EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb1243*
HOUSE BILL 1243
J5 5lr2645
CF SB 975
By: Delegate S. Johnson Delegates S. Johnson, Alston, Bagnall, Bhandari,
Chisholm, Cullison, Guzzone, Hill, Hutchinson, Kaiser, Kerr, Kipke, Lopez,
Martinez, M. Morgan, Pena–Melnyk, Reilly, Rosenberg, Ross, Szeliga,
Taveras, White Holland, Woods, and Woorman
Introduced and read first time: February 7, 2025
Assigned to: Health and Government Operations
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 1, 2025
CHAPTER ______
AN ACT concerning 1
Health Insurance – Coverage for Specialty Drugs 2
FOR the purpose of prohibiting certain insurers, nonprofit health service plans, and health 3
maintenance organizations from excluding coverage for certain specialty drugs that 4
are administered or dispensed by a provider that meets certain criteria; requiring 5
the reimbursement rate for certain specialty drugs to meet certain criteria; and 6
generally relating to health insurance coverage for specialty drugs. 7
BY repealing and reenacting, without amendments, 8
Article – Insurance 9
Section 15–847(a)(1) and (5) 10
Annotated Code of Maryland 11
(2017 Replacement Volume and 2024 Supplement) 12
BY repealing and reenacting, with amendments, 13
Article – Insurance 14
Section 15–847(d), 15–1611.1, and 15–1612 15
Annotated Code of Maryland 16
(2017 Replacement Volume and 2024 Supplement) 17
BY adding to 18
Article – Insurance 19 2 HOUSE BILL 1243
Section 15–847(h) and 15–847.2 1
Annotated Code of Maryland 2
(2017 Replacement Volume and 2024 Supplement) 3
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 4
That the Laws of Maryland read as follows: 5
Article – Insurance 6
15–847. 7
(a) (1) In this section the following words have the meanings indicated. 8
(5) (i) “Specialty drug” means a prescription drug that: 9
1. is prescribed for an individual with a complex or chronic 10
medical condition or a rare medical condition; 11
2. costs $600 or more for up to a 30–day supply; 12
3. is not typically stocked at retail pharmacies; and 13
4. A. requires a difficult or unusual process of delivery to 14
the patient in the preparation, handling, storage, inventory, or distribution of the drug; or 15
B. requires enhanced patient education, management, or 16
support, beyond those required for traditional dispensing, before or after administration of 17
the drug. 18
(ii) “Specialty drug” does not include a prescription drug prescribed 19
to treat diabetes, HIV, or AIDS. 20
(d) Subject to SUBSECTION (H) OF THIS SECTION AND § 15–805 of this subtitle 21
[and], notwithstanding § 15–806 of this subtitle, [nothing in] AND EXCEPT AS PROVID ED 22
IN § 15–847.2 OF THIS SUBTITLE , this article or regulations adopted under this article 23
[precludes] DO NOT PRECLUDE an entity subject to this section from requiring a covered 24
specialty drug to be obtained through: 25
(1) a designated pharmacy or other source authorized under the Health 26
Occupations Article to dispense or administer prescription drugs; or 27
(2) a pharmacy participating in the entity’s provider network, if the entity 28
determines that the pharmacy: 29
(i) meets the entity’s performance standards; and 30
(ii) accepts the entity’s network reimbursement rates. 31 HOUSE BILL 1243 3
(H) THIS SECTION MAY NOT BE CONSTRUED TO SUPE RSEDE THE AUTHORITY 1
OF THE HEALTH SERVICES COST REVIEW COMMISSION TO SET RAT ES FOR 2
SPECIALTY DRUGS ADMI NISTERED TO PATIENTS IN A SETTING REGULAT ED BY THE 3
HEALTH SERVICES COST REVIEW COMMISSION. 4
15–847.2. 5
(A) IN THIS SECTION, “SPECIALTY DRUG ” HAS THE MEANING STAT ED IN § 6
15–847 OF THIS SUBTITLE . 7
(B) (1) THIS SECTION APPLIES TO: 8
(I) INSURERS AND NONPROF IT HEALTH SERVICE PL ANS THAT 9
PROVIDE COVERAGE FOR PRESCRIPTION DRUGS UNDER INDIVIDUAL , GROUP, OR 10
BLANKET HEALTH INSUR ANCE POLICIES OR CON TRACTS THAT ARE ISSU ED OR 11
DELIVERED IN THE STATE; AND 12
(II) HEALTH MAINTENANCE O RGANIZATIONS THAT PR OVIDE 13
COVERAGE FOR PRESCRI PTION DRUGS UNDER IN DIVIDUAL OR GROUP CO NTRACTS 14
THAT ARE ISSUED OR DELIVERED I N THE STATE. 15
