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A BILL TO BE ENTITLED
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AN ACT
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relating to the delivery of prescription drugs for certain state |
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health plans by mail order and to the payment of certain pharmacy or |
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pharmacist claims; providing an administrative penalty. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle H, Title 8, Insurance Code, is amended |
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by adding Chapter 1560 to read as follows: |
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CHAPTER 1560. DELIVERY OF PRESCRIPTION DRUGS BY MAIL |
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Sec. 1560.001. DEFINITIONS. In this chapter: |
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(1) "Community retail pharmacy" means a pharmacy that |
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is licensed as a Class A pharmacy under Chapter 560, Occupations |
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Code. |
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(2) "Mail order pharmacy" means a pharmacy that is |
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licensed under Chapter 560, Occupations Code, and that primarily |
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delivers prescription drugs to an enrollee through the United |
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States Postal Service or a commercial delivery service. |
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(3) "Prescription drug formulary" means a list of |
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prescription drugs preferred for use and eligible for coverage |
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under a health benefit plan. |
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Sec. 1560.002. APPLICABILITY OF CHAPTER. This chapter |
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applies only to a health benefit plan that provides benefits for |
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medical or surgical expenses incurred as a result of a health |
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condition, accident, or sickness, including an individual, group, |
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blanket, or franchise insurance policy or insurance agreement, a |
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group hospital service contract, or an individual or group evidence |
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of coverage or similar coverage document that is offered or |
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administered by: |
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(1) the Teacher Retirement System of Texas under |
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Chapter 1575 or 1579; or |
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(2) the Employees Retirement System of Texas under |
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Chapter 1551. |
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Sec. 1560.003. ACCESS TO PHARMACIES. (a) Notwithstanding |
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any other law, an issuer of a health benefit plan that provides |
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pharmacy benefits to enrollees may not: |
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(1) require an enrollee, as a condition of obtaining |
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benefits or reimbursement for prescription drugs or pharmacy |
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services, to obtain the drugs or services exclusively from a mail |
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order pharmacy; |
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(2) discriminate between different pharmacies based |
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on whether the pharmacy is a mail order pharmacy or a community |
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retail pharmacy by: |
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(A) limiting the quantity of a prescription drug |
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an enrollee may obtain from the pharmacy, including limiting the |
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number of days of supply or number of units of a prescription drug |
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or the number of prescriptions or refills of a prescription drug the |
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enrollee may obtain; |
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(B) requiring an enrollee to pay a different |
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copayment, coinsurance, or deductible amount; or |
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(C) using different prescription drug |
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formularies for mail order pharmacies and community retail |
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pharmacies; |
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(3) provide a monetary incentive or impose a monetary |
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penalty on an enrollee that could reasonably be expected to affect |
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the enrollee's choice among pharmacies that have agreed to |
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participate in the health benefit plan; or |
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(4) prohibit a pharmacy licensed under Chapter 560, |
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Occupations Code, from participating under the health benefit plan |
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if the pharmacy meets all of the conditions of and agrees to all of |
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the terms of participation in the health benefit plan. |
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(b) An issuer of a health benefit plan that provides |
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pharmacy benefits to enrollees shall offer all pharmacies the same |
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conditions and terms of participation in the health benefit plan, |
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including prescription drug reimbursement rates, regardless of |
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whether a pharmacy is a mail order pharmacy or a community retail |
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pharmacy. |
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Sec. 1560.004. PRESCRIPTION DRUG REIMBURSEMENT RATES. (a) |
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An issuer of a health benefit plan that provides pharmacy benefits |
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to enrollees shall reimburse pharmacies participating in the health |
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plan using prescription drug reimbursement rates that are based on |
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a current and nationally recognized benchmark index for both brand |
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name and generic prescription drugs. |
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(b) An issuer of a health benefit plan shall use the same |
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benchmark index, including the same national prescription drug |
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codes, to reimburse all pharmacies participating in the health |
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benefit plan, regardless of whether the pharmacy is a mail order |
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pharmacy or a community retail pharmacy. |
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Sec. 1560.005. ACQUISITION COSTS AND REBATES. An issuer of |
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a health benefit plan that contracts with a third-party |
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administrator, pharmacy benefit manager, or other entity to manage |
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pharmacy benefits provided to enrollees through a mail order |
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pharmacy shall require the managing entity to: |
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(1) provide the issuer of the health benefit plan with |
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an annual electronic report containing: |
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(A) the actual acquisition cost of all drugs |
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purchased by the managing entity in relation to the pharmacy |
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benefits under the health benefit plan; and |
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(B) an identification of the source, type, and |
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amount of all rebates, rebate administrative fees, and other |
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monetary benefits received by the managing entity from a drug |
