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2004 SESSION
040470428Be it enacted by the General Assembly of Virginia:
1. That §§ 38.2-3407.7, 38.2-4209.1, and 38.2-4312.1 of the Code of Virginia are amended and reenacted as follows:
§ 38.2-3407.7. Pharmacies; freedom of choice.
A. Notwithstanding any provision of § 38.2-3407 to the contrary, no insurer proposing to issue preferred provider policies or contracts shall prohibit any person receiving pharmacy benefits furnished thereunder from selecting, without limitation, the pharmacy of his choice to furnish such benefits. This right of selection extends to and includes pharmacies that are nonpreferred providers and that have previously notified the insurer, by facsimile or otherwise, of their agreement to accept reimbursement for their services at rates applicable to pharmacies that are preferred providers, including any copayment consistently imposed by the insurer, as payment in full. Each insurer shall permit prompt electronic or telephonic transmittal of the reimbursement agreement by the pharmacy and ensure prompt verification to the pharmacy of the terms of reimbursement. In no event shall any person receiving a covered pharmacy benefit from a nonpreferred provider which has submitted a reimbursement agreement be responsible for amounts that may be charged by the nonpreferred provider in excess of the copayment and the insurer's reimbursement applicable to all of its preferred pharmacy providers.
B. No such insurer shall impose upon any person receiving pharmaceutical benefits furnished under any such policy or contract:
1. Any copayment, fee or condition that is not equally imposed upon all individuals in the same benefit category, class or copayment level, whether or not such benefits are furnished by pharmacists who are nonpreferred providers;
2. Any monetary penalty, condition, or communication that would affect or influence any such person's choice of pharmacy, including without limitation actions designed or intended to divert such person to a mail order pharmacy owned by the insurer or an affiliate of such insurer, or by such insurer’s or affiliate’s pharmacy benefit manager, under the circumstances described in subdivision D 4; or
3. Any reduction in allowable reimbursement for pharmacy services related to utilization of pharmacists who are nonpreferred providers.
C. No such insurer, or a pharmacy benefit manager of such insurer, shall impose upon or require of a pharmacy providing or proposing to provide pharmaceutical benefits in the Commonwealth to any person entitled to receive such benefits under any such policy or contract:
1. Any nonprice term or condition that is not equally required of all pharmacies in the Commonwealth, whether or not such benefits are furnished by pharmacists who are nonpreferred providers; or
2. Any payment, compensation, or reimbursement structure that results in, or would tend to result in:
(a) A violation of § 59.1-9.7;
(b) The artificial depression of prices to be paid, or proposed to be paid, to a pharmacy providing pharmaceutical benefits;
(c) The establishment or unilateral change of reimbursement rates to a pharmacy that are below such pharmacy’s costs or prevailing market rates; or
(d) Direct or indirect discrimination by the insurer, where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly, or to injure, destroy, or prevent competition in the practice of pharmacy as defined in § 54.1-3300.
C D. For purposes of this section, a prohibited condition or penalty shall
include, without limitation:
(i) denying 1. Denying immediate access to electronic claims filing to a
pharmacy whichthat is a nonpreferred provider and which has complied with
subsection D below; or
(ii) requiring 2. Requiring a person receiving pharmacy benefits to make
payment at point of service, except to the extent such conditions and penalties are
similarly imposed on preferred providers.;
3. Directly or indirectly paying or accepting rebates, discounts, or other forms of disclosed or undisclosed incentives between or among the insurer, the insurer’s pharmacy benefit manager, or a pharmacy, including without limitation any pharmacy that is an affiliate of such insurer or an affiliate of such insurer’s pharmacy benefit manager, in a manner that would be a violation of state or federal law; or
4. Requiring or inducing a person receiving pharmacy benefits to use a mail order pharmacy for maintenance medications, where such medications or refills are for more than a one-month supply or the amount customarily approved by such insurer for purchase from a retail pharmacy, unless the pharmacy selected by such person has not agreed to accept reimbursement for such services at the same rates, terms, and conditions, including any copayment consistently imposed by the insurer as payment in full, that are applicable to mail order pharmacies that have one or more contracts with the insurer or the insurer’s pharmacy benefit manager. Nothing in this subdivision shall prohibit an insurer or such insurer’s pharmacy benefit manager from establishing a different reimbursement structure for such maintenance medications, provided such reimbursement structure otherwise does not violate this section or other state or federal law.
DE. Any pharmacy whichthat wishes to provide pharmaceutical benefits pursuant
to be covered by this section shall, if requested to do so in writing by an
insurer, within thirty 30 days of the pharmacy's receipt of the request,
execute and deliver to the insurer the direct service agreement or preferred
provider agreement whichthat the insurer requires all of its preferred
providers of pharmacy benefits to execute. Any pharmacy whichthat fails to
timely execute and deliver such agreement shall not be covered byentitled to
provide pharmaceutical benefits pursuant to this section with respect to that
insurer unless and until the pharmacy executes and delivers the agreement.
E F. The Commission shall have no jurisdiction to adjudicate controversies
arising out of this section. Violations of subsections B or C, or of
subdivisions D 3 or 4, shall be deemed to be violations of § 59.1-9.7.
