A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING SECTION 38-71-292 AND SECTION 38-71-820 BOTH SO AS TO DEFINE TERMS AND OUTLINE THE APPLICABILITY AND REQUIREMENTS FOR COST SHARING FOR INSURERS; BY ADDING SECTION 38-71-2270 SO AS TO DEFINE TERMS AND OUTLINE THE APPLICABILITY AND REQUIREMENTS FOR COST SHARING FOR PHARMACY BENEFIT MANAGERS; AND BY AMENDING SECTION 38-71-2200, RELATING TO DEFINITIONS CONCERNING PHARMACY BENEFITS MANAGERS, SO AS TO MAKE CONFORMING CHANGES.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1.  Article 1, Chapter 71, Title 38 of the S.C. Code is amended by adding:

    Section 38-71-292. (A) As used in this section:

       (1) "Cost sharing" means any copayment, coinsurance, deductible, or other similar charges required of an enrollee for a healthcare service, including a prescription drug, covered by a health plan, and paid by or on behalf of such enrollee.

       (2) "Enrollee" means any individual entitled to healthcare services from an insurer.

       (3) "Health plan" means a policy, contract, certification, or agreement offered or issued by an insurer to provide, deliver, arrange for, pay for, or reimburse any of the costs of healthcare services.

       (4) "Healthcare service" means an item or service furnished to any individual for the purpose of preventing, alleviating, curing, or healing human illness, injury, or physical disability.

       (5) "Insurer" means an entity subject to the insurance laws and rules of insurance in this State or subject to the jurisdiction of the director that contracts, or offers to contract, to provide, deliver, arrange for, pay for, or reimburse any of the costs of healthcare services under a health plan in this State.

       (6) "Person" means a natural person, corporation, mutual company, unincorporated association, partnership, joint venture, limited liability company, trust, estate, foundation, not-for-profit corporation, unincorporated organization, government or governmental subdivision or agency.

    (B) The annual limitation on cost sharing provided for under 42 U.S.C. Section 18022(c)(1) applies to all healthcare services covered under any health plan offered or issued by an insurer in this State.

    (C) When calculating an enrollee's contribution to any applicable cost-sharing requirement, an insurer shall include any cost-sharing amounts paid by the enrollee or on behalf of the enrollee by another person. If under federal law, application of this requirement would result in Health Savings Account ineligibility under Section 223 of the federal Internal Revenue Code, this requirement applies for Health Savings Account-qualified High Deductible Health Plans with respect to the deductible of such a plan after the enrollee has satisfied the minimum deductible under Section 223, except with respect to items or services that are preventive care pursuant to Section 223(c)(2)(C) of the federal Internal Revenue Code, in which case the requirements of this paragraph apply regardless of whether the minimum deductible under Section 223 has been satisfied.

    (D) Subsection (C) does not apply to a prescription drug for which there is a medically appropriate generic equivalent, unless the enrollee has obtained access to the brand name prescription drug through prior authorization, a step therapy protocol, the insurer's exceptions and appeals process, or as specified in Section 39-24-30(A).

    (E) An insurer shall not directly or indirectly set, alter, implement, or condition the terms of health plan coverage, including the benefit design, based in part or entirely on information about the availability or amount of financial or product assistance available for a prescription drug.

    (F) This section applies with respect to health plans that are entered into, amended, extended, or renewed on or after January 1, 2027.

    (G) In implementing the requirement of this section, the State shall only regulate an insurer or health benefit plan to the extent permissible under applicable law.

    (H) The director or his designee may promulgate rules and regulations as it deems necessary to implement this section.

SECTION 2.  Article 5, Chapter 71, Title 38 of the S.C. Code is amended by adding:

    Section 38-71-820. (A) As used in this section:

       (1) "Cost sharing" means any copayment, coinsurance, deductible, or other similar charges required of an enrollee for a healthcare service, including a prescription drug, covered by a health plan, and paid by or on behalf of such enrollee.

       (2) "Enrollee" means any individual entitled to health care services from an insurer.

       (3) "Health plan" means a policy, contract, certification, or agreement offered or issued by an insurer to provide, deliver, arrange for, pay for, or reimburse any of the costs of healthcare services.

