CS for CS for SB 1550                     Second Engrossed (ntc)
       
       
       
       
       
       
       
       
       20231550e2
       
    1                        A bill to be entitled                      
    2         An act relating to prescription drugs; providing a
    3         short title; amending s. 499.005, F.S.; specifying
    4         additional prohibited acts related to the Florida Drug
    5         and Cosmetic Act; amending s. 499.012, F.S.; providing
    6         that prescription drug manufacturer and nonresident
    7         prescription drug manufacturer permitholders are
    8         subject to specified requirements; creating s.
    9         499.026, F.S.; defining terms; requiring certain drug
   10         manufacturers to notify the Department of Business and
   11         Professional Regulation of reportable drug price
   12         increases on a specified form on the effective date of
   13         such increase; providing requirements for the form;
   14         providing construction; requiring such manufacturers
   15         to submit certain reports to the department by a
   16         specified date each year; providing requirements for
   17         the reports; authorizing the department to request
   18         certain additional information from the manufacturer
   19         before approving the report; requiring the department
   20         to submit the forms and reports to the Agency for
   21         Health Care Administration to be posted on the
   22         agency’s website; prohibiting the agency from posting
   23         on its website certain submitted information that is
   24         marked as a trade secret; requiring the agency to
   25         compile all information from the submitted forms and
   26         reports and make it available to the Governor and the
   27         Legislature upon request; prohibiting manufacturers
   28         from claiming a public records exemption for trade
   29         secrets for certain information provided in such forms
   30         or reports; providing that department employees remain
   31         protected from liability for releasing the forms and
   32         reports as public records; authorizing the department,
   33         in consultation with the agency, to adopt rules;
   34         providing for emergency rulemaking; amending s.
   35         624.307, F.S.; requiring the Division of Consumer
   36         Services of the Department of Financial Services to
   37         designate an employee as the primary contact for
   38         consumer complaints involving pharmacy benefit
   39         managers; requiring the division to refer certain
   40         complaints to the Office of Insurance Regulation;
   41         amending s. 624.490, F.S.; revising the definition of
   42         the term “pharmacy benefit manager”; amending s.
   43         624.491, F.S.; revising provisions related to pharmacy
   44         audits; amending s. 626.88, F.S.; revising the
   45         definition of the term “administrator”; defining the
   46         term “pharmacy benefit manager”; amending s. 626.8805,
   47         F.S.; providing a grandfathering provision for certain
   48         pharmacy benefit managers operating as administrators;
   49         providing a penalty for certain persons who do not
   50         hold a certificate of authority to act as an
   51         administrator on or after a specified date; requiring
   52         the office to submit a report detailing specified
   53         information to the Governor and the Legislature by a
   54         specified date; providing additional requirements for
   55         pharmacy benefit managers applying for a certificate
   56         of authority to act as an administrator; exempting
   57         pharmacy benefit managers from certain fees; amending
   58         s. 626.8814, F.S.; requiring pharmacy benefit managers
   59         to identify certain ownership affiliations to the
   60         office; requiring pharmacy benefit managers to report
   61         any change in such information to the office within a
   62         specified timeframe; creating s. 626.8825, F.S.;
   63         defining terms; providing requirements for certain
   64         contracts between a pharmacy benefit manager and a
   65         pharmacy benefits plan or program; requiring pharmacy
   66         benefits plans and programs, beginning on a specified
   67         date, to annually submit a certain attestation to the
   68         office; providing requirements for certain contracts
   69         between a pharmacy benefit manager and a participating
   70         pharmacy; requiring the Financial Services Commission
   71         to adopt rules; specifying requirements for certain
   72         administrative appeal procedures that such contracts
   73         with participating pharmacies must include; requiring
   74         pharmacy benefit managers to submit reports on
   75         submitted appeals to the office every 90 days;
   76         creating s. 626.8827, F.S.; specifying prohibited
   77         practices for pharmacy benefit managers; creating s.
   78         626.8828, F.S.; authorizing the office to investigate
   79         administrators that are pharmacy benefit managers and
   80         certain applicants; requiring the office to review
   81         certain referrals and investigate them under certain
   82         circumstances; providing for biennial reviews of
   83         pharmacy benefit managers; requiring the office to
   84         submit an annual report of its examinations to the
   85         Governor and the Legislature by a specified date;
   86         providing requirements for the report, including
   87         specified additional requirements for the biennial
   88         reports; authorizing the office to conduct additional
   89         examinations; requiring the office to conduct an
   90         examination under certain circumstances; providing
   91         procedures and requirements for such examinations;
   92         defining the terms “contracts” and “knowing and
   93         willful”; providing that independent professional
   94         examiners under contract with the office may conduct
   95         examinations of pharmacy benefit managers; requiring
   96         the commission to adopt specified rules; specifying
   97         provisions that apply to such investigations and
   98         examinations; providing recordkeeping requirements for
   99         pharmacy benefit managers; authorizing the office to
  100         order the production of such records and other
  101         specified information; authorizing the office to take
  102         statements under oath; requiring pharmacy benefit
  103         managers and applicants subjected to an investigation
  104         or examination to pay the associated expenses;
  105         specifying covered expenses; providing for collection
  106         of such expenses; providing for the deposit of certain
  107         moneys into the Insurance Regulatory Trust Fund;
  108         authorizing the office to pay examiners,
  109         investigators, and other persons from such fund;
  110         providing administrative penalties; providing grounds
  111         for administrative action against a certificate of
  112         authority; amending s. 626.89, F.S.; requiring
  113         pharmacy benefit managers to notify the office of
  114         specified complaints, settlements, or discipline
  115         within a specified timeframe; requiring pharmacy
  116         benefit managers to annually submit a certain
  117         attestation statement to the office; amending s.
  118         627.42393, F.S.; providing that certain step-therapy
  119         protocol requirements apply to a pharmacy benefit
  120         manager acting on behalf of a health insurer; amending
  121         ss. 627.64741 and 627.6572, F.S.; conforming
  122         provisions to changes made by the act; amending s.
  123         641.31, F.S.; providing that certain step-therapy
  124         protocol requirements apply to a pharmacy benefit
  125         manager acting on behalf of a health maintenance
  126         organization; amending s. 641.314, F.S.; conforming a
  127         provision to changes made by the act; providing
  128         legislative intent, construction, and severability;
  129         providing appropriations and authorizing positions;
  130         providing an effective date.
  131          
  132  Be It Enacted by the Legislature of the State of Florida:
  133  
  134         Section 1. This act may be cited as the “Prescription Drug
  135  Reform Act.”
  136         Section 2. Subsection (29) is added to section 499.005,
  137  Florida Statutes, to read:
  138         499.005 Prohibited acts.—It is unlawful for a person to
  139  perform or cause the performance of any of the following acts in
  140  this state:
  141         (29) Failure to accurately complete and timely submit
  142  reportable drug price increase forms, reports, and documents as
  143  required by s. 499.026 and rules adopted thereunder.
  144         Section 3. Subsection (16) is added to section 499.012,
  145  Florida Statutes, to read:
  146         499.012 Permit application requirements.—
  147         (16)A permit for a prescription drug manufacturer or a
  148  nonresident prescription drug manufacturer is subject to the
  149  requirements of s. 499.026.
  150         Section 4. Section 499.026, Florida Statutes, is created to
  151  read:
  152         499.026 Notification of manufacturer prescription drug
  153  price increases.—
  154         (1)As used in this section, the term:
  155         (a)“Course of therapy” means the recommended daily dose
  156  units of a prescription drug pursuant to its prescribing label
  157  for 30 days or the recommended daily dose units of a
  158  prescription drug pursuant to its prescribing label for a normal
  159  course of treatment which is less than 30 days.
  160         (b)“Manufacturer” means a person holding a prescription
  161  drug manufacturer permit or a nonresident prescription drug
  162  manufacturer permit under s. 499.01.
  163         (c)“Prescription drug” has the same meaning as in s.
  164  499.003 and includes biological products but is limited to those
  165  prescription drugs and biological products intended for human
  166  use.
  167         (d)“Reportable drug price increase” means, for a
  168  prescription drug with a wholesale acquisition cost of at least
  169  $100 for a course of therapy before the effective date of an
  170  increase:
  171         1.Any increase of 15 percent or more of the wholesale
  172  acquisition cost during the preceding 12-month period; or
  173         2.Any cumulative increase of 30 percent or more of the
  174  wholesale acquisition cost during the preceding 3 calendar
  175  years. In calculating the 30 percent threshold, the manufacturer
  176  must base the calculation on the wholesale acquisition cost in
  177  effect at the end of the 3-year period as compared to the
  178  wholesale acquisition cost in effect at the beginning of the
  179  same 3-year period.
  180         (e)“Wholesale acquisition cost” means, with respect to a
  181  prescription drug or biological product, the manufacturer’s list
  182  price for the prescription drug or biological product to
  183  wholesalers or direct purchasers in the United States, not
  184  including prompt pay or other discounts, rebates, or reductions
  185  in price, for the most recent month for which the information is
  186  available, as reported in wholesale price guides or other
  187  publications of drug or biological product pricing data.
