LEGISLATIVE GENERAL COUNSEL S.B. 256
6 Approved for Filing: C. Williams 6
6 02-19-24 9:19 AM 6
1 MEDICATION AMENDMENTS
2 2024 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Evan J. Vickers
5 House Sponsor: ____________
6
7 LONG TITLE
8 General Description:
9 This bill amends provisions related to pharmaceutical drugs.
10 Highlighted Provisions:
11 This bill:
12 < defines terms;
13 < merges provisions related to federally qualified health centers and 340B entities;
14 < enacts provisions related to how insurers and pharmacy benefit managers interact
15 with 340B entities; and
16 < limits how a pharmaceutical company can interact with a 340B entity, directly or
17 indirectly.
18 Money Appropriated in this Bill:
19 None
20 Other Special Clauses:
21 None
22 Utah Code Sections Affected:
23 AMENDS:
24 31A-46-310, as enacted by Laws of Utah 2021, Chapter 317
25 31A-48-102, as last amended by Laws of Utah 2022, Chapter 198
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26 ENACTS:
27 31A-48-104, Utah Code Annotated 1953
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28 REPEALS:
29 31A-46-309, as enacted by Laws of Utah 2020, Chapter 275
30 31A-48-101, as enacted by Laws of Utah 2020, Chapter 198
31
32 Be it enacted by the Legislature of the state of Utah:
33 Section 1. Section 31A-46-310 is amended to read:
34 31A-46-310. Prohibited actions .
35 [(1) As used in this section, "federally qualified health center":]
36 [(a) means the same as that term is defined in 42 U.S.C. Sec. 1395x(aa)(4); and]
37 [(b) includes the pharmacy or pharmacies that are operated by or contract with a
38 federally qualified health center described in Subsection (1)(a) to dispense drugs purchased
39 through the federally qualified health center.]
40 (1) As used in this section, "insurance entity" means:
41 (a) an insurer or an agent of an insurer; or
42 (b) a pharmacy service entity or an agent of a pharmacy service entity.
43 (2) This section applies to a contract entered into or renewed on or after January 1,
44 [2022, between an insurer and a pharmacy described in Subsection (1)(b)] 2025, between a
45 340B entity and an insurance entity.
46 (3) An [insurer] insurance entity may not vary the amount that the [insurer] insurance
47 entity reimburses to a [federally qualified health center] 340B entity for a drug on the basis of
48 whether:
49 (a) the drug is a 340B drug; or
50 (b) the pharmacy dispensing the drug is a 340B entity.
51 (4) Subsection (3) does not apply to a drug reimbursed, directly or indirectly, by the
52 Medicaid program.
53 (5) An [insurer or an insurer's pharmacy service] insurance entity may not:
54 (a) on the basis that a [federally qualified health center] 340B entity participates,
55 directly or through a contractual arrangement, in the 340B drug discount program:
56 (i) refuse to contract with the 340B entity;
57 [(i)] (ii) assess a fee, charge-back, or other adjustment on a [federally qualified health
58 center] 340B entity;
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59 [(ii)] (iii) restrict access to the [insurer's] insurance entity's pharmacy network;
60 [(iii)] (iv) require the [federally qualified health center] 340B entity to enter into a
61 contract with a specific pharmacy to participate in the [insurer's] insurance entity's pharmacy
62 network;
63 [(iv)] (v) create a restriction or an additional charge on a patient who chooses to
64 receive drugs from a [federally qualified health center] 340B entity; [or]
65 (vi) modify a copayment or other cost-sharing requirement of a patient of the 340B
66 entity; or
67 [(v)] (vii) create any additional requirements or restrictions on the [federally qualified
68 health center] 340B entity; [or]
69 (b) base drug formulary or drug coverage decisions on whether a drug is a 340B drug
70 or whether a dispensing pharmacy is a 340B entity;
71 (c) transfer the benefit of 340B drug discount program savings from a 340B entity to an
72 insurance entity;
73 (d) unilaterally modify the definition of pharmacy in a way that is inconsistent with
74 Utah law through a contract, provider manual, or other means;
75 (e) require the 340B entity to reverse, resubmit, or clarify a claim for a 340B drug after
76 an initial adjudication;
77 (f) charge or hold a 340B entity responsible for a fee related to a claim:
78 (i) that is not apparent at the time of claim processing;
79 (ii) that is not reported on the remittance advice of an adjudicated claim; or
80 (iii) after the initial claim is adjudicated at the point of sale; or
81 [(b)] (g) require a claim for a drug to include a modifier to indicate that the drug is a
82 340B drug unless the claim is for payment, directly or indirectly, by the Medicaid program.
