House Bill No. 1217, introduced by Representative Echols, aims to enhance transparency, accountability, and enforcement mechanisms related to pharmacy benefit managers (PBMs), insurers, health maintenance organizations, and third-party administrators. The bill mandates that these entities disclose all affiliated or related entities involved in pharmacy-related services, including their corporate structure and financial relationships. It also requires PBMs and insurers managing self-funded plans to provide annual financial reconciliations to plan sponsors, detailing all fees, rebates, and payments. Additionally, the bill prohibits contract provisions that restrict access to claims-level data and mandates quarterly claims-level reporting to the commissioner and attorney general.

The proposed legislation establishes significant enforcement measures, including a minimum civil penalty of $1 million per violation for undisclosed remuneration or failure to provide required reporting. It grants the commissioner and attorney general the authority to conduct audits and enforce compliance, with provisions for restitution, disgorgement, and treble damages for willful violations. The bill also creates the Pharmacy Benefit Enforcement Fund to support investigations and consumer protection efforts, provides whistleblower protections, and defines fiduciary duties for PBMs to ensure they act in good faith toward health plans or plan sponsors. The law will take effect upon the governor's signature or after the lapse of time for gubernatorial action.

Statutes affected:
HB1217 Original: 40:2864(A)