SB 1195 Summary

• Prohibits audit entities from receiving payment tied to amounts recovered from pharmacies, preventing financial incentives to inflate audit findings.

• Requires preliminary audit reports within 60 days with 30-day pharmacy response period, followed by final reports within 120 days of the pharmacy's response.

• Establishes mandatory appeal process for final audit reports with at least 30 days to file; chargebacks cannot be collected until appeal period expires or process is exhausted.

• Exempts clerical and recordkeeping errors from recoupment unless they caused actual financial harm to the carrier, pharmacy benefit manager, or beneficiary.

• Permits pharmacies to use various documentation types (medication records, facsimiles, electronic prescriptions) to validate claims and challenge extrapolated findings; audits cannot exceed 24 months of claims history.