  188         (2)On the effective date of a manufacturer’s reportable
  189  drug price increase, the manufacturer must provide notification
  190  of each reportable drug price increase to the department on a
  191  form prescribed by the department. The form must require the
  192  manufacturer to specify all of the following:
  193         (a)The proprietary and nonproprietary names of the
  194  prescription drug, as applicable.
  195         (b)The wholesale acquisition cost before the reportable
  196  drug price increase.
  197         (c)The dollar amount of the reportable drug price
  198  increase.
  199         (d)The percentage amount of the reportable drug price
  200  increase from the wholesale acquisition cost before the
  201  reportable drug price increase.
  202         (e)Whether a change or an improvement in the prescription
  203  drug necessitates the reportable drug price increase.
  204         (f)If a change or an improvement in the prescription drug
  205  necessitates the reportable drug price increase as reported in
  206  paragraph (e), the manufacturer must describe the change or
  207  improvement.
  208         (g)The intended uses of the prescription drug.
  209  
  210  This subsection does not prohibit a manufacturer from notifying
  211  other parties, such as pharmacy benefit managers, of a drug
  212  price increase before the effective date of the drug price
  213  increase.
  214         (3)By April 1 of each year, each manufacturer shall submit
  215  a report to the department on a form prescribed by the
  216  department. The report must include all of the following:
  217         (a)A list of all prescription drugs affected by a
  218  reportable drug price increase during the previous calendar year
  219  and both the dollar amount of each reportable drug price
  220  increase and the percentage increase of each reportable drug
  221  price increase relative to the previous wholesale acquisition
  222  cost of the prescription drug. The prescription drugs must be
  223  identified using their proprietary names and nonproprietary
  224  names, as applicable.
  225         (b)If more than one form has been filed under this section
  226  for previous reportable drug price increases, the percentage
  227  increase of the prescription drug from the earliest form filed
  228  to the most recent form filed.
  229         (c)The intended uses of each prescription drug listed in
  230  the report and whether the prescription drug manufacturer
  231  benefits from market exclusivity for such drug.
  232         (d)The length of time the prescription drug has been
  233  available for purchase.
  234         (e)A listing of the factors contributing to each
  235  reportable drug price increase. As used in this section, the
  236  term “factors” means any of the following: research and
  237  development; manufacturing costs; advertising and marketing;
  238  whether the drug has more competitive value; an increased rate
  239  of inflation or other economic dynamics; changes in market
  240  dynamics; supporting regulatory and safety commitments;
  241  operating patient assistance and educational programs; rebate
  242  increases, including any rebate increase requested by a pharmacy
  243  benefit manager; Medicaid, Medicare, or 340B Drug Pricing
  244  Program offsets; profit; or other factors. An estimated
  245  percentage of the influence of each listed factor must be
  246  provided to equal 100 percent.
  247         (f)A description of the justification for each factor
  248  referenced in paragraph (e) must be provided with such
  249  specificity as to explain the need or justification for each
  250  reportable drug price increase. The department may request
  251  additional information from a manufacturer relating to the need
  252  or justification for any reportable drug price increase before
  253  approving the manufacturer’s report.
  254         (g)Any action that the manufacturer has filed to extend a
  255  patent report after the first extension has been granted.
  256         (4)(a)The department shall submit all forms and reports
  257  submitted by manufacturers to the Agency for Health Care
  258  Administration, to be posted on the agency’s website pursuant to
  259  s. 408.062. The agency may not post on its website any of the
  260  information provided pursuant to paragraph (2)(f), paragraph
  261  (3)(f), or paragraph (3)(g) which is marked as a trade secret.
  262  The agency shall compile all information from the forms and
  263  reports submitted by manufacturers and make it available upon
  264  request to the Governor, the President of the Senate, and the
  265  Speaker of the House of Representatives.
  266         (b)Except for information provided pursuant to paragraph
  267  (2)(f), paragraph (3)(f), or paragraph (3)(g), a manufacturer
  268  may not claim a public records exemption for a trade secret
  269  under s. 119.0715 for any information required by the department
  270  under this section. Department employees remain protected from
  271  liability for release of forms and reports pursuant to s.
  272  119.0715(4).
  273         (5)The department, in consultation with the Agency for
  274  Health Care Administration, shall adopt rules to implement this
  275  section.
  276         (a)The department shall adopt necessary emergency rules
  277  pursuant to s. 120.54(4) to implement this section. If an
  278  emergency rule adopted under this section is held to be
  279  unconstitutional or an invalid exercise of delegated legislative
  280  authority and becomes void, the department may adopt an
  281  emergency rule pursuant to this section to replace the rule that
  282  has become void. If the emergency rule adopted to replace the
  283  void emergency rule is also held to be unconstitutional or an
  284  invalid exercise of delegated legislative authority and becomes
  285  void, the department must follow the nonemergency rulemaking
  286  procedures of the Administrative Procedure Act to replace the
  287  rule that has become void.
  288         (b)For emergency rules adopted under this section, the
  289  department need not make the findings required under s.
  290  120.54(4)(a). Emergency rules adopted under this section are
  291  also exempt from:
  292         1.Sections 120.54(3)(b) and 120.541. Challenges to
  293  emergency rules adopted under this section are subject to the
  294  time schedules provided in s. 120.56(5).
  295         2.Section 120.54(4)(c) and remain in effect until replaced
  296  by rules adopted under the nonemergency rulemaking procedures of
  297  the Administrative Procedure Act.
  298         Section 5. Paragraph (a) of subsection (10) of section
  299  624.307, Florida Statutes, is amended, and paragraph (b) of that
  300  subsection is republished, to read:
  301         624.307 General powers; duties.—
  302         (10)(a) The Division of Consumer Services shall perform the
  303  following functions concerning products or services regulated by
  304  the department or office:
  305         1. Receive inquiries and complaints from consumers.
  306         2. Prepare and disseminate information that the department
  307  deems appropriate to inform or assist consumers.
  308         3. Provide direct assistance to and advocacy for consumers
  309  who request such assistance or advocacy.
  310         4. With respect to apparent or potential violations of law
  311  or applicable rules committed by a person or an entity licensed
  312  by the department or office, report apparent or potential
  313  violations to the office or to the appropriate division of the
  314  department, which may take any additional action it deems
  315  appropriate.
  316         5. Designate an employee of the division as the primary
  317  contact for consumers on issues relating to sinkholes.
  318         6.Designate an employee of the division as the primary
  319  contact for consumers and pharmacies on issues relating to
  320  pharmacy benefit managers. The division must refer to the office
  321  any consumer complaint that alleges conduct that may constitute
  322  a violation of part VII of chapter 626 or for which a pharmacy
  323  benefit manager does not respond in accordance with paragraph
  324  (b).
  325         (b) Any person licensed or issued a certificate of
  326  authority by the department or the office shall respond, in
  327  writing, to the division within 20 days after receipt of a
  328  written request for documents and information from the division
  329  concerning a consumer complaint. The response must address the
  330  issues and allegations raised in the complaint and include any
  331  requested documents concerning the consumer complaint not
  332  subject to attorney-client or work-product privilege. The
  333  division may impose an administrative penalty for failure to
  334  comply with this paragraph of up to $2,500 per violation upon
  335  any entity licensed by the department or the office and $250 for
  336  the first violation, $500 for the second violation, and up to
  337  $1,000 for the third or subsequent violation upon any individual
  338  licensed by the department or the office.
  339         Section 6. Subsection (1) of section 624.490, Florida
  340  Statutes, is amended to read:
  341         624.490 Registration of pharmacy benefit managers.—
  342         (1) As used in this section, the term “pharmacy benefit
  343  manager” has the same meaning as in s. 626.88 means a person or
  344  entity doing business in this state which contracts to
  345  administer prescription drug benefits on behalf of a health
  346  insurer or a health maintenance organization to residents of
  347  this state.
  348         Section 7. Subsections (1) and (5) of section 624.491,
  349  Florida Statutes, are amended to read:
  350         624.491 Pharmacy audits.—
  351         (1) A pharmacy benefits plan or program as defined in s.
  352  626.8825 health insurer or health maintenance organization
  353  providing pharmacy benefits through a major medical individual
  354  or group health insurance policy or a health maintenance
  355  contract, respectively, must comply with the requirements of
  356  this section when the pharmacy benefits plan or program health
  357  insurer or health maintenance organization or any person or
  358  entity acting on behalf of the pharmacy benefits plan or program
  359  health insurer or health maintenance organization, including,
  360  but not limited to, a pharmacy benefit manager as defined in s.
  361  626.88 s. 624.490(1), audits the records of a pharmacy licensed
  362  under chapter 465. The person or entity conducting such audit
  363  must:
  364         (a) Except as provided in subsection (3), notify the
  365  pharmacy at least 7 calendar days before the initial onsite
  366  audit for each audit cycle.
  367         (b) Not schedule an onsite audit during the first 3
  368  calendar days of a month unless the pharmacist consents
  369  otherwise.
  370         (c) Limit the duration of the audit period to 24 months
  371  after the date a claim is submitted to or adjudicated by the
  372  entity.
  373         (d) In the case of an audit that requires clinical or
  374  professional judgment, conduct the audit in consultation with,
  375  or allow the audit to be conducted by, a pharmacist.
