Maryland 2025 Regular Session

Maryland House Bill HB813 Compare Versions

OldNewDifferences
11
22
33 EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
44 [Brackets] indicate matter deleted from existing law.
55 Underlining indicates amendments to bill.
66 Strike out indicates matter stricken from the bill by amendment or deleted from the law by
77 amendment.
8- Italics indicate opposite chamber/conference committee amendments.
98 *hb0813*
109
1110 HOUSE BILL 813
12-J5 EMERGENCY BILL (5lr2785)
13-ENROLLED BILL
14-— Health and Government Operations/Finance —
15-Introduced by Delegates S. Johnson and A. Johnson, A. Johnson, Alston, Bagnall,
16-Bhandari, Cullison, Guzzone, Hill, Hutchinson, Kaiser, Kerr, Kipke, Lopez,
17-Martinez, M. Morgan, Pena–Melnyk, Reilly, Rosenberg, Ross, Szeliga,
18-Taveras, White Holland, Woods, and Woorman
19-
20-Read and Examined by Proofreaders:
21-
22-_______________________________________________
23-Proofreader.
24-_______________________________________________
25-Proofreader.
26-
27-Sealed with the Great Seal and presented to the Governor, for his approval this
28-
29-_______ day of _______________ at _________________ _______ o’clock, ________M.
30-
31-______________________________________________
32-Speaker.
11+J5 EMERGENCY BILL 5lr2785
12+HB 880/24 – HGO CF SB 438
13+By: Delegates S. Johnson and A. Johnson, A. Johnson, Alston, Bagnall, Bhandari,
14+Cullison, Guzzone, Hill, Hutchinson, Kaiser, Kerr, Kipke, Lopez, Martinez,
15+M. Morgan, Pena–Melnyk, Reilly, Rosenberg, Ross, Szeliga, Taveras,
16+White Holland, Woods, and Woorman
17+Introduced and read first time: January 29, 2025
18+Assigned to: Health and Government Operations
19+Committee Report: Favorable with amendments
20+House action: Adopted
21+Read second time: March 1, 2025
3322
3423 CHAPTER ______
3524
3625 AN ACT concerning 1
3726
3827 Pharmacy Benefits Administration – Maryland Medical Assistance Program and 2
3928 Pharmacy Benefits Managers 3
4029 Maryland Insurance Administration and Maryland Department of Health – 4
4130 Workgroup to Study Pharmacy Benefits Managers 5
4231
4332 FOR the purpose of altering the reimbursement levels for drug products that the Maryland 6
4433 Medical Assistance Program is required to establish and that pharmacy benefits 7
4534 managers that contract with a pharmacy on behalf of a managed care organization 8
4635 are required to reimburse the pharmacy; altering the definition of “purchaser” for 9
4736 purposes of certain provisions of law regulating pharmacy benefits managers to 10
4837 include certain insurers, nonprofit health service plans, and health maintenance 11
49-organizations requiring the Maryland Insurance Administration and the Maryland 12 2 HOUSE BILL 813
38+organizations requiring the Maryland Insurance Administration and the Maryland 12
39+Department of Health to convene a workgroup to study certain issues related to 13
40+pharmacy benefits managers and report to certain committees on or before a certain 14
41+date; and generally relating to pharmacy benefits administration a workgroup to 15
42+study pharmacy benefits managers. 16
5043
51-
52-Department of Health, in consultation with the Prescription Drug Affordability 1
53-Board, to convene a workgroup to study certain issues related to pharmacy benefits 2
54-managers and report to certain committees on or before a certain date; and generally 3
55-relating to pharmacy benefits administration a workgroup to study pharmacy 4
56-benefits managers. 5
57-
58-BY repealing and reenacting, with amendments, 6
59- Article – Health – General 7
60-Section 15–118(b) 8
61- Annotated Code of Maryland 9
62- (2023 Replacement Volume and 2024 Supplement) 10
63-
64-BY adding to 11
65- Article – Health – General 12
66-Section 15–118(f) 13
67- Annotated Code of Maryland 14
68- (2023 Replacement Volume and 2024 Supplement) 15
69-
70-BY repealing and reenacting, with amendments, 16
71- Article – Insurance 17
72-Section 15–1601(s) 18
73- Annotated Code of Maryland 19
74- (2017 Replacement Volume and 2024 Supplement) 20
