1 STATE OF OKLAHOMA
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2 2nd Session of the 59th Legislature (2024)
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3 SENATE BILL 1390 By: McCortney
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6 AS INTRODUCED
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7 An Act relating to pharmacy benefits managers;
7 amending 36 O.S. 2021, Sections 6960, as amended by
8 Section 1, Chapter 38, O.S.L. 2022, 6962, as amended
8 by Section 1, Chapter 293, O.S.L. 2023, 6965, as
9 amended by Section 2, Chapter 293, O.S.L. 2023,
9 Section 3, Chapter 38, O.S.L. 2022, as amended by
10 Section 3, Chapter 293, O.S.L. 2023, and 6967 (36
10 O.S. Supp. 2023, Sections 6960, 6962, 6965, and
11 6966.1), which relate to the Patient’s Right to
11 Pharmacy Choice Act; defining terms; modifying
12 definitions; prohibiting certain contract terms from
12 restricting document disclosure to certain entities;
13 modifying certain compliance provisions; conforming
13 language; construing provisions; providing for rule
14 promulgation; establishing requirements for
14 disclosure of protected health information; modifying
15 certain fine amount; providing for certain fines and
15 fees; creating the Attorney General’s Pharmacy
16 Benefits Manager Enforcement Revolving Fund;
16 establishing fund source; stating purpose;
17 establishing provisions relating to public disclosure
17 of certain report and certain information obtained by
18 the Attorney General; amending 51 O.S. 2021, Section
18 24A.3, as amended by Section 11, Chapter 271, O.S.L.
19 2023 (51 O.S. Supp. 2023, Section 24A.3), which
19 relates to the Oklahoma Open Records Act; modifying
20 definition; amending 59 O.S. 2021, Sections 356.1 and
20 358, which relate to pharmacy benefits managers;
21 providing for rule promulgation; repealing 36 O.S.
21 2021, Section 6966, which relates to the Patient’s
22 Right to Pharmacy Choice Commission; updating
22 statutory reference; updating statutory language;
23 providing for codification; and providing an
23 effective date.
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2 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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3 SECTION 1. AMENDATORY 36 O.S. 2021, Section 6960, as
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4 amended by Section 1, Chapter 38, O.S.L. 2022 (36 O.S. Supp. 2023,
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5 Section 6960), is amended to read as follows:
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6 Section 6960. For purposes of the Patient’s Right to Pharmacy
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7 Choice Act:
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8 1. “Covered entity” means a nonprofit hospital or medical
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9 service organization, insurer, health benefit plan, health
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10 maintenance organization, health program administered by the state
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11 in the capacity of providing health coverage, or an employer, labor
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12 union, or other entity organized in the state that provides health
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13 coverage to covered individuals who are employed or reside in the
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14 state. This term does not include a health plan that provides
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15 coverage only for accidental injury, specified disease, hospital
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16 indemnity, disability income, or other limited benefit health
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17 insurance policies and contracts that do not include prescription
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18 drug coverage;
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19 2. “Health insurer” means any corporation, association, benefit
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20 society, exchange, partnership or individual licensed by the
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21 Oklahoma Insurance Code;
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22 2. 3. “Health insurer payor” means a health insurance company,
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23 health maintenance organization, union, hospital and medical
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 1 services organization or any entity providing or administering a
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2 self-funded health benefit plan;
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3 3. 4. “Mail-order pharmacy” means a pharmacy licensed by this
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4 state that primarily dispenses and delivers covered drugs via common
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5 carrier;
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6 4. 5. “Pharmacy benefits manager” or “PBM” means a person,
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7 business, or other entity that performs pharmacy benefits management
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8 and any other person acting for such person under. The term shall
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9 include a person or entity acting on behalf of a PBM in a
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10 contractual or employment relationship in the performance of
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11 pharmacy benefits management for a managed-care company, nonprofit
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12 hospital, medical service organization, insurance company, third-
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13 party payor or a health program administered by a department of this
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14 state;
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15 6. “Pharmacy benefits management” means a service provided to
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16 covered entities to facilitate the provisions of prescription drug
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17 benefits to covered individuals within the state, including, but not
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18 limited to, negotiating pricing and other terms with drug
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19 manufacturers and providers. Pharmacy benefits management may
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20 include any or all of the following services:
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21 a. claims processing, retail network management, and
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22 payment of claims to pharmacies for prescription drugs
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23 dispensed to covered individuals,
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 1 b. clinical formulary development and management
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2 services,
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3 c. rebate contracting and administration,
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4 d. certain patient compliance, therapeutic intervention,
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5 and generic substitution programs, or
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6 e. disease management programs;
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7 5. 7. “Provider” means a pharmacy, as defined in Section 353.1
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8 of Title 59 of the Oklahoma Statutes or an agent or representative
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9 of a pharmacy;
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10 6. 8. “Retail pharmacy network” means retail pharmacy providers