       (4) "Health care service" means an item or service furnished to any individual for the purpose of preventing, alleviating, curing, or healing human illness, injury, or physical disability.

       (5) "Insurer" means an entity subject to the insurance laws and rules of insurance in this State or subject to the jurisdiction of the director, that contracts, or offers to contract to provide, deliver, arrange for, pay for, or reimburse any of the costs of healthcare services under a health plan in this State.

       (6) "Person" means a natural person, corporation, mutual company, unincorporated association, partnership, joint venture, limited liability company, trust, estate, foundation, not-for-profit corporation, unincorporated organization, government or governmental subdivision or agency.

    (B) The annual limitation on cost sharing provided for under 42 U.S.C. Section 18022(c)(1) applies to all healthcare services covered under any health plan offered or issued by an insurer in this State.

    (C) When calculating an enrollee's contribution to any applicable cost sharing requirement, an insurer shall include any cost sharing amounts paid by the enrollee or on behalf of the enrollee by another person. If under federal law, application of this requirement would result in Health Savings Account ineligibility under Section 223 of the federal Internal Revenue Code, this requirement applies for Health Savings Account-qualified High Deductible Health Plans with respect to the deductible of such a plan after the enrollee has satisfied the minimum deductible under Section 223, except with respect to items or services that are preventive care pursuant to Section 223(c)(2)(C) of the federal Internal Revenue Code, in which case the requirements of this paragraph applies regardless of whether the minimum deductible under Section 223 has been satisfied.

    (D) Subsection (C) does not apply to a prescription drug for which there is a medically appropriate generic equivalent, unless the enrollee has obtained access to the brand name prescription drug through prior authorization, a step therapy protocol, the insurer's exceptions and appeals process, or as specified in Section 39-24-30 (A).

    (E) An insurer shall not directly or indirectly set, alter, implement, or condition the terms of health plan coverage, including the benefit design, based in part or entirely on information about the availability or amount of financial or product assistance available for a prescription drug.

    (F) This section applies with respect to health plans that are entered into, amended, extended, or renewed on or after January 1, 2027.

    (G) In implementing the requirement of this section, the State shall only regulate an insurer or health benefit plan to the extent permissible under applicable law.

    (H) The director or his designee may promulgate rules and regulations as it deems necessary to implement this section.

SECTION 3.  Article 21, Chapter 71, Title 38 of the S.C. Code is amended by adding:

    Section 38-71-2270.  (A) The annual limitation on cost sharing provided for under 42 U.S.C. Section 18022(c)(1) applies to all healthcare services covered under any health plan offered or issued by an insurer in this State, including a health benefit plan administered by a pharmacy benefits manager.

    (B) When calculating an enrollee's contribution to any applicable cost-sharing requirement, a pharmacy benefits manager shall include any cost sharing amounts paid by the enrollee or on behalf of the enrollee by another person. If under federal law, application of this requirement would result in Health Savings Account ineligibility under Section 223 of the federal Internal Revenue Code, this requirement applies for Health Savings Account-qualified High Deductible Health Plans with respect to the deductible of such a plan after the enrollee has satisfied the minimum deductible under Section 223, except with respect to items or services that are preventive care pursuant to Section 223(c)(2)(C) of the federal Internal Revenue Code, in which case the requirements of this paragraph apply regardless of whether the minimum deductible under Section 223 has been satisfied.

    (C) Subsection (B) does not apply to a prescription drug for which there is a medically appropriate generic equivalent, unless the enrollee has obtained access to the brand name prescription drug through prior authorization, a step therapy protocol, the insurer's exceptions and appeals process, or as specified in Section 39-24-30 (A).

    (D) An insurer shall not directly or indirectly set, alter, implement, or condition the terms of health plan coverage, including the benefit design, based in part or entirely on information about the availability or amount of financial or product assistance available for a prescription drug.

    (E) This section applies with respect to health plans that are entered into, amended, extended, or renewed on or after January 1, 2027.

    (F) In implementing the requirement of this section, the State shall only regulate an insurer or health benefit plan to the extent permissible under applicable law.

SECTION 4.  Section 38-71-2200 of the S.C. Code is amended to read:

    Section 38-71-2200.  As used in this article: