NY State Senate Bill 2017-S3484

Senate Bill S3484

2017-2018 Legislative Session

Relates to enacting provisions relating to mail order pharmacies and prescription benefit plans

download bill text pdf

Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2018	referred to consumer protection
May 25, 2017	print number 3484a
May 25, 2017	amend and recommit to insurance
May 16, 2017	reported and committed to insurance
Jan 23, 2017	referred to consumer protection

Votes

- May 16, 2017 - Consumer Protection Committee Vote
  S3484
  
  11
  
  Aye
  
  0
  
  Nay
  
  0
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Consumer Protection Committee Vote: May 16, 2017
      
      aye (11)
      
      Amedore
      
      Boyle
      
      Brooks
      
      Carlucci
      
      Comrie
      
      Funke
      
      Hamilton
      
      Helming
      
      Latimer
      
      Robach
      
      Serrano

Bill Amendments

Original

A (Active)

co-Sponsors

View additional co-sponsors

2017-S3484 - Details

Current Committee:: Senate Consumer Protection
Law Section:: General Business Law
Laws Affected:: Add Art 40 §§900 - 905, Gen Bus L

2017-S3484 - Summary

Provides that prescription benefit plans may not require patients to receive prescriptions through mail order pharmacies.

2017-S3484 - Sponsor Memo

                                 BILL NUMBER:  S3484

 TITLE OF BILL :  An act to amend the general business law, in
relation to mail order pharmacies

 PURPOSE :

To provide New Yorkers with the ability to choose to fill
prescriptions at a local retail pharmacy rather than a mail order
pharmacy without incurring any penalties for filling prescriptions
locally.

 SUMMARY OF PROVISIONS :

Section one of the bill adds a new Article 40 entitled Mail Order
Pharmacies to the General Business Law. New Article 40 contains six
new sections. The first new section, General Business Law section 900,
provides the legislative findings, declarations and purposes. In this
section, the Legislature finds and declares that, among other things,
it is beneficial for New Yorkers enrolled in prescription benefit
plans to be able to fill any prescription at a local retail pharmacy
and that the enrollee should not be required to pay more for
prescriptions that are locally filled. Additionally, the Legislature
finds and declares that local retail pharmacies should not be required
to agree to contractual terms and conditions that are solely
applicable to the mail order pharmacy business in order to be able to

dispense specialty prescriptions.

New General Business Law section 901 provides definitions for terms
that are used in new Article 40. These terms include "mail order
pharmacy," "retail pharmacy," "prescription benefit plan," and
"specialty prescription drug."

New General Business Law section 902 lists the types of conduct
prohibited by new Article 40. New Article 40 prohibits the following
types of conduct:

(1) Requiring prescriptions for specialty drugs to be filled by a mail
order pharmacy in order for such prescription to be covered by a
prescription benefit plan.

(2) Requiring a prescription benefit plan enrollee remit a higher
co-payment when a prescription is filled by a network retail pharmacy
instead of a mail order pharmacy.

(3) Requiring a local retail pharmacy to agree to additional terms and
conditions that go beyond the industry standard before the pharmacy
can dispense specialty prescription drugs.

(4) The practice, by mail order pharmacies, of automatically refilling
prescriptions without authorization from the patient or the patient's
guardian.

(5) The practice, by mail order pharmacies, of retaining a customer's
payment information for future use without express permission from the
customer.

New General Business Law section 903 provides a right of action for
any person who has been injured as a result of violating new Article
40.

New General Business Law section 904 provides a civil penalty for each
violation of new Article 40 by either a mail order pharmacy or a
prescription benefit plan. The amount of the penalty shall not exceed
two thousand five hundred dollars per occurrence.

New General Business Law section 905 provides the Attorney General
with the power to enforce the provisions of new Article 40.

Section two of this bill provides that this act shall take effect on
the ninetieth day after it shall have become a law and shall apply to
contracts entered into, amended or renewed on and after such date.

 EXISTING LAW :

New bill

 JUSTIFICATION :

The number of Americans who take three or more prescription drugs is
rapidly increasing, with approximately ten percent of all Americans
taking five or more prescription drugs. Managing these prescriptions
presents a number of challenges and can become complicated. One of the
most significant challenges occurs when some of the prescriptions must
be filled by a mail order pharmacy in order for the prescription to be
covered by insurance, while other prescriptions cannot be filled by
such a pharmacy. In this instance, the consumer must not only manage
interaction with multiple pharmacies, but also the delivery of
prescriptions from a mail order pharmacy.

Additionally, when consumers are not filling all of their
prescriptions at one pharmacy, none of the pharmacies can conduct an
adequate interaction check prior to dispensing a prescription because
the pharmacy does not have all of the information needed to conduct a
proper interaction check. This places the burden of checking for drug
interactions on the consumer. While this may seem like an easy task,
for many, it is difficult because the consumer may not have access to
a computer, or the consumer may use multiple interaction checkers that
provide conflicting results. If a consumer could fill all of his or
her prescriptions at one pharmacy and have all of the prescriptions
covered by his or her prescription insurance, consumers would benefit
because the pharmacist would have a list of all of the consumer's
prescriptions and could run the interaction checker. The pharmacist
would be able to discuss any potentially adverse interactions with the
consumer and be able to answer the consumer's questions.

Another challenge for consumers arises when the consumer experiences
an adverse reaction, such as an injection site reaction, that needs to
be seen for proper evaluation. Because mail order pharmacies are
unable to see such a reaction, they direct consumers to go to an
urgent care facility or the emergency room. Many times, the medical
care was unnecessary and a pharmacist could have provided adequate
counsel to address the adverse reaction. This situation can be avoided
by allowing consumers to fill prescriptions at local retail
pharmacies.

In January 2012, the Legislature thought it had solved this problem
and that consumers would always have the choice of obtaining covered
prescription drugs from a local network participating pharmacy. Over
the course of the year, however, it became clear that the law was not
working as intended. Consumers received letters from pharmacy benefit
managers directing them to out-of-state "specialty" pharmacies.
Consumers returning to their local participating pharmacy could no
longer obtain their prescription drugs there because the claim was
blocked. The pharmacy was notified that coverage for that medication
was no longer covered in the "retail" pharmacy network. The patient
was to be directed to the "specialty" pharmacy.

This bill would provide consumers with the choice that they should
have had since 2012.

 LEGISLATIVE HISTORY :
New bill.

 FISCAL IMPLICATIONS :

None to the State

 EFFECTIVE DATE :
This act shall take effect on the ninetieth day after it shall have
become a law and shall apply to contracts entered into, amended or
renewed on and after such date.

2017-S3484 - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   3484
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                             January 23, 2017
                                ___________
 
 Introduced  by  Sens.  GOLDEN,  FUNKE,  ADDABBO, AKSHAR, BOYLE, BRESLIN,
   CARLUCCI, COMRIE, CROCI, GALLIVAN, HAMILTON, HOYLMAN,  LANZA,  LARKIN,
   LAVALLE, O'MARA, ORTT, PERKINS, RANZENHOFER, RITCHIE, STAVISKY -- read
   twice  and  ordered  printed,  and when printed to be committed to the
   Committee on Consumer Protection

 AN ACT to amend the general business law,  in  relation  to  mail  order
   pharmacies
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The general business law is amended by adding a new article
 40 to read as follows:
                                ARTICLE 40
                           MAIL ORDER PHARMACIES
 SECTION 900. LEGISLATIVE FINDINGS AND DECLARATIONS; PURPOSES.
         901. DEFINITIONS.
         902. PROHIBITED CONDUCT.
         903. ACTION TO RECOVER DAMAGES BY AN ENROLLEE.
         904. VIOLATIONS.
         905. ENFORCEMENT BY ATTORNEY GENERAL.
   § 900. LEGISLATIVE FINDINGS AND DECLARATIONS; PURPOSES. 1. THE  LEGIS-
 LATURE FINDS AND DECLARES THAT:
   (A)  THE  NUMBER  OF AMERICANS WHO ARE PRESCRIBED THREE MEDICATIONS IS
 GROWING AT AN ALARMING RATE, WITH APPROXIMATELY TEN PERCENT OF THE POPU-
 LATION TAKING FIVE OR MORE  PRESCRIPTION  MEDICATIONS.  THESE  AMERICANS
 FACE  MANY  CHALLENGES  WHEN  THEY ARE REQUIRED TO RECEIVE SOME OF THEIR
 PRESCRIPTIONS FROM A MAIL ORDER PHARMACY AND OTHER PRESCRIPTIONS FROM  A
 LOCAL RETAIL PHARMACY.  THESE CHALLENGES INCLUDE THE DISCOVERY OF POTEN-
 TIAL  ADVERSE INTERACTIONS AMONG THEIR PRESCRIPTION DRUGS, COMPREHENSIVE
 COUNSELING, THE COORDINATION AND TIMING OF THE RECEIPT OF PRESCRIPTIONS,
 AND THE ABILITY TO KEEP INFORMATION REGARDING THEIR MEDICAL CONDITION OR
 CONDITIONS PRIVATE.

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD06513-03-7

 S. 3484                             2
 
   (B) AMERICANS WITH MULTIPLE PRESCRIPTIONS BENEFIT  FROM  THE  SERVICES
 PROVIDED  BY  A LOCAL RETAIL PHARMACY BECAUSE SUCH LOCAL SOURCE WILL NOT
 ONLY BE ABLE TO DETERMINE IF THERE ARE ANY HARMFUL OR POTENTIALLY  HARM-
 FUL  DRUG  INTERACTIONS  BUT  CAN  ALSO  PROVIDE IMMEDIATE FACE-TO-FACE,
 CONFIDENTIAL  COUNSELING  TO THE PATIENT REGARDING ANY AND ALL OF HIS OR
 HER PRESCRIBED DRUGS. FOR PATIENTS WHO ARE ENROLLED  IN  A  PRESCRIPTION
 BENEFIT  PLAN,  ENSURING  THAT  THE PLAN'S NETWORK INCLUDES LOCAL RETAIL
 PHARMACIES HAS  BECOME  OF  GREAT  IMPORTANCE.  MANDATING  THAT  CERTAIN
 PRESCRIPTIONS MUST BE FILLED BY A MAIL ORDER PHARMACY IS NOT IN THE BEST
 INTEREST   OF   ALL   PRESCRIPTION   BENEFIT  PLAN  ENROLLEES  AND  SUCH
 PRESCRIPTION BENEFIT PLAN ENROLLEES SHOULD BE GIVEN THE CHOICE REGARDING
 WHERE A PRESCRIPTION WILL BE FILLED.
   (C)  MANY  AMERICANS  WISH  TO  KEEP   INFORMATION   REGARDING   THEIR
 PRESCRIPTIONS  AND HEALTH CONDITIONS PRIVATE. SOME AMERICANS WILL CHOOSE
 TO DISCLOSE INFORMATION TO THEIR FAMILY, WHILE OTHERS MAY CHOOSE NOT  TO
 DISCLOSE ANY INFORMATION TO ANY PERSON. MANY PEOPLE KNOW THAT MEDICATION
 USED  TO  TREAT CHRONIC, COMPLEX OR RARE CONDITIONS IS DISPENSED BY MAIL
 ORDER PHARMACIES, NOT LOCAL RETAIL PHARMACIES. AS PART OF THEIR BUSINESS
 MODEL, MAIL ORDER PHARMACIES ENGAGE THE SERVICES OF  THIRD-PARTY  COMMON
 CARRIERS  TO DELIVER PRESCRIPTIONS. THIS CAN LEAD TO INADVERTENT DISCLO-
 SURE OF AND CONJECTURE REGARDING  PRIVATE  INFORMATION  TO  SUCH  COMMON
 CARRIERS'  EMPLOYEES,  AS WELL AS THE RECIPIENT'S NEIGHBORS WHO MAY NOTE
 THE REGULAR DELIVERIES OF PRESCRIPTION  MEDICATIONS  TO  THE  RECIPIENT,
 ESPECIALLY IF THE PACKAGES ARE LEFT AT THE RECIPIENT'S DOOR.
   (D) WHILE PRESCRIPTION BENEFIT PLANS HAVE NOT FORECLOSED THE POSSIBIL-
 ITY  FOR  A  LOCAL NETWORK RETAIL PHARMACY TO DISPENSE SPECIALTY MEDICA-
 TIONS, THESE PLANS WILL NOT ALLOW  THESE  PHARMACIES  TO  DISPENSE  SUCH
 PRESCRIPTIONS UNLESS THE PHARMACY AGREES TO ADDITIONAL CONTRACTUAL TERMS
 AND CONDITIONS. MANY SPECIALTY MEDICATIONS DO NOT REQUIRE ANY ADDITIONAL
 OR  SPECIAL  SERVICES FOR PROPER DISPENSING; THEY HAVE BEEN DEEMED TO BE
 SPECIALTY PRESCRIPTIONS BECAUSE THEY ARE EXPENSIVE.  WHILE  THESE  ADDI-
 TIONAL  TERMS AND CONDITIONS MAKE SENSE WHEN THERE IS NO POSSIBILITY FOR
 FACE-TO-FACE INTERACTIONS BETWEEN A PHARMACIST  AND  THE  PATIENT,  THEY
 PRESENT  AN  UNDUE BURDEN TO LOCAL RETAIL PHARMACIES SEEKING TO DISPENSE
 SPECIALTY MEDICATIONS. THUS, FEW LOCAL  RETAIL  NETWORK  PHARMACIES  ARE
 AUTHORIZED TO DISPENSE SPECIALTY MEDICATIONS.
   (E)  REQUIRING  PRESCRIPTION  BENEFIT PLAN ENROLLEES TO REMIT A HIGHER
 CO-PAYMENT OR PAY THE FULL RETAIL  PRICE  FOR  A  PRESCRIPTION  THAT  IS
 DISPENSED  BY  A NETWORK RETAIL PHARMACY INSTEAD OF A NETWORK MAIL ORDER
 PHARMACY IS NOT IN THE BEST INTEREST OF SUCH ENROLLEES AS IT EFFECTIVELY
 FORCES AN ENROLLEE TO USE ONLY MAIL  ORDER  PRESCRIPTION  PHARMACIES  BY
 MAKING ALL ALTERNATIVES COST PROHIBITIVE.
   (F)  SIMILARLY,  REQUIRING LOCAL NETWORK RETAIL PHARMACIES TO ACCEPT A
 LOWER CO-PAYMENT FOR DISPENSING SPECIALTY PRESCRIPTION DRUGS IS  NOT  IN
 THE  BEST  INTEREST OF THE PRESCRIPTION BENEFIT PLAN'S ENROLLEES BECAUSE
 IT MAY BECOME FINANCIALLY DIFFICULT FOR A  NETWORK  RETAIL  PHARMACY  TO
 REMAIN  IN  THE  PRESCRIPTION BENEFIT PLAN'S NETWORK. THE RESULT OF THIS
 PRACTICE IS THE COMPLETE ELIMINATION OF OR A REDUCTION IN THE NUMBER  OF
 LOCAL  NETWORK  RETAIL PHARMACIES AVAILABLE TO PRESCRIPTION BENEFIT PLAN
 ENROLLEES.
   2. THE LEGISLATURE DECLARES THAT IT IS  THE  EXPRESS  POLICY  OF  THIS
 STATE  TO SAFEGUARD THE PUBLIC AGAINST INADVERTENT DISCLOSURE OF MEDICAL
 CONDITIONS, UNNECESSARY COMPLEXITY IN OBTAINING PRESCRIPTION MEDICATIONS
 AND FINANCIAL HARDSHIP, AND TO FOSTER AND ENCOURAGE COMPETITION AND FAIR
 DEALING  IN  THE  FIELD  OF  PHARMACEUTICAL  SERVICES   BY   PROHIBITING
 PRESCRIPTION  BENEFIT PLANS FROM REQUIRING THAT CERTAIN PRESCRIPTIONS BE

 S. 3484                             3
 
 FILLED BY A NETWORK MAIL ORDER PHARMACY,  HARMFUL  FINANCIAL  PRACTICES,
 AND OTHER UNFAIR PRACTICES THAT HAVE BEEN CONDUCTED BY SOME PRESCRIPTION
 BENEFIT PLANS.
   3.  THE  LEGISLATURE FURTHER FINDS THAT PRESCRIPTION BENEFIT PLANS MAY
 HAVE A SIGNIFICANT IMPACT UPON THE ECONOMY AND WELL-BEING OF THIS  STATE
 AND  ITS LOCAL COMMUNITIES, AND THEREFORE THE PROVISIONS OF THIS ARTICLE
 ARE NECESSARY TO PROMOTE THE PUBLIC WELFARE.
   4. THE INTENT AND PURPOSES OF THIS ARTICLE ARE TO PROVIDE PRESCRIPTION
 BENEFIT PLAN ENROLLEES WITH THE ABILITY TO  CHOOSE  WHETHER  TO  FILL  A
 PRESCRIPTION  AT A LOCAL NETWORK RETAIL PHARMACY OR A NETWORK MAIL ORDER
 PHARMACY WITHOUT INCURRING ADDITIONAL COSTS FOR CHOOSING TO  HAVE  THEIR
 PRESCRIPTIONS  FILLED BY A LOCAL NETWORK RETAIL PHARMACY; TO PROVIDE ALL
 NETWORK RETAIL PHARMACIES WITH THE ABILITY TO CONTRACT WITH PRESCRIPTION
 BENEFIT PLANS TO DISPENSE PRESCRIPTIONS THAT HAVE BEEN DEEMED TO BE MAIL
 ORDER PRESCRIPTIONS  BY  THE  PHARMACY  BENEFIT  MANAGER  WITHOUT  BEING
 REQUIRED  TO  AGREE  TO ADDITIONAL CONTRACTUAL TERMS AND CONDITIONS THAT
 ARE APPLICABLE TO MAIL ORDER PHARMACIES WHERE THERE IS  NO  FACE-TO-FACE
 INTERACTION  WITH PRESCRIPTION BENEFIT PLAN ENROLLEES, SUCH AS A TWENTY-
 FOUR HOUR CUSTOMER SERVICE HOTLINE; AND TO  ENSURE  THAT  LOCAL  NETWORK
 RETAIL   PHARMACIES   ARE   NOT   MONETARILY  PENALIZED  FOR  DISPENSING
 PRESCRIPTIONS THAT  THE  PHARMACY  BENEFIT  MANAGER  HAS  DEEMED  TO  BE
 SPECIALTY  DRUG PRESCRIPTIONS REQUIRING DISPENSING BY A MAIL ORDER PHAR-
 MACY.
   § 901. DEFINITIONS. AS USED IN THIS ARTICLE:
   1. "MAIL ORDER PHARMACY" SHALL MEAN A PHARMACY WHOSE PRIMARY  BUSINESS
 IS  TO  RECEIVE  PRESCRIPTIONS  BY  MAIL,  TELEFAX OR THROUGH ELECTRONIC
 SUBMISSIONS AND TO DISPENSE MEDICATION TO PATIENTS THROUGH  THE  USE  OF
 THE  UNITED STATES MAIL OR OTHER COMMON OR CONTRACT CARRIER SERVICES AND
 PROVIDE ANY CONSULTATION WITH PATIENTS ELECTRONICALLY RATHER THAN  FACE-
 TO-FACE.
   2.  "RETAIL  PHARMACY" SHALL MEAN A PHARMACY WHOSE PRIMARY BUSINESS IS
 TO RECEIVE PRESCRIPTIONS DIRECTLY FROM PATIENTS  OR  THROUGH  ELECTRONIC
 SUBMISSIONS  AND TO DISPENSE MEDICATION DIRECTLY TO PATIENTS AND PROVIDE
 FACE-TO-FACE CONSULTATION WITH PATIENTS. FOR PURPOSES OF  THIS  SUBDIVI-
 SION,  THE TERM "PATIENT" SHALL INCLUDE A PERSON WHO IS ACTING ON BEHALF
 OF A PATIENT.
   3. "PRESCRIPTION BENEFIT PLAN" SHALL MEAN ANY BENEFIT PLAN OTHER  THAN
 A  STATE PUBLIC HEALTH PLAN, AS DEFINED IN SUBDIVISION ELEVEN OF SECTION
 TWO HUNDRED SEVENTY OF THE PUBLIC HEALTH LAW, THAT INCLUDES PRESCRIPTION
 DRUG BENEFITS TO ENROLLEES AND THEIR DEPENDENTS.
   4. "SPECIALTY PRESCRIPTION DRUG" SHALL MEAN A PRESCRIPTION  DRUG  THAT
 IS  USED  TO TREAT A CHRONIC, COMPLEX OR RARE CONDITION, HAS BEEN DESIG-
 NATED BY THE PRESCRIPTION BENEFIT AS A SPECIALTY PRESCRIPTION DRUG,  AND
 WILL ONLY BE COVERED BY THE PRESCRIPTION BENEFIT PLAN IF IT IS DISPENSED
 BY A NETWORK MAIL ORDER PHARMACY.
   5.  "NETWORK" SHALL MEAN A MAIL ORDER PHARMACY OR RETAIL PHARMACY THAT
 PARTICIPATES IN A PRESCRIPTION BENEFIT PLAN.
   6. "MAIL ORDER PRESCRIPTION" SHALL MEAN ANY PRESCRIPTION DRUG, INCLUD-
 ING,  BUT  NOT  LIMITED  TO  SPECIALTY  PRESCRIPTION   DRUGS,   THAT   A
 PRESCRIPTION BENEFIT PLAN REQUIRES BE FILLED BY A MAIL ORDER PHARMACY IN
 ORDER FOR SUCH DISPENSED PRESCRIPTION TO BE COVERED BY SUCH PLAN.
   7.  "PRESCRIPTION  BENEFIT PLAN ENROLLEE" OR "ENROLLEE" SHALL MEAN THE
 PERSON WHO IS ENROLLED IN THE PRESCRIPTION BENEFIT PLAN AND HIS  OR  HER
 SPOUSE AND DEPENDENT CHILDREN WHO ARE ENROLLED IN THE PRESCRIPTION BENE-
 FIT PLAN AS DEPENDENTS OF SUCH PERSON.

 S. 3484                             4

   §  902. PROHIBITED CONDUCT. 1. NOTWITHSTANDING ANY PROVISION OF LAW TO
 THE CONTRARY, IT SHALL BE UNLAWFUL FOR A PRESCRIPTION  BENEFIT  PLAN  TO
 REQUIRE   AN   ENROLLEE   OR  AN  ENROLLEE'S  DEPENDENT  TO  OBTAIN  ANY
 PRESCRIPTION DRUG FROM A NETWORK MAIL ORDER PHARMACY IN ORDER TO RECEIVE
 COVERAGE FROM SUCH PLAN FOR SUCH PRESCRIPTION.
   2.  NOTWITHSTANDING  ANY PROVISION OF LAW TO THE CONTRARY, IT SHALL BE
 UNLAWFUL FOR A PRESCRIPTION BENEFIT PLAN TO REQUIRE THAT AN ENROLLEE  OR
 AN  ENROLLEE'S  DEPENDENT  REMIT  A HIGHER CO-PAYMENT FOR A PRESCRIPTION
 WHEN SUCH PRESCRIPTION IS DISPENSED BY A NETWORK RETAIL PHARMACY.
   3. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, IT  SHALL  BE
 UNLAWFUL  FOR  A  PRESCRIPTION  BENEFIT PLAN TO REQUIRE A NETWORK RETAIL
 PHARMACY TO AGREE TO ADDITIONAL CONTRACTUAL TERMS AND CONDITIONS THAT GO
 BEYOND THE INDUSTRY STANDARD AS A CONDITION PRECEDENT TO ALLOWING SUCH A
 RETAIL PHARMACY TO DISPENSE SPECIALTY PRESCRIPTION DRUGS  AS  A  NETWORK
 PROVIDER.
   4.  NOTWITHSTANDING  ANY PROVISION OF LAW TO THE CONTRARY, IT SHALL BE
 UNLAWFUL  FOR  A  MAIL  ORDER  PHARMACY  TO   AUTOMATICALLY   REFILL   A
 PRESCRIPTION  BENEFIT  PLAN  ENROLLEE'S  PRESCRIPTION  WITHOUT OBTAINING
 PERMISSION FOR SUCH AUTOMATIC REFILLS FROM SUCH ENROLLEE, OR IN THE CASE
 OF AN ENROLLEE'S  DEPENDENT  CHILD,  THE  ENROLLEE  OR  CHILD'S  PARENT;
 PROVIDED,  HOWEVER,  ANY  PERMISSION GRANTED FOR AUTOMATIC REFILLS SHALL
 EXPIRE AFTER SIX MONTHS AND MAY BE RENEWED THEREAFTER FOR INTERVALS  NOT
 TO EXCEED SIX MONTHS.
   5.  NOTWITHSTANDING  ANY PROVISION OF LAW TO THE CONTRARY, IT SHALL BE
 UNLAWFUL FOR ANY MAIL ORDER PHARMACY TO  RETAIN  AN  ENROLLEE'S  PAYMENT
 INFORMATION  FOR  FUTURE  USE  WITHOUT  THE CONSENT OF THE ENROLLEE. FOR
 PURPOSES OF THIS SUBDIVISION, PAYMENT INFORMATION INCLUDES, BUT  IS  NOT
 LIMITED  TO,  CREDIT  CARD INFORMATION, DEBIT CARD INFORMATION, AND BANK
 ACCOUNT INFORMATION.
   § 903. ACTION TO RECOVER DAMAGES. 1. ANY PERSON INJURED BY A VIOLATION
 OF THIS ARTICLE MAY BRING AN ACTION FOR THE RECOVERY OF  DAMAGES.  JUDG-
 MENT  MAY  BE ENTERED IN FAVOR OF SUCH PERSON IN AN AMOUNT NOT TO EXCEED
 THREE TIMES THE ACTUAL DAMAGES OR  ONE  HUNDRED  DOLLARS,  WHICHEVER  IS
 GREATER.  THE COURT MAY AWARD REASONABLE ATTORNEY'S FEES TO A PREVAILING
 PLAINTIFF.
   2. NOTHING IN THIS ARTICLE SHALL BE CONSTRUED  SO  AS  TO  NULLIFY  OR
 IMPAIR ANY RIGHT OR RIGHTS WHICH A PRESCRIPTION BENEFIT PLAN ENROLLEE OR
 SUCH  ENROLLEE'S  DEPENDENT  MAY HAVE AGAINST A SELLER AT COMMON LAW, BY
 STATUTE, OR OTHERWISE.
   § 904. VIOLATIONS. ANY MAIL ORDER  PHARMACY  OR  PRESCRIPTION  BENEFIT
 PLAN, INCLUDING ITS EMPLOYEES AND AGENTS, THAT VIOLATES ANY PROVISION OF
 THIS  ARTICLE, SHALL BE LIABLE FOR A CIVIL FINE OF NOT MORE THAN TWENTY-
 FIVE HUNDRED DOLLARS FOR EACH VIOLATION.
   § 905. ENFORCEMENT BY ATTORNEY GENERAL. IN ADDITION TO THE OTHER REME-
 DIES PROVIDED, WHENEVER THERE SHALL BE  A  VIOLATION  OF  THIS  ARTICLE,
 APPLICATION  MAY  BE  MADE  BY  THE  ATTORNEY GENERAL IN THE NAME OF THE
 PEOPLE OF THE STATE TO A COURT HAVING JURISDICTION TO ISSUE  AN  INJUNC-
 TION,  AND UPON NOTICE TO THE RESPONDENT OF NOT FEWER THAN FIVE DAYS, TO
 ENJOIN AND RESTRAIN THE CONTINUANCE OF THE VIOLATION. IF IT SHALL APPEAR
 TO THE SATISFACTION OF THE COURT OR JUSTICE THAT THE DEFENDANT  HAS,  IN
 FACT,  VIOLATED  THIS ARTICLE, AN INJUNCTION MAY BE ISSUED BY SUCH COURT
 OR JUSTICE, ENJOINING AND RESTRAINING  ANY  FURTHER  VIOLATION,  WITHOUT
 REQUIRING  PROOF  THAT  ANY PERSON HAS, IN FACT, BEEN INJURED OR DAMAGED
 THEREBY. IN ANY SUCH PROCEEDING, THE COURT MAY MAKE  ALLOWANCES  TO  THE
 ATTORNEY  GENERAL  AS  PROVIDED  IN  PARAGRAPH SIX OF SUBDIVISION (A) OF
 SECTION EIGHTY-THREE HUNDRED THREE OF THE CIVIL PRACTICE LAW AND  RULES,

 S. 3484                             5
 
 AND  DIRECT  RESTITUTION.  WHENEVER  THE  COURT  SHALL  DETERMINE THAT A
 VIOLATION OF THIS ARTICLE HAS OCCURRED, THE COURT  MAY  IMPOSE  A  CIVIL
 PENALTY OF NOT MORE THAN TEN THOUSAND DOLLARS FOR EACH VIOLATION.
   §  2.  This  act shall take effect on the ninetieth day after it shall
 have become a law and shall apply to contracts entered into, amended  or
 renewed on and after such date.

co-Sponsors

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2017-S3484A (ACTIVE) - Details

Current Committee:: Senate Consumer Protection
Law Section:: General Business Law
Laws Affected:: Add Art 40 §§900 - 905, Gen Bus L

2017-S3484A (ACTIVE) - Summary

Provides that prescription benefit plans may not require patients to receive prescriptions through mail order pharmacies.

2017-S3484A (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S3484A

 TITLE OF BILL :  An act to amend the general business law, in
relation to mail order pharmacies

 PURPOSE :

To provide New Yorkers with the ability to choose to fill
prescriptions at a local retail pharmacy rather than a mail order
pharmacy without incurring any penalties for filling prescriptions
locally.

 SUMMARY OF PROVISIONS :

Section one of the bill adds a new Article 40 entitled Mail Order
Pharmacies to the General Business Law. New Article 40 contains five
new sections. The first new section, General Business Law section 900,
provides the legislative findings, declarations and purposes. In this
section, the Legislature finds and declares that, among other things,
it is beneficial for New Yorkers enrolled in prescription benefit
plans to be able to fill any prescription at a local retail pharmacy
and that they should not be required to pay more for prescriptions
that are locally filled. Additionally, the Legislature finds and
declares that local retail pharmacies should not be required to agree
to contractual terms and conditions that are solely applicable to the
mail order pharmacy business in order to be able to dispense specialty

prescriptions.

New General Business Law section 901provides definitions for terms
that are used in new Article 40. These terms include "mail order
pharmacy," "retail pharmacy," "prescription benefit plan," and
"specialty prescription drug." In the definition of "prescription
benefit plan," Medicaid plans and plans that, pursuant to Employee
Retirement Income Security Act ("ERISA"), constitute an employee
benefit plan, a governmental plan, a church plan, or a plan that is
maintained solely for the purpose of complying with applicable
workmen's compensation laws or unemployment compensation or disability
insurance laws. See, 32 USC section 1002(1), (32) and (33).

New General Business Law section 902 lists the types of conduct
prohibited by new Article 40. New Article 40 prohibits prescription
benefit plans from engaging in the following types of conduct:

(1) Requiring prescriptions for specialty drugs to be filled by a mail
order pharmacy in order for such prescription to be covered by the
prescription benefit plan.

(2) Requiring a prescription benefit plan enrollee remit a higher
co-payment when a prescription is filled by a network retail pharmacy
instead of a mail order pharmacy.

(3) Requiring a local retail pharmacy to agree to additional terms and
conditions that go beyond the industry standard and are not reasonable
and relevant before the pharmacy can dispense specialty prescription
drugs. In 2014, the Center for Medicaid and Medicare Services
promulgated regulations implementing the reasonable and relevant
standard. See, 42 CFR 423.505(18).

(4) The practice, by mail order pharmacies, of automatically refilling
prescriptions without authorization from the patient or the patient's
guardian.

(5) The practice, by mail order pharmacies, of retaining a customer's
payment information for future use without express permission from the
customer.

New General Business Law section 903 provides a right of action for
any person who has been injured as a result of a prescription benefit
plan violating new Article 40.

New General Business Law section 904 provides a civil penalty for each
violation of new Article 40 by either a mail order pharmacy or a
prescription benefit plan. The amount of the penalty shall not exceed
two thousand five hundred dollars per occurrence.

New General Business Law section 905 provides the Attorney General
with the power to enforce the provisions of new Article 40.

Section two of this bill provides that this act shall take effect on
the ninetieth day after it shall have become a law and shall apply to
contracts entered into, amended or renewed on and after such date.

 JUSTIFICATION :

The number of Americans who take three or more prescription drugs is
rapidly increasing, with approximately ten percent of all Americans
taking five or more prescription drugs. Managing these prescriptions
presents a number of challenges and can become complicated. One of the
most significant challenges occurs when some of the prescriptions must
be filled by a mail order pharmacy in order for the prescription to be
covered by insurance, while other prescriptions cannot be filled by
such a pharmacy. In this instance, the consumer must not only manage
interaction with multiple pharmacies, but also the delivery of
prescriptions from a mail order pharmacy.

Additionally, when consumers are not filling all of their
prescriptions at one pharmacy, none of the pharmacies can conduct an
adequate interaction check prior to dispensing a prescription because
the pharmacy does not have all of the information needed to conduct a
proper interaction check. This places the burden of checking for drug
interactions on the consumer. While this may seem like an easy task,
for many, it is difficult because the consumer may not have access to
a computer, or the consumer may use multiple interaction checkers that
provide conflicting results. If a consumer could fill all of his or
her prescriptions at one pharmacy and have all of the prescriptions
covered by his or her prescription insurance, consumers would benefit
because the pharmacist would have a list of all of the consumer's
prescriptions and could run the interaction checker. The pharmacist
would be able to discuss any potentially adverse interactions with the
consumer and be able to answer the consumer's questions.

Another challenge for consumers arises when the consumer experiences
an adverse reaction, such as an injection site reaction, that needs to
be seen for proper evaluation. Because mail order pharmacies are
unable to see such a reaction, they direct consumers to go to an
urgent care facility or the emergency room. Many times, the medical
care was unnecessary and a pharmacist could have provided adequate
counsel to address the adverse reaction. This situation can be avoided
by allowing consumers to fill prescriptions at local retail
pharmacies.

On January 10, 2014 the Center for Medicaid and Medicare Services
("CMS") issued a notice of proposed rulemaking for Medicare Part D
that included an any willing pharmacy requirement mandating that the
contractual terms and conditions offered to a pharmacies by health
insurance plans be reasonable and relevant. In support of the proposed
rule, CMS stated " w hen issues with filling a prescription arise in a
retail setting, the beneficiary often is notified of the problem in
real time, or within hours of discovery. When issues arise in a mail
order setting, the delays in finding, communicating, and making the
appropriate contacts to resolve the problem may add days onto the
ultimate delivery date, resulting in a potentially more significant
concern for mail order beneficiaries if these delays result in gaps in
therapy." See, 17 Federal Register 1918 at 1929. We share this concern
regarding mail order pharmacies and believe that because of the
inherent differences between retail pharmacies and mail order
pharmacies, one of which is highlighted above, prescription benefit
plan enrollees should be allowed to choose whether to have a
prescription filled by a network local retail pharmacy or a network
mail order pharmacy.

In response to the proposed regulation implementing the any willing
pharmacy requirement, the Federal Trade Commission ("FTC") wrote a
letter dated March 7, 2014 to the CMS expressing concerns that the any
willing pharmacy requirement could, among other things, have
anticompetitive effects and lead to consumer harm. The FTC asserted
that the any willing pharmacy requirement, instead of allowing for
limited pharmacies, could lead to higher prices because, among other
things, Pharmacy Benefit Managers ("PBMs") and insurance plans would
be less likely to want to engage in complex negotiations with
pharmaceutical companies for preferred drug prices. In the response to
the FTC's concerns, CMS stated that " i f limited networks per se led
to significantly lower costs, we would see consistently significant
savings in those network segments relative to the rest of the
sponsors' networks. However, an April 2013 analysis by CMS,
"Negotiated Pricing Between Preferred and Non-Preferred Pharmacy
Networks", reviewed actual program experience and indicated that this
is not the case across the board (see
http://www.ans.gov/Medicare/Prescription-Druq-Coverage/
PrescriptionDrugCovGenln/Downloads/PharmacyNetwork.pdt)." See, 79
Federal Register 29843 at 29886. CMS went on to state " w e have also
heard the argument that the pharmacies in currently limited networks
are offering deeper discounts solely in return for increased market
share and that they will withdraw such offers if the limited network
is opened up to other pharmacies that can meet those T&C. We are
skeptical that such participants in the highly competitive retail
market will abandon their market share by returning to the broader
network T&C. As some network pharmacies offering standard cost sharing
have been able to extend discounts in pricing even deeper than what is
seen in some pharmacies offering preferred cost sharing, it is not
obvious that negotiated prices would necessarily increase in the
aggregate in the event that a limited number of pharmacies consider
changing from preferred to standard cost sharing." Id. After reviewing
and considering the FTC's concerns, and the concerns expressed by
other commenters, CMS promulgated the regulation.

In 2012, the Legislature thought that, pursuant to a newly enacted
law, consumers would always have the choice of obtaining covered
prescription drugs from a local network retail pharmacy. Over the
course of the year, however, it became clear that the law was not
working as intended. Consumers received letters from pharmacy benefit
managers directing them to "specialty" pharmacies. Consumers returning
to their local participating pharmacy could no longer obtain some of
their prescription drugs there because the drug would be covered by
the prescription benefit plan if the drug was filled by a mail order
pharmacy. The pharmacy was notified that coverage for that medication
was no longer covered in the "retail" pharmacy network and that the
patient was to be directed to the "specialty" pharmacy.

This bill would provide consumers with the choice that they should
have had since 2012.

 LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

None to the State

 EFFECTIVE DATE :
This act shall take effect on the ninetieth day after it shall have
become a law and shall apply to contracts entered into, amended or
renewed on and after such date.

2017-S3484A (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  3484--A
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                             January 23, 2017
                                ___________
 
 Introduced  by  Sens.  GOLDEN, FUNKE, ADDABBO, AKSHAR, ALCANTARA, BOYLE,
   BRESLIN, CARLUCCI, COMRIE, CROCI, GALLIVAN, GRIFFO, HAMILTON, HELMING,
   HOYLMAN, KENNEDY, KRUEGER, LANZA, LARKIN,  LATIMER,  LAVALLE,  LITTLE,
   MARCHIONE, MURPHY, O'MARA, ORTT, PARKER, RANZENHOFER, RITCHIE, ROBACH,
   SERINO, SQUADRON, STAVISKY, TEDISCO, VALESKY -- read twice and ordered
   printed, and when printed to be committed to the Committee on Consumer
   Protection  -- reported favorably from said committee and committed to
   the Committee on Insurance  --  committee  discharged,  bill  amended,
   ordered reprinted as amended and recommitted to said committee
 
 AN  ACT  to  amend  the  general business law, in relation to mail order
   pharmacies
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The general business law is amended by adding a new article
 40 to read as follows:
                                ARTICLE 40
                           MAIL ORDER PHARMACIES
 SECTION 900. LEGISLATIVE FINDINGS AND DECLARATIONS; PURPOSES.
         901. DEFINITIONS.
         902. PROHIBITED CONDUCT.
         903. ACTION TO RECOVER DAMAGES BY AN ENROLLEE.
         904. VIOLATIONS.
         905. ENFORCEMENT BY ATTORNEY GENERAL.
         906. APPLICABILITY.
   §  900. LEGISLATIVE FINDINGS AND DECLARATIONS; PURPOSES. 1. THE LEGIS-
 LATURE FINDS AND DECLARES THAT:
   (A) THE NUMBER OF AMERICANS WHO ARE PRESCRIBED THREE OR  MORE  MEDICA-
 TIONS  IS GROWING AT AN ALARMING RATE, WITH APPROXIMATELY TEN PERCENT OF
 THE POPULATION TAKING FIVE OR MORE PRESCRIPTION MEDICATIONS. THESE AMER-
 ICANS FACE MANY CHALLENGES WHEN THEY ARE REQUIRED  TO  RECEIVE  SOME  OF
 THEIR  PRESCRIPTIONS  FROM  A  MAIL ORDER PHARMACY WHILE RECEIVING OTHER
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD06513-07-7

