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1 STATE OF OKLAHOMA
1
2 1st Session of the 60th Legislature (2025)
2
3 SENATE BILL 1025 By: Haste
3
4
4
5
5
6 AS INTRODUCED
6
7 An Act relating to health care; amending 36 O.S.
7 2021, Sections 6960 and 6962, as last amended by
8 Sections 1 and 2, Chapter 306, O.S.L. 2024 (36 O.S.
8 Supp. 2024, Sections 6960 and 6962), which relate to
9 definitions and pharmacy benefits manager compliance;
9 defining terms; creating pharmacy benefits manager
10 disclosures; creating duties; creating the Oklahoma
10 Rebate Pass-Through and Pharmacy Benefits Manager
11 Meaningful Transparency Act of 2025; providing short
11 title; clarifying authority to take certain actions;
12 prohibiting the disclosure of certain information;
12 declaring that certain information not be considered
13 public record; defining terms; providing cost sharing
13 calculation methodology, limitations, and
14 requirements; creating penalties; providing certain
14 exceptions; amending 36 O.S. 2021, Section 6964,
15 which relates to a formulary for prescription drugs;
15 creating agency duties; amending 59 O.S. 2021,
16 Sections 357 and 358, as amended by Sections 4 and 5,
16 Chapter 332, O.S.L. 2024 (59 O.S. Supp. 2024,
17 Sections 357 and 358), which relate to definitions
17 and pharmacy benefits management licensure,
18 procedure, and penalties; modifying definitions;
18 creating duties; creating licensing application
19 requirements; providing for noncodification;
19 providing for codification; and providing an
20 effective date.
20
21
21
22 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
22
23
23
24
24
Req. No. 830 Page 1
1 SECTION 1. AMENDATORY 36 O.S. 2021, Section 6960, as
1
2 last amended by Section 1, Chapter 306, O.S.L. 2024 (36 O.S. Supp.
2
3 2024, Section 6960), is amended to read as follows:
3
4 Section 6960. A. For purposes of the Patient's Right to
4
5 Pharmacy Choice Act:
5
6 1. "Administrative fees" means fees or payments from
6
7 pharmaceutical manufacturers to, or otherwise retained by, a
7
8 pharmacy benefits manager (PBM) or its designee pursuant to a
8
9 contract between a PBM or affiliate and the manufacturer in
9
10 connection with the PBM's administering, invoicing, allocating, and
10
11 collecting the rebates;
11
12 2. "Aggregate retained rebate percentage" means the percentage
12
13 of all rebates received by a PBM from all pharmaceutical
13
14 manufacturers which is not passed on to the PBM's health plan or
14
15 health insurer clients. Aggregate retained rebate percentage shall
15
16 be expressed without disclosing any identifying information
16
17 regarding any health plan, prescription drug, or therapeutic class,
17
18 and shall be calculated by dividing:
18
19 a. the aggregate dollar amount of all rebates that the
19
20 PBM received during the prior calendar year from all
20
21 pharmaceutical manufacturers and did not pass through
21
22 to the PBM's health plan or health insurer clients, by
22
23
23
24
24
Req. No. 830 Page 2
1 b. the aggregate dollar amount of all rebates that the
1
2 pharmacy benefits manager received during the prior
2
3 calendar year from all pharmaceutical manufacturers;
3
4 3. "Covered entity" means a nonprofit hospital or medical
4
5 service organization, for-profit hospital or medical service
5
6 organization, insurer, health benefit plan, health maintenance
6
7 organization, health program administered by the state in the
7
8 capacity of providing health coverage, or an employer, labor union,
8
9 or other group of persons that provides health coverage to persons
9
10 in this state. This term does not include a health plan that
10
11 provides coverage only for accidental injury, specified disease,
11
12 hospital indemnity, disability income, or other limited benefit
12
13 health insurance policies and contracts that do not include
13
14 prescription drug coverage;
14
15 4. "Defined cost sharing" means a deductible payment or
15
16 coinsurance amount imposed on an enrollee for a covered prescription
16
17 drug under the enrollee's health plan;
17
18 5. "Formulary" means a list of prescription drugs, as well as
18
19 accompanying tiering and other coverage information, that has been
19
20 developed by an insurer, a health plan, or the designee of a health
20
21 insurer or health plan, which the health insurer, health plan, or
21
22 designee of the health insurer or health plan references in
22
23 determining applicable coverage and benefit levels;
23
24
24
Req. No. 830 Page 3
1 6. "Generic equivalent" means a drug that is designated to be
1
2 therapeutically equivalent, as indicated by the United States Food
2
3 and Drug Administration's Approved Drug Products with Therapeutic
3
4 Equivalence Evaluations; provided, however, that a drug shall not be
4
5 considered a generic equivalent until the drug becomes nationally
5
6 available;
6
7 2. 7. "Health insurer" means any corporation, association,
7
8 benefit society, exchange, partnership or individual licensed by the
8
9 Oklahoma Insurance Code;
9
10 8. "Health insurer administrative service fees" means fees or
10
11 payments from a health insurer or a designee of the health insurer
11
12 to, or otherwise retained by, a PBM or its designee pursuant to a
12
13 contract between a PBM or affiliate, and the health insurer or
13
14 designee of the health insurer in connection with the PBM managing
14
15 or administering the pharmacy benefits and administering, invoicing,
15
16 allocating, and collecting rebates;
16
17 3. 9. "Health insurer payor" means a health insurance company,
17
18 health maintenance organization, union, hospital and medical
18
19 services organization or any entity providing or administering a
19
20 self-funded health benefit plan;
20
21 10. "Health plan" means a policy, contract, certification, or
21
22 agreement offered or issued by a health insurer to provide, deliver,
22
23 arrange for, pay for, or reimburse any of the costs of health
23
24 services;
24
Req. No. 830 Page 4
1 4. 11. "Mail-order pharmacy" means a pharmacy licensed by this
1
2 state that primarily dispenses and delivers covered drugs via common
2
3 carrier;
3
4 12. "Pharmacy and therapeutics committee" or "P&T committee"
4
5 means a committee at a hospital or a health insurance plan that
5
6 decides which drugs will appear on that entity's drug formulary;
6
7 5. 13. "Pharmacy benefits manager" or "PBM" means a person,
7
8 business, or other entity that, either directly or through an
8
9 intermediary, performs pharmacy benefits management, as defined in
9
10 paragraph 7 of Section 357 of Title 59 of the Oklahoma Statutes.