§ 38.2-4209.1. Pharmacies; freedom of choice.
A. Notwithstanding any provision of § 38.2-4209, no corporation providing preferred provider subscription contracts shall prohibit any person receiving pharmaceutical benefits thereunder from selecting, without limitation, the pharmacy of his choice to furnish such benefits. This right of selection extends to and includes pharmacies that are nonpreferred providers and that have previously notified the corporation, by facsimile or otherwise, of their agreement to accept reimbursement for their services at rates applicable to pharmacies that are preferred providers, including any copayment consistently imposed by the corporation, as payment in full. Each corporation shall permit prompt electronic or telephonic transmittal of the reimbursement agreement by the pharmacy and ensure payment verification to the pharmacy of the terms of reimbursement. In no event shall any person receiving a covered pharmacy benefit from a nonpreferred provider which has submitted a reimbursement agreement be responsible for amounts that may be charged by the nonpreferred provider in excess of the copayment and the corporation's reimbursement applicable to all of its preferred pharmacy providers.
B. No such corporation shall impose upon any person receiving pharmaceutical benefits furnished under any such contract:
1. Any copayment, fee or condition that is not equally imposed upon all individuals in the same benefit category, class or copayment level, whether or not such benefits are furnished by pharmacists who are nonpreferred providers;
2. Any monetary penalty, condition, or communication that would affect or influence any such person's choice of pharmacy, including without limitation actions designed or intended to divert such person to a mail order pharmacy owned by the insurer or an affiliate of such insurer, or by such insurer’s or affiliate’s pharmacy benefit manager, under the circumstances described in subdivision D 4; or
3. Any reduction in allowable reimbursement for pharmacy services related to utilization of pharmacists who are nonpreferred providers.
C. No such insurer, or a pharmacy benefit manager of such insurer, shall impose upon or require of a pharmacy providing or proposing to provide pharmaceutical benefits in the Commonwealth to any person entitled to receive such benefits under any such policy or contract:
1. Any nonprice term or condition that is not equally required of all pharmacies in the Commonwealth, whether or not such benefits are furnished by pharmacists who are nonpreferred providers; or
2. Any payment, compensation, or reimbursement structure that results in, or would tend to result in:
(a) A violation of § 59.1-9.7;
(b) The artificial depression of prices to be paid, or proposed to be paid, to a pharmacy providing pharmaceutical benefits;
(c) The establishment or unilateral change of reimbursement rates to a pharmacy that are below such pharmacy’s costs or prevailing market rates; or
(d) Direct or indirect discrimination by the insurer, where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly, or to injure, destroy, or prevent competition in the practice of pharmacy as defined in § 54.1-3300.
C D. For purposes of this section, a prohibited action, condition or penalty
shall also include, without limitation:
(i) denying 1. Denying immediate access to electronic claims filing to a
pharmacy which is a nonpreferred provider and which has complied with subsection D
below; or
(ii) requiring 2. Requiring a person receiving pharmacy benefits to make
payment at point of service, except to the extent such conditions and penalties are similarly imposed
on preferred providers.
3. Directly or indirectly paying or accepting rebates, discounts, or other forms of disclosed or undisclosed incentives between or among the insurer, the insurer’s pharmacy benefit manager, or a pharmacy, including without limitation any pharmacy that is an affiliate of such insurer or an affiliate of such insurer’s pharmacy benefit manager, in a manner that would be a violation of state or federal law; or
4. Requiring or inducing a person receiving pharmacy benefits to use a mail order pharmacy for maintenance medications, where such medications or refills are for more than a one-month supply or the amount customarily approved by such insurer for purchase from a retail pharmacy, unless the pharmacy selected by such person has not agreed to accept reimbursement for such services at the same rates, terms, and conditions, including any copayment consistently imposed by the insurer as payment in full, that are applicable to mail order pharmacies that have one or more contracts with the insurer or the insurer’s pharmacy benefit manager. Nothing in this subdivision shall prohibit an insurer or such insurer’s pharmacy benefit manager from establishing a different reimbursement structure for such maintenance medications, provided such reimbursement structure otherwise does not violate this section or other state or federal law.
D E. Any pharmacy which that wishes to provide pharmaceutical benefits pursuant
to be covered by this section shall, if requested to do so in writing by a
corporation, within thirty 30 days of the pharmacy's receipt of the request,
execute and deliver to the corporation the direct service agreement or preferred provider agreement
which the corporation requires all of its preferred providers of pharmacy benefits to execute. Any
pharmacy which that fails to timely execute and deliver such agreement shall
not be entitled to provide pharmaceutical benefits pursuant to covered by this
section with respect to that corporation unless and until the pharmacy executes and delivers the
agreement.
E F. The Commission shall have no jurisdiction to adjudicate controversies
arising out of this section. Violations of subsections B or C, or of
subdivisions D 3 or 4, shall be deemed to be violations of § 59.1-9.7.
§ 38.2-4312.1. Pharmacies; freedom of choice.
