Texas 2025 - 89th Regular

Texas House Bill HB970 Compare Versions

Only one version of the bill is available at this time.

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1	1	By: Harrison H.B. No. 970
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6	6	A BILL TO BE ENTITLED
7	7	AN ACT
8	8	relating to the application of prescription drug price reductions;
9	9	imposing a civil penalty.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Chapter 1369, Insurance Code, is amended by
12	12	adding Subchapter B-3 to read as follows:
13	13	SUBCHAPTER B-3. PRESCRIPTION DRUG PRICE REDUCTIONS
14	14	Sec. 1369.095. DEFINITIONS. In this subchapter:
15	15	(1) "Manufacturer" means a person who is engaged in
16	16	making, preparing, propagating, fabricating, compounding,
17	17	processing, packaging, repackaging, labeling or relabeling of a
18	18	prescription drug or biological product.
19	19	(2) "Pharmacy benefit manager" and "prescription
20	20	drug" have the meanings assigned by Section 1369.501.
21	21	Sec. 1369.096. APPLICABILITY OF SUBCHAPTER. (a) This
22	22	subchapter applies only to a health benefit plan that provides
23	23	benefits for medical or surgical expenses incurred as a result of a
24	24	health condition, accident, or sickness, including an individual,
25	25	group, blanket, or franchise insurance policy or insurance
26	26	agreement, a group hospital service contract, or an individual or
27	27	group evidence of coverage or similar coverage document that is
28	28	issued by:
29	29	(1) an insurance company;
30	30	(2) a group hospital service corporation operating
31	31	under Chapter 842;
32	32	(3) a health maintenance organization operating under
33	33	Chapter 843;
34	34	(4) an approved nonprofit health corporation that
35	35	holds a certificate of authority under Chapter 844;
36	36	(5) a multiple employer welfare arrangement that holds
37	37	a certificate of authority under Chapter 846;
38	38	(6) a stipulated premium company operating under
39	39	Chapter 884;
40	40	(7) a fraternal benefit society operating under
41	41	Chapter 885;
42	42	(8) a Lloyd's plan operating under Chapter 941; or
43	43	(9) an exchange operating under Chapter 942.
44	44	(b) Notwithstanding any other law, this subchapter applies
45	45	to:
46	46	(1) a small employer health benefit plan subject to
47	47	Chapter 1501, including coverage provided through a health group
48	48	cooperative under Subchapter B of that chapter;
49	49	(2) a standard health benefit plan issued under
50	50	Chapter 1507;
51	51	(3) a basic coverage plan under Chapter 1551;
52	52	(4) a basic plan under Chapter 1575;
53	53	(5) a primary care coverage plan under Chapter 1579;
54	54	(6) a plan providing basic coverage under Chapter
55	55	1601;
56	56	(7) group health coverage made available by a school
57	57	district in accordance with Section 22.004, Education Code;
58	58	(8) a regional or local health care program operated
59	59	under Section 75.104, Health and Safety Code;
60	60	(9) a self-funded health benefit plan sponsored by a
61	61	professional employer organization under Chapter 91, Labor Code;
62	62	(10) county employee group health benefits provided
63	63	under Chapter 157, Local Government Code; and
64	64	(11) health and accident coverage provided by a risk
65	65	pool created under Chapter 172, Local Government Code.
66	66	Sec. 1369.097. EXCEPTIONS TO APPLICABILITY OF SUBCHAPTER.
67	67	This subchapter does not apply to an issuer or provider of health
68	68	benefits under or a pharmacy benefit manager administering pharmacy
69	69	benefits under:
70	70	(1) the state Medicaid program, including the Medicaid
71	71	managed care program under Chapter 540, Government Code;
72	72	(2) the child health plan program under Chapter 62,
73	73	Health and Safety Code;
74	74	(3) the TRICARE military health system; or
75	75	(4) a workers' compensation insurance policy or other
76	76	form of providing medical benefits under Title 5, Labor Code.
77	77	Sec. 1369.098. APPLICATION OF PRICE REDUCTIONS. (a) A
78	78	pharmacy benefit manager that obtains, directly or indirectly, from
79	79	a manufacturer a reduction in price, whether by discount, rebate,
80	80	or otherwise, on a prescription drug, on behalf of a health benefit
81	81	plan issuer or on its own behalf, shall ensure through contracts
82	82	with the health benefit plan issuer, manufacturer, pharmacy, or any
83	83	other necessary party that the reduction in price is reflected
84	84	completely in the price of the prescription drug when it is
85	85	dispensed to a health benefit plan enrollee at a pharmacy.
86	86	(b) Charging the patient a fixed dollar copayment less than
87	87	the net price negotiated by the pharmacy benefit manager or health
88	88	plan satisfies the intent of this section.
89	89	(c) Any coinsurance charged by the pharmacy benefit manager
90	90	or health plan shall be calculated off the net price that reflects
91	91	the reduction in price by discount, rebate, or otherwise negotiated
92	92	with the manufacturer.
93	93	(d) The pharmacy benefit manager or health plan may provide
94	94	the full price reduction provided by the manufacturer directly to
95	95	the dispensing pharmacy or require the manufacturer to provide the
96	96	full price reduction, directly or indirectly, through a
97	97	point-of-sale chargeback or series of point-of-sale chargebacks or
98	98	as otherwise required by law.
99	99	Sec. 1369.099. CIVIL PENALTY; INJUNCTIVE RELIEF. (a) A
100	100	pharmacy benefit manager that violates Section 1369.098 is liable
101	101	to the state for a civil penalty of three times the total amount of
102	102	the price reduction that was not reflected in the price of the
103	103	prescription drug at the time it was dispensed plus $5,000 for each
104	104	violation that occurs.
105	105	(b) The attorney general may bring an action in the name of
106	106	the state against a person that violates Section 1369.098 for:
107	107	(1) injunctive relief;
108	108	(2) recovery of a civil penalty imposed under this
109	109	section; or
110	110	(3) both injunctive relief and a civil penalty.
111	111	(c) An action under this section may be brought in a
112	112	district court in:
113	113	(1) Travis County; or
114	114	(2) a county in which any part of the violation occurs.
115	115	SECTION 2. Subchapter B-3, Chapter 1369, Insurance Code, as
116	116	added by this Act, applies only to a health benefit plan delivered,
117	117	issued for delivery, or renewed on or after January 1, 2026.
118	118	SECTION 3. This Act takes effect September 1, 2025.