10
11 The term shall include a person or entity acting on behalf of a PBM
11
12 in a contractual or employment relationship in the performance of
12
13 pharmacy benefits management for a managed care company, nonprofit
13
14 hospital, medical service organization, insurance company, third-
14
15 party payor or a health program administered by a department of this
15
16 state. PBM does not include a pharmacy services administrative
16
17 organization;
17
18 6. 14. "Pharmacy benefits management" means a service provided
18
19 to covered entities to facilitate the provisions of prescription
19
20 drug benefits to covered individuals within the state, including,
20
21 but not limited to, negotiating pricing and other terms with drug
21
22 manufacturers and providers. Pharmacy benefits management may
22
23 include any or all of the following services:
23
24
24
Req. No. 830 Page 5
1 a. claims processing, retail network management, and
1
2 payment of claims to pharmacies for prescription drugs
2
3 dispensed to covered individuals,
3
4 b. administration or management of pharmacy discount
4
5 cards or programs,
5
6 c. clinical formulary development and management
6
7 services, or
7
8 d. rebate contracting and administration;
8
9 15. "Price protection rebate" means a negotiated price
9
10 concession that accrues directly or indirectly to the health
10
11 insurer, or other party on behalf of the health insurer, in the
11
12 event of an increase in the wholesale acquisition of a drug above a
12
13 specified threshold;
13
14 7. 16. "Provider" means a pharmacy, as defined in Section 353.1
14
15 of Title 59 of the Oklahoma Statutes or an agent or representative
15
16 of a pharmacy;
16
17 17. "Rebates" means:
17
18 a. negotiated price concessions including, but not
18
19 limited to, base price concessions, whether described
19
20 as a rebate or otherwise, and reasonable estimates of
20
21 any price protection rebates and performance-based
21
22 price concessions that may accrue directly or
22
23 indirectly to a health insurer, health plan, or PBM
23
24 during the coverage year from a manufacturer,
24
Req. No. 830 Page 6
1 dispensing pharmacy, or other party in connection with
1
2 the dispensing or administration of a prescription
2
3 drug, and
3
4 b. reasonable estimates of any price concessions, fees,
4
5 and other administrative costs that are passed
5
6 through, or are reasonably anticipated to be passed
6
7 through, to a health insurer, health plan, or PBM and
7
8 serve to reduce the health insurer, health plan, or
8
9 PBM's liabilities for a prescription drug;
9
10 8. 18. "Retail pharmacy network" means retail pharmacy
10
11 providers contracted with a PBM in which the pharmacy primarily
11
12 fills and sells prescriptions via a retail, storefront location;
12
13 9. 19. "Rural service area" means a five-digit ZIP code in
13
14 which the population density is less than one thousand (1,000)
14
15 individuals per square mile;
15
16 10. 20. "Spread pricing" means a prescription drug pricing
16
17 model utilized by a pharmacy benefits manager in which the PBM
17
18 charges a health benefit plan a contracted price for prescription
18
19 drugs that differs from the amount the PBM directly or indirectly
19
20 pays the pharmacy or pharmacist for providing pharmacy services;
20
21 11. 21. "Suburban service area" means a five-digit ZIP code in
21
22 which the population density is between one thousand (1,000) and
22
23 three thousand (3,000) individuals per square mile; and
23
24
24
Req. No. 830 Page 7
1 12. 22. "Urban service area" means a five-digit ZIP code in
1
2 which the population density is greater than three thousand (3,000)
2
3 individuals per square mile.