  376         (e) Allow the pharmacy to use the written and verifiable
  377  records of a hospital, physician, or other authorized
  378  practitioner, which are transmitted by any means of
  379  communication, to validate the pharmacy records in accordance
  380  with state and federal law.
  381         (f) Reimburse the pharmacy for a claim that was
  382  retroactively denied for a clerical error, typographical error,
  383  scrivener’s error, or computer error if the prescription was
  384  properly and correctly dispensed, unless a pattern of such
  385  errors exists, fraudulent billing is alleged, or the error
  386  results in actual financial loss to the entity.
  387         (g) Provide the pharmacy with a copy of the preliminary
  388  audit report within 120 days after the conclusion of the audit.
  389         (h) Allow the pharmacy to produce documentation to address
  390  a discrepancy or audit finding within 10 business days after the
  391  preliminary audit report is delivered to the pharmacy.
  392         (i) Provide the pharmacy with a copy of the final audit
  393  report within 6 months after the pharmacy’s receipt of the
  394  preliminary audit report.
  395         (j) Calculate any recoupment or penalties based on actual
  396  overpayments and not according to the accounting practice of
  397  extrapolation.
  398         (5) A pharmacy benefits plan or program health insurer or
  399  health maintenance organization that, under terms of a contract,
  400  transfers to a pharmacy benefit manager the obligation to pay a
  401  pharmacy licensed under chapter 465 for any pharmacy benefit
  402  claims arising from services provided to or for the benefit of
  403  an insured or subscriber remains responsible for a violation of
  404  this section.
  405         Section 8. Subsection (1) of section 626.88, Florida
  406  Statutes, is amended, and subsection (6) is added to that
  407  section, to read:
  408         626.88 Definitions.—For the purposes of this part, the
  409  term:
  410         (1) “Administrator” means is any person who directly or
  411  indirectly solicits or effects coverage of, collects charges or
  412  premiums from, or adjusts or settles claims on residents of this
  413  state in connection with authorized commercial self-insurance
  414  funds or with insured or self-insured programs which provide
  415  life or health insurance coverage or coverage of any other
  416  expenses described in s. 624.33(1); or any person who, through a
  417  health care risk contract as defined in s. 641.234 with an
  418  insurer or health maintenance organization, provides billing and
  419  collection services to health insurers and health maintenance
  420  organizations on behalf of health care providers; or a pharmacy
  421  benefit manager. The term does not include, other than any of
  422  the following persons:
  423         (a) An employer or wholly owned direct or indirect
  424  subsidiary of an employer, on behalf of such employer’s
  425  employees or the employees of one or more subsidiary or
  426  affiliated corporations of such employer.
  427         (b) A union on behalf of its members.
  428         (c) An insurance company which is either authorized to
  429  transact insurance in this state or is acting as an insurer with
  430  respect to a policy lawfully issued and delivered by such
  431  company in and pursuant to the laws of a state in which the
  432  insurer was authorized to transact an insurance business.
  433         (d) A health care services plan, health maintenance
  434  organization, professional service plan corporation, or person
  435  in the business of providing continuing care, possessing a valid
  436  certificate of authority issued by the office, and the sales
  437  representatives thereof, if the activities of such entity are
  438  limited to the activities permitted under the certificate of
  439  authority.
  440         (e) An entity that is affiliated with an insurer and that
  441  only performs the contractual duties, between the administrator
  442  and the insurer, of an administrator for the direct and assumed
  443  insurance business of the affiliated insurer. The insurer is
  444  responsible for the acts of the administrator and is responsible
  445  for providing all of the administrator’s books and records to
  446  the insurance commissioner, upon a request from the insurance
  447  commissioner. For purposes of this paragraph, the term “insurer”
  448  means a licensed insurance company, health maintenance
  449  organization, prepaid limited health service organization, or
  450  prepaid health clinic.
  451         (f) A nonresident entity licensed in its state of domicile
  452  as an administrator if its duties in this state are limited to
  453  the administration of a group policy or plan of insurance and no
  454  more than a total of 100 lives for all plans reside in this
  455  state.
  456         (g) An insurance agent licensed in this state whose
  457  activities are limited exclusively to the sale of insurance.
  458         (h) A person appointed as a managing general agent in this
  459  state, whose activities are limited exclusively to the scope of
  460  activities conveyed under such appointment.
  461         (i) An adjuster licensed in this state whose activities are
  462  limited to the adjustment of claims.
  463         (j) A creditor on behalf of such creditor’s debtors with
  464  respect to insurance covering a debt between the creditor and
  465  its debtors.
  466         (k) A trust and its trustees, agents, and employees acting
  467  pursuant to such trust established in conformity with 29 U.S.C.
  468  s. 186.
  469         (l) A trust exempt from taxation under s. 501(a) of the
  470  Internal Revenue Code, a trust satisfying the requirements of
  471  ss. 624.438 and 624.439, or any governmental trust as defined in
  472  s. 624.33(3), and the trustees and employees acting pursuant to
  473  such trust, or a custodian and its agents and employees,
  474  including individuals representing the trustees in overseeing
  475  the activities of a service company or administrator, acting
  476  pursuant to a custodial account which meets the requirements of
  477  s. 401(f) of the Internal Revenue Code.
  478         (m) A financial institution which is subject to supervision
  479  or examination by federal or state authorities or a mortgage
  480  lender licensed under chapter 494 who collects and remits
  481  premiums to licensed insurance agents or authorized insurers
  482  concurrently or in connection with mortgage loan payments.
  483         (n) A credit card issuing company which advances for and
  484  collects premiums or charges from its credit card holders who
  485  have authorized such collection if such company does not adjust
  486  or settle claims.
  487         (o) A person who adjusts or settles claims in the normal
  488  course of such person’s practice or employment as an attorney at
  489  law and who does not collect charges or premiums in connection
  490  with life or health insurance coverage.
  491         (p) A person approved by the department who administers
  492  only self-insured workers’ compensation plans.
  493         (q) A service company or service agent and its employees,
  494  authorized in accordance with ss. 626.895-626.899, serving only
  495  a single employer plan, multiple-employer welfare arrangements,
  496  or a combination thereof.
  497         (r) Any provider or group practice, as defined in s.
  498  456.053, providing services under the scope of the license of
  499  the provider or the member of the group practice.
  500         (s) Any hospital providing billing, claims, and collection
  501  services solely on its own and its physicians’ behalf and
  502  providing services under the scope of its license.
  503         (t) A corporation not for profit whose membership consists
  504  entirely of local governmental units authorized to enter into
  505  risk management consortiums under s. 112.08.
  506  
  507  A person who provides billing and collection services to health
  508  insurers and health maintenance organizations on behalf of
  509  health care providers shall comply with the provisions of ss.
  510  627.6131, 641.3155, and 641.51(4).
  511         (6)“Pharmacy benefit manager” means a person or an entity
  512  doing business in this state which contracts to administer
  513  prescription drug benefits on behalf of a pharmacy benefits plan
  514  or program as defined in s. 626.8825. The term includes, but is
  515  not limited to, a person or an entity that performs one or more
  516  of the following services on behalf of such plan or program:
  517         (a)Pharmacy claims processing.
  518         (b)Administration or management of a pharmacy discount
  519  card program and performance of any other service listed in this
  520  subsection.
  521         (c)Managing pharmacy networks or pharmacy reimbursement.
  522         (d)Paying or managing claims for pharmacist services
  523  provided to covered persons.
  524         (e)Developing or managing a clinical formulary, including
  525  utilization management or quality assurance programs.
  526         (f)Pharmacy rebate administration.
  527         (g)Managing patient compliance, therapeutic intervention,
  528  or generic substitution programs.
  529         (h)Administration or management of a mail-order pharmacy
  530  program.
  531         Section 9. Present subsections (3) through (6) of section
  532  626.8805, Florida Statutes, are redesignated as subsections (4)
  533  through (7), respectively, a new subsection (3) and subsection
  534  (8) are added to that section, and subsection (1) and present
  535  subsection (3) of that section are amended, to read:
  536         626.8805 Certificate of authority to act as administrator.—
  537         (1) It is unlawful for any person to act as or hold himself
  538  or herself out to be an administrator in this state without a
  539  valid certificate of authority issued by the office pursuant to
  540  ss. 626.88-626.894. A pharmacy benefit manager that is
  541  registered with the office under s. 624.490 as of June 30, 2023,
  542  may continue to operate until January 1, 2024, as an
  543  administrator without a certificate of authority and is not in
  544  violation of the requirement to possess a valid certificate of
  545  authority as an administrator during that timeframe. To qualify
  546  for and hold authority to act as an administrator in this state,
  547  an administrator must otherwise be in compliance with this code
  548  and with its organizational agreement. The failure of any
  549  person, excluding a pharmacy benefit manager, to hold such a
  550  certificate while acting as an administrator shall subject such
  551  person to a fine of not less than $5,000 or more than $10,000
  552  for each violation. A person who, on or after January 1, 2024,
  553  does not hold a certificate of authority to act as an
  554  administrator while operating as a pharmacy benefit manager is
  555  subject to a fine of $10,000 per violation per day. By January
  556  15, 2024, the office shall submit to the Governor, the President
  557  of the Senate, and the Speaker of the House of Representatives a
  558  report detailing whether each pharmacy benefit manager operating
  559  in this state on January 1, 2024, obtained a certificate of
  560  authority on or before that date as required by this section.