 S. 3484--A                          2
 
 PRESCRIPTIONS FROM A LOCAL RETAIL PHARMACY.   THESE  CHALLENGES  INCLUDE
 THE DISCOVERY OF POTENTIAL ADVERSE INTERACTIONS AMONG THEIR PRESCRIPTION
 DRUGS,  COMPREHENSIVE  COUNSELING,  THE  COORDINATION  AND TIMING OF THE
 RECEIPT  OF PRESCRIPTIONS, AND THE ABILITY TO KEEP INFORMATION REGARDING
 THEIR MEDICAL CONDITION OR CONDITIONS PRIVATE.
   (B) AMERICANS WITH MULTIPLE PRESCRIPTIONS BENEFIT  FROM  THE  SERVICES
 PROVIDED  BY  A LOCAL RETAIL PHARMACY BECAUSE SUCH LOCAL SOURCE WILL NOT
 ONLY BE ABLE TO DETERMINE IF THERE ARE ANY HARMFUL OR POTENTIALLY  HARM-
 FUL  DRUG  INTERACTIONS  BUT  CAN  ALSO  PROVIDE IMMEDIATE FACE-TO-FACE,
 CONFIDENTIAL COUNSELING TO THE PATIENT REGARDING ANY AND ALL OF  HIS  OR
 HER  PRESCRIBED  DRUGS.  FOR PATIENTS WHO ARE ENROLLED IN A PRESCRIPTION
 BENEFIT PLAN, ENSURING THAT THE PLAN'S  NETWORK  INCLUDES  LOCAL  RETAIL
 PHARMACIES  HAS  BECOME  OF  GREAT  IMPORTANCE.  MANDATING  THAT CERTAIN
 PRESCRIPTIONS MUST BE FILLED BY A MAIL ORDER PHARMACY IS NOT IN THE BEST
 INTEREST  OF  ALL  PRESCRIPTION  BENEFIT   PLAN   ENROLLEES   AND   SUCH
 PRESCRIPTION BENEFIT PLAN ENROLLEES SHOULD BE GIVEN THE CHOICE REGARDING
 WHERE A PRESCRIPTION WILL BE FILLED.
   (C)   MANY   AMERICANS   WISH  TO  KEEP  INFORMATION  REGARDING  THEIR
 PRESCRIPTIONS AND HEALTH CONDITIONS PRIVATE. SOME AMERICANS WILL  CHOOSE
 TO  DISCLOSE INFORMATION TO THEIR FAMILY, WHILE OTHERS MAY CHOOSE NOT TO
 DISCLOSE ANY INFORMATION TO ANY PERSON. MANY PEOPLE KNOW THAT MEDICATION
 USED TO TREAT CHRONIC, COMPLEX OR RARE CONDITIONS IS DISPENSED  BY  MAIL
 ORDER PHARMACIES, NOT LOCAL RETAIL PHARMACIES. AS PART OF THEIR BUSINESS
 MODEL,  MAIL  ORDER PHARMACIES ENGAGE THE SERVICES OF THIRD-PARTY COMMON
 CARRIERS TO DELIVER PRESCRIPTIONS. THIS CAN LEAD TO INADVERTENT  DISCLO-
 SURE  OF  AND  CONJECTURE  REGARDING  PRIVATE INFORMATION TO SUCH COMMON
 CARRIERS' EMPLOYEES, AS WELL AS THE RECIPIENT'S NEIGHBORS WHO  MAY  NOTE
 THE  REGULAR  DELIVERIES  OF  PRESCRIPTION MEDICATIONS TO THE RECIPIENT,
 ESPECIALLY IF THE PACKAGES ARE LEFT AT THE RECIPIENT'S DOOR.
   (D) WHILE PRESCRIPTION BENEFIT PLANS HAVE NOT FORECLOSED THE POSSIBIL-
 ITY FOR A LOCAL NETWORK RETAIL PHARMACY TO  DISPENSE  SPECIALTY  MEDICA-
 TIONS, MANY OF THESE PLANS WILL NOT ALLOW A LOCAL NETWORK RETAIL PHARMA-
 CY  TO  DISPENSE  SUCH  PRESCRIPTIONS  UNLESS  THE  PHARMACY  AGREES  TO
 ADDITIONAL CONTRACTUAL TERMS AND CONDITIONS. MANY SPECIALTY  MEDICATIONS
 DO NOT REQUIRE ANY ADDITIONAL OR SPECIAL SERVICES FOR PROPER DISPENSING;
 THEY  HAVE  BEEN  DEEMED  TO BE SPECIALTY PRESCRIPTIONS BECAUSE THEY ARE
 EXPENSIVE. WHILE THESE ADDITIONAL TERMS AND CONDITIONS MAKE  SENSE  WHEN
 THERE  IS NO POSSIBILITY FOR FACE-TO-FACE INTERACTIONS BETWEEN A PHARMA-
 CIST AND THE PATIENT, THEY PRESENT AN UNDUE BURDEN TO LOCAL RETAIL PHAR-
 MACIES SEEKING TO DISPENSE SPECIALTY MEDICATIONS.
   (E) REQUIRING PRESCRIPTION BENEFIT PLAN ENROLLEES TO  REMIT  A  HIGHER
 CO-PAYMENT  OR  PAY  THE  FULL  RETAIL  PRICE FOR A PRESCRIPTION THAT IS
 DISPENSED BY A NETWORK RETAIL PHARMACY INSTEAD OF A NETWORK  MAIL  ORDER
 PHARMACY IS NOT IN THE BEST INTEREST OF SUCH ENROLLEES AS IT EFFECTIVELY
 FORCES  AN  ENROLLEE  TO  USE ONLY MAIL ORDER PRESCRIPTION PHARMACIES BY
 MAKING ALL ALTERNATIVES COST PROHIBITIVE.
   (F) SIMILARLY, REQUIRING LOCAL NETWORK RETAIL PHARMACIES TO  ACCEPT  A
 LOWER  PAYMENT FOR DISPENSING SPECIALTY PRESCRIPTION DRUGS IS NOT IN THE
 BEST INTEREST OF THE PRESCRIPTION BENEFIT PLAN'S  ENROLLEES  BECAUSE  IT
 MAY BECOME FINANCIALLY DIFFICULT FOR A NETWORK RETAIL PHARMACY TO REMAIN
 IN  THE PRESCRIPTION BENEFIT PLAN'S NETWORK. THE RESULT OF THIS PRACTICE
 IS THE COMPLETE ELIMINATION OF OR A REDUCTION IN  THE  NUMBER  OF  LOCAL
 NETWORK  RETAIL PHARMACIES AVAILABLE TO PRESCRIPTION BENEFIT PLAN ENROL-
 LEES.
   2. THE LEGISLATURE DECLARES THAT IT IS  THE  EXPRESS  POLICY  OF  THIS
 STATE  TO SAFEGUARD THE PUBLIC AGAINST INADVERTENT DISCLOSURE OF MEDICAL