3
4 B. Nothing in the definitions of pharmacy benefits manager or
4
5 pharmacy benefits management as such terms are defined in the
5
6 Patient's Right to Pharmacy Choice Act, the Pharmacy Audit Integrity
6
7 Act, or Sections 357 through 360 of Title 59 of the Oklahoma
7
8 Statutes shall be construed to deem the following entities to be a
8
9 pharmacy benefits manager:
9
10 1. An employer of its own self-funded health benefit plan,
10
11 except, to the extent permitted by applicable law, where the
11
12 employer without the utilization of a third party and unrelated to
12
13 the employer's own pharmacy:
13
14 a. negotiates directly with drug manufacturers,
14
15 b. processes claims on behalf of its members, or
15
16 c. manages its own retail network of pharmacies; or
16
17 2. A pharmacy that provides a patient with a discount card or
17
18 program that is for exclusive use at the pharmacy offering the
18
19 discount.
19
20 SECTION 2. AMENDATORY 36 O.S. 2021, Section 6962, as
20
21 last amended by Section 2, Chapter 306, O.S.L. 2024 (36 O.S. Supp.
21
22 2024, Section 6962), is amended to read as follows:
22
23
23
24
24
Req. No. 830 Page 8
1 Section 6962. A. The Attorney General shall review and approve
1
2 retail pharmacy network access for all pharmacy benefits managers
2
3 (PBMs) to ensure compliance with Section 6961 of this title.
3
4 B. A PBM, or an agent of a PBM, shall not:
4
5 1. Cause or knowingly permit the use of advertisement,
5
6 promotion, solicitation, representation, proposal or offer that is
6
7 untrue, deceptive or misleading;
7
8 2. Charge a pharmacist or pharmacy a fee related to the
8
9 adjudication of a claim including without limitation a fee for:
9
10 a. the submission of a claim,
10
11 b. enrollment or participation in a retail pharmacy
11
12 network, or
12
13 c. the development or management of claims processing
13
14 services or claims payment services related to
14
15 participation in a retail pharmacy network;
15
16 3. Reimburse a pharmacy or pharmacist in the state an amount
16
17 less than the amount that the PBM reimburses a pharmacy owned by or
17
18 under common ownership with a PBM for providing the same covered
18
19 services. The reimbursement amount paid to the pharmacy shall be
19
20 equal to the reimbursement amount calculated on a per-unit basis
20
21 using the same generic product identifier or generic code number
21
22 paid to the PBM-owned or PBM-affiliated pharmacy;
22
23 4. Deny a provider the opportunity to participate in any
23
24 pharmacy network at preferred participation status if the provider
24
Req. No. 830 Page 9
1 is willing to accept the terms and conditions that the PBM has
1
2 established for other providers as a condition of preferred network
2
3 participation status;
3
4 5. Deny, limit or terminate a provider's contract based on
4
5 employment status of any employee who has an active license to
5
6 dispense, despite probation status, with the State Board of
6
7 Pharmacy;
7
8 6. Retroactively deny or reduce reimbursement for a covered
8
9 service claim after returning a paid claim response as part of the
9
10 adjudication of the claim, unless:
10
11 a. the original claim was submitted fraudulently, or
11
12 b. to correct errors identified in an audit, so long as
12
13 the audit was conducted in compliance with Sections
13
14 356.2 and 356.3 of Title 59 of the Oklahoma Statutes;
14
15 7. Fail to make any payment due to a pharmacy or pharmacist for
15
16 covered services properly rendered in the event a PBM terminates a
16
17 provider from a pharmacy benefits manager network;
17
18 8. Conduct or practice Either directly or through an
18
19 intermediary, agent, or affiliate, engage in, facilitate, or enter
19
20 into a contract with another person involving spread pricing, as
20
21 defined in Section 6960 of this title, in this state; or
21
22 9. Charge a pharmacist or pharmacy a fee related to
22
23 participation in a retail pharmacy network including but not limited
23
24 to the following:
24
Req. No. 830 Page 10
1 a. an application fee,
1
2 b. an enrollment or participation fee,
2
3 c. a credentialing or re-credentialing fee,
3
4 d. a change of ownership fee, or
4
5 e. a fee for the development or management of claims
5
6 processing services or claims payment services; or
6
7 10. Prohibit or penalize a pharmacy or pharmacist for:
7
8 a. disclosing to an individual information regarding the
8
9 existence and clinical efficacy of a generic
9
10 equivalent that would be less expensive to the
10
11 enrollee:
11
12 (1) under his or her health plan prescription drug
12
13 benefit, or
13
14 (2) outside his or her health plan prescription drug
14
15 benefit, without requesting any health plan
15
16 reimbursement, than the drug that was originally
16
17 prescribed, or
17
18 b. selling to an individual, instead of a particular
18
19 prescribed drug, a therapeutically equivalent drug
19
20 that would be less expensive to the enrollee:
20
21 (1) under his or her health plan prescription drug
21
22 benefit, or
22
23 (2) outside his or her health plan prescription drug
23
24 benefit, without requesting any health plan
24
Req. No. 830 Page 11
1 reimbursement, than the drug that was originally
1
2 prescribed.
2
3 C. The prohibitions under this section shall apply to contracts
3
4 between pharmacy benefits managers and providers for participation
4
5 in retail pharmacy networks.