  561         (3) An applicant that is a pharmacy benefit manager must
  562  also submit all of the following:
  563         (a)A complete biographical statement on forms prescribed
  564  by the commission.
  565         (b)An independent background report as prescribed by the
  566  commission.
  567         (c)A full set of fingerprints of all of the individuals
  568  referenced in paragraph (2)(c) to the office or to a vendor,
  569  entity, or agency authorized by s. 943.053(13). The office,
  570  vendor, entity, or agency, as applicable, shall forward the
  571  fingerprints to the Department of Law Enforcement for state
  572  processing, and the Department of Law Enforcement shall forward
  573  the fingerprints to the Federal Bureau of Investigation for
  574  national processing in accordance with s. 943.053 and 28 C.F.R.
  575  s. 20.
  576         (d)A self-disclosure of any administrative, civil, or
  577  criminal complaints, settlements, or discipline of the
  578  applicant, or any of the applicant’s affiliates, which relate to
  579  a violation of the insurance laws, including pharmacy benefit
  580  manager laws, in any state.
  581         (e)A statement attesting to compliance with the network
  582  requirements in s. 626.8825 beginning January 1, 2024.
  583         (4)(a)(3) The applicant shall make available for inspection
  584  by the office copies of all contracts relating to services
  585  provided by the administrator to insurers or other persons using
  586  the services of the administrator.
  587         (b)An applicant that is a pharmacy benefit manager shall
  588  also make available for inspection by the office:
  589         1.Copies of all contract templates with any pharmacy as
  590  defined in s. 465.003; and
  591         2.Copies of all subcontracts to support its operations.
  592         (8)A pharmacy benefit manager is exempt from fees
  593  associated with the initial application and the annual filing
  594  fees in s. 626.89.
  595         Section 10. Section 626.8814, Florida Statutes, is amended
  596  to read:
  597         626.8814 Disclosure of ownership or affiliation.—
  598         (1) Each administrator shall identify to the office any
  599  ownership interest or affiliation of any kind with any insurance
  600  company responsible for providing benefits directly or through
  601  reinsurance to any plan for which the administrator provides
  602  administrative services.
  603         (2)Pharmacy benefit managers shall also identify to the
  604  office any ownership affiliation of any kind with any pharmacy
  605  which, either directly or indirectly, through one or more
  606  intermediaries:
  607         (a)Has an investment or ownership interest in a pharmacy
  608  benefit manager holding a certificate of authority issued under
  609  this part;
  610         (b)Shares common ownership with a pharmacy benefit manager
  611  holding a certificate of authority issued under this part; or
  612         (c)Has an investor or a holder of an ownership interest
  613  which is a pharmacy benefit manager holding a certificate of
  614  authority issued under this part.
  615         (3)A pharmacy benefit manager shall report any change in
  616  information required by subsection (2) to the office in writing
  617  within 60 days after the change occurs.
  618         Section 11. Section 626.8825, Florida Statutes, is created
  619  to read:
  620         626.8825 Pharmacy benefit manager transparency and
  621  accountability.—
  622         (1)DEFINITIONS.—As used in this section, the term:
  623         (a)“Adjudication transaction fee” means a fee charged by
  624  the pharmacy benefit manager to the pharmacy for electronic
  625  claim submissions.
  626         (b)“Affiliated pharmacy” means a pharmacy that, either
  627  directly or indirectly through one or more intermediaries:
  628         1.Has an investment or ownership interest in a pharmacy
  629  benefit manager holding a certificate of authority issued under
  630  this part;
  631         2.Shares common ownership with a pharmacy benefit manager
  632  holding a certificate of authority issued under this part; or
  633         3.Has an investor or a holder of an ownership interest
  634  which is a pharmacy benefit manager holding a certificate of
  635  authority issued under this part.
  636         (c)“Brand name or generic effective rate” means the
  637  contractual rate set forth by a pharmacy benefit manager for the
  638  reimbursement of covered brand name or generic drugs, calculated
  639  using the total payments in the aggregate, by drug type, during
  640  the performance period. The effective rates are typically
  641  calculated as a discount from industry benchmarks, such as
  642  average wholesale price or wholesale acquisition cost.
  643         (d)“Covered person” means a person covered by,
  644  participating in, or receiving the benefit of a pharmacy
  645  benefits plan or program.
  646         (e)“Direct and indirect remuneration fees” means price
  647  concessions that are paid to the pharmacy benefit manager by the
  648  pharmacy retrospectively and that cannot be calculated at the
  649  point of sale. The term may also include discounts, chargebacks
  650  or rebates, cash discounts, free goods contingent on a purchase
  651  agreement, upfront payments, coupons, goods in kind, free or
  652  reduced-price services, grants, or other price concessions or
  653  similar benefits from manufacturers, pharmacies, or similar
  654  entities.
  655         (f)“Dispensing fee” means a fee intended to cover
  656  reasonable costs associated with providing the drug to a covered
  657  person. This cost includes the pharmacist’s services and the
  658  overhead associated with maintaining the facility and equipment
  659  necessary to operate the pharmacy.
  660         (g)“Effective rate guarantee” means the minimum ingredient
  661  cost reimbursement a pharmacy benefit manager guarantees it will
  662  pay for pharmacist services during the applicable measurement
  663  period.
  664         (h)“Erroneous claims” means pharmacy claims submitted in
  665  error, including, but not limited to, unintended, incorrect,
  666  fraudulent, or test claims.
  667         (i)“Group purchasing organization” means an entity
  668  affiliated with a pharmacy benefit manager or a pharmacy
  669  benefits plan or program which uses purchasing volume aggregates
  670  as leverage to negotiate discounts and rebates for covered
  671  prescription drugs with pharmaceutical manufacturers,
  672  distributors, and wholesale vendors.
  673         (j)“Incentive payment” means a retrospective monetary
  674  payment made as a reward or recognition by the pharmacy benefits
  675  plan or program or pharmacy benefit manager to a pharmacy for
  676  meeting or exceeding predefined pharmacy performance metrics as
  677  related to quality measures, such as Healthcare Effectiveness
  678  Data and Information Set measures.
  679         (k)“Maximum allowable cost appeal pricing adjustment”
  680  means a retrospective positive payment adjustment made to a
  681  pharmacy by the pharmacy benefits plan or program or by the
  682  pharmacy benefit manager pursuant to an approved maximum
  683  allowable cost appeal request submitted by the same pharmacy to
  684  dispute the amount reimbursed for a drug based on the pharmacy
  685  benefit manager’s listed maximum allowable cost price.
  686         (l)“Monetary recoupments” means rescinded or recouped
  687  payments from a pharmacy or provider by the pharmacy benefits
  688  plan or program or by the pharmacy benefit manager.
  689         (m)“Network” means a group of pharmacies that agree to
  690  provide pharmacist services to covered persons on behalf of a
  691  pharmacy benefits plan or program or a group of pharmacy
  692  benefits plans or programs in exchange for payment for such
  693  services. The term includes a pharmacy that generally dispenses
  694  outpatient prescription drugs to covered persons.
  695         (n)“Network reconciliation offsets” means a process during
  696  annual payment reconciliation between a pharmacy benefit manager
  697  and a pharmacy which allows the pharmacy benefit manager to
  698  offset an amount for overperformance or underperformance of
  699  contractual guarantees across guaranteed line items, channels,
  700  networks, or payors, as applicable.
  701         (o)“Participation contract” means any agreement between a
  702  pharmacy benefit manager and pharmacy for the provision and
  703  reimbursement of pharmacist services and any exhibits,
  704  attachments, amendments, or addendums to such agreement.
  705         (p)“Pass-through pricing model” means a payment model used
  706  by a pharmacy benefit manager in which the payments made by the
  707  pharmacy benefits plan or program to the pharmacy benefit
  708  manager for the covered outpatient drugs are:
  709         1.Equivalent to the payments the pharmacy benefit manager
  710  makes to a dispensing pharmacy or provider for such drugs,
  711  including any contracted professional dispensing fee between the
  712  pharmacy benefit manager and its network of pharmacies. Such
  713  dispensing fee would be paid if the pharmacy benefits plan or
  714  program was making the payments directly.
  715         2.Passed through in their entirety by the pharmacy
  716  benefits plan or program or by the pharmacy benefit manager to
  717  the pharmacy or provider that dispenses the drugs, and the
  718  payments are made in a manner that is not offset by any
  719  reconciliation.
  720         (q)“Pharmacist” has the same meaning as in s. 465.003.
  721         (r)“Pharmacist services” means products, goods, and
  722  services or any combination of products, goods, and services
  723  provided as part of the practice of the profession of pharmacy
  724  as defined in s. 465.003 or otherwise covered by a pharmacy
  725  benefits plan or program.
  726         (s)“Pharmacy” has the same meaning as in s. 465.003.
  727         (t)“Pharmacy benefit manager” has the same meaning as in
  728  s. 626.88.
  729         (u)“Pharmacy benefits plan or program” means a plan or
  730  program that pays for, reimburses, covers the cost of, or
  731  provides access to discounts on pharmacist services provided by
  732  one or more pharmacies to covered persons who reside in, are
  733  employed by, or receive pharmacist services from this state.
