84R7002 PMO-D
By: Eltife S.B. No. 1176
A BILL TO BE ENTITLED
AN ACT
relating to the authority and rights of pharmacy services
administrative organizations to conduct the business of
independent pharmacies with respect to certain pharmacy benefits.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter I, Chapter 843, Insurance Code, is
amended by adding Section 843.324 to read as follows:
Sec. 843.324. PHARMACY SERVICES ADMINISTRATIVE
ORGANIZATIONS. (a) In this section:
(1) "Independent pharmacy" means a pharmacy that is
under common ownership with not more than two other pharmacies.
(2) "Pharmacy benefit manager" means a person, other
than a pharmacist, pharmacy, or pharmacy services administrative
organization, who acts as an administrator in connection with
pharmacy benefits.
(3) "Pharmacy services administrative organization"
means an entity that contracts with an independent pharmacy to
conduct on behalf of the pharmacy the pharmacy's business with a
third-party payor, including a pharmacy benefit manager, in
connection with pharmacy benefits and to assist the pharmacy by
providing administrative services, including negotiating,
executing, and administering a contract with a third-party payor
and communicating with the third-party payor in connection with a
contract or pharmacy benefits.
(b) This section applies to a Medicaid managed care program
and a managed care organization that contracts with the Health and
Human Services Commission to provide services under Chapter 533,
Government Code.
(c) This section does not apply with respect to pharmacy
benefits under a self-insured, self-funded, or other employee
welfare benefit plan that is exempt from state regulation under the
Employee Retirement Income Security Act of 1974 (29 U.S.C. Section
1001 et seq.).
(d) Subject to Subsection (e), a pharmacy services
administrative organization designated and authorized by an
independent pharmacy as the pharmacy's agent and vested with actual
authority may conduct the pharmacy's business with a pharmacy
benefit manager in connection with pharmacy benefits provided under
a health maintenance organization plan and administered by a
pharmacy benefit manager.
(e) Before a pharmacy services administrative organization
may act on behalf of the independent pharmacy as described by
Subsection (d), the pharmacy must provide written notice to the
pharmacy benefit manager that the organization has the authority to
conduct the pharmacy's business with the pharmacy benefit manager
to the extent provided in the notice. The notice must detail the
specific nature and scope of the authority granted to the
organization with respect to the pharmacy's business with the
pharmacy benefit manager.
(f) A pharmacy benefit manager that receives a notice under
Subsection (e) shall recognize the authority of the pharmacy
services administrative organization to conduct the pharmacy's
business with the pharmacy benefit manager to the extent provided
in the notice. A pharmacy benefit manager may not refuse to deal
with the organization to the extent of the authority detailed in the
notice, including by refusing to:
(1) enter into a contract with the organization acting
on behalf of the independent pharmacy on terms agreed to by the
pharmacy benefit manager and organization; or
(2) communicate with the organization about any matter
relevant to the pharmacy or pharmacy benefits, including contract
provisions, maximum allowable cost lists, and reimbursement price
appeals.
(g) A pharmacy benefit manager may not require an
independent pharmacy acting through a pharmacy services
administrative organization under this section to participate as a
network provider or preferred provider under a particular health
benefit plan as a condition of participating as a network provider
or preferred provider under another health benefit plan.
(h) A pharmacy services administrative organization has the
same rights and obligations under this chapter as the independent
pharmacy on behalf of which the organization acts with respect to
pharmacy benefits provided under a health maintenance organization
plan and administered by a pharmacy benefit manager, to the extent
of the organization's authority to act with respect to those
benefits.
SECTION 2. Subchapter B, Chapter 1301, Insurance Code, is
amended by adding Section 1301.070 to read as follows:
Sec. 1301.070. PHARMACY SERVICES ADMINISTRATIVE
ORGANIZATIONS. (a) In this section:
(1) "Independent pharmacy" means a pharmacy that is
under common ownership with not more than two other pharmacies.
(2) "Pharmacy benefit manager" means a person, other
than a pharmacist, pharmacy, or pharmacy services administrative
organization, who acts as an administrator in connection with
pharmacy benefits.
(3) "Pharmacy services administrative organization"
means an entity that contracts with an independent pharmacy to
conduct on behalf of the pharmacy the pharmacy's business with a
third-party payor, including a pharmacy benefit manager, in
connection with pharmacy benefits and to assist the pharmacy by
providing administrative services, including negotiating,
executing, and administering a contract with a third-party payor
and communicating with the third-party payor in connection with a
contract or pharmacy benefits.
(b) Notwithstanding Section 1301.0041, this section applies
to a Medicaid managed care program and a managed care organization
that contracts with the Health and Human Services Commission to
provide services under Chapter 533, Government Code.
(c) This section does not apply with respect to pharmacy
benefits under a self-insured, self-funded, or other employee
welfare benefit plan that is exempt from state regulation under the
Employee Retirement Income Security Act of 1974 (29 U.S.C. Section
1001 et seq.).
(d) Subject to Subsection (e), a pharmacy services
administrative organization designated and authorized by an
independent pharmacy as the pharmacy's agent and vested with actual
authority may conduct the pharmacy's business with a pharmacy
benefit manager in connection with pharmacy benefits provided under
a preferred provider benefit plan and administered by a pharmacy
benefit manager.
(e) Before a pharmacy services administrative organization
may act on behalf of the independent pharmacy as described by
Subsection (d), the pharmacy must provide written notice to the
pharmacy benefit manager that the organization has the authority to
conduct the pharmacy's business with the pharmacy benefit manager
to the extent provided in the notice. The notice must detail the
specific nature and scope of the authority granted to the
organization with respect to the pharmacy's business with the
pharmacy benefit manager.
(f) A pharmacy benefit manager that receives a notice under
Subsection (e) shall recognize the authority of the pharmacy
services administrative organization to conduct the pharmacy's
business with the pharmacy benefit manager to the extent provided
in the notice. A pharmacy benefit manager may not refuse to deal
with the organization to the extent of the authority detailed in the
notice, including by refusing to:
(1) enter into a contract with the organization acting
on behalf of the independent pharmacy on terms agreed to by the
pharmacy benefit manager and organization; or
(2) communicate with the organization about any matter
relevant to the pharmacy or pharmacy benefits, including contract
provisions, maximum allowable cost lists, and reimbursement price
appeals.
(g) A pharmacy benefit manager may not require an
independent pharmacy acting through a pharmacy services
administrative organization under this section to participate as a
network provider or preferred provider under a particular health
benefit plan as a condition of participating as a network provider
or preferred provider under another health benefit plan.
(h) A pharmacy services administrative organization has the
same rights and obligations under this chapter as the independent
pharmacy on behalf of which the organization acts with respect to
pharmacy benefits provided under a preferred provider benefit plan
and administered by a pharmacy benefit manager, to the extent of the
organization's authority to act with respect to those benefits.
SECTION 3. This Act applies only to benefits provided under
a health benefit plan that is delivered, issued for delivery, or
renewed on or after the effective date of this Act. Benefits
provided under a health benefit plan delivered, issued for
delivery, or renewed before the effective date of this Act are
governed by the law as it existed immediately before the effective
date of this Act, and that law is continued in effect for that
purpose.
SECTION 4. This Act takes effect September 1, 2015.