 S. 3484--A                          3
 
 CONDITIONS, UNNECESSARY COMPLEXITY IN OBTAINING PRESCRIPTION MEDICATIONS
 AND FINANCIAL HARDSHIP, AND TO FOSTER AND ENCOURAGE COMPETITION AND FAIR
 DEALING  IN  THE  FIELD  OF  PHARMACEUTICAL  SERVICES   BY   PROHIBITING
 PRESCRIPTION  BENEFIT PLANS FROM REQUIRING THAT CERTAIN PRESCRIPTIONS BE
 FILLED BY A NETWORK MAIL ORDER PHARMACY,  HARMFUL  FINANCIAL  PRACTICES,
 AND OTHER UNFAIR PRACTICES THAT HAVE BEEN CONDUCTED BY SOME PRESCRIPTION
 BENEFIT PLANS.
   3.  THE  LEGISLATURE FURTHER FINDS THAT PRESCRIPTION BENEFIT PLANS MAY
 HAVE A SIGNIFICANT IMPACT UPON THE ECONOMY AND WELL-BEING OF THIS  STATE
 AND  ITS LOCAL COMMUNITIES, AND THEREFORE THE PROVISIONS OF THIS ARTICLE
 ARE NECESSARY TO PROMOTE THE PUBLIC WELFARE.
   4. THE INTENT AND PURPOSES OF THIS ARTICLE ARE TO PROVIDE PRESCRIPTION
 BENEFIT PLAN ENROLLEES WITH THE ABILITY TO  CHOOSE  WHETHER  TO  FILL  A
 PRESCRIPTION  AT A LOCAL NETWORK RETAIL PHARMACY OR A NETWORK MAIL ORDER
 PHARMACY WITHOUT INCURRING ADDITIONAL COSTS FOR CHOOSING TO  HAVE  THEIR
 PRESCRIPTIONS  FILLED BY A LOCAL NETWORK RETAIL PHARMACY; TO PROVIDE ALL
 NETWORK RETAIL PHARMACIES WITH THE ABILITY TO CONTRACT WITH PRESCRIPTION
 BENEFIT PLANS TO DISPENSE PRESCRIPTIONS THAT HAVE BEEN DEEMED TO BE MAIL
 ORDER PRESCRIPTIONS  BY  THE  PHARMACY  BENEFIT  MANAGER  WITHOUT  BEING
 REQUIRED  TO  AGREE  TO ADDITIONAL CONTRACTUAL TERMS AND CONDITIONS THAT
 ARE APPLICABLE TO MAIL ORDER PHARMACIES WHERE THERE IS  NO  FACE-TO-FACE
 INTERACTION  WITH PRESCRIPTION BENEFIT PLAN ENROLLEES, SUCH AS A TWENTY-
 FOUR HOUR CUSTOMER SERVICE HOTLINE; AND TO  ENSURE  THAT  LOCAL  NETWORK
 RETAIL   PHARMACIES   ARE   NOT   MONETARILY  PENALIZED  FOR  DISPENSING
 PRESCRIPTIONS THAT  THE  PHARMACY  BENEFIT  MANAGER  HAS  DEEMED  TO  BE
 SPECIALTY  DRUG PRESCRIPTIONS REQUIRING DISPENSING BY A MAIL ORDER PHAR-
 MACY.
   § 901. DEFINITIONS. AS USED IN THIS ARTICLE:
   1. "MAIL ORDER PHARMACY" SHALL MEAN A PHARMACY WHOSE PRIMARY  BUSINESS
 IS  TO  RECEIVE  PRESCRIPTIONS  BY  MAIL,  TELEFAX OR THROUGH ELECTRONIC
 SUBMISSIONS AND TO DISPENSE MEDICATION TO PATIENTS THROUGH  THE  USE  OF
 THE  UNITED STATES MAIL OR OTHER COMMON OR CONTRACT CARRIER SERVICES AND
 PROVIDE ANY CONSULTATION WITH PATIENTS ELECTRONICALLY RATHER THAN  FACE-
 TO-FACE.
   2.  "RETAIL  PHARMACY" SHALL MEAN A PHARMACY WHOSE PRIMARY BUSINESS IS
 TO RECEIVE PRESCRIPTIONS DIRECTLY FROM PATIENTS  OR  THROUGH  ELECTRONIC
 SUBMISSIONS  AND TO DISPENSE MEDICATION DIRECTLY TO PATIENTS AND PROVIDE
 FACE-TO-FACE CONSULTATION WITH PATIENTS. FOR PURPOSES OF  THIS  SUBDIVI-
 SION,  THE TERM "PATIENT" SHALL INCLUDE A PERSON WHO IS ACTING ON BEHALF
 OF A PATIENT.
   3. "PRESCRIPTION BENEFIT PLAN" SHALL MEAN ANY BENEFIT PLAN OTHER  THAN
 A  STATE PUBLIC HEALTH PLAN, AS DEFINED IN SUBDIVISION ELEVEN OF SECTION
 TWO HUNDRED SEVENTY OF THE PUBLIC HEALTH LAW,  OR  AN  EMPLOYEE  WELFARE
 BENEFIT  PLAN,  AS DEFINED IN SUBSECTION ONE OF SECTION ONE THOUSAND TWO
 OF THE UNITED  STATES  CODE,  THAT  PROVIDES  PRESCRIPTION  BENEFITS,  A
 GOVERNMENTAL  PLAN,  AS  DEFINED IN SUBSECTION THIRTY-TWO OF SECTION ONE
 THOUSAND TWO OF THE UNITED STATES CODE, A CHURCH  PLAN,  AS  DEFINED  IN
 SUBSECTION THIRTY-THREE OF SECTION ONE THOUSAND TWO OF THE UNITED STATES
 CODE,  OR  A PLAN IS MAINTAINED SOLELY FOR THE PURPOSE OF COMPLYING WITH
 APPLICABLE WORKERS' COMPENSATION LAWS OR  UNEMPLOYMENT  COMPENSATION  OR
 DISABILITY  INSURANCE  LAWS, THAT INCLUDES PRESCRIPTION DRUG BENEFITS TO
 ENROLLEES AND THEIR DEPENDENTS.
   4. "SPECIALTY PRESCRIPTION DRUG" SHALL MEAN A PRESCRIPTION  DRUG  THAT
 IS  USED  TO TREAT A CHRONIC, COMPLEX OR RARE CONDITION, HAS BEEN DESIG-
 NATED IN THE  PRESCRIPTION  BENEFIT  PLAN'S  FORMULARY  AS  A  SPECIALTY
 PRESCRIPTION  DRUG, AND WILL ONLY BE COVERED BY THE PRESCRIPTION BENEFIT