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manufacturer in relation to the pharmacy benefits under the health |
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benefit plan; and |
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(2) not later than the 30th day after the date the |
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managing entity receives a rebate, rebate administrative fee, or |
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other monetary benefit from a drug manufacturer in relation to the |
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pharmacy benefits under the health benefit plan, reimburse or |
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credit to the issuer of the health benefit plan an amount equal to |
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the amount of the rebate, rebate administrative fee, or other |
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monetary benefit received by the managing entity. |
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Sec. 1560.006. PHARMACY BENEFIT MANAGERS: DESIGNATION OF |
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CONFIDENTIAL INFORMATION. (a) A pharmacy benefit manager may |
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designate as confidential any information the pharmacy benefit |
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manager is required to disclose under Section 1560.005. |
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(b) Information designated as confidential under this |
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section may not be disclosed to any person without the consent of |
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the pharmacy benefit manager unless the disclosure is: |
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(1) ordered by a court for good cause shown; |
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(2) made under seal in a court filing; or |
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(3) made to the commissioner of insurance or the |
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attorney general in connection with an investigation authorized by |
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this code, the Government Code, or any other law. |
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Sec. 1560.007. COMPLAINT AND ENFORCEMENT; ADMINISTRATIVE |
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PENALTIES. (a) The department shall investigate any complaint |
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that the department receives concerning conduct regulated by this |
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chapter. |
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(b) Following an investigation under Subsection (a), the |
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commissioner shall issue a written determination of the outcome of |
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the investigation, including whether the department has taken or |
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intends to take any action under Chapters 81-86. |
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(c) If, as a result of a complaint investigated under |
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Subsection (a), the commissioner determines that an issuer of a |
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health benefit plan has violated this chapter, the commissioner |
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shall impose an administrative penalty against the issuer of the |
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health benefit plan in accordance with Chapter 84. The amount of an |
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administrative penalty imposed under this subsection may not exceed |
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$1,000 per prescription that was filled or that was not filled in |
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violation of this chapter. The limitation on the amount of an |
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administrative penalty under Section 84.022 does not apply to an |
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administrative penalty imposed under this subsection. |
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SECTION 2. Section 1551.219, Insurance Code, as added by |
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Chapter 213, Acts of the 78th Legislature, Regular Session, 2003, |
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is amended to read as follows: |
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Sec. 1551.219. MAIL ORDER REQUIREMENT FOR PRESCRIPTION DRUG |
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COVERAGE PROHIBITED. The board of trustees or a health benefit plan |
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under this chapter that provides benefits for prescription drugs |
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may not require a participant in the group benefits program to |
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purchase a prescription drug through a mail order program. The |
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board or health benefit plan may not [shall] require that a |
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participant who chooses to obtain a prescription drug through a |
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retail pharmacy or other method other than by mail order pay a |
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deductible, copayment, coinsurance, or other cost-sharing |
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obligation to cover the additional cost of obtaining a prescription |
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drug through that method rather than by mail order. |
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SECTION 3. (a) Section 843.338, Insurance Code, is amended |
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to read as follows: |
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Sec. 843.338. DEADLINE FOR ACTION ON CLEAN CLAIMS. Except |
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as provided by Sections [Section] 843.3385 and 843.339, not later |
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than the 45th day after the date on which a health maintenance |
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organization receives a clean claim from a participating physician |
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or provider in a nonelectronic format or the 30th day after the date |
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the health maintenance organization receives a clean claim from a |
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participating physician or provider that is electronically |
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submitted, the health maintenance organization shall make a |
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determination of whether the claim is payable and: |
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(1) if the health maintenance organization determines |
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the entire claim is payable, pay the total amount of the claim in |
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accordance with the contract between the physician or provider and |
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the health maintenance organization; |
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(2) if the health maintenance organization determines |
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a portion of the claim is payable, pay the portion of the claim that |
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is not in dispute and notify the physician or provider in writing |
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why the remaining portion of the claim will not be paid; or |
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(3) if the health maintenance organization determines |
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that the claim is not payable, notify the physician or provider in |
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writing why the claim will not be paid. |
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(b) Section 843.339, Insurance Code, is amended to read as |
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follows: |
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Sec. 843.339. DEADLINE FOR ACTION ON [CERTAIN] PRESCRIPTION |
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CLAIMS; PAYMENT. (a) Not later than the 21st day after the date a |
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health maintenance organization affirmatively adjudicates a |
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pharmacy claim that is electronically submitted, the health |
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maintenance organization shall pay the total amount of the claim. A |
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health maintenance organization shall pay a pharmacy claim that is |
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submitted in a nonelectronic format not later than the deadline |
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provided under Section 843.338. |
