HB 188 Summary

• Creates the Pharmacy Audit Integrity Act establishing uniform standards for pharmacy audits by managed care companies, insurers, pharmacy benefit managers, and state health programs, requiring two weeks' written notice before on-site audits and prohibiting audits during the first seven calendar days of each month.

• Prohibits extrapolation methodology in audit calculations, limits audits to 250 prescriptions per 12-month period, requires audits to include equal numbers of generic and nongeneric drugs, and bars auditing entities from receiving payment based on percentage of amounts recovered.

• Establishes the Pharmacy Benefit Manager Transparency Act requiring pharmacy benefit managers to register with the Idaho Department of Insurance beginning January 1, 2017, disclose conflicts of interest, provide financial and utilization information to covered entities, and prohibit actions restricting pharmacy choice for covered individuals.

• Requires pharmacy benefit managers to obtain prescriber approval before substituting higher-priced drugs for prescribed medications and to disclose all payments or benefits received from drug manufacturers related to substitutions or volume-based arrangements.

• Establishes maximum allowable cost standards for pharmacy benefit managers, requiring drug lists be updated every seven business days, prohibiting dispensing fees from reimbursement calculations, and creating a 30-day appeals process for network pharmacies to challenge reimbursement rates below their net acquisition costs.