  734         1. The term includes, but is not limited to, health
  735  maintenance organizations, health insurers, self-insured
  736  employer health plans, discount card programs, and government
  737  funded health plans, including the Statewide Medicaid Managed
  738  Care program established pursuant to part IV of chapter 409 and
  739  the state group insurance program pursuant to part I of chapter
  740  110.
  741         2. The term excludes such a plan or program under chapter
  742  440.
  743         (v)“Rebate” means all payments that accrue to a pharmacy
  744  benefit manager or its pharmacy benefits plan or program client
  745  or an affiliated group purchasing organization, directly or
  746  indirectly, from a pharmaceutical manufacturer, including, but
  747  not limited to, discounts, administration fees, credits,
  748  incentives, or penalties associated directly or indirectly in
  749  any way with claims administered on behalf of a pharmacy
  750  benefits plan or program client.
  751         (w)“Spread pricing” is the practice in which a pharmacy
  752  benefit manager charges a pharmacy benefits plan or program a
  753  different amount for pharmacist services than the amount the
  754  pharmacy benefit manager reimburses a pharmacy for such
  755  pharmacist services.
  756         (x)“Usual and customary price” means the amount charged to
  757  cash customers for a pharmacist service exclusive of sales tax
  758  or other amounts claimed.
  759         (2)CONTRACTS BETWEEN A PHARMACY BENEFIT MANAGER AND A
  760  PHARMACY BENEFITS PLAN OR PROGRAM.—In addition to any other
  761  requirements in the Florida Insurance Code, all contractual
  762  arrangements executed, amended, adjusted, or renewed on or after
  763  July 1, 2023, which are applicable to pharmacy benefits covered
  764  on or after January 1, 2024, between a pharmacy benefit manager
  765  and a pharmacy benefits plan or program must include, in
  766  substantial form, terms that ensure compliance with all of the
  767  following requirements and that, except to the extent not
  768  allowed by law, shall supersede any contractual terms to the
  769  contrary:
  770         (a) Use a pass-through pricing model, remaining consistent
  771  with the prohibition in paragraph (3)(c).
  772         (b) Exclude terms that allow for the direct or indirect
  773  engagement in the practice of spread pricing unless the pharmacy
  774  benefit manager passes along the entire amount of such
  775  difference to the pharmacy benefits plan or program as allowable
  776  under paragraph (a).
  777         (c) Ensure that funds received in relation to providing
  778  services for a pharmacy benefits plan or program or a pharmacy
  779  are used or distributed only pursuant to the pharmacy benefit
  780  manager’s contract with the pharmacy benefits plan or program or
  781  with the pharmacy or as otherwise required by applicable law.
  782         (d) Require the pharmacy benefit manager to pass 100
  783  percent of all prescription drug manufacturer rebates, including
  784  nonresident prescription drug manufacturer rebates, received to
  785  the pharmacy benefits plan or program, if the contractual
  786  arrangement delegates the negotiation of rebates to the pharmacy
  787  benefit manager, for the sole purpose of offsetting defined cost
  788  sharing and reducing premiums of covered persons. Any excess
  789  rebate revenue after the pharmacy benefit manager and the
  790  pharmacy benefits plan or program have taken all actions
  791  required under this paragraph must be used for the sole purpose
  792  of offsetting copayments and deductibles of covered persons.
  793  This paragraph does not apply to contracts involving Medicaid
  794  managed care plans.
  795         (e) Include network adequacy requirements that meet or
  796  exceed Medicare Part D program standards for convenient access
  797  to the network pharmacies set forth in 42 C.F.R. s.
  798  423.120(a)(1) and that:
  799         1. Do not limit a network to solely include affiliated
  800  pharmacies;
  801         2. Require a pharmacy benefit manager to offer a provider
  802  contract to licensed pharmacies physically located on the
  803  physical site of providers that are:
  804         a. Within the pharmacy benefits plan’s or program’s
  805  geographic service area and that have been specifically
  806  designated as essential providers by the Agency for Health Care
  807  Administration pursuant to s. 409.975(1)(a);
  808         b. Designated as cancer centers of excellence under s.
  809  381.925, regardless of the pharmacy benefits plan’s or program’s
  810  geographic service area;
  811         c. Organ transplant hospitals, regardless of the pharmacy
  812  benefits plan’s or program’s geographic service area;
  813         d. Hospitals licensed as specialty children’s hospitals as
  814  defined in s. 395.002; or
  815         e. Regional perinatal intensive care centers as defined in
  816  s. 383.16(2), regardless of the pharmacy benefits plan’s or
  817  program’s geographic service area.
  818  
  819  Such provider contracts must be solely for the administration or
  820  dispensing of covered prescription drugs, including biological
  821  products, which are administered through infusions,
  822  intravenously injected, or inhaled during a surgical procedure
  823  or are covered parenteral drugs, as part of onsite outpatient
  824  care;
  825         3. Do not require a covered person to receive a
  826  prescription drug by United States mail, common carrier, local
  827  courier, third-party company or delivery service, or pharmacy
  828  direct delivery unless the prescription drug cannot be acquired
  829  at any retail pharmacy in the pharmacy benefit manager’s network
  830  for the covered person’s pharmacy benefits plan or program. This
  831  subparagraph does not prohibit a pharmacy benefit manager from
  832  operating mail order or delivery programs on an opt-in basis at
  833  the sole discretion of a covered person, provided that the
  834  covered person is not penalized through the imposition of any
  835  additional retail cost-sharing obligations or a lower allowed
  836  quantity limit for choosing not to select the mail order or
  837  delivery programs;
  838         4. For the in-person administration of covered prescription
  839  drugs, prohibit requiring a covered person to receive pharmacist
  840  services from an affiliated pharmacy or an affiliated health
  841  care provider; and
  842         5. Prohibit offering or implementing pharmacy networks that
  843  require or provide a promotional item or an incentive, defined
  844  as anything other than a reduced cost-sharing amount or enhanced
  845  quantity limit allowed under the benefit design for a covered
  846  drug, to a covered person to use an affiliated pharmacy or an
  847  affiliated health care provider for the in-person administration
  848  of covered prescription drugs; or advertising, marketing, or
  849  promoting an affiliated pharmacy to covered persons. Subject to
  850  the foregoing, a pharmacy benefit manager may include an
  851  affiliated pharmacy in communications to covered persons
  852  regarding network pharmacies and prices, provided that the
  853  pharmacy benefit manager includes information, such as links to
  854  all nonaffiliated network pharmacies, in such communications and
  855  that the information provided is accurate and of equal
  856  prominence. This subparagraph may not be construed to prohibit a
  857  pharmacy benefit manager from entering into an agreement with an
  858  affiliated pharmacy to provide pharmacist services to covered
  859  persons.
  860         (f) Prohibit the ability of a pharmacy benefit manager to
  861  condition participation in one pharmacy network on participation
  862  in any other pharmacy network or penalize a pharmacy for
  863  exercising its prerogative not to participate in a specific
  864  pharmacy network.
  865         (g) Prohibit a pharmacy benefit manager from instituting a
  866  network that requires a pharmacy to meet accreditation standards
  867  inconsistent with or more stringent than applicable federal and
  868  state requirements for licensure and operation as a pharmacy in
  869  this state. However, a pharmacy benefit manager may specify
  870  additional specialty networks that require enhanced standards
  871  related to the safety and competency necessary to meet the
  872  United States Food and Drug Administration’s limited
  873  distribution requirements for dispensing any drug that, on a
  874  drug-by-drug basis, requires extraordinary special handling,
  875  provider coordination, or clinical care or monitoring when such
  876  extraordinary requirements cannot be met by a retail pharmacy.
  877  For purposes of this paragraph, drugs requiring extraordinary
  878  special handling are limited to drugs that are subject to a risk
  879  evaluation and mitigation strategy approved by the United States
  880  Food and Drug Administration and that:
  881         1. Require special certification of a health care provider
  882  to prescribe, receive, dispense, or administer; or
  883         2. Require special handling due to the molecular complexity
  884  or cytotoxic properties of the biologic or biosimilar product or
  885  drug.
  886  
  887  For participation in a specialty network, a pharmacy benefit
  888  manager may not require a pharmacy to meet requirements for
  889  participation beyond those necessary to demonstrate the
  890  pharmacy’s ability to dispense the drug in accordance with the
  891  United States Food and Drug Administration’s approved
  892  manufacturer labeling.
  893         (h)1.At a minimum, require the pharmacy benefit manager or
  894  pharmacy benefits plan or program to, upon revising its
  895  formulary of covered prescription drugs during a plan year,
  896  provide a 60-day continuity-of-care period in which the covered
  897  prescription drug that is being revised from the formulary
  898  continues to be provided at the same cost for the patient for a
  899  period of 60 days. The 60-day continuity-of-care period
  900  commences upon notification to the patient. This requirement
  901  does not apply if the covered prescription drug:
  902         a.Has been approved and made available over the counter by
  903  the United States Food and Drug Administration and has entered
  904  the commercial market as such;
  905         b.Has been removed or withdrawn from the commercial market
  906  by the manufacturer; or
  907         c.Is subject to an involuntary recall by state or federal
  908  authorities and is no longer available on the commercial market.
