SF 841

as introduced - 91st Legislature (2019 - 2020) Posted on 02/04/2019 03:20pm

A bill for an act
relating to health; requiring the disclosure of all financial transactions related to
prescription drug pricing; requiring rulemaking; providing civil penalties; amending
Minnesota Statutes 2018, section 151.061, subdivision 2; proposing coding for
new law as Minnesota Statutes, chapter 151A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2018, section 151.061, subdivision 2, is amended to read:

Subd. 2.

Remedy.

Any person injured by unfair discrimination as defined in subdivision
1 may bring a civil action and recover damages, together with costs and disbursements,
including reasonable attorney's fees, and receive other equitable relief as determined by the
court. The remedies provided by this section are cumulative and shall not be construed as
restricting any remedy which is otherwise available. new text begin The attorney general may enforce this
section pursuant to the authority in section 8.31.
new text end

Sec. 2.

new text begin [151A.01] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin The definitions in this section apply to this chapter.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of health.
new text end

new text begin Subd. 3. new text end

new text begin Covered entity. new text end

new text begin "Covered entity" means a hospital; a health maintenance
organization operating under chapter 62D; an insurance company licensed under chapter
60A; a nonprofit health service plan corporation operating under chapter 62C; a fraternal
benefit society operating under chapter 64B; a joint self-insurance employee health plan
operating under chapter 62H; a health program administered by a department or the state
in the capacity of provider of health coverage; or an employer, labor union, or other group
of persons organized in the state that provides health coverage to covered individuals who
are employed or reside in the state. Covered entity does not include a self-funded plan that
is exempt from state regulation pursuant to the Employee Retirement and Income Security
Act; a plan issued for coverage for federal employees; or a health plan that provides coverage
only for accidental injury, a specified disease, hospital indemnity, Medicare supplement,
disability income, long-term care, or other limited benefit health insurance policies and
contracts.
new text end

new text begin Subd. 4. new text end

new text begin Covered individual. new text end

new text begin "Covered individual" means a member, participant,
enrollee, contract holder, policyholder, or beneficiary of a covered entity who is provided
health coverage by the covered entity. Covered individual includes a dependent or other
person provided health coverage through a policy, contract, or plan for a covered individual.
new text end

new text begin Subd. 5. new text end

new text begin Labeler. new text end

new text begin "Labeler" means an entity or person that receives prescription drugs
from a manufacturer or wholesaler and repackages those drugs for later retail sale and that
has a labeler code from the federal Food and Drug Administration under Code of Federal
Regulations, title 21, section 207.20.
new text end

new text begin Subd. 6. new text end

new text begin Pharmacy benefits management. new text end

new text begin "Pharmacy benefits management" means
the procurement of prescription drugs at a negotiated rate for dispensation within the state
to covered individuals, the administration or management of prescription drug benefits
provided by a covered entity for the benefit of covered individuals, or any of the following
services provided with regard to the administration of pharmacy benefits:
new text end

new text begin (1) mail service pharmacy;
new text end

new text begin (2) specialty pharmacy;
new text end

new text begin (3) claims processing and payment of claims to pharmacies for prescription drugs
dispensed to covered individuals;
new text end

new text begin (4) clinical formulary development and management services;
new text end

new text begin (5) rebate contracting and administration;
new text end

new text begin (6) patient compliance, therapeutic intervention, and generic substitution programs;
new text end

new text begin (7) disease management programs; and
new text end

new text begin (8) retail network or preferred network management.
new text end

new text begin Subd. 7. new text end

new text begin Pharmacy benefits manager. new text end

new text begin "Pharmacy benefits manager" means an entity
that performs pharmacy benefits management. Pharmacy benefits manager includes a person
or entity acting for a pharmacy benefits manager in a contractual or employment relationship
in the performance of pharmacy benefits management for a covered entity and includes
mail service pharmacy.
new text end

Sec. 3.

new text begin [151A.03] CERTIFICATE OF AUTHORITY.
new text end

new text begin No person or entity may perform or act as a pharmacy benefits manager in this state
without a valid certificate of authority issued by the commissioner. Each person or entity
seeking a certificate of authority to act as a pharmacy benefits manager shall file with the
commissioner an application for a certificate of authority upon a form to be furnished by
the commissioner and a filing fee to be determined by the commissioner. The commissioner
may establish a filing fee notwithstanding section 16A.1283.
new text end

