H.B. 1134 Summary

• Establishes procedures for pharmacy audits conducted by health care providers, insurance companies, pharmacy benefit managers, third-party payors, and related entities, addressing the lack of existing regulations on these audits.

• Requires auditors to provide at least two weeks written notice before conducting initial audits and prohibits audits during the first seven days of each month unless the pharmacy consents.

• Limits audit scope to claims submitted within one year prior, requires pharmacist involvement for audits involving clinical judgment, and prohibits use of extrapolation or projections in calculating recoupments or penalties.

• Grants pharmacies at least 30 days to correct clerical errors or produce documentation after receiving preliminary audit findings, with a written appeals process allowing 30 days to contest findings.

• Prohibits chargebacks or penalties until all appeals are exhausted, prevents auditors from receiving payment based on recovery percentages, and requires confidentiality of audit information with limited access to previous audit findings.

• Effective July 1, 2021, applying only to audits of claims submitted after that date; does not apply to investigative audits involving fraud, wilful misconduct, abuse, or health and safety issues.