75-
76-BY adding to 21
77- Article – Insurance 22
78-Section 15–1632 23
79- Annotated Code of Maryland 24
80- (2017 Replacement Volume and 2024 Supplement) 25
81-
82- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 26
83-That the Laws of Maryland read as follows: 27
84-
85-Article – Health – General 28
86-
87-15–118. 29
88-
89- (b) (1) [Except] SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION A ND 30
90-EXCEPT as provided under paragraph [(2)] (3) of this subsection, the Program shall 31
91-establish [maximum] MINIMUM reimbursement levels for the drug products for which 32
92-there is a generic equivalent authorized under § 12–504 of the Health Occupations Article[, 33
93-based on the cost of the generic product]. 34
94-
95- (2) EXCEPT AS PROVIDED IN PARAGRAPH (4) OF THIS SUBSECTION , 35
96-MINIMUM REIMBURSEMEN T LEVELS ESTABLISHED UNDER PARAGRAPH (1) OF THIS 36
97-SUBSECTION SHALL BE AT LEAST EQUAL TO TH E NATIONAL AVERAGE DRUG 37 HOUSE BILL 813 3
98-
99-
100-ACQUISITION COST OF THE GENERIC P RODUCT PLUS THE FEE –FOR–SERVICE 1
101-PROFESSIONAL DISPENS ING FEE DETERMINED B Y THE DEPARTMENT IN 2
102-ACCORDANCE WITH THE MOST RECENT IN –STATE COST–OF–DISPENSING SURVEY . 3
103-
104- [(2)] (3) [If] EXCEPT AS PROVIDED IN PARAGRAPH (4) OF THIS 4
105-SUBSECTION, IF a prescriber directs a specific brand name drug, the reimbursement level 5
106-shall be based on the [cost] NATIONAL AVERAGE DRUG ACQUISITION COST of the 6
107-brand name product PLUS THE FEE–FOR–SERVICE PROFESSIONAL DISPENSING FEE 7
108-DETERMINED BY THE DEPARTMENT IN ACCORDA NCE WITH THE MOST RE CENT 8
109-IN–STATE COST–OF–DISPENSING SURVEY . 9
110-
111- (4) PARAGRAPHS (2) AND (3) OF THIS SUBSECTION D O NOT APPLY TO: 10
112-
113- (I) A PHARMACY OWNED BY OR UNDER THE SAME CORPO RATE 11
114-AFFILIATION AS A PHA RMACY BENEFI TS MANAGER; OR 12
115-
116- (II) A MAIL ORDER PHARMACY . 13
117-
118- (F) THE PROVISIONS OF § 15–1632 OF THE INSURANCE ARTICLE APPLY TO 14
119-A MANAGED CARE ORGAN IZATION THAT USES A PHARMACY BENEFITS MA NAGER TO 15
120-MANAGE PRESCRIPTION DRUG COVERAGE BENEFI TS ON BEHALF OF THE MANAGED 16
121-CARE ORGANIZATION . 17
122-
123-Article – Insurance 18
124-
125-15–1601. 19
126-
127- (s) (1) “Purchaser” means a person that offers a plan or program in the State, 20
128-including the State Employee and Retiree Health and Welfare Benefits Program, AN 21
129-INSURER, A NONPROFIT HEALTH S ERVICE PLAN , OR A HEALTH MAINTENANCE 22
130-ORGANIZATION , that: 23
131-
132- [(1)] (I) provides prescription drug coverage or benefits in the State; and 24
133-
134- [(2)] (II) enters into an agreement with a pharmacy benefits manager for 25
135-the provision of pharmacy benefits management services. 26
136-
137- (2) “PURCHASER” DOES NOT INCLUDE A N ONPROFIT HEALTH 27
138-MAINTENANCE ORGANIZA TION THAT: 28
139-
140- (I) OPERATES AS A GROUP MODEL; 29
141-
142- (II) PROVIDES SERVICES SO LELY TO A MEMBER OR PATIENT OF 30
143-THE NONPROFIT HEALTH MAINTENANCE ORGANIZA TION; AND 31 4 HOUSE BILL 813
44+BY repealing and reenacting, with amendments, 17
45+ Article – Health – General 18
46+Section 15–118(b) 19
47+ Annotated Code of Maryland 20
48+ (2023 Replacement Volume and 2024 Supplement) 21 2 HOUSE BILL 813
14449
14550
14651
147- (III) FURNISHES SERVICES THROUGH THE INTERNAL PHARMACY 1
148-OPERATIONS OF THE NO NPROFIT HEALTH MAINT ENANCE ORGANIZATION . 2
52+BY adding to 1
53+ Article – Health – General 2
54+Section 15–118(f) 3
55+ Annotated Code of Maryland 4
56+ (2023 Replacement Volume and 2024 Supplement) 5
14957
150-15–1632. 3
58+BY repealing and reenacting, with amendments, 6
59+ Article – Insurance 7
60+Section 15–1601(s) 8
61+ Annotated Code of Maryland 9
62+ (2017 Replacement Volume and 2024 Supplement) 10
15163
152- A PHARMACY BENEFITS MA NAGER THAT CONTRACTS WITH A PHARMACY ON 4
153-BEHALF OF A MANAGED CARE ORGANIZATION , AS DEFINED IN § 15–101 OF THE 5
154-HEALTH – GENERAL ARTICLE, SHALL REIMBURSE THE PHARMACY AN AMOUNT 6
155-THAT IS AT LEAST EQU AL TO THE NATIONAL AVERAGE DRUG ACQUISITION COST 7