 S. 3484--A                          4
 
 PLAN IF IT IS DISPENSED BY A NETWORK MAIL ORDER PHARMACY OR  AN  AUTHOR-
 IZED NETWORK RETAIL PHARMACY.
   5.  "NETWORK" SHALL MEAN A MAIL ORDER PHARMACY OR RETAIL PHARMACY THAT
 PARTICIPATES IN A PRESCRIPTION BENEFIT PLAN.
   6. "MAIL ORDER PRESCRIPTION" SHALL MEAN ANY PRESCRIPTION DRUG, INCLUD-
 ING,  BUT  NOT  LIMITED  TO  SPECIALTY  PRESCRIPTION   DRUGS,   THAT   A
 PRESCRIPTION BENEFIT PLAN REQUIRES BE FILLED BY A MAIL ORDER PHARMACY OR
 AN  AUTHORIZED  NETWORK  RETAIL  PHARMACY  IN  ORDER  FOR SUCH DISPENSED
 PRESCRIPTION TO BE COVERED BY SUCH PLAN.
   7. "PRESCRIPTION BENEFIT PLAN ENROLLEE" OR "ENROLLEE" SHALL  MEAN  THE
 PERSON  WHO  IS ENROLLED IN THE PRESCRIPTION BENEFIT PLAN AND HIS OR HER
 SPOUSE AND DEPENDENT CHILDREN WHO ARE ENROLLED IN THE PRESCRIPTION BENE-
 FIT PLAN AS DEPENDENTS OF SUCH PERSON.
   8. "AUTHORIZED NETWORK RETAIL PHARMACY" SHALL MEAN A  RETAIL  PHARMACY
 THAT,  WHEN  USED  BY  A  MEMBER TO FILL A MAIL ORDER PRESCRIPTION, SUCH
 PRESCRIPTION WILL BE COVERED BY THE MEMBER'S PRESCRIPTION  BENEFIT  PLAN
 AS IF SUCH PHARMACY WAS A MAIL ORDER PHARMACY.
   §  902. PROHIBITED CONDUCT. 1. NOTWITHSTANDING ANY PROVISION OF LAW TO
 THE CONTRARY, IT SHALL BE UNLAWFUL FOR A PRESCRIPTION  BENEFIT  PLAN  TO
 REQUIRE   AN   ENROLLEE   OR  AN  ENROLLEE'S  DEPENDENT  TO  OBTAIN  ANY
 PRESCRIPTION DRUG FROM A NETWORK MAIL ORDER PHARMACY IN ORDER TO RECEIVE
 COVERAGE FROM SUCH PLAN FOR SUCH PRESCRIPTION.
   2. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, IT  SHALL  BE
 UNLAWFUL  FOR A PRESCRIPTION BENEFIT PLAN TO REQUIRE THAT AN ENROLLEE OR
 AN ENROLLEE'S DEPENDENT REMIT A HIGHER  CO-PAYMENT  FOR  A  PRESCRIPTION
 WHEN SUCH PRESCRIPTION IS DISPENSED BY A NETWORK RETAIL PHARMACY.
   3.  NOTWITHSTANDING  ANY PROVISION OF LAW TO THE CONTRARY, IT SHALL BE
 UNLAWFUL FOR A PRESCRIPTION BENEFIT PLAN TO  REQUIRE  A  NETWORK  RETAIL
 PHARMACY TO AGREE TO ADDITIONAL CONTRACTUAL TERMS AND CONDITIONS THAT GO
 BEYOND  THE  INDUSTRY  STANDARD AND ARE NOT REASONABLE AND RELEVANT AS A
 CONDITION PRECEDENT TO ALLOWING SUCH A RETAIL PHARMACY TO  DISPENSE  ANY
 PRESCRIPTION DRUG, INCLUDING MAIL ORDER PRESCRIPTION DRUGS, AS A NETWORK
 PROVIDER.
   4.  NOTWITHSTANDING  ANY PROVISION OF LAW TO THE CONTRARY, IT SHALL BE
 UNLAWFUL  FOR  A  MAIL  ORDER  PHARMACY  TO   AUTOMATICALLY   REFILL   A
 PRESCRIPTION  BENEFIT  PLAN  ENROLLEE'S  PRESCRIPTION  WITHOUT OBTAINING
 PERMISSION FOR SUCH AUTOMATIC REFILLS FROM SUCH ENROLLEE, OR IN THE CASE
 OF AN ENROLLEE'S  DEPENDENT  CHILD,  THE  ENROLLEE  OR  CHILD'S  PARENT;
 PROVIDED,  HOWEVER,  ANY  PERMISSION GRANTED FOR AUTOMATIC REFILLS SHALL
 EXPIRE AFTER SIX MONTHS AND MAY BE RENEWED THEREAFTER FOR INTERVALS  NOT
 TO EXCEED SIX MONTHS.
   5.  NOTWITHSTANDING  ANY PROVISION OF LAW TO THE CONTRARY, IT SHALL BE
 UNLAWFUL FOR ANY MAIL ORDER PHARMACY TO  RETAIN  AN  ENROLLEE'S  PAYMENT
 INFORMATION  FOR  FUTURE  USE  WITHOUT  THE CONSENT OF THE ENROLLEE. FOR
 PURPOSES OF THIS SUBDIVISION, PAYMENT INFORMATION INCLUDES, BUT  IS  NOT
 LIMITED  TO,  CREDIT  CARD INFORMATION, DEBIT CARD INFORMATION, AND BANK
 ACCOUNT INFORMATION.
   § 903. ACTION TO RECOVER DAMAGES BY AN ENROLLEE. 1. ANY PERSON INJURED
 BY A VIOLATION OF THIS ARTICLE MAY BRING AN ACTION FOR THE  RECOVERY  OF
 DAMAGES.  JUDGMENT  MAY  BE ENTERED IN FAVOR OF SUCH PERSON IN AN AMOUNT
 NOT TO EXCEED THREE TIMES THE ACTUAL DAMAGES  OR  ONE  HUNDRED  DOLLARS,
 WHICHEVER  IS GREATER. THE COURT MAY AWARD REASONABLE ATTORNEY'S FEES TO
 A PREVAILING PLAINTIFF.
   2. NOTHING IN THIS ARTICLE SHALL BE CONSTRUED  SO  AS  TO  NULLIFY  OR
 IMPAIR ANY RIGHT OR RIGHTS WHICH A PRESCRIPTION BENEFIT PLAN ENROLLEE OR

 S. 3484--A                          5

 SUCH  ENROLLEE'S  DEPENDENT  MAY HAVE AGAINST A SELLER AT COMMON LAW, BY
 STATUTE, OR OTHERWISE.
   §  904.  VIOLATIONS.  ANY  MAIL ORDER PHARMACY OR PRESCRIPTION BENEFIT
 PLAN, INCLUDING ITS EMPLOYEES AND AGENTS, THAT VIOLATES ANY PROVISION OF
 THIS ARTICLE, SHALL BE LIABLE FOR A CIVIL FINE OF NOT MORE THAN  TWENTY-
 FIVE HUNDRED DOLLARS FOR EACH VIOLATION.
   § 905. ENFORCEMENT BY ATTORNEY GENERAL. IN ADDITION TO THE OTHER REME-
 DIES  PROVIDED,  WHENEVER  THERE  SHALL  BE A VIOLATION OF THIS ARTICLE,
 APPLICATION MAY BE MADE BY THE ATTORNEY  GENERAL  IN  THE  NAME  OF  THE
 PEOPLE  OF  THE STATE TO A COURT HAVING JURISDICTION TO ISSUE AN INJUNC-
 TION, AND UPON NOTICE TO THE RESPONDENT OF NOT FEWER THAN FIVE DAYS,  TO
 ENJOIN AND RESTRAIN THE CONTINUANCE OF THE VIOLATION. IF IT SHALL APPEAR
 TO  THE  SATISFACTION OF THE COURT OR JUSTICE THAT THE DEFENDANT HAS, IN
 FACT, VIOLATED THIS ARTICLE, AN INJUNCTION MAY BE ISSUED BY  SUCH  COURT
 OR  JUSTICE,  ENJOINING  AND  RESTRAINING ANY FURTHER VIOLATION, WITHOUT
 REQUIRING PROOF THAT ANY PERSON HAS, IN FACT, BEEN  INJURED  OR  DAMAGED
 THEREBY.  IN  ANY  SUCH PROCEEDING, THE COURT MAY MAKE ALLOWANCES TO THE
 ATTORNEY GENERAL AS PROVIDED IN PARAGRAPH  SIX  OF  SUBDIVISION  (A)  OF
 SECTION  EIGHTY-THREE HUNDRED THREE OF THE CIVIL PRACTICE LAW AND RULES,
 AND DIRECT RESTITUTION.  WHENEVER  THE  COURT  SHALL  DETERMINE  THAT  A
 VIOLATION  OF  THIS  ARTICLE  HAS OCCURRED, THE COURT MAY IMPOSE A CIVIL
 PENALTY OF NOT MORE THAN TEN THOUSAND DOLLARS FOR EACH VIOLATION.
   § 906. APPLICABILITY.  THIS ARTICLE SHALL NOT APPLY  TO  ANY  EMPLOYEE
 WELFARE  BENEFIT PLAN, AS DEFINED IN SUBSECTION ONE OF SECTION ONE THOU-
 SAND TWO OF THE UNITED STATES CODE, THAT PROVIDES PRESCRIPTION BENEFITS,
 GOVERNMENTAL PLAN, AS DEFINED IN SUBSECTION THIRTY-TWO  OF  SECTION  ONE
 THOUSAND  TWO  OF  THE  UNITED  STATES  CODE, CHURCH PLAN, AS DEFINED IN
 SUBSECTION THIRTY-THREE OF SECTION ONE THOUSAND TWO OF THE UNITED STATES
 CODE, OR A PLAN IS MAINTAINED SOLELY FOR THE PURPOSE OF  COMPLYING  WITH
 APPLICABLE  WORKERS'  COMPENSATION  LAWS OR UNEMPLOYMENT COMPENSATION OR
 DISABILITY INSURANCE LAWS.
   § 2. This act shall take effect on the ninetieth day  after  it  shall
 have  become a law and shall apply to contracts entered into, amended or
 renewed on and after such date.

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Senate Bill S3484

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Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

Bill Amendments

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2017-S3484 - Details

2017-S3484 - Summary

2017-S3484 - Sponsor Memo

2017-S3484 - Bill Text download pdf

co-Sponsors

2017-S3484A (ACTIVE) - Details

2017-S3484A (ACTIVE) - Summary

2017-S3484A (ACTIVE) - Sponsor Memo

2017-S3484A (ACTIVE) - Bill Text download pdf

Comments