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11 contracted with a PBM in which the pharmacy primarily fills and
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12 sells prescriptions via a retail, storefront location;
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13 7. 9. “Rural service area” means a five-digit ZIP code in which
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14 the population density is less than one thousand (1,000) individuals
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15 per square mile;
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16 8. 10. “Spread pricing” means a prescription drug pricing model
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17 utilized by a pharmacy benefits manager in which the PBM charges a
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18 health benefit plan a contracted price for prescription drugs that
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19 differs from the amount the PBM directly or indirectly pays the
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20 pharmacy or pharmacist for providing pharmacy services;
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21 9. 11. “Suburban service area” means a five-digit ZIP code in
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22 which the population density is between one thousand (1,000) and
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23 three thousand (3,000) individuals per square mile; and
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 1 10. 12. “Urban service area” means a five-digit ZIP code in
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2 which the population density is greater than three thousand (3,000)
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3 individuals per square mile.
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4 SECTION 2. AMENDATORY 36 O.S. 2021, Section 6962, as
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5 amended by Section 1, Chapter 293, O.S.L. 2023 (36 O.S. Supp. 2023,
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6 Section 6962), is amended to read as follows:
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7 Section 6962. A. The Attorney General shall review and approve
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8 retail pharmacy network access for all pharmacy benefits managers
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9 (PBMs) to ensure compliance with Section 6961 of this title.
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10 B. A PBM, or an agent of a PBM, shall not:
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11 1. Cause or knowingly permit the use of advertisement,
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12 promotion, solicitation, representation, proposal or offer that is
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13 untrue, deceptive or misleading;
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14 2. Charge a pharmacist or pharmacy a fee related to the
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15 adjudication of a claim including without limitation a fee for:
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16 a. the submission of a claim,
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17 b. enrollment or participation in a retail pharmacy
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18 network, or
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19 c. the development or management of claims processing
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20 services or claims payment services related to
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21 participation in a retail pharmacy network;
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22 3. Reimburse a pharmacy or pharmacist in the state an amount
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23 less than the amount that the PBM reimburses a pharmacy owned by or
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24 under common ownership with a PBM for providing the same covered
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 1 services. The reimbursement amount paid to the pharmacy shall be
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2 equal to the reimbursement amount calculated on a per-unit basis
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3 using the same generic product identifier or generic code number
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4 paid to the PBM-owned or PBM-affiliated pharmacy;
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5 4. Deny a provider the opportunity to participate in any
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6 pharmacy network at preferred participation status if the provider
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7 is willing to accept the terms and conditions that the PBM has
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8 established for other providers as a condition of preferred network
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9 participation status;
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10 5. Deny, limit or terminate a provider’s contract based on
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11 employment status of any employee who has an active license to
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12 dispense, despite probation status, with the State Board of
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13 Pharmacy;
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14 6. Retroactively deny or reduce reimbursement for a covered
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15 service claim after returning a paid claim response as part of the
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16 adjudication of the claim, unless:
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17 a. the original claim was submitted fraudulently, or
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18 b. to correct errors identified in an audit, so long as
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19 the audit was conducted in compliance with Sections
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20 356.2 and 356.3 of Title 59 of the Oklahoma Statutes;
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21 7. Fail to make any payment due to a pharmacy or pharmacist for
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22 covered services properly rendered in the event a PBM terminates a
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23 provider from a pharmacy benefits manager network;
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 1 8. Conduct or practice spread pricing, as defined in Section 1
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2 of this act Section 6960 of this title, in this state; or
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3 9. Charge a pharmacist or pharmacy a fee related to
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4 participation in a retail pharmacy network including but not limited
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5 to the following:
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6 a. an application fee,
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7 b. an enrollment or participation fee,
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8 c. a credentialing or re-credentialing fee,
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9 d. a change of ownership fee, or
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10 e. a fee for the development or management of claims
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11 processing services or claims payment services.
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12 C. The prohibitions under this section shall apply to contracts
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13 between pharmacy benefits managers and providers for participation
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14 in retail pharmacy networks.
