| |
| |
|
|
A BILL TO BE ENTITLED
|
|
|
AN ACT
|
|
|
relating to certain contracts between pharmacy benefit managers and |
|
|
the Employees Retirement System of Texas, the Teacher Retirement |
|
|
System of Texas, The Texas A&M University System, or The University |
|
|
of Texas System. |
|
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
|
SECTION 1. Subchapter B, Chapter 1551, Insurance Code, is |
|
|
amended by adding Section 1551.067 to read as follows: |
|
|
Sec. 1551.067. PHARMACY BENEFIT MANAGER CONTRACTS. (a) In |
|
|
awarding a contract to provide pharmacy benefit manager services |
|
|
under this chapter the board of trustees is not required to select |
|
|
the lowest bid, but must select a contract that meets the criteria |
|
|
established by this section. |
|
|
(b) The contract must state whether the pharmacy benefit |
|
|
manager may or may not engage in therapeutic interchange by |
|
|
substituting a prescription drug with a different prescription drug |
|
|
preferred by the pharmacy benefit manager. If the contract |
|
|
authorizes therapeutic interchange as described by this |
|
|
subsection, the contract must provide that the pharmacy benefit |
|
|
manager shall maintain documentation of each instance in which |
|
|
therapeutic interchange is used. |
|
|
(c) The contract must state that the pharmacy benefit |
|
|
manager shall disclose in writing the financial and medical reasons |
|
|
for the addition, removal, or change in placement of a prescription |
|
|
drug from the drug formulary used by the pharmacy benefit manager. |
|
|
The disclosure required by this subsection must be made not later |
|
|
than the 30th day before the date that the addition, removal, or |
|
|
change in placement becomes effective. |
|
|
(d) The contract must identify the specialty drugs on the |
|
|
drug formulary used by the pharmacy benefit manager and state the |
|
|
specialty drug's associated costs, discounts, and other fees that |
|
|
apply to the pharmacy benefit manager's services performed under |
|
|
the contract. |
|
|
(e) The contract must disclose any policy, practice, or |
|
|
business relationship of the pharmacy benefit manager that could |
|
|
conflict with the performance of the pharmacy benefit manager's |
|
|
duties under the contract. |
|
|
(f) The contract must describe cost savings initiatives |
|
|
used by the pharmacy benefit manager, including the methodology and |
|
|
data used to compute any rebate amount that the board of trustees |
|
|
receives from the pharmacy benefit manager. |
|
|
(g) The contract must include a statement defining the |
|
|
maximum allowable cost, or MAC, price list to be used by the |
|
|
pharmacy benefit manager in performing the contract. |
|
|
(h) The contract must identify and label the specific |
|
|
information contained in the contract that is considered |
|
|
proprietary information belonging to the pharmacy benefit manager. |
|
|
(i) The contract must state whether the pharmacy benefit |
|
|
manager has a revenue-sharing agreement concerning the sale of data |
|
|
related to the services performed under the contract or whether the |
|
|
data can be sold by the pharmacy benefit manager. If data may be |
|
|
sold, the contract must: |
|
|
(1) disclose the conditions under which the pharmacy |
|
|
benefit manager may sell the data; and |
|
|
(2) state that the pharmacy benefit manager may not |
|
|
disclose any data in connection with the sale of the data before the |
|
|
30th day after the date the pharmacy benefit manager has provided |
|
|
written notice of that sale to the board of trustees. |
|
|
(j) The contract must state that: |
|
|
(1) the board of trustees is entitled to audit the |
|
|
pharmacy benefit manager to verify costs and discounts associated |
|
|
with drug claims, pharmacy benefit manager compliance with contract |
|
|
requirements, and services provided by subcontractors; |
|
|
(2) the audit must be conducted by an independent |
|
|
auditor in accordance with established auditing standards; and |
|
|
(3) to conduct the audit, the board of trustees and the |
|
|
independent auditor are entitled access to information related to |
|
|
the services and the costs associated with the services performed |
|
|
under the contract, including access to the pharmacy benefit |
|
|
manager's facilities, records, contracts, medical records, and |
|
|
agreements with subcontractors. |
|
|
(k) The contract must define the information that the |
|
|
pharmacy benefit manager is required to provide to the board of |
|
|
trustees concerning the audit of the retail, independent, and mail |
|
|
order pharmacies performing services under the contract and |
|
|
describe how the results of these audits must be reported to the |
|
|
board of trustees, including how often the results must be |
|
|
reported. The contract must state whether the pharmacy benefit |
|
|
manager is required to return recovered overpayments to the board |
|
|
of trustees. |
|
|
(l) The contract must state that any audit of a mail order |