  909         2.Beginning January 1, 2024, and annually thereafter, the
  910  pharmacy benefits plan or program shall submit to the office,
  911  under the penalty of perjury, a statement attesting to its
  912  compliance with the requirements of this subsection.
  913         (3)CONTRACTS BETWEEN A PHARMACY BENEFIT MANAGER AND A
  914  PARTICIPATING PHARMACY.—In addition to other requirements in the
  915  Florida Insurance Code, a participation contract executed,
  916  amended, adjusted, or renewed on or after July 1, 2023, that
  917  applies to pharmacist services on or after January 1, 2024,
  918  between a pharmacy benefit manager and one or more pharmacies or
  919  pharmacists, must include, in substantial form, terms that
  920  ensure compliance with all of the following requirements, and
  921  that, except to the extent not allowed by law, shall supersede
  922  any contractual terms in the participation contract to the
  923  contrary:
  924         (a)At the time of adjudication for electronic claims or
  925  the time of reimbursement for nonelectronic claims, the pharmacy
  926  benefit manager shall provide the pharmacy with a remittance,
  927  including such detailed information as is necessary for the
  928  pharmacy or pharmacist to identify the reimbursement schedule
  929  for the specific network applicable to the claim and which is
  930  the basis used by the pharmacy benefit manager to calculate the
  931  amount of reimbursement paid. This information must include, but
  932  is not limited to, the applicable network reimbursement ID or
  933  plan ID as defined in the most current version of the National
  934  Council for Prescription Drug Programs (NCPDP) Telecommunication
  935  Standard Implementation Guide, or its nationally recognized
  936  successor industry guide. The commission shall adopt rules to
  937  implement this paragraph.
  938         (b)The pharmacy benefit manager must ensure that any basis
  939  of reimbursement information is communicated to a pharmacy in
  940  accordance with the NCPDP Telecommunication Standard
  941  Implementation Guide, or its nationally recognized successor
  942  industry guide, when performing reconciliation for any effective
  943  rate guarantee, and that such basis of reimbursement information
  944  communicated is accurate, corresponds with the applicable
  945  network rate, and may be relied upon by the pharmacy.
  946         (c)A prohibition of financial clawbacks, reconciliation
  947  offsets, or offsets to adjudicated claims. A pharmacy benefit
  948  manager may not charge, withhold, or recoup direct or indirect
  949  remuneration fees, dispensing fees, brand name or generic
  950  effective rate adjustments through reconciliation, or any other
  951  monetary charge, withholding, or recoupments as related to
  952  discounts, multiple network reconciliation offsets, adjudication
  953  transaction fees, and any other instance when a fee may be
  954  recouped from a pharmacy. This prohibition does not apply to:
  955         1.Any incentive payments provided by the pharmacy benefit
  956  manager to a network pharmacy for meeting or exceeding
  957  predefined quality measures, such as Healthcare Effectiveness
  958  Data and Information Set measures; recoupment due to an
  959  erroneous claim, fraud, waste, or abuse; a claim adjudicated in
  960  error; a maximum allowable cost appeal pricing adjustment; or an
  961  adjustment made as part of a pharmacy audit pursuant to s.
  962  624.491.
  963         2.Any recoupment that is returned to the state for
  964  programs in chapter 409 or the state group insurance program in
  965  s. 110.123.
  966         (d)A pharmacy benefit manager may not unilaterally change
  967  the terms of any participation contract.
  968         (e)Unless otherwise prohibited by law, a pharmacy benefit
  969  manager may not prohibit a pharmacy or pharmacist from:
  970         1.Offering mail or delivery services on an opt-in basis at
  971  the sole discretion of the covered person.
  972         2.Mailing or delivering a prescription drug to a covered
  973  person upon his or her request.
  974         3.Charging a shipping or handling fee to a covered person
  975  requesting a prescription drug be mailed or delivered if the
  976  pharmacy or pharmacist discloses to the covered person before
  977  the mailing or delivery the amount of the fee that will be
  978  charged and that the fee may not be reimbursable by the covered
  979  person’s pharmacy benefits plan or program.
  980         (f)The pharmacy benefit manager must provide a pharmacy,
  981  upon its request, a list of pharmacy benefits plans or programs
  982  in which the pharmacy is a part of the network. Updates to the
  983  list must be communicated to the pharmacy within 7 days. The
  984  pharmacy benefit manager may not restrict the pharmacy or
  985  pharmacist from disclosing this information to the public.
  986         (g)The pharmacy benefit manager must ensure that the
  987  Electronic Remittance Advice contains claim level payment
  988  adjustments in accordance with the American National Standards
  989  Institute Accredited Standards Committee, X12 format, and
  990  includes or is accompanied by the appropriate level of detail
  991  for the pharmacy to reconcile any debits or credits, including,
  992  but not limited to, pharmacy NCPDP or NPI identifier, date of
  993  service, prescription number, refill number, adjustment code, if
  994  applicable, and transaction amount.
  995         (h)The pharmacy benefit manager shall provide a reasonable
  996  administrative appeal procedure to allow a pharmacy or
  997  pharmacist to challenge the maximum allowable cost pricing
  998  information and the reimbursement made under the maximum
  999  allowable cost as defined in s. 627.64741 for a specific drug as
 1000  being below the acquisition cost available to the challenging
 1001  pharmacy or pharmacist.
 1002         1.The administrative appeal procedure must include a
 1003  telephone number and e-mail address, or a website, for the
 1004  purpose of submitting the administrative appeal. The appeal may
 1005  be submitted by the pharmacy or an agent of the pharmacy
 1006  directly to the pharmacy benefit manager or through a pharmacy
 1007  service administration organization. The pharmacy or pharmacist
 1008  must be given at least 30 business days after a maximum
 1009  allowable cost update or after an adjudication for an electronic
 1010  claim or reimbursement for a nonelectronic claim to file the
 1011  administrative appeal.
 1012         2.The pharmacy benefit manager must respond to the
 1013  administrative appeal within 30 business days after receipt of
 1014  the appeal.
 1015         3.If the appeal is upheld, the pharmacy benefit manager
 1016  must:
 1017         a.Update the maximum allowable cost pricing information to
 1018  at least the acquisition cost available to the pharmacy;
 1019         b.Permit the pharmacy or pharmacist to reverse and rebill
 1020  the claim in question;
 1021         c.Provide to the pharmacy or pharmacist the national drug
 1022  code on which the increase or change is based; and
 1023         d.Make the increase or change effective for each similarly
 1024  situated pharmacy or pharmacist who is subject to the applicable
 1025  maximum allowable cost pricing information.
 1026         4.If the appeal is denied, the pharmacy benefit manager
 1027  must provide to the pharmacy or pharmacist the national drug
 1028  code and the name of the national or regional pharmaceutical
 1029  wholesalers operating in this state which have the drug
 1030  currently in stock at a price below the maximum allowable cost
 1031  pricing information.
 1032         5.Every 90 days, a pharmacy benefit manager shall report
 1033  to the office the total number of appeals received and denied in
 1034  the preceding 90-day period, with an explanation or reason for
 1035  each denial, for each specific drug for which an appeal was
 1036  submitted pursuant to this paragraph.
 1037         Section 12. Section 626.8827, Florida Statutes, is created
 1038  to read:
 1039         626.8827 Pharmacy benefit manager prohibited practices.—In
 1040  addition to other prohibitions in this part, a pharmacy benefit
 1041  manager may not do any of the following:
 1042         (1)Prohibit, restrict, or penalize in any way a pharmacy
 1043  or pharmacist from disclosing to any person any information that
 1044  the pharmacy or pharmacist deems appropriate, including, but not
 1045  limited to, information regarding any of the following:
 1046         (a) The nature of treatment, risks, or alternatives
 1047  thereto.
 1048         (b) The availability of alternate treatment, consultations,
 1049  or tests.
 1050         (c) The decision of utilization reviewers or similar
 1051  persons to authorize or deny pharmacist services.
 1052         (d) The process used to authorize or deny pharmacist
 1053  services or benefits.
 1054         (e) Information on financial incentives and structures used
 1055  by the pharmacy benefits plan or program.
 1056         (f) Information that may reduce the costs of pharmacist
 1057  services.
 1058         (g) Whether the cost-sharing obligation exceeds the retail
 1059  price for a covered prescription drug and the availability of a
 1060  more affordable alternative drug, pursuant to s. 465.0244.
 1061         (2) Prohibit, restrict, or penalize in any way a pharmacy
 1062  or pharmacist from disclosing information to the office, the
 1063  Agency for Health Care Administration, Department of Management
 1064  Services, law enforcement, or state and federal governmental
 1065  officials, provided that the recipient of the information
 1066  represents it has the authority, to the extent provided by state
 1067  or federal law, to maintain proprietary information as
 1068  confidential; and before disclosure of information designated as
 1069  confidential, the pharmacist or pharmacy marks as confidential
 1070  any document in which the information appears or requests
 1071  confidential treatment for any oral communication of the
 1072  information.
 1073         (3) Communicate at the point-of-sale, or otherwise require,
 1074  a cost-sharing obligation for the covered person in an amount
 1075  that exceeds the lesser of:
 1076         (a) The applicable cost-sharing amount under the applicable
 1077  pharmacy benefits plan or program; or
 1078         (b) The usual and customary price, as defined in s.