(2) AN INSURER, A NONPROFIT HEALTH S ERVICE PLAN, OR A HEALTH 16
MAINTENANCE ORGANIZA TION THAT PROVIDES C OVERAGE FOR PRESCRIP TION 17
DRUGS THROUGH A PHAR MACY BENEFITS MANAGE R IS SUBJECT TO THE 18
REQUIREMENTS OF THIS SECTION. 19
(C) AN ENTITY SUBJECT TO THIS SECTION MAY NOT EXCLUDE COVERAGE 20
FOR A COVERED SPECIA LTY DRUG ADMINISTERE D OR DISPENSED BY A PROVIDER 21
UNDER § 12–102 OF THE HEALTH OCCUPATIONS ARTICLE IF THE ENTITY 22
DETERMINES THAT : 23
(1) THE PROVIDER THAT AD MINISTERS OR DISPENSES THE COVERE D 24
SPECIALTY DRUG : 25
(I) IS AN IN–NETWORK PROVIDER OF COVERED MEDICAL 26
ONCOLOGY SERVICES ; AND 27
(II) COMPLIES WITH STATE REGULATIONS FOR THE 28
ADMINISTERING AND DI SPENSING OF SPECIALT Y DRUGS; AND 29
(2) THE COVERED SPECIALT Y DRUG IS: 30
4 HOUSE BILL 1243
(I) INFUSED, AUTO–INJECTED, OR AN ORAL TARGETED 1
IMMUNE MODULATOR ; OR 2
(II) AN ORAL MEDICATION T HAT: 3
1. REQUIRES COMPLEX DOS ING BASED ON CLINICA L 4
PRESENTATION ; OR 5
2. IS USED CONCOMITANTL Y WITH OTHER INFUSIO N OR 6
RADIATION THERAPIES . 7
(D) (1) THE SUBJECT TO SUBSECTION (F) OF THIS SECTION , THE 8
REIMBURSEMENT RATE F OR SPECIALTY DRUGS COVE RED UNDER THIS SECTI ON 9
SHALL BE: 10
(1) (I) AGREED TO BY THE COV ERED, IN–NETWORK PROVIDER AND 11
THE ENTITY SUBJECT T O THIS SECTION; AND 12
(2) (II) BILLED AT A NONHOSPITAL LEVEL OF CARE OR PLACE OF 13
SERVICE. 14
(2) UNLESS OTHERWISE AGRE ED TO BY THE COVERED , IN–NETWORK 15
PROVIDER AND THE ENT ITY SUBJECT TO THIS SECTION, THE REIMBURSEMENT RA TE 16
FOR SPECIALTY DRUGS COVERED UNDER THIS S ECTION MAY NOT EXCEE D THE RATE 17
APPLICABLE TO A DESI GNATED SPECIALTY PHA RMACY FOR DISPENSING THE 18
COVERED SPECIALTY DR UGS. 19
(E) THIS SECTION DOES NOT PROHIBIT AN ENTITY S UBJECT TO THIS 20
SECTION FROM REFUSIN G TO AUTHORIZE OR AP PROVE OR FROM DENYIN G 21
COVERAGE FOR A COVER ED SPECIALTY DRUG ADMINISTERED OR DISP ENSED BY A 22
PROVIDER IF ADMINIST ERING OR DISPENSING THE DRUG FAILS TO SA TISFY 23
MEDICAL NECESSITY CR ITERIA. 24
(F) THIS SECTION MAY NOT BE CONSTRUED TO SUPE RSEDE THE AUTHORITY 25
OF THE HEALTH SERVICES COST REVIEW COMMISSION TO SET RAT ES FOR 26
SPECIALTY DRUGS ADMIN ISTERED TO PATIENTS IN A SETTING REGULAT ED BY THE 27
HEALTH SERVICES COST REVIEW COMMISSION. 28
15–1611.1. 29
(a) This section applies only to a pharmacy benefits manager that provides 30
pharmacy benefits management services on behalf of a carrier. 31
HOUSE BILL 1243 5
(b) Except as provided in subsection (c) of this section, a pharmacy benefits 1
manager may not require that a beneficiary use a specific pharmacy or entity to fill a 2
prescription if: 3
(1) the pharmacy benefits manager or a corporate affiliate of the pharmacy 4
benefits manager has an ownership interest in the pharmacy or entity; or 5
(2) the pharmacy or entity has an ownership interest in the pharmacy 6
benefits manager or a corporate affiliate of the pharmacy benefits manager. 7
(c) [A] EXCEPT AS PRO VIDED IN § 15–847.2 OF THIS TITLE, A pharmacy 8
benefits manager may require a beneficiary to use a specific pharmacy or entity for a 9
specialty drug as defined in § 15–847 of this title. 10
15–1612. 11
(a) This section applies only to a pharmacy benefits manager that provides 12
pharmacy benefits management services on behalf of a carrier. 13
(b) This section does not apply to reimbursement: 14
(1) EXCEPT AS PROVIDED I N § 15–847.2 OF THIS TITLE, for specialty 15
drugs; 16
(2) for mail order drugs; or 17
(3) to a chain pharmacy with more than 15 stores or a pharmacist who is 18
an employee of the chain pharmacy. 19
(c) A pharmacy benefits manager may not reimburse a pharmacy or pharmacist 20
for a pharmaceutical product or pharmacist service in an amount less than the amount that 21
the pharmacy benefits manager reimburses itself or an affiliate for providing the same 22
product or service. 23
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall apply to all 24
policies, contracts, and health benefit plans issued, delivered, or renewed in the State on or 25
after January 1, 2026. 26
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 27
January 1, 2026. 28