156-PLUS THE FEE–FOR–SERVICE PROFESSIONAL DISPENSING FEE DETER MINED BY THE 8
157-MARYLAND DEPARTMENT OF HEALTH FOR THE MARYLAND MEDICAL ASSISTANCE 9
158-PROGRAM IN ACCORDANCE WITH T HE MOST RECENT IN –STATE 10
159-COST–OF–DISPENSING SURVEY . 11
64+BY adding to 11
65+ Article – Insurance 12
66+Section 15–1632 13
67+ Annotated Code of Maryland 14
68+ (2017 Replacement Volume and 2024 Supplement) 15
16069
161- SECTION 2. AND BE IT FURTHER ENACTED, That this Act is an emergency 12
162-measure, is necessary for the immediate preservation of the public health or safety, has 13
163-been passed by a yea and nay vote supported by three–fifths of all the members elected to 14
164-each of the two Houses of the General Assembly, and shall take effect from the date it is 15
165-enacted. 16
70+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 16
71+That the Laws of Maryland read as follows: 17
16672
167- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 17
168-That the Maryland Insurance Administration and the Maryland Department of Health, in 18
169-consultation with the Prescription Drug Affordability Board, shall: 19
73+Article – Health – General 18
17074
171- (1) convene a workgroup of interested stakeholders, including community 20
172-pharmacies from both chain and independent settings, pharmacy services administrative 21
173-organizations, health insurance carriers, plan sponsor representatives, drug wholesalers 22
174-and distributors, non–pharmacy benefit manager–owned mail order pharmacies, brand 23
175-name and generic drug manufacturers, pharmacists, pharmacy benefits managers, and 24
176-managed care organizations, and third–party experts in the field of drug pricing in 25
177-Medicaid; 26
75+15–118. 19
17876
179- (2) review reimbursement for pharmacists, including: 27
77+ (b) (1) [Except] SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION A ND 20
78+EXCEPT as provided under paragraph [(2)] (3) of this subsection, the Program shall 21
79+establish [maximum] MINIMUM reimbursement levels for the drug products for which 22
80+there is a generic equivalent authorized under § 12–504 of the Health Occupations Article[, 23
81+based on the cost of the generic product]. 24
18082
181- (i) existing Maryland Medical Assistance Program requirements for 28
182-pharmacy benefits managers and managed care organizations related to dispensing fee 29
183-reimbursement, pharmacy benefits managers fees charged to pharmacies and the 30
184-Maryland Medical Assistance Program, transparency in pricing and reimbursement data, 31
185-specialty drug designations, and appeals processes; 32
83+ (2) EXCEPT AS PROVIDED IN PARAGRAPH (4) OF THIS SUBSECTION , 25
84+MINIMUM REIMBURSEMEN T LEVELS ESTABLISHED UNDER PARAGRAPH (1) OF THIS 26
85+SUBSECTION SHALL BE AT LEAST EQUAL TO TH E NATIONAL AVERAGE DRUG 27
86+ACQUISITION COST OF THE GENERIC PRODU CT PLUS THE FEE –FOR–SERVICE 28
87+PROFESSIONAL DISPENS ING FEE DETERMINED B Y THE DEPARTMENT IN 29
88+ACCORDANCE WITH THE MOST RECENT IN –STATE COST–OF–DISPENSING SURVEY . 30
18689
187- (ii) how other states’ pharmacy benefits services operate in 33
188-Medicaid, including in Ohio, Kentucky, New York, California, and West Virginia; 34
90+ [(2)] (3) [If] EXCEPT AS PROVIDED IN PARAGRAPH (4) OF THIS 31
91+SUBSECTION, IF a prescriber directs a specific brand name drug, the reimbursement level 32
92+shall be based on the [cost] NATIONAL AVERAGE DRUG ACQUISITION COST of the 33
93+brand name product PLUS THE FEE–FOR–SERVICE PROFESSIONAL DISPENSING FEE 34
94+DETERMINED BY THE DEPARTMENT IN ACC ORDANCE WITH THE MOS T RECENT 35
95+IN–STATE COST–OF–DISPENSING SURVEY . 36
96+ HOUSE BILL 813 3
97+
98+
99+ (4) PARAGRAPHS (2) AND (3) OF THIS SUBSECTION D O NOT APPLY TO: 1
100+
101+ (I) A PHARMACY OWNED BY OR UNDER THE SAME CORPO RATE 2
102+AFFILIATION AS A PHA RMACY BENEFITS MANAG ER; OR 3
103+
104+ (II) A MAIL ORDER PHARMACY. 4
105+
106+ (F) THE PROVISIONS OF § 15–1632 OF THE INSURANCE ARTICLE APPLY TO 5
107+A MANAGED CARE ORGAN IZATION THAT USES A PHARMACY BENEFITS MA NAGER TO 6