5
6 1. A PBM contract shall:
6
7 a. not restrict, directly or indirectly, any pharmacy
7
8 that dispenses a prescription drug from informing, or
8
9 penalize such pharmacy for informing, an individual of
9
10 any differential between the individual's out-of-
10
11 pocket cost or coverage with respect to acquisition of
11
12 the drug and the amount an individual would pay to
12
13 purchase the drug directly, and
13
14 b. ensure that any entity that provides pharmacy benefits
14
15 management services under a contract with any such
15
16 health plan or health insurance coverage does not,
16
17 with respect to such plan or coverage, restrict,
17
18 directly or indirectly, a pharmacy that dispenses a
18
19 prescription drug from informing, or penalize such
19
20 pharmacy for informing, a covered individual of any
20
21 differential between the individual's out-of-pocket
21
22 cost under the plan or coverage with respect to
22
23 acquisition of the drug and the amount an individual
23
24
24
Req. No. 830 Page 12
1 would pay for acquisition of the drug without using
1
2 any health plan or health insurance coverage.
2
3 2. A pharmacy benefits manager's contract with a provider shall
3
4 not prohibit, restrict, or limit disclosure of information or
4
5 documents to the Attorney General, law enforcement or state and
5
6 federal governmental officials investigating or examining a
6
7 complaint or conducting a review of a pharmacy benefits manager's
7
8 compliance with the requirements under the Patient's Right to
8
9 Pharmacy Choice Act, the Pharmacy Audit Integrity Act, and Sections
9
10 357 through 360 of Title 59 of the Oklahoma Statutes.
10
11 D. A pharmacy benefits manager shall:
11
12 1. Establish and maintain an electronic claim inquiry
12
13 processing system using the National Council for Prescription Drug
13
14 Programs' current standards to communicate information to pharmacies
14
15 submitting claim inquiries;
15
16 2. Fully disclose to insurers, self-funded employers, unions or
16
17 other PBM clients the existence of the respective aggregate
17
18 prescription drug discounts, rebates received from drug
18
19 manufacturers and pharmacy audit recoupments;
19
20 3. Provide the Attorney General, insurers, self-funded employer
20
21 plans and unions unrestricted audit rights of and access to the
21
22 respective PBM pharmaceutical manufacturer and provider contracts,
22
23 plan utilization data, plan pricing data, pharmacy utilization data
23
24 and pharmacy pricing data;
24
Req. No. 830 Page 13
1 4. Maintain, for no less than three (3) years, documentation of
1
2 all network development activities including but not limited to
2
3 contract negotiations and any denials to providers to join networks.
3
4 This documentation shall be made available to the Attorney General
4
5 upon request; and
5
6 5. Report to the Attorney General, on a quarterly basis for
6
7 each health insurer payor, on the following information:
7
8 a. the aggregate amount of rebates received by the PBM,
8
9 b. the aggregate amount of rebates distributed to the
9
10 appropriate health insurer payor,
10
11 c. the aggregate amount of rebates passed on to the
11
12 enrollees of each health insurer payor at the point of
12
13 sale that reduced the applicable deductible,
13
14 copayment, coinsure or other cost sharing amount of
14
15 the enrollee,
15
16 d. the individual and aggregate amount paid by the health
16
17 insurer payor to the PBM for pharmacy services
17
18 itemized by pharmacy, drug product and service
18
19 provided, and
19
20 e. the individual and aggregate amount a PBM paid a
20
21 provider for pharmacy services itemized by pharmacy,
21
22 drug product and service provided.
22
23 E. Nothing in the Patient's Right to Pharmacy Choice Act shall
23
24 prohibit the Attorney General from requesting and obtaining detailed
24
Req. No. 830 Page 14
1 data, including raw data, in response to the information provided by
1
2 a PBM in the quarterly reports required by this section. The
2
3 Attorney General may alter the frequency of the reports required by
3
4 this section at his or her sole discretion.
4
5 F. The Attorney General may promulgate rules to implement the
5
6 provisions of the Patient's Right to Pharmacy Choice Act, the
6
7 Pharmacy Audit Integrity Act, and Sections 357 through 360 of Title
7
8 59 of the Oklahoma Statutes.
8
9 SECTION 3. NEW LAW A new section of law not to be
9
10 codified in the Oklahoma Statutes reads as follows:
10
11 This act shall be known and may be cited as the "Oklahoma Rebate
11
12 Pass-Through and Pharmacy Benefits Manager Meaningful Transparency
12
13 Act of 2025".
13
14 SECTION 4. NEW LAW A new section of law to be codified
14
15 in the Oklahoma Statutes as Section 6962.2 of Title 36, unless there
15
16 is created a duplication in numbering, reads as follows:
16
17 A. An enrollee's defined cost sharing for each prescription
17
18 drug shall be calculated at the point of sale based on a price that
18
19 is reduced by an amount equal to at least eighty-five percent (85%)
19
20 of all rebates received, or to be received, in connection with the
20
21 dispensing or administration of the prescription drug.
21
22 B. For any violation of this section, the Insurance
22
23 Commissioner may subject a pharmacy benefits manager (PBM) to an
23
24 administrative penalty of not less than One Hundred Dollars
24
Req. No. 830 Page 15
1 ($100.00) nor more than Ten Thousand Dollars ($10,000.00) for each
1
2 occurrence. Such administrative penalty may be enforced in the same
2
3 manner in which civil judgments may be enforced.
