CS for Senate Bill No. 175(L&C) Summary

• Requires pharmacy benefits managers to register with the director of insurance as third-party administrators and renew registration biannually with a self-supporting fee established by the director.

• Establishes audit procedures limiting claims review to two years from submission, requiring 10 business days' written notice before initial audits, and prohibiting more than one on-site audit per pharmacy within 12 months or audits of more than 250 prescriptions unless fraud is alleged.

• Prohibits pharmacy benefits managers from basing overpayment findings on projections of patient diagnosis or similar drugs, restricting extrapolation use except in settlement agreements, and preventing recoupment of dispensing fees except for non-dispensed prescriptions, denied authorizations, medication errors, or sole dispensing fee overpayments.

• Requires pharmacy benefits managers to deliver preliminary audit reports within 60 days, allow 30 days for pharmacy response, and issue final reports within 120 days, while establishing written appeals processes and preventing charge-backs until appeals are exhausted.

• Establishes multi-source generic drug pricing and appeal procedures, requiring reimbursement adjustments when equivalent drugs are unavailable at the listed price from contracted suppliers and allowing network pharmacies to request hearings before the insurance director for adverse decisions.