S.C. 256b(a)(4).
509 (2) “340B entity” shall mean an entity participating or authorized to participate in the
510federal 340B drug discount program, as defined by 42 U.S.C. 256b, including its pharmacy, or 26 of 30
511any pharmacy contracted with the participating entity to dispense drugs purchased through the
512340B drug discount program.
513 (3) “Health insurance issuer” shall mean “carrier” as defined in section 1 of chapter
514176O.
515 (4) “Third party” shall mean a group health plan, a health insurance issuer offering group
516or individual health insurance coverage, or a pharmacy benefit manager that reimburses a 340B
517covered entity for drugs. Third party includes Medicaid managed care organizations, employee
518benefit plans under the Employee Retirement Income Security Act of 1974, or Medicare Part C
519or D plans. Third party does not include drugs reimbursed under Medicaid fee-for-service or a
520self-pay patient.
521 (5) “Manufacturer” means a person who is engaged in manufacturing, preparing,
522propagating, compounding, processing, packaging, repackaging or labeling a prescription drug as
523defined in 247 CMR 2.00.
524 (6) “Pharmacy” incudes the definition of “pharmacy” and “retail drug business” as
525defined by section 1 of chapter 94C, and “Institutional pharmacy” as defined by section 39D of
526chapter 112.
527 (7) “Pharmacy benefit manager” shall have the same meaning as defined by section 226
528of chapter 175.
529 (b) With respect to reimbursement to a 340B entity for 340B drugs, a health insurance
530issuer, pharmacy benefit manager, other third party payor, or their agents shall not do any of the
531following: 27 of 30
532 (i) Reimburse a 340B entity for 340B drugs at a rate lower than that paid for the same
533drug to entities that are not 340B entities or lower reimbursement for a claim on the basis that the
534claim is for a 340B drug.
535 (ii) Impose any terms or conditions on any 340B entity with respect to any of the
536following that differ from such terms or conditions applied to non-340B entities on the basis that
537the entity participates in the federal 340B drug discount program set forth in 42 U.S.C.256b or
538that a drug is a 340B drug including, without limitation, any of the following:
539 A. Fees, charges, clawbacks, or other adjustments or assessments. For purposes of this
540Subsection, the term “other adjustment” includes placing any additional requirements,
541restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
542fees to the 340B entity that are not placed upon other entities that do not participate in the 340B
543drug discount program, including affiliate pharmacies of the health insurance issuer, pharmacy
544benefit manager, or other third-party payor.
545 B. Dispensing fees that are less than the dispensing fees for non-340B entities.
546 C. Restrictions or requirements regarding participation in standard or preferred pharmacy
547networks.
548 D. Restrictions or requirements regarding participation in standard or preferred pharmacy
549network.
550 E. Requirements that a claim for a drug include any identification, billing modifier,
551attestation, or other indication that a drug is a 340B drug in order to be processed or resubmitted
552unless it is required by the United States Department of Health and Human Services, Centers for 28 of 30
553Medicare and Medicaid Services, the executive office of health and human services, or the
554division of medical assistance.
555 F. Any other restrictions, conditions, practices, or policies that are not imposed on non-
556340B entities.
557 (iii) Require a 340B entity to reverse, resubmit, or clarify a claim after the initial
558adjudication unless these actions are in the normal course of pharmacy business and not related
559to 340B drug pricing.
560 (iv) Discriminate against a 340B entity in a manner that prevents or interferes with any
561patient’s choice to receive such drugs from the 340B entity, including the administration of such
562drugs. For purposes of this subsection, it is considered a discriminatory practice that prevents or
563interferes with a patient’s choice to receive drugs at a 340B entity if a health insurance issuer,
564pharmacy benefit manager, or other third-party payor places any additional requirements,
565restrictions, or unnecessary burdens upon the 340B entity that results in administrative costs or
566fees to the 340B entity, including but not limited to requiring a claim for a drug to include any
567identification, billing modifier, attestation or other indication that a drug is a 340B drug in order
568to be processed or resubmitted unless it is required by the United States Department of Health
569and Human Services, Centers for Medicare and Medicaid Services, the executive office of health
570and human services, or the division of medical assistance.
571 (v) Require a 340B entity to submit any claims, utilization, patient, or other data as a
572condition for allowing the acquisition of a 340B drug by, or delivery of a 340B drug to, a 340B
573entity unless the data is required by the United States Department of Health and Human Services, 29 of 30
574Centers for Medicare and Medicaid Services, the executive office of health and human services,
575or the division of medical assistance.
576 (vi) Include any other provision in a contract between a health insurance issuer, pharmacy
577benefit manager, or other third-party payor and a 340B entity that discriminates against the 340B
578entity or prevents or interferes with an individual’s choice to receive a prescription drug from a
579340B entity, including the administration of the drug, in person or via direct delivery, mail, or
580other form of shipment, or creation of a restriction or additional charge on a patient who chooses
581to receive drugs from a 340B entity.
582 (vii) Require or compel the submission of ingredient costs or pricing data pertaining to
583340B drugs to any health insurance issuer, pharmacy benefit manager, or other third party payor.
584 (viii) Exclude any 340B entity from the health insurance issuer, pharmacy benefit
585manager, or other third party payor network on the basis that the 340B entity dispenses drugs
586subject to an agreement under 42 U.S.C.256b, or refusing to contract with a 340B entity for
587reasons other than those that apply equally to non-340B entities.
588 (ix) Nothing in this section applies to the division of medical assistance as payor when
589Medicaid provides reimbursement for covered outpatient drugs as defined in 42 U.S.C. 1396r-
5908(9k)).
591 (c) With respect to manufacturing or distribution of drugs related to 340B entities:
592 (i) A manufacturer or distributor shall not deny, restrict, prohibit, or otherwise interfere
593with, either directly or indirectly, the acquisition of a 340B drug by, or delivery of a 340B drug
594to, a pharmacy that is under contract with a 340B entity and is authorized under such contract to 30 of 30
595receive and dispense 340B drugs on behalf of the covered entity unless such receipt is prohibited
596by the United States Department of Health and Human Services.
597 (ii) A manufacturer or distributor shall not interfere with a pharmacy contracted with a
598340B entity.
599 (iii) A manufacturer or distributor shall not require a 340B entity to submit any claims,
600utilization, patient, or other data as a condition for allowing the acquisition of a 340B drug by, or
601delivery of a 340B drug to, a 340B entity unless the data is required by the United States
602Department of Health and Human Services.