108+MANAGE PRESCRIPTION DRUG COVERAGE BENEFI TS ON BEHALF OF THE MANAGED 7
109+CARE ORGANIZATION . 8
110+
111+Article – Insurance 9
112+
113+15–1601. 10
114+
115+ (s) (1) “Purchaser” means a person that offers a plan or program in the State, 11
116+including the State Employee and Retiree Health and Welfare Benefits Program, AN 12
117+INSURER, A NONPROFIT HEALTH S ERVICE PLAN , OR A HEALTH MAINTENA NCE 13
118+ORGANIZATION , that: 14
119+
120+ [(1)] (I) provides prescription drug coverage or benefits in the State; and 15
121+
122+ [(2)] (II) enters into an agreement with a pharmacy benefits manager for 16
123+the provision of pharmacy benefits management services. 17
124+
125+ (2) “PURCHASER” DOES NOT INCLUDE A NONPROFIT HEALTH 18
126+MAINTENANCE ORGANIZA TION THAT: 19
127+
128+ (I) OPERATES AS A GROUP MODEL; 20
129+
130+ (II) PROVIDES SERVICES SO LELY TO A MEMBER OR PATIENT OF 21
131+THE NONPROFIT HEALTH MAINTENANCE ORGANIZA TION; AND 22
132+
133+ (III) FURNISHES SERVICES T HROUGH THE INTERNAL PHARMACY 23
134+OPERATIONS OF THE NO NPROFIT HEALTH MAINT ENANCE ORGANIZATION . 24
135+
136+15–1632. 25
137+
138+ A PHARMACY BENEFITS MA NAGER THAT CONTRACTS WITH A PHARMACY ON 26
139+BEHALF OF A MANAGED CARE ORGANIZATION , AS DEFINED IN § 15–101 OF THE 27
140+HEALTH – GENERAL ARTICLE, SHALL REIMBURSE THE PHARMACY AN AMOUNT 28
141+THAT IS AT LEAST EQU AL TO THE NATIONAL AVERAGE DRUG ACQUISITION COST 29
142+PLUS THE FEE–FOR–SERVICE PROFESSIONAL DISPENSING FEE DETER MINED BY THE 30
143+MARYLAND DEPARTMENT OF HEALTH FOR THE MARYLAND MEDICAL ASSISTANCE 31 4 HOUSE BILL 813
144+
145+
146+PROGRAM IN ACCORDANCE WITH THE MOST RECENT IN –STATE 1
147+COST–OF–DISPENSING SURVEY . 2
148+
149+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act is an emergency 3
150+measure, is necessary for the immediate preservation of the public health or safety, has 4
151+been passed by a yea and nay vote supported by three–fifths of all the members elected to 5
152+each of the two Houses of the General Assembly, and shall take effect from the date it is 6
153+enacted. 7
154+
155+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 8
156+That the Maryland Insurance Administration and the Maryland Department of Health 9
157+shall: 10
158+
159+ (1) convene a workgroup of interested stakeholders, including community 11
160+pharmacies from both chain and independent settings, pharmacy services administrative 12
161+organizations, pharmacists, pharmacy benefits managers, and managed care organizations 13
162+and third–party experts in the field of drug pricing in Medicaid; 14
163+
164+ (2) review reimbursement for pharmacists, including: 15
165+
166+ (i) existing Maryland Medical Assistance Program requirements for 16
167+pharmacy benefits managers and managed care organizations related to dispensing fee 17
168+reimbursement, pharmacy benefits managers fees charged to pharmacies and the 18
169+Maryland Medical Assistance Program, transparency in pricing and reimbursement data, 19
170+specialty drug designations, and appeals processes; 20
171+
172+ (ii) how other states’ pharmacy benefits services operate in 21
173+Medicaid, including in Ohio, Kentucky, New York, California, and West Virginia; 22
174+
175+ (iii) measures that offset the Department’s costs to fund the Medicaid 23
176+Managed Care Program and adop t NADAC plus the Fee–for–Service Professional 24
177+Dispensing, including: 25
178+
179+ 1. savings associated with NADAC ingredient cost pricing 26
180+and managed care organizations; and 27
181+
182+ 2. pharmacy benefits managers administrative fee 28
183+consolidation and rebate allocations; and 29
184+
185+ (iv) strategies for adopting pharmacy reimbursement parity and 30
186+drug pricing transparency; 31
187+
188+ (3) review coverage requirements for specialty drugs, including: 32
189+
190+ (i) which drugs are considered specialty for purposes of formularies 33
191+across carriers and pharmacy benefits managers; and 34
189192 HOUSE BILL 813 5
190193
191194
192- (iii) measures that offset the Department’s costs to fund the Medicaid 1
193-Managed Care Program and adopt NADAC plus the Fee –for–Service Professional 2
194-Dispensing, including: 3
195+ (ii) what these drugs have in common for purposes of developing a 1
196+new definition for “specialty drug”; 2
195197
196- 1. savings associated with NADAC ingredient cost pricing 4
197-and managed care organizations; and 5
198+ (4) review ERISA exemptions for pharmacy benefits management 3
199+regulation, including: 4
198200
199- 2. pharmacy benefits managers administrative fee 6
200-consolidation and rebate allocations; and 7
201+ (i) the scope of Rutledge v. Pharmaceutical Care Management 5
202+Association and subsequent case law and federal guidance; 6
201203
202- (iv) strategies for adopting pharmacy reimbursement parity and 8
203-drug pricing transparency; 9
204+ (ii) how other states have responded to the Rutledge decision; and 7
204205
205- (3) review coverage requirements for specialty drugs, including: 10
206+ (iii) what, if any, other State laws should be amended; 8
206207
207- (i) which drugs are considered specialty for purposes of formularies 11
208-across carriers and pharmacy benefits managers; and 12
208+ (5) on or before December 31, 2025, submit an interim report on their 9
209+findings and recommendations to the Senate Finance Committee and the House Health 10
210+and Government Operations Committee, in accordance with § 2 –1257 of the State 11
211+Government Article; and 12
209212
210- (ii) what these drugs have in common for purposes of developing a 13
211-new definition for “specialty drug”; 14
213+ (6) on or before December 31, 2026, submit a final report on their findings 13
214+and recommendations to the Senate Finance Committee and the House Health and 14
215+Government Operations Committee, in accordance with § 2–1257 of the State Government 15
216+Article. 16
212217
213- (4) review ERISA exemptions for pharmacy benefits management 15
214-regulation, including: 16
215-
216- (i) the scope of Rutledge v. Pharmaceutical Care Management 17
217-Association and subsequent case law and federal guidance; 18
218-
219- (ii) how other states have responded to the Rutledge decision; and 19
220-
221- (iii) what, if any, other State laws should be amended; 20
222-
223- (5) review the costs associated with pharmacies contracting with 21
224-commercial plans versus pharmacies contracting with the Maryland Medical Assistance 22
225-Program; 23
226-
227- (6) review provisions of State law regarding pharmacy benefit managers, 24
228-specialty pharmacies, and anti–steering, including: 25
229-
230- (i) § 15–1611.1 of the Insurance Article related to the use of specific 26
231-pharmacies or entities and the effect the section has on pharmacy costs in the fully insured 27
232-market; and 28
233-
234- (ii) § 15–1612 of the Insurance Article related to reimbursement and 29
235-the effect the section has on pharmacy costs in the fully insured market; 30
236-
237- (5) (7) on or before December 31, 2025, submit an interim report on their 31
238-findings and recommendations to the Senate Finance Committee and the House Health 32 6 HOUSE BILL 813
239-
240-
241-and Government Operations Committee, in accordance with § 2 –1257 of the State 1
242-Government Article; and 2
243-
244- (6) (8) on or before December 31, 2026, submit a final report on their findings 3
245-and recommendations to the Senate Finance Comm ittee and the House Health and 4
246-Government Operations Committee, in accordance with § 2–1257 of the State Government 5
247-Article. 6
248-
249- SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect June 7
250-1, 2025. 8
218+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect June 17
219+1, 2025. 18
251220
252221
253222
254223
255224 Approved:
256225 ________________________________________________________________________________
257226 Governor.
258227 ________________________________________________________________________________
259228 Speaker of the House of Delegates.
260229 ________________________________________________________________________________
261230 President of the Senate.