 1079  626.8825, of the pharmacist services.
 1080         (4) Transfer or share records relative to prescription
 1081  information containing patient-identifiable or prescriber
 1082  identifiable data to an affiliated pharmacy for any commercial
 1083  purpose other than the limited purposes of facilitating pharmacy
 1084  reimbursement, formulary compliance, or utilization review on
 1085  behalf of the applicable pharmacy benefits plan or program.
 1086         (5) Fail to make any payment due to a pharmacy for an
 1087  adjudicated claim with a date of service before the effective
 1088  date of a pharmacy’s termination from a pharmacy benefit network
 1089  unless payments are withheld because of fraud on the part of the
 1090  pharmacy or except as otherwise required by law.
 1091         (6) Terminate the contract of, penalize, or disadvantage a
 1092  pharmacist or pharmacy due to a pharmacist or pharmacy:
 1093         (a) Disclosing information about pharmacy benefit manager
 1094  practices in accordance with this act;
 1095         (b) Exercising any of its prerogatives under this part; or
 1096         (c) Sharing any portion, or all, of the pharmacy benefit
 1097  manager contract with the office pursuant to a complaint or a
 1098  query regarding whether the contract is in compliance with this
 1099  act.
 1100         (7)Fail to comply with the requirements in s. 626.8825 or
 1101  s. 624.491.
 1102         Section 13. Section 626.8828, Florida Statutes, is created
 1103  to read:
 1104         626.8828Investigations and examinations of pharmacy
 1105  benefit managers; expenses; penalties.—
 1106         (1)The office may investigate administrators who are
 1107  pharmacy benefit managers and applicants for authorization as
 1108  provided in ss. 624.307 and 624.317. The office shall review any
 1109  referral made pursuant to s. 624.307(10) and shall investigate
 1110  any referral that, as determined by the Commissioner of
 1111  Insurance Regulation or his or her designee, reasonably
 1112  indicates a possible violation of this part.
 1113         (2)(a)The office shall examine the business and affairs of
 1114  each pharmacy benefit manager at least biennially. The biennial
 1115  examination of each pharmacy benefit manager must be a
 1116  systematic review for the purpose of determining the pharmacy
 1117  benefit manager’s compliance with all provisions of this part
 1118  and all other laws or rules applicable to pharmacy benefit
 1119  managers and must include a detailed review of the pharmacy
 1120  benefit manager’s compliance with ss. 626.8825 and 626.8827. The
 1121  first 2-year cycle for conducting biennial reviews begins
 1122  January 1, 2025. By January 15, 2026, and each January 15
 1123  thereafter, the office shall submit to the Governor, the
 1124  President of the Senate, and the Speaker of the House of
 1125  Representatives a report summarizing the results of the prior
 1126  year’s examinations which includes detailed descriptions of any
 1127  violations committed by each pharmacy benefit manager and
 1128  detailed reporting of actions taken by the office against each
 1129  pharmacy benefit manager for such violations. Beginning with the
 1130  2027 report, and every 2 years thereafter, the report must
 1131  document the office’s compliance with the examination timeframe
 1132  requirements as provided in this paragraph. The office must
 1133  specify the number and percentage of all examination completed
 1134  within the timeframe.
 1135         (b)The office also may conduct additional examinations as
 1136  often as it deems advisable or necessary for the purpose of
 1137  ascertaining compliance with this part and any other laws or
 1138  rules applicable to pharmacy benefit managers or applicants for
 1139  authorization.
 1140         (c)If a referral made pursuant to s. 624.307(10)
 1141  reasonably indicates a pattern or practice of violations of this
 1142  part by a pharmacy benefit manager, the office must begin an
 1143  examination of the pharmacy benefit manager or include findings
 1144  related to such referral within an ongoing examination.
 1145         (d)Based on the findings of an examination that a pharmacy
 1146  benefit manager or an applicant for authorization has exhibited
 1147  a pattern or practice of knowing and willful violations of s.
 1148  626.8825 or s. 626.8827, the office may, pursuant to chapter
 1149  120, order a pharmacy benefit manager to file all contracts
 1150  between the pharmacy benefit manager and pharmacies or pharmacy
 1151  benefits plans or programs and any policies, guidelines, rules,
 1152  protocols, standard operating procedures, instructions, or
 1153  directives that govern or guide the manner in which the pharmacy
 1154  benefit manager or applicant conducts business related to such
 1155  knowing and willful violations for review and inspection for the
 1156  following 36-month period. Such documents are public records and
 1157  are not trade secrets or otherwise exempt from s. 119.07(1). As
 1158  used in this section, the term:
 1159         1.Contracts” means any contract to which s. 626.8825 is
 1160  applicable.
 1161         2.“Knowing and willful” means any act of commission or
 1162  omission which is committed intentionally, as opposed to
 1163  accidentally, and which is committed with knowledge of the act’s
 1164  unlawfulness or with reckless disregard as to the unlawfulness
 1165  of the act.
 1166         (e)Examinations may be conducted by an independent
 1167  professional examiner under contract to the office, in which
 1168  case payment must be made directly to the contracted examiner by
 1169  the pharmacy benefit manager examined in accordance with the
 1170  rates and terms agreed to by the office and the examiner. The
 1171  commission shall adopt rules providing for the types of
 1172  independent professional examiners who may conduct examinations
 1173  under this section, which types must include, but need not be
 1174  limited to, independent certified public accountants, actuaries,
 1175  investment specialists, information technology specialists, or
 1176  others meeting criteria specified by commission rule. The rules
 1177  must also require that:
 1178         1.The rates charged to the pharmacy benefit manager being
 1179  examined are consistent with rates charged by other firms in a
 1180  similar profession and are comparable with the rates charged for
 1181  comparable examinations.
 1182         2.The firm selected by the office to perform the
 1183  examination has no conflicts of interest which might affect its
 1184  ability to independently perform its responsibilities for the
 1185  examination.
 1186         (3)In making investigations and examinations of pharmacy
 1187  benefit managers and applicants for authorization, the office
 1188  and such pharmacy benefit manager are subject to all of the
 1189  following provisions:
 1190         (a)Section 624.318, as to the conduct of examinations.
 1191         (b)Section 624.319, as to examination and investigation
 1192  reports.
 1193         (c) Section 624.321, as to witnesses and evidence.
 1194         (d) Section 624.322, as to compelled testimony.
 1195         (e) Section 624.324, as to hearings.
 1196         (f) Any other provision of chapter 624 applicable to the
 1197  investigation or examination of a licensee under this part.
 1198         (4)(a) A pharmacy benefit manager must maintain an accurate
 1199  record of all contracts and records with all pharmacies and
 1200  pharmacy benefits plans or programs for the duration of the
 1201  contract, and for 5 years thereafter. Such contracts must be
 1202  made available to the office and kept in a form accessible to
 1203  the office.
 1204         (b)The office may order any pharmacy benefit manager or
 1205  applicant to produce any records, books, files, contracts,
 1206  advertising and solicitation materials, or other information and
 1207  may take statements under oath to determine whether the pharmacy
 1208  benefit manager or applicant is in violation of the law or is
 1209  acting contrary to the public interest.
 1210         (5)(a) Notwithstanding s. 624.307(3), each pharmacy benefit
 1211  manager and applicant for authorization must pay to the office
 1212  the expenses of the examination or investigation. Such expenses
 1213  include actual travel expenses, a reasonable living expense
 1214  allowance, compensation of the examiner, investigator, or other
 1215  person making the examination or investigation, and necessary
 1216  costs of the office directly related to the examination or
 1217  investigation. Such travel expenses and living expense
 1218  allowances are limited to those expenses necessarily incurred on
 1219  account of the examination or investigation and shall be paid by
 1220  the examined pharmacy benefit manager or applicant together with
 1221  compensation upon presentation by the office to such pharmacy
 1222  benefit manager or applicant of such charges and expenses after
 1223  a detailed statement has been filed by the examiner and approved
 1224  by the office.
 1225         (b) All moneys collected from pharmacy benefit managers and
 1226  applicants for authorization pursuant to this subsection shall
 1227  be deposited into the Insurance Regulatory Trust Fund, and the
 1228  office may make deposits from time to time into such fund from
 1229  moneys appropriated for the operation of the office.
 1230         (c) Notwithstanding s. 112.061, the office may pay to the
 1231  examiner, investigator, or person making such examination or
 1232  investigation out of such trust fund the actual travel expenses,
 1233  reasonable living expense allowance, and compensation in
 1234  accordance with the statement filed with the office by the
 1235  examiner, investigator, or other person, as provided in
 1236  paragraph (a).
 1237         (6) In addition to any other enforcement authority
 1238  available to the office, the office shall impose an
 1239  administrative fine of $5,000 for each violation of s. 626.8825
 1240  or s. 626.8827. Each instance of a violation of such sections by
 1241  a pharmacy benefit manager against each individual pharmacy or
 1242  prescription benefits plan or program constitutes a separate
 1243  violation. Notwithstanding any other provision of law, there is
 1244  no limitation on aggregate fines issued pursuant to this
 1245  section. The proceeds from any administrative fine shall be
 1246  deposited into the General Revenue Fund.