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(b) Except as provided by Subsection (c), a pharmacy benefit |
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manager that administers a pharmacy claim for a health maintenance |
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organization shall pay the provider through electronic funds |
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transfer not later than the 14th day after the date on which the |
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claim is determined under this subchapter to be affirmatively |
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adjudicated. |
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(c) If the provider is unable to receive payment of a claim |
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described by Subsection (b) through electronic funds transfer, the |
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pharmacy benefit manager shall pay the claim not later than the 21st |
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day after the date on which the claim is determined under this |
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subchapter to be affirmatively adjudicated. |
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(c) Section 843.340, Insurance Code, is amended by adding |
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Subsection (f) to read as follows: |
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(f) A pharmacy benefit manager who performs an on-site audit |
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under this chapter of a provider who is a pharmacist or pharmacy |
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shall provide the provider written notice of the audit and it must |
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be sent by certified mail not later than the 15th day before the |
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date on which the audit is scheduled to occur. |
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(d) Section 1301.001(1), Insurance Code, is amended to read |
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as follows: |
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(1) "Health care provider" means a practitioner, |
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institutional provider, or other person or organization that |
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furnishes health care services and that is licensed or otherwise |
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authorized to practice in this state. The term includes a |
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pharmacist and a pharmacy. The term does not include a physician. |
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(e) Section 1301.103, Insurance Code, is amended to read as |
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follows: |
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Sec. 1301.103. DEADLINE FOR ACTION ON CLEAN CLAIMS. Except |
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as provided by Sections 1301.104 and [Section] 1301.1054, not later |
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than the 45th day after the date an insurer receives a clean claim |
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from a preferred provider in a nonelectronic format or the 30th day |
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after the date an insurer receives a clean claim from a preferred |
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provider that is electronically submitted, the insurer shall make a |
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determination of whether the claim is payable and: |
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(1) if the insurer determines the entire claim is |
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payable, pay the total amount of the claim in accordance with the |
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contract between the preferred provider and the insurer; |
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(2) if the insurer determines a portion of the claim is |
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payable, pay the portion of the claim that is not in dispute and |
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notify the preferred provider in writing why the remaining portion |
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of the claim will not be paid; or |
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(3) if the insurer determines that the claim is not |
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payable, notify the preferred provider in writing why the claim |
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will not be paid. |
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(f) Section 1301.104, Insurance Code, is amended to read as |
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follows: |
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Sec. 1301.104. DEADLINE FOR ACTION ON [CERTAIN] PHARMACY |
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CLAIMS; PAYMENT. (a) Not later than the 21st day after the date an |
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insurer affirmatively adjudicates a pharmacy claim that is |
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electronically submitted, the insurer shall pay the total amount of |
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the claim. An insurer shall pay a pharmacy claim that is submitted |
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in a nonelectronic format not later than the deadline provided |
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under Section 1301.103. |
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(b) Except as provided by Subsection (c), a pharmacy benefit |
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manager that administers a pharmacy claim for an insurer under a |
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preferred provider benefit plan shall pay the provider through |
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electronic funds transfer not later than the 14th day after the date |
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on which the claim is determined under this subchapter to be |
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affirmatively adjudicated. |
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(c) If the provider is unable to receive payment of a claim |
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described by Subsection (b) through electronic funds transfer, the |
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pharmacy benefit manager shall pay the claim not later than the 21st |
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day after the date on which the claim is determined under this |
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subchapter to be affirmatively adjudicated. |
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(g) Section 1301.105, Insurance Code, is amended by adding |
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Subsection (e) to read as follows: |
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(e) A pharmacy benefit manager who performs an on-site audit |
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under this chapter of a provider who is a pharmacist or pharmacy |
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shall provide the provider reasonable written notice of the audit |
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and it must be sent by certified mail not later than the 15th day |
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before the date on which the audit is scheduled to occur. |
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(h) The change in law made by this section applies only to a |
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claim submitted by a provider to a health maintenance organization |
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or an insurer on or after the effective date of this Act. A claim |
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submitted before the effective date of this Act is governed by the |
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law as it existed immediately before that date, and that law is |
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continued in effect for that purpose. |
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SECTION 4. The change in law made by this Act applies only |
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to a health benefit plan that is delivered, issued for delivery, or |
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renewed on or after January 1, 2008. A health benefit plan that is |
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delivered, issued for delivery, or renewed before January 1, 2008, |
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is covered by the law in effect at the time the policy was |
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delivered, issued for delivery, or renewed, and that law is |
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continued in effect for that purpose. |
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SECTION 5. This Act takes effect September 1, 2007. |