A. Notwithstanding any other provision in this chapter, no health maintenance organization providing health care plans shall prohibit any person receiving pharmaceutical benefits thereunder from selecting, without limitation, the pharmacy of his choice to furnish such benefits. This right of selection extends to and includes pharmacies that are not participating providers under any such health care plan and that have previously notified the health maintenance organization, by facsimile or otherwise, of their agreement to accept reimbursement for their services at rates applicable to pharmacies that are participating providers, including any copayment consistently imposed by the plan, as payment in full. Each health maintenance organization shall permit prompt electronic or telephonic transmittal of the reimbursement agreement by the pharmacy and ensure prompt verification to the pharmacy of the terms of reimbursement. In no event shall any person receiving a covered pharmacy benefit from a nonparticipating provider which has submitted a reimbursement agreement be responsible for amounts that may be charged by the nonparticipating provider in excess of the copayment and the health maintenance organization's reimbursement applicable to all of its participating pharmacy providers.
B. No such health maintenance organization shall impose upon any person receiving pharmaceutical benefits furnished under any such health care plan:
1. Any copayment, fee or condition that is not equally imposed upon all individuals in the same benefit category, class or copayment level, whether or not such benefits are furnished by pharmacists who are not participating providers;
2. Any monetary penalty, condition, or communication that would affect or influence any such person's choice of pharmacy, including without limitation actions designed or intended to divert such person to a mail order pharmacy owned by the insurer or an affiliate of such insurer, or by such insurer’s or affiliate’s pharmacy benefit manager, under the circumstances described in subdivision D 4; or
3. Any reduction in allowable reimbursement for pharmacy services related to utilization of pharmacists who are not participating providers.
C. No such insurer, or a pharmacy benefit manager of such insurer, shall impose upon or require of a pharmacy providing or proposing to provide pharmaceutical benefits in the Commonwealth to any person entitled to receive such benefits under any such policy or contract:
1. Any nonprice term or condition that is not equally required of all pharmacies in the Commonwealth, whether or not such benefits are furnished by pharmacists who are nonpreferred providers; or
2. Any payment, compensation, or reimbursement structure that results in, or would tend to result in:
(a) A violation of § 59.1-9.7;
(b) The artificial depression of prices to be paid, or proposed to be paid, to a pharmacy providing pharmaceutical benefits;
(c) The establishment or unilateral change of reimbursement rates to a pharmacy that are below such pharmacy’s costs or prevailing market rates; or
(d) Direct or indirect discrimination by the insurer, where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly, or to injure, destroy, or prevent competition in the practice of pharmacy as defined in § 54.1-3300.
C D. For purposes of this section, a prohibited action, condition or penalty
shall also include, without limitation:
(i) denying 1. Denying immediate access to electronic claims filing to a
pharmacy which is a nonparticipating provider and which has complied with subsection
E below; or
(ii) requiring 2. Requiring a person receiving pharmacy benefits to make
payment at point of service, except to the extent such conditions and penalties are similarly imposed
on participating providers.
3. Directly or indirectly paying or accepting rebates, discounts, or other forms of disclosed or undisclosed incentives between or among the insurer, the insurer’s pharmacy benefit manager, or a pharmacy, including without limitation any pharmacy that is an affiliate of such insurer or an affiliate of such insurer’s pharmacy benefit manager, in a manner that would be a violation of state or federal law; or
4. Requiring or inducing a person receiving pharmacy benefits to use a mail order pharmacy for maintenance medications, where such medications or refills are for more than a one-month supply or the amount customarily approved by such insurer for purchase from a retail pharmacy, unless the pharmacy selected by such person has not agreed to accept reimbursement for such services at the same rates, terms, and conditions, including any copayment consistently imposed by the insurer as payment in full, that are applicable to mail order pharmacies that have one or more contracts with the insurer or the insurer’s pharmacy benefit manager. Nothing in this subdivision shall prohibit an insurer or such insurer’s pharmacy benefit manager from establishing a different reimbursement structure for such maintenance medications, provided such reimbursement structure otherwise does not violate this section or other state or federal law.
D. The provisions of this section are not applicable to any pharmaceutical
benefit covered by a health care plan when those benefits are obtained from a
pharmacy wholly owned and operated by, or exclusively operated for, the health
maintenance organization providing the health care plan.
E. Any pharmacy which that wishes to provide pharmaceutical benefits pursuant
to be covered by this section shall, if requested to do so in writing by a
health maintenance organization, within thirty 30 days of the pharmacy's
receipt of the request, execute and deliver to the health maintenance organization the direct service
agreement or participating provider agreement which the health maintenance
organization requires all of its participating providers of pharmacy benefits
to execute. Any pharmacy which that fails to timely execute and deliver such
agreement shall not be entitled to provide pharmaceutical benefits pursuant to
covered by this section with respect to that health maintenance
organization unless and until the pharmacy executes and delivers the agreement.
F. The Commission shall have no jurisdiction to adjudicate controversies arising out of this section. Violations of subsections B or C, or of subdivisions D 3 or 4, shall be deemed to be violations of § 59.1-9.7.