3
4 C. Nothing in subsections A and B of this section shall
4
5 preclude a PBM from decreasing an enrollee's defined cost sharing by
5
6 an amount greater than that required under subsection A of this
6
7 section.
7
8 D. In implementing the requirements of this section, the state
8
9 shall only regulate a PBM to the extent permissible under applicable
9
10 law.
10
11 E. In complying with the provisions of this section, a PBM or
11
12 its agents shall not publish or otherwise reveal information
12
13 regarding the actual amount of rebates a PBM receives on a product
13
14 or therapeutic class of products, manufacturer, or pharmacy-specific
14
15 basis. Such information is protected as a trade secret, is not a
15
16 public record as defined in the Oklahoma Open Records Act, Section
16
17 24A.1 et seq. of Title 51 of the Oklahoma Statutes, and shall not be
17
18 disclosed directly or indirectly, or in a manner that would allow
18
19 for the identification of an individual product, therapeutic class
19
20 of products, or manufacturer, or in a manner that would have the
20
21 potential to compromise the financial, competitive, or proprietary
21
22 nature of the information. A PBM shall impose the confidentiality
22
23 protections of this section on any vendor or downstream third party
23
24
24
Req. No. 830 Page 16
1 that performs health care or administrative services on behalf of
1
2 the insurer that may receive or have access to rebate information.
2
3 SECTION 5. NEW LAW A new section of law to be codified
3
4 in the Oklahoma Statutes as Section 6970 of Title 36, unless there
4
5 is created a duplication in numbering, reads as follows:
5
6 A. For purposes of this section:
6
7 1. "Defined cost sharing" means a deductible payment or
7
8 coinsurance amount imposed on an enrollee for a covered prescription
8
9 drug under the enrollee's health plan;
9
10 2. "Insurer" means any health insurance issuer that is subject
10
11 to state law regulating insurance and offers health insurance
11
12 coverage, as defined in 42 U.S.C., Section 300gg-91, or any state or
12
13 local governmental employer plan;
13
14 3. "Price protection rebate" means a negotiated price
14
15 concession that accrues directly or indirectly to the insurer, or
15
16 other party on behalf of the insurer, in the event of an increase in
16
17 the wholesale acquisition cost of a drug above a specified
17
18 threshold; and
18
19 4. "Rebate" means:
19
20 a. negotiated price concessions including, but not
20
21 limited to, base price concessions, whether described
21
22 as a rebate or otherwise, and reasonable estimates of
22
23 any price protection rebates and performance-based
23
24 price concessions that may accrue directly or
24
Req. No. 830 Page 17
1 indirectly to the insurer during the coverage year
1
2 from a manufacturer, dispensing pharmacy, or other
2
3 party in connection with the dispensing or
3
4 administration of a prescription drug, and
4
5 b. reasonable estimates of any negotiated price
5
6 concessions, fees, and other administrative costs that
6
7 are passed through, or are reasonably anticipated to
7
8 be passed through, to the insurer and serve to reduce
8
9 the insurer's liabilities for a prescription drug.
9
10 B. An enrollee's defined cost sharing for each prescription
10
11 drug shall be calculated at the point of sale based on a price that
11
12 is reduced by an amount equal to at least eighty-five percent (85%)
12
13 of all rebates received, or to be received, in connection with the
13
14 dispensing or administration of the prescription drug.
14
15 C. For any violation of this section, the Insurance
15
16 Commissioner may subject an insurer to an administrative penalty of
16
17 not less than One Hundred Dollars ($100.00) nor more than Ten
17
18 Thousand Dollars ($10,000.00) for each occurrence. Such
18
19 administrative penalty may be enforced in the same manner in which
19
20 civil judgments may be enforced.
20
21 D. Nothing in subsections A through C of this section shall
21
22 preclude an insurer from decreasing an enrollee's defined cost
22
23 sharing by an amount greater than that required under subsection B
23
24 of this section.
24
Req. No. 830 Page 18
1 E. In implementing the requirements of this section, the state
1
2 shall only regulate an insurer to the extent permissible under
2
3 applicable law.
3
4 F. In complying with the provisions of this section, an insurer
4
5 or its agents shall not publish or otherwise reveal information
5
6 regarding the actual amount of rebates an insurer receives on a
6
7 product or therapeutic class of products, manufacturer, or pharmacy-
7
8 specific basis. Such information is protected as a trade secret, is
8
9 not a public record as defined in the Oklahoma Open Records Act,
9
10 Section 24A.1 et seq. of Title 51 of the Oklahoma Statutes, and
10
11 shall not be disclosed directly or indirectly, or in a manner that
11
12 would allow for the identification of an individual product,
12
13 therapeutic class of products, or manufacturer, or in a manner that
13
14 would have the potential to compromise the financial, competitive,
14
15 or proprietary nature of the information. An insurer shall impose
15
16 the confidentiality protections of this section on any vendor or
16
17 downstream third party that performs health care or administrative
17
18 services on behalf of the insurer and that may receive or have
18
19 access to rebate information.