|
|
pharmacy owned by the pharmacy benefit manager must be conducted by |
|
|
an independent auditor selected by the board of trustees in |
|
|
accordance with established auditing standards. |
|
|
SECTION 2. Subchapter C, Chapter 1575, Insurance Code, is |
|
|
amended by adding Section 1575.110 to read as follows: |
|
|
Sec. 1575.110. PHARMACY BENEFIT MANAGER CONTRACTS. (a) In |
|
|
awarding a contract to provide pharmacy benefit manager services |
|
|
under this chapter the trustee is not required to select the lowest |
|
|
bid, but must select a contract that meets the criteria established |
|
|
by this section. |
|
|
(b) The contract must state whether the pharmacy benefit |
|
|
manager may or may not engage in therapeutic interchange by |
|
|
substituting a prescription drug with a different prescription drug |
|
|
preferred by the pharmacy benefit manager. If the contract |
|
|
authorizes therapeutic interchange as described by this |
|
|
subsection, the contract must provide that the pharmacy benefit |
|
|
manager shall maintain documentation of each instance in which |
|
|
therapeutic interchange is used. |
|
|
(c) The contract must state that the pharmacy benefit |
|
|
manager shall disclose in writing the financial and medical reasons |
|
|
for the addition, removal, or change in placement of a prescription |
|
|
drug from the drug formulary used by the pharmacy benefit manager. |
|
|
The disclosure required by this subsection must be made not later |
|
|
than the 30th day before the date that the addition, removal, or |
|
|
change in placement becomes effective. |
|
|
(d) The contract must identify the specialty drugs on the |
|
|
drug formulary used by the pharmacy benefit manager and state the |
|
|
specialty drug's associated costs, discounts, and other fees that |
|
|
apply to the pharmacy benefit manager's services performed under |
|
|
the contract. |
|
|
(e) The contract must disclose any policy, practice, or |
|
|
business relationship of the pharmacy benefit manager that could |
|
|
conflict with the performance of the pharmacy benefit manager's |
|
|
duties under the contract. |
|
|
(f) The contract must describe cost savings initiatives |
|
|
used by the pharmacy benefit manager, including the methodology and |
|
|
data used to compute any rebate amount that the trustee receives |
|
|
from the pharmacy benefit manager. |
|
|
(g) The contract must include a statement defining the |
|
|
maximum allowable cost, or MAC, price list to be used by the |
|
|
pharmacy benefit manager in performing the contract. |
|
|
(h) The contract must identify and label the specific |
|
|
information contained in the contract that is considered |
|
|
proprietary information belonging to the pharmacy benefit manager. |
|
|
(i) The contract must state whether the pharmacy benefit |
|
|
manager has a revenue-sharing agreement concerning the sale of data |
|
|
related to the services performed under the contract or whether the |
|
|
data can be sold by the pharmacy benefit manager. If data may be |
|
|
sold, the contract must: |
|
|
(1) disclose the conditions under which the pharmacy |
|
|
benefit manager may sell the data; and |
|
|
(2) state that the pharmacy benefit manager may not |
|
|
disclose any data in connection with the sale of the data before the |
|
|
30th day after the date the pharmacy benefit manager has provided |
|
|
written notice of that sale to the trustee. |
|
|
(j) The contract must state that: |
|
|
(1) the trustee is entitled to audit the pharmacy |
|
|
benefit manager to verify costs and discounts associated with drug |
|
|
claims, pharmacy benefit manager compliance with contract |
|
|
requirements, and services provided by subcontractors; |
|
|
(2) the audit must be conducted by an independent |
|
|
auditor in accordance with established auditing standards; and |
|
|
(3) to conduct the audit, the trustee and the |
|
|
independent auditor are entitled access to information related to |
|
|
the services and the costs associated with the services performed |
|
|
under the contract, including access to the pharmacy benefit |
|
|
manager's facilities, records, contracts, medical records, and |
|
|
agreements with subcontractors. |
|
|
(k) The contract must define the information that the |
|
|
pharmacy benefit manager is required to provide to the trustee |
|
|
concerning the audit of the retail, independent, and mail order |
|
|
pharmacies performing services under the contract and describe how |
|
|
the results of these audits must be reported to the trustee, |
|
|
including how often the results must be reported. The contract must |
|
|
state whether the pharmacy benefit manager is required to return |
|
|
recovered overpayments to the trustee. |
|
|
(l) The contract must state that any audit of a mail order |
|
|
pharmacy owned by the pharmacy benefit manager must be conducted by |
|
|
an independent auditor selected by the trustee in accordance with |
|
|
established auditing standards. |
|
|