 1247         (7) Failure by a pharmacy benefit manager to pay expenses
 1248  incurred or administrative fines imposed under this section is
 1249  grounds for the denial, suspension, or revocation of its
 1250  certificate of authority.
 1251         Section 14. Section 626.89, Florida Statutes, is amended to
 1252  read:
 1253         626.89 Annual financial statement and filing fee; notice of
 1254  change of ownership; pharmacy benefit manager filings.—
 1255         (1) Each authorized administrator shall annually file with
 1256  the office a full and true statement of its financial condition,
 1257  transactions, and affairs within 3 months after the end of the
 1258  administrator’s fiscal year or within such extension of time as
 1259  the office for good cause may have granted. The statement must
 1260  be for the preceding fiscal year and must be in such form and
 1261  contain such matters as the commission prescribes and must be
 1262  verified by at least two officers of the administrator.
 1263         (2) Each authorized administrator shall also file an
 1264  audited financial statement performed by an independent
 1265  certified public accountant. The audited financial statement
 1266  must shall be filed with the office within 5 months after the
 1267  end of the administrator’s fiscal year and be for the preceding
 1268  fiscal year. An audited financial statement prepared on a
 1269  consolidated basis must include a columnar consolidating or
 1270  combining worksheet that must be filed with the statement and
 1271  must comply with the following:
 1272         (a) Amounts shown on the consolidated audited financial
 1273  statement must be shown on the worksheet;
 1274         (b) Amounts for each entity must be stated separately; and
 1275         (c) Explanations of consolidating and eliminating entries
 1276  must be included.
 1277         (3) At the time of filing its annual statement, the
 1278  administrator shall pay a filing fee in the amount specified in
 1279  s. 624.501 for the filing of an annual statement by an insurer.
 1280         (4) In addition, the administrator shall immediately notify
 1281  the office of any material change in its ownership.
 1282         (5) A pharmacy benefit manager shall also notify the office
 1283  within 30 days after any administrative, civil, or criminal
 1284  complaints, settlements, or discipline of the pharmacy benefit
 1285  manager or any of its affiliates which relate to a violation of
 1286  the insurance laws, including pharmacy benefit laws in any
 1287  state.
 1288         (6) A pharmacy benefit manager shall also annually submit
 1289  to the office a statement attesting to its compliance with the
 1290  network requirements of s. 626.8825.
 1291         (7) The commission may by rule require all or part of the
 1292  statements or filings required under this section to be
 1293  submitted by electronic means in a computer-readable form
 1294  compatible with the electronic data format specified by the
 1295  commission.
 1296         Section 15. Subsection (5) is added to section 627.42393,
 1297  Florida Statutes, to read:
 1298         627.42393 Step-therapy protocol.—
 1299         (5)This section applies to a pharmacy benefit manager
 1300  acting on behalf of a health insurer.
 1301         Section 16. Subsections (2), (3), and (4) of section
 1302  627.64741, Florida Statutes, are amended to read:
 1303         627.64741 Pharmacy benefit manager contracts.—
 1304         (2) In addition to the requirements of part VII of chapter
 1305  626, a contract between a health insurer and a pharmacy benefit
 1306  manager must require that the pharmacy benefit manager:
 1307         (a) Update maximum allowable cost pricing information at
 1308  least every 7 calendar days.
 1309         (b) Maintain a process that will, in a timely manner,
 1310  eliminate drugs from maximum allowable cost lists or modify drug
 1311  prices to remain consistent with changes in pricing data used in
 1312  formulating maximum allowable cost prices and product
 1313  availability.
 1314         (3) A contract between a health insurer and a pharmacy
 1315  benefit manager must prohibit the pharmacy benefit manager from
 1316  limiting a pharmacist’s ability to disclose whether the cost
 1317  sharing obligation exceeds the retail price for a covered
 1318  prescription drug, and the availability of a more affordable
 1319  alternative drug, pursuant to s. 465.0244.
 1320         (4) A contract between a health insurer and a pharmacy
 1321  benefit manager must prohibit the pharmacy benefit manager from
 1322  requiring an insured to make a payment for a prescription drug
 1323  at the point of sale in an amount that exceeds the lesser of:
 1324         (a) The applicable cost-sharing amount; or
 1325         (b) The retail price of the drug in the absence of
 1326  prescription drug coverage.
 1327         Section 17. Subsections (2), (3), and (4) of section
 1328  627.6572, Florida Statutes, are amended to read:
 1329         627.6572 Pharmacy benefit manager contracts.—
 1330         (2) In addition to the requirements of part VII of chapter
 1331  626, a contract between a health insurer and a pharmacy benefit
 1332  manager must require that the pharmacy benefit manager:
 1333         (a) Update maximum allowable cost pricing information at
 1334  least every 7 calendar days.
 1335         (b) Maintain a process that will, in a timely manner,
 1336  eliminate drugs from maximum allowable cost lists or modify drug
 1337  prices to remain consistent with changes in pricing data used in
 1338  formulating maximum allowable cost prices and product
 1339  availability.
 1340         (3) A contract between a health insurer and a pharmacy
 1341  benefit manager must prohibit the pharmacy benefit manager from
 1342  limiting a pharmacist’s ability to disclose whether the cost
 1343  sharing obligation exceeds the retail price for a covered
 1344  prescription drug, and the availability of a more affordable
 1345  alternative drug, pursuant to s. 465.0244.
 1346         (4) A contract between a health insurer and a pharmacy
 1347  benefit manager must prohibit the pharmacy benefit manager from
 1348  requiring an insured to make a payment for a prescription drug
 1349  at the point of sale in an amount that exceeds the lesser of:
 1350         (a) The applicable cost-sharing amount; or
 1351         (b) The retail price of the drug in the absence of
 1352  prescription drug coverage.
 1353         Section 18. Paragraph (e) is added to subsection (46) of
 1354  section 641.31, Florida Statutes, to read:
 1355         641.31 Health maintenance contracts.—
 1356         (46)
 1357         (e)This subsection applies to a pharmacy benefit manager
 1358  acting on behalf of a health maintenance organization.
 1359         Section 19. Subsections (2), (3), and (4) of section
 1360  641.314, Florida Statutes, are amended to read:
 1361         641.314 Pharmacy benefit manager contracts.—
 1362         (2) In addition to the requirements of part VII of chapter
 1363  626, a contract between a health maintenance organization and a
 1364  pharmacy benefit manager must require that the pharmacy benefit
 1365  manager:
 1366         (a) Update maximum allowable cost pricing information at
 1367  least every 7 calendar days.
 1368         (b) Maintain a process that will, in a timely manner,
 1369  eliminate drugs from maximum allowable cost lists or modify drug
 1370  prices to remain consistent with changes in pricing data used in
 1371  formulating maximum allowable cost prices and product
 1372  availability.
 1373         (3) A contract between a health maintenance organization
 1374  and a pharmacy benefit manager must prohibit the pharmacy
 1375  benefit manager from limiting a pharmacist’s ability to disclose
 1376  whether the cost-sharing obligation exceeds the retail price for
 1377  a covered prescription drug, and the availability of a more
 1378  affordable alternative drug, pursuant to s. 465.0244.
 1379         (4) A contract between a health maintenance organization
 1380  and a pharmacy benefit manager must prohibit the pharmacy
 1381  benefit manager from requiring a subscriber to make a payment
 1382  for a prescription drug at the point of sale in an amount that
 1383  exceeds the lesser of:
 1384         (a) The applicable cost-sharing amount; or
 1385         (b) The retail price of the drug in the absence of
 1386  prescription drug coverage.
 1387         Section 20. (1)This act establishes requirements for
 1388  pharmacy benefit managers as defined in s. 626.88, Florida
 1389  Statutes, including, without limitation, pharmacy benefit
 1390  managers in their performance of services for or otherwise on
 1391  behalf of a pharmacy benefits plan or program as defined in s.
 1392  626.8825, Florida Statutes, which includes coverage pursuant to
 1393  Titles XVIII, XIX, or XXI of the Social Security Act, 42 U.S.C.
 1394  ss. 1395 et seq., 1396 et seq., and 1397aa et seq., known as
 1395  Medicare, Medicaid, or any other similar coverage under a state
 1396  or Federal Government funded health plan, including the
 1397  Statewide Medicaid Managed Care program established pursuant to
 1398  part IV of chapter 409, Florida Statutes, and the state group
 1399  insurance program pursuant to part I of chapter 110, Florida
 1400  Statutes.
 1401         (2)This act is not intended, nor may it be construed, to
 1402  conflict with existing, relevant federal law.
 1403         (3)If any provision of this act or its application to any
 1404  person or circumstances is held invalid, the invalidity does not
 1405  affect other provisions or applications of this act which can be
 1406  given effect without the invalid provision or application, and
 1407  to this end the provisions of this act are severable.
 1408         Section 21. For the 2023-2024 fiscal year, the sum of
 1409  $980,705 in recurring funds and $146,820 in nonrecurring funds
 1410  from the Insurance Regulatory Trust Fund are appropriated to the
 1411  Office of Insurance Regulation, and 10 full-time equivalent
 1412  positions with associated salary rate of 644,877 are authorized,
 1413  for the purpose of implementing this act.
 1414         Section 22. This act shall take effect July 1, 2023.