19
20 SECTION 6. AMENDATORY 36 O.S. 2021, Section 6964, is
20
21 amended to read as follows:
21
22 Section 6964. A. A health insurer's insurer or its agent's
22
23 including pharmacy benefits managers, pharmacy and therapeutics
23
24 committee (P&T committee) shall establish a formulary, which shall
24
Req. No. 830 Page 19
1 be a list of prescription drugs, both generic and brand name, used
1
2 by practitioners to identify drugs that offer the greatest overall
2
3 value.
3
4 B. A health insurer shall prohibit conflicts of interest for
4
5 members of the P&T committee. The P&T committee shall review the
5
6 formulary annually and must meet the following requirements:
6
7 1. A person may not serve on a P&T committee if the person is
7
8 currently employed or was employed within the preceding year by a
8
9 pharmaceutical manufacturer, developer, labeler, wholesaler or
9
10 distributor. A majority of P&T committee members shall be practicing
10
11 physicians, practicing pharmacists, or both, and shall be licensed
11
12 in Oklahoma;
12
13 2. A health insurer shall require any member of the P&T
13
14 committee to disclose any compensation or funding from a
14
15 pharmaceutical manufacturer, developer, labeler, wholesaler or
15
16 distributor. Such P&T committee member shall be recused from voting
16
17 on any product manufactured or sold by such pharmaceutical
17
18 manufacturer, developer, labeler, wholesaler or distributor. P&T
18
19 committee members shall practice in various clinical specialties
19
20 that adequately represent the needs of health plan enrollees, and
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21 there shall be an adequate number of high-volume specialists and
21
22 specialists treating rare and orphan diseases;
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23 3. The P&T committee shall meet no less frequently than on a
23
24 quarterly basis;
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Req. No. 830 Page 20
1 4. P&T committee formulary development shall be conducted
1
2 pursuant to a transparent process, and formulary decisions and
2
3 rationale shall be documented in writing, with any records and
3
4 documents relating to the process available upon request to the
4
5 health plan, subject to the conditions in subsection C of this
5
6 section. In the case of P&T committee decisions that relate to
6
7 Medicaid managed care organizations' prescription drug coverage
7
8 policies, if the P&T committee relies upon any third party to
8
9 provide cost-effectiveness analysis or research, the P&T committee
9
10 shall:
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11 a. disclose to the health benefit plan, the state, and
11
12 the general public the name of the relevant third
12
13 party, and
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14 b. provide a process through which patients and providers
14
15 potentially impacted by the third party's analysis or
15
16 research may provide input to the P&T committee;
16
17 5. Specialists with current clinical expertise who actively
17
18 treat patients in a specific therapeutic area, and specific
18
19 conditions within a therapeutic area, shall participate in formulary
19
20 decisions regarding each therapeutic area and specific condition;
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21 6. The P&T committee shall base its clinical decisions on the
21
22 strength of scientific evidence, standards of practice, and
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23 nationally accepted treatment guidelines;
23
24
24
Req. No. 830 Page 21
1 7. The P&T committee shall consider whether a particular drug
1
2 has a clinically meaningful therapeutic advantage over other drugs
2
3 in terms of safety, effectiveness, or clinical outcome for patient
3
4 populations who may be treated with the drug;
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5 8. The P&T committee shall evaluate and analyze treatment
5
6 protocols and procedures related to the health plan's formulary at
6
7 least annually;
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8 9. The P&T committee shall review formulary management
8
9 activities, including exceptions and appeals processes, prior
9
10 authorization, step therapy, quantity limits, generic substitutions,
10
11 therapeutic interchange, and other drug utilization management
11
12 activities for clinical appropriateness and consistency with
12
13 industry standards and patient and provider organization guidelines;
13
14 10. The P&T committee shall annually review and provide a
14
15 written report to the pharmacy benefits manager on:
15
16 a. the percentage of prescription drugs on formulary
16
17 subject to each of the types of utilization management
17
18 described in paragraph 9 of this subsection,
18
19 b. rates of adherence and nonadherence to medicines by
19
20 therapeutic area,
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21 c. rates of abandonment of medicines by therapeutic area,
21
22 d. recommendations for improved adherence and reduced
22
23 abandonment, and
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24
24
Req. No. 830 Page 22
1 e. recommendations for improvement in formulary
1
2 management practices consistent with patient and
2
3 provider organization and other clinical guidelines,
3
4 provided that the report shall be subject to the
4
5 conditions in subsection C of this section;
5
6 11. The P&T committee shall review and make a formulary
6
7 decision on a new U.S. Food and Drug Administration-approved drug
7
8 within ninety (90) days of such drug's approval, or shall provide a
8
9 clinical justification if this time frame is not met; and
9
10 12. The P&T committee shall review procedures for medical
10
11 review of, and transitioning new plan enrollees to, appropriate
11
12 formulary alternatives to ensure that such procedures appropriately
12
13 address situations involving enrollees stabilized on drugs that are
13
14 not on the health plan formulary, or that are on formulary but are
14
15 subject to prior authorization, step therapy, or other utilization
15
16 management requirements.
