HB 219

Abstract

Over 80% of pharmaceuticals in the United States are purchased through pharmacy benefits manager ("PBM") networks. PBMs serve as intermediaries between health plans, pharmaceutical manufacturers, and pharmacies or pharmacists, and PBMs establish networks for patients to receive reimbursement for drugs. Given the scope of PBMs in the healthcare delivery system, this Act is designed to provide enhanced oversight and transparency as it relates to PBMs. Specifically, this Act does the following: (1) If a PBM denies an appeal for reimbursement subject to maximum allowable cost pricing, requires the PBM to provide the national drug code number of wholesalers in Delaware that have the drug in stock below maximum allowable cost. (2) Authorizes a pharmacy or pharmacist to decline to dispense a prescription drug or provide a pharmacy service to a patient if the amount reimbursed by a PBM is less than the pharmacy acquisition cost. If a pharmacy or pharmacist declines to provide a drug or service, the pharmacy or pharmacist must inform the patient that the pharmacy or pharmacist did this because of the costs of providing the drug or service and provide the patient with a list of pharmacies in the area that may provide the drug or service. (3) Requires PBMs to provide a reasonably adequate and accessible pharmacy benefits manager network. (4) Increases transparency by requiring PBMs to provide reports to the Insurance Commissioner on network adequacy and the amount of rebates received by PBMs to provide reports to the Insurance Commissioner on network adequacy and the amount of rebates received by PBMs and distributed to insurers or patients. (5) Prohibits PBMs from engaging in certain conduct, such as spread pricing, false advertising, and reimbursing a pharmacist or pharmacy in an amount less than the PBM reimburses itself or an affiliate for the same drug or service. If a PBM engages in prohibited conduct, the Insurance Commissioner is authorized to deny, suspend, or revoke the PBM's registration under § 3355A of Title 18 or impose penalties or take other enforcement action under § 3359A of Title 18. (6) Clarifies that the Insurance Commissioner is authorized to deny an application for registration filed by a PBM. (7) Increases the registration and renewal fee to be paid by a PBM to better reflect the cost of the registration and renewal process and better align with the fee assessed by other states that require PBMs to register. (8) Transfers § 3359A of Title 18 (regarding penalties and enforcement) to a separate subchapter focused on prohibited practices, penalties, and enforcement. In addition, this Act makes technical corrections to conform existing law to the standards of the Delaware Legislative Drafting Manual. Finally, this Act requires a greater than majority vote for passage because § 10 of Article VIII of the Delaware Constitution requires the affirmative vote of three-fifths of the members elected to each house of the General Assembly to increase the effective rate of any tax levied or license fee imposed.