Sec. 4.

new text begin [151A.05] DISCLOSURE.
new text end

new text begin (a) Each pharmacy benefits manager shall provide to a covered entity and any other
person that it contracts within the state:
new text end

new text begin (1) all financial and utilization information requested by the covered entity relating to
the provision of benefits to covered individuals through that covered entity and all financial
and utilization information relating to services to that covered entity or person; and
new text end

new text begin (2) all rebates, discounts, or other forms of economic incentives that apply between the
pharmacy benefits manager and any prescription drug manufacturer, labeler, or pharmacy,
including formulary management and drug-switch programs, educational support, claims
processing, pharmacy network fees that are charged from retail pharmacies, and data sales
fees.
new text end

new text begin (b) The pharmacy benefits manager shall provide all information identified in paragraph
(a), clause (2), and its list of the maximum allowable cost for each drug to the commissioner
and the attorney general's office. The information may be used for law enforcement purposes,
including the enforcement of section 151.061.
new text end

Sec. 5.

new text begin [151A.07] DISPENSATION OF A THERAPEUTIC ALTERNATIVE
PRESCRIPTION DRUG.
new text end

new text begin (a) With regard to the dispensation of a therapeutic alternative prescription drug for a
prescribed drug to a covered individual, the following provisions apply:
new text end

new text begin (1) the pharmacy benefits manager may request the switch of a lower-priced generic
and therapeutically equivalent drug for a higher-priced prescribed drug; and
new text end

new text begin (2) if the therapeutic alternative drug costs more than the prescribed drug, the switch
must only be made for medical reasons that benefit the covered individual.
new text end

new text begin (b) Before a switch is made under this section, the pharmacy benefits manager shall
obtain approval of the prescribing health professional and must disclose to the covered
individual and the covered entity the cost of both drugs and any benefit or payment directly
or indirectly accruing to the pharmacy benefits manager as a result of the switch.
new text end

Sec. 6.

new text begin [151A.08] SPECIALTY PHARMACY.
new text end

new text begin A pharmacy benefits manager who offers a specialty pharmacy must disclose to covered
individuals the price for each prescription drug at a specialty pharmacy and at a retail
pharmacy unless the specialty pharmacy offers prescription drugs at the same or lower price
than the covered individual could receive at a retail pharmacy.
new text end

Sec. 7.

new text begin [151A.09] PREFERRED NETWORK.
new text end

new text begin A pharmacy benefits manager who offers a preferred network of pharmacies must
disclose to a covered individual the price for each prescription drug at the preferred network
pharmacies and at a retail pharmacy unless the preferred network pharmacies offer the
prescription drug at the same or lower price than the covered individual could receive at a
retail pharmacy.
new text end

Sec. 8.

new text begin [151A.10] REQUIRING MAIL ORDER SERVICE.
new text end

new text begin A pharmacy benefits manager shall not require a covered individual whose contract has
the option of using a retail pharmacy to change by requiring the individual to exclusively
use a mail order pharmacy unless the mail service pharmacy offers drugs at the same or
lower price than the covered individual could receive at the retail pharmacy.
new text end

Sec. 9.

new text begin [151A.11] ENFORCEMENT.
new text end

new text begin The commissioner shall enforce this chapter, including the suspension or revocation of
the authority of a pharmacy benefits manager to provide pharmacy benefits management
in this state for a violation of this chapter or the imposition of a monetary penalty not to
exceed $25,000 for each violation. The attorney general may pursue the penalties and
remedies available to the attorney general under section 8.31 for any violation of this chapter.
new text end

Sec. 10.

new text begin [151A.12] RULES.
new text end

new text begin The commissioner shall adopt rules to issue a certificate of authority and to enforce this
chapter.
new text end

Sec. 11.

new text begin [151A.13] CIVIL ACTION.
new text end

new text begin A covered entity may bring a civil action to enforce the provisions of this chapter or to
seek civil damages for the violation of this chapter.
new text end