SECTION 3. Subchapter B, Chapter 1601, Insurance Code, is |
|
|
amended by adding Section 1601.064 to read as follows: |
|
|
Sec. 1601.064. PHARMACY BENEFIT MANAGER CONTRACTS. (a) In |
|
|
awarding a contract to provide pharmacy benefit manager services |
|
|
under this chapter a system is not required to select the lowest |
|
|
bid, but must select a contract that meets the criteria established |
|
|
by this section. |
|
|
(b) The contract must state whether the pharmacy benefit |
|
|
manager may or may not engage in therapeutic interchange by |
|
|
substituting a prescription drug with a different prescription drug |
|
|
preferred by the pharmacy benefit manager. If the contract |
|
|
authorizes therapeutic interchange as described by this |
|
|
subsection, the contract must provide that the pharmacy benefit |
|
|
manager shall maintain documentation of each instance in which |
|
|
therapeutic interchange is used. |
|
|
(c) The contract must state that the pharmacy benefit |
|
|
manager shall disclose in writing the financial and medical reasons |
|
|
for the addition, removal, or change in placement of a prescription |
|
|
drug from the drug formulary used by the pharmacy benefit manager. |
|
|
The disclosure required by this subsection must be made not later |
|
|
than the 30th day before the date that the addition, removal, or |
|
|
change in placement becomes effective. |
|
|
(d) The contract must identify the specialty drugs on the |
|
|
drug formulary used by the pharmacy benefit manager and state the |
|
|
specialty drug's associated costs, discounts, and other fees that |
|
|
apply to the pharmacy benefit manager's services performed under |
|
|
the contract. |
|
|
(e) The contract must disclose any policy, practice, or |
|
|
business relationship of the pharmacy benefit manager that could |
|
|
conflict with the performance of the pharmacy benefit manager's |
|
|
duties under the contract. |
|
|
(f) The contract must describe cost savings initiatives |
|
|
used by the pharmacy benefit manager, including the methodology and |
|
|
data used to compute any rebate amount that the system receives from |
|
|
the pharmacy benefit manager. |
|
|
(g) The contract must include a statement defining the |
|
|
maximum allowable cost, or MAC, price list to be used by the |
|
|
pharmacy benefit manager in performing the contract. |
|
|
(h) The contract must identify and label the specific |
|
|
information contained in the contract that is considered |
|
|
proprietary information belonging to the pharmacy benefit manager. |
|
|
(i) The contract must state whether the pharmacy benefit |
|
|
manager has a revenue-sharing agreement concerning the sale of data |
|
|
related to the services performed under the contract or whether the |
|
|
data can be sold by the pharmacy benefit manager. If data may be |
|
|
sold, the contract must: |
|
|
(1) disclose the conditions under which the pharmacy |
|
|
benefit manager may sell the data; and |
|
|
(2) state that the pharmacy benefit manager may not |
|
|
disclose any data in connection with the sale of the data before the |
|
|
30th day after the date the pharmacy benefit manager has provided |
|
|
written notice of that sale to the system. |
|
|
(j) The contract must state that: |
|
|
(1) the system is entitled to audit the pharmacy |
|
|
benefit manager to verify costs and discounts associated with drug |
|
|
claims, pharmacy benefit manager compliance with contract |
|
|
requirements, and services provided by subcontractors; |
|
|
(2) the audit must be conducted by an independent |
|
|
auditor in accordance with established auditing standards; and |
|
|
(3) to conduct the audit, the system and the |
|
|
independent auditor are entitled access to information related to |
|
|
the services and the costs associated with the services performed |
|
|
under the contract, including access to the pharmacy benefit |
|
|
manager's facilities, records, contracts, medical records, and |
|
|
agreements with subcontractors. |
|
|
(k) The contract must define the information that the |
|
|
pharmacy benefit manager is required to provide to the system |
|
|
concerning the audit of the retail, independent, and mail order |
|
|
pharmacies performing services under the contract and describe how |
|
|
the results of these audits must be reported to the system, |
|
|
including how often the results must be reported. The contract must |
|
|
state whether the pharmacy benefit manager is required to return |
|
|
recovered overpayments to the system. |
|
|
(l) The contract must state that any audit of a mail order |
|
|
pharmacy owned by the pharmacy benefit manager must be conducted by |
|
|
an independent auditor selected by the system in accordance with |
|
|
established auditing standards. |
|
|
SECTION 4. The change in law made by this Act applies only |
|
|
to a contract with a pharmacy benefit manager executed or renewed on |
|
|
or after the effective date of this Act. |
|
|
SECTION 5. This Act takes effect September 1, 2009. |