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15 1. A PBM contract shall:
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16 a. not restrict, directly or indirectly, any pharmacy
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17 that dispenses a prescription drug from informing, or
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18 penalize such pharmacy for informing, an individual of
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19 any differential between the individual’s out-of-
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20 pocket cost or coverage with respect to acquisition of
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21 the drug and the amount an individual would pay to
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22 purchase the drug directly, and
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23 b. ensure that any entity that provides pharmacy benefits
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24 management services under a contract with any such
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 1 health plan or health insurance coverage does not,
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2 with respect to such plan or coverage, restrict,
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3 directly or indirectly, a pharmacy that dispenses a
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4 prescription drug from informing, or penalize such
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5 pharmacy for informing, a covered individual of any
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6 differential between the individual’s out-of-pocket
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7 cost under the plan or coverage with respect to
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8 acquisition of the drug and the amount an individual
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9 would pay for acquisition of the drug without using
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10 any health plan or health insurance coverage.
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11 2. A pharmacy benefits manager’s contract with a provider shall
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12 not prohibit, restrict or limit disclosure of information and
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13 documents to the Attorney General, law enforcement or state and
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14 federal governmental officials investigating or examining a
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15 complaint or conducting a review of a pharmacy benefits manager’s
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16 compliance with the requirements under the Patient’s Right to
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17 Pharmacy Choice Act, Pharmacy Audit Integrity Act, and Section 357
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18 et seq. of Title 59 of the Oklahoma Statutes.
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19 D. A pharmacy benefits manager shall:
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20 1. Establish and maintain an electronic claim inquiry
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21 processing system using the National Council for Prescription Drug
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22 Programs’ current standards to communicate information to pharmacies
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23 submitting claim inquiries;
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 1 2. Fully disclose to insurers, self-funded employers, unions or
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2 other PBM clients the existence of the respective aggregate
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3 prescription drug discounts, rebates received from drug
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4 manufacturers and pharmacy audit recoupments;
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5 3. Provide the Attorney General, insurers, self-funded employer
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6 plans and unions unrestricted audit rights of and access to the
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7 respective PBM pharmaceutical manufacturer and provider contracts,
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8 plan utilization data, plan pricing data, pharmacy utilization data
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9 and pharmacy pricing data;
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10 4. Maintain, for no less than three (3) years, documentation of
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11 all network development activities including but not limited to
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12 contract negotiations and any denials to providers to join networks.
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13 This documentation shall be made available to the Attorney General
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14 upon request;
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15 5. Report to the Attorney General, on a quarterly basis for
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16 each health insurer payor, on the following information:
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17 a. the aggregate amount of rebates received by the PBM,
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18 b. the aggregate amount of rebates distributed to the
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19 appropriate health insurer payor,
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20 c. the aggregate amount of rebates passed on to the
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21 enrollees of each health insurer payor at the point of
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22 sale that reduced the applicable deductible,
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23 copayment, coinsure or other cost sharing amount of
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24 the enrollee,
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 1 d. the individual and aggregate amount paid by the health
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2 insurer payor to the PBM for pharmacy services
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3 itemized by pharmacy, drug product and service
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4 provided, and
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5 e. the individual and aggregate amount a PBM paid a
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6 provider for pharmacy services itemized by pharmacy,
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7 drug product and service provided.
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8 E. Nothing in the Patient’s Right to Pharmacy Choice Act shall
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9 prohibit an employer from incentivizing their employees to use an
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10 employer-owned pharmacy; provided, the employee may use another in-
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11 network pharmacy of his or her choice.
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12 F. Nothing in the Patient’s Right to Pharmacy Choice Act shall
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13 prohibit the Attorney General from requesting and obtaining detailed
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14 data, including raw data, in response to the information provided by
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15 a PBM in the quarterly reports required by this section.
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16 G. The Attorney General may promulgate rules to implement the
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17 provisions of the Patient’s Right to Pharmacy Choice Act.
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18 SECTION 3. AMENDATORY 36 O.S. 2021, Section 6965, as
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19 amended by Section 2, Chapter 293, O.S.L. 2023 (36 O.S. Supp. 2023,
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20 Section 6965), is amended to read as follows:
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21 Section 6965. A. The Attorney General shall have power and
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22 authority to examine and investigate the affairs of every pharmacy
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23 benefits manager (PBM) engaged in pharmacy benefits management in
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24 this state in orde