83 Section 2. Section 31A-48-102 is amended to read:
84 31A-48-102. Definitions.
85 As used in this chapter:
86 (1) "340B drug" means the same as that term is defined in Section 31A-46-102.
87 (2) "340B entity" means the same as that term is defined in Section 31A-46-102.
88 [(1)] (3) (a) "Drug" means a substance that is:
89 (i) (A) intended for use in the diagnosis, cure, mitigation, treatment, or prevention of
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90 disease in humans; and
91 (B) recognized in or in a supplement to the official United States Pharmacopoeia, the
92 Homeopathic Pharmacopoeia of the United States, or the official National Formulary;
93 (ii) required by an applicable federal or state law or rule to be dispensed by prescription
94 only;
95 (iii) restricted to administration by practitioners only;
96 (iv) a substance other than food intended to affect the structure or a function of the
97 human body; or
98 (v) intended for use as a component of a substance described in Subsection [(1)(a)(i),
99 (ii), (iii), or (iv)] (3)(a)(i), (ii), (iii), or (iv).
100 (b) "Drug" does not include a dietary supplement.
101 [(2)] (4) "Insurer" means the same as that term is defined in Section 31A-22-634.
102 [(3)] (5) "Manufacturer" means a person that is engaged in the manufacturing of a drug
103 that is available for purchase by residents of the state.
104 (6) "Pharmaceutical manufacturer" means the same as that term is defined in Section
105 31A-46-102.
106 (7) "Pharmacy" means the same as that term is defined in Section 58-17b-102.
107 [(4)] (8) "Rebate" means the same as that term is defined in Section 31A-46-102.
108 [(5)] (9) "Wholesale acquisition cost" means the same as that term is defined in 42
109 U.S.C. Sec. 1395w-3a.
110 Section 3. Section 31A-48-104 is enacted to read:
111 31A-48-104. Prohibited conduct.
112 A pharmaceutical manufacturer, or any person involved in the distribution of a
113 pharmaceutical manufacturer's products, may not directly or indirectly:
114 (1) prohibit a pharmacy from contracting with a 340B entity, including by denying the
115 pharmacy access to a drug that is manufactured by the pharmaceutical manufacturer;
116 (2) prohibit a 340B entity from contracting with a pharmacy, including by denying the
117 340B entity access to a drug that is manufactured by the pharmaceutical manufacturer;
118 (3) deny or restrict a 340B entity from:
119 (a) acquiring or dispensing a 340B drug; or
120 (b) receiving 340B drug discount program pricing for a 340B drug, including by
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121 imposing a time limitation on a 340B entity to replenish or submit a claim for a 340B drug;
122 (4) require a 340B entity to purchase a 340B drug from a certain supplier if the
123 pharmaceutical manufacturer, or person involved in the distribution of the pharmaceutical
124 manufacturer's products, would otherwise permit the 340B entity to purchase a drug that is not
125 a 340B drug from the supplier; or
126 (5) otherwise interfere with:
127 (a) a contract between a pharmacy and a 340B entity; or
128 (b) the ability of a pharmacy and a 340B entity to enter into a contract.
129 Section 4. Repealer.
130 This bill repeals:
131 Section 31A-46-309, Reimbursement -- Prohibitions.
132 Section 31A-48-101, Title.
133 Section 5. Effective date.
134 This bill takes effect on May 1, 2024.
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Statutes affected: Introduced: 31A-46-310, 31A-48-102