16
17 C. The health insurer, its agents, including pharmacy benefits
17
18 managers, and the Department shall not publish or otherwise disclose
18
19 any confidential, proprietary information, including, but not
19
20 limited to, any information that would reveal the identity of a
20
21 specific health plan, the prices charged for a specific drug or
21
22 class of drugs, the amount of any rebates provided for a specific
22
23 drug or class of drugs, the manufacturer, or that would otherwise
23
24 have the potential to compromise the financial, competitive, or
24
Req. No. 830 Page 23
1 proprietary nature of the information. Any such information shall
1
2 be protected from disclosure as confidential and proprietary
2
3 information, is not a record as defined in the Oklahoma Open Records
3
4 Act, Section 24A.3 of Title 51 of the Oklahoma Statutes, and shall
4
5 not be disclosed directly or indirectly. A health insurer shall
5
6 impose the confidentiality protections of this section on any vendor
6
7 or downstream third party that performs health care or
7
8 administrative services on behalf of the pharmacy benefits manager
8
9 that may receive or have access to rebate information.
9
10 SECTION 7. AMENDATORY 59 O.S. 2021, Section 357, as
10
11 amended by Section 4, Chapter 332, O.S.L. 2024 (59 O.S. Supp. 2024,
11
12 Section 357), is amended to read as follows:
12
13 Section 357. A. As used in Sections 357 through 360 of this
13
14 title:
14
15 1. "Covered entity" means a nonprofit hospital or medical
15
16 service organization, for-profit hospital or medical service
16
17 organization, insurer, health benefit plan, health maintenance
17
18 organization, health program administered by the state in the
18
19 capacity of providing health coverage, or an employer, labor union,
19
20 or other group of persons that provides health coverage to persons
20
21 in this state. This term does not include a health benefit plan
21
22 that provides coverage only for accidental injury, specified
22
23 disease, hospital indemnity, disability income, or other limited
23
24
24
Req. No. 830 Page 24
1 benefit health insurance policies and contracts that do not include
1
2 prescription drug coverage;
2
3 2. "Covered individual" means a member, participant, enrollee,
3
4 contract holder or policy holder or beneficiary of a covered entity
4
5 who is provided health coverage by the covered entity. A covered
5
6 individual includes any dependent or other person provided health
6
7 coverage through a policy, contract or plan for a covered
7
8 individual;
8
9 3. "Department" means the Insurance Department;
9
10 4. "Maximum allowable cost", "MAC", or "MAC list" means the
10
11 list of drug products delineating the maximum per-unit reimbursement
11
12 for multiple-source prescription drugs, medical product, or device;
12
13 5. "Multisource drug product reimbursement" (reimbursement)
13
14 means the total amount paid to a pharmacy inclusive of any reduction
14
15 in payment to the pharmacy, excluding prescription dispense fees;
15
16 6. "Office" means the Office of the Attorney General;
16
17 7. "Pharmacy benefits management" means a service provided to
17
18 covered entities to facilitate the provision of prescription drug
18
19 benefits to covered individuals within the state, including
19
20 negotiating pricing and other terms with drug manufacturers and
20
21 providers. Pharmacy benefits management may include any or all of
21
22 the following services:
22
23 a. claims processing, performance of drug utilization
23
24 review, processing of drug prior authorization
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Req. No. 830 Page 25
1 requests, retail network management and payment of
1
2 claims to pharmacies for prescription drugs dispensed
2
3 to covered individuals,
3
4 b. clinical formulary development and management
4
5 services, or
5
6 c. rebate contracting and administration;,
6
7 d. adjudication of appeals and grievances related to the
7
8 prescription drug benefit, or
8
9 e. controlling the cost of prescription drugs;
9
10 8. "Pharmacy benefits manager" or "PBM" means a person,
10
11 business, or other entity that, either directly or through an
11
12 intermediary, performs pharmacy benefits management. The term shall
12
13 include a person or entity acting on behalf of a PBM in a
13
14 contractual or employment relationship in the performance of
14
15 pharmacy benefits management for a managed care company, nonprofit
15
16 hospital, medical service organization, insurance company, third-
16
17 party payor, or a health program administered by an agency or
17
18 department of this state. PBM does not include a pharmacy services
18
19 administrative organization;
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20 9. "Plan sponsor" means the employers, insurance companies,
20
21 unions and health maintenance organizations or any other entity
21
22 responsible for establishing, maintaining, or administering a health
22
23 benefit plan on behalf of covered individuals; and
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24
24
Req. No. 830 Page 26
1 10. "Provider" means a pharmacy licensed by the State Board of
1
2 Pharmacy, or an agent or representative of a pharmacy, including,
2
3 but not limited to, the pharmacy's contracting agent, which
3
4 dispenses prescription drugs or devices to covered individuals.
4
5 B. Nothing in the definition of pharmacy benefits management or
5
6 pharmacy benefits manager in the Patient's Right to Pharmacy Choice
6
7 Act, Pharmacy Audit Integrity Act, or Sections 357 through 360 of
7
8 this title shall deem an employer a "pharmacy benefits manager" of
8
9 its own self-funded health benefit plan, except, to the extent
9
10 permitted by applicable law, where the employer, without the
10
11 utilization of a third party and unrelated to the employer's own
11
12 pharmacy:
12
13 a. negotiates directly with drug manufacturers,
13
14 b. processes claims on behalf of its members, or
14
15 c. manages its own retail network of pharmacies.
15
16 SECTION 8. AMENDATORY 59 O.S. 2021, Section 358, as
16
17 amended by Section 5, Chapter 332, O.S.L. 2024 (59 O.S. Supp. 2024,
17
18 Section 358), is amended to read as follows:
18
19 Section 358. A. In order to provide pharmacy benefits
19
20 management or any of the services included under the definition of
20
21 pharmacy benefits management in this state, a pharmacy benefits
21
22 manager or any entity acting as one in a contractual or employment
22
23 relationship for a covered entity shall first obtain a license from
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24
24
Req. No. 830 Page 27
1 the Insurance Department, and the Department may charge a fee for
1
2 such licensure.
2
3 B. The Department shall establish, by regulation, licensure
3
4 procedures, required disclosures for pharmacy benefits managers
4
5 (PBMs) and other rules as may be necessary for carrying out and
5
6 enforcing the provisions of this title. The licensure procedures
6
7 shall, at a minimum, include the completion of an application form
7
8 that shall include the name and address of an agent for service of
8
9 process, the payment of a requisite fee, and evidence of the
9
10 procurement of a surety bond the following:
10
11 1. The name, address, and telephone contact number of the PBM;
11
12 2. The name and address of the PBM's agent for service of
12
13 process in the state;
13
14 3. The name and address of each person with management or
14
15 control over the PBM;
15
16 4. Evidence of the procurement of a surety bond;
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17 5. The name and address of each person with a beneficial
17
18 ownership interest in the PBM;
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19 6. In the case of a PBM applicant that is a partnership or
19
20 other unincorporated association, limited liability corporation, or
20
21 corporation, and has five or more partners, members, or
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22 stockholders:
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23 a. the applicant's legal structure and the total number
23
24 of partners, members, or stockholders,
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Req. No. 830 Page 28
1 b. the name, address, usual occupation, and professional
1
2 qualifications of the five partners, members, or
2
3 stockholders with the five largest ownership interests
3
4 in the PBM, and
4
5 c. the applicant's agreement that, upon request by the
5
6 Department, it shall furnish the Department with
6
7 information regarding the name, address, usual
7
8 occupation, and professional qualifications of any
8
9 other partners, members, or stockholders;
9
10 7. A signed statement indicating that the PBM has not been
10
11 convicted of a felony and has not violated any of the requirements
11
12 of the Oklahoma Pharmacy Act and the Patient's Right to Pharmacy
12
13 Choice Act, or, if the applicant cannot provide such a statement, a
13
14 signed statement describing all relevant convictions or violations;
14
15 and
15
16 8. Any other information the Commissioner deems necessary to
16
17 review.
17
18 C. The Department or the Office of the Attorney General may
18
19 subpoena witnesses and information. Its compliance officers may
19
20 take and copy records for investigative use and prosecutions.
20
21 Nothing in this subsection shall limit the Office of the Attorney
21
22 General from using its investigative demand authority to investigate
22
23 and prosecute violations of the law.
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24
24
Req. No. 830 Page 29
1 D. The Department may suspend, revoke or refuse to issue or
1
2 renew a license for noncompliance with any of the provisions hereby
2
3 established or with the rules promulgated by the Department; for
3
4 conduct likely to mislead, deceive or defraud the public or the
4
5 Department; for unfair or deceptive business practices or for
5
6 nonpayment of an application or renewal fee or fine. The Department
6
7 may also levy administrative fines for each count of which a PBM has
7
8 been convicted in a Department hearing.
8
9 E. 1. The Office of the Attorney General, after notice and
9
10 opportunity for hearing, may instruct the Insurance Commissioner
10
11 that the PBM's license be censured, suspended, or revoked for
11
12 conduct likely to mislead, deceive, or defraud the public or the
12
13 State of Oklahoma; or for unfair or deceptive business practices, or
13
14 for any violation of the Patient's Right to Pharmacy Choice Act, the
14
15 Pharmacy Audit Integrity Act, or Sections 357 through 360 of this
15
16 title. The Office of the Attorney General may also levy
16
17 administrative fines for each count of which a PBM has been
17
18 convicted following a hearing before the Attorney General. If the
18
19 Attorney General makes such instruction, the Commissioner shall
19
20 enforce the instructed action within thirty (30) calendar days.
20
21 2. In addition to or in lieu of any censure, suspension, or
21
22 revocation of a license by the Commissioner, the Attorney General
22
23 may levy a civil or administrative fine of not less than One Hundred
23
24 Dollars ($100.00) and not greater than Ten Thousand Dollars
24
Req. No. 830 Page 30
1 ($10,000.00) for each violation of this subsection and/or assess any
1
2 other penalty or remedy authorized by this section. For purposes of
2
3 this section, each day a PBM fails to comply with an investigation
3
4 or inquiry may be considered a separate violation.
4
5 F. The Attorney General may promulgate rules to implement the
5
6 provisions of Sections 357 through 360 of this title.
6
7 SECTION 9. This act shall become effective November 1, 2025.
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9 60-1-830 CAD 1/16/2025 2:29:19 PM
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Req. No. 830 Page 31Every fact on this page links to its source, starting with the official bill record.