AB 2436, as amended, Roger Hernández. Health care coverage: disclosures: drug pricing.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and makes a willful violation of the act a crime. Existing law also provides for the regulation of health insurers by the Department of Insurance. Existing law imposes various requirements on contracts and policies that cover prescription drug benefits.
This bill would require a health care service plan contract or a policy of health insurance that is issued, amended, or renewed on or after January 1, 2017, and that provides coverage for prescription drug benefits to notify the enrollee or insured, at the time that a prescription drug is delivered or within 30 days of purchase, of specified information related to the cost of the prescription drug.begin delete The bill would
require a health care service plan or a health insurer, in contracting with a pharmaceutical manufacturer for the purchase of a prescription drug, to require the manufacturer to disclose to the plan or insurer the cost of the prescription drug in United States dollars in Canada, Germany, and Mexico.end deletebegin insert The bill would require the Department of Managed Health Care to adopt regulations relating to these requirements, as specified.end insert The bill would make related legislative findings and declarations. Because a willful violation of the bill’s requirements by a health care service plan would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
(a) The Legislature finds and declares that the
2escalating cost of prescription drugs is a major concern for
3Californians.
4(b) It is the intent of the Legislature in enacting this bill to
5provide consumers with information about the cost of prescription
6drugs, including the cost to the health plan or insurer and the cost
7in other countries.
8(c) It is not the intent of the Legislature in enacting this bill to
9encourage Californians to purchase or otherwise obtain prescription
10drugs from other countries in violation of federal law.
Section 1367.207 is added to the Health and Safety
12Code, immediately following Section 1367.205, to read:
begin delete(a)end deletebegin delete end deleteA health care service plan contract issued,
14amended, or renewed on or after January 1, 2017, that provides
15coverage for prescription drug benefits shall require the plan to
16notify the enrollee of the following at the time of delivery or within
1730 days of purchase of a prescription drug:
20 18(1)
end delete
19begin insert(a)end insert The enrollee’s share of the cost for the prescription drug,
20including any copayment, coinsurance, or other cost sharing, and
21the accumulation of that cost sharing to the enrollee’s deductible,
22if any, or out-of-pocket maximum.begin insert The Department of Managed
P3 1Health Care shall adopt regulations regarding the manner in
2which plans will implement these requirements by January 1, 2018.end insert
3(2) The cost of the prescription drug to the plan, after applying
4any discounts, rebates, or other reductions in cost to the plan.
5(3) The cost of the prescription drug in United States dollars in
6the following countries:
7(A) Canada.
8(B) Germany.
9(C) Mexico.
10(b) In contracting with a pharmaceutical manufacturer for the
11purchase of a prescription drug, a health care service plan or its
12contracting pharmacy benefits manager, if any, shall require the
13pharmaceutical manufacturer to disclose to the plan the cost of the
14prescription drug in United States dollars in Canada, Germany,
15and Mexico. If the pharmaceutical manufacturer fails to provide
16that
information, the health care service plan may take that failure
17into account in determining whether to include the prescription
18drug in the plan’s drug formulary or in which tier of the plan’s
19drug formulary to place the prescription drug.
20
(b) The publicly available, nonproprietary wholesale acquisition
21cost (WAC) of a prescription drug.
Section 10123.202 is added to the Insurance Code, 23immediately following Section 10123.201, to read:
begin delete(a)end deletebegin delete end deleteA policy of health insurance issued, amended,
25or renewed on or after January 1, 2017, that provides coverage for
26prescription drug benefits shall require the insurer to notify the
27insured of the following at the time of delivery or within 30 days
28of purchase of a prescription drug:
31 29(1)
end delete
30begin insert(a)end insert The insured’s share of the cost for the prescription drug,
31including any copayment, coinsurance, or other cost sharing, and
32the accumulation of that cost sharing to the insured’s deductible,
33if any, or out-of-pocket maximum.
34(2) The cost of the prescription drug to the insurer, after applying
35any discounts, rebates, or other reductions in cost to the insurer.
36(3) The cost of the prescription drug in United States dollars in
37the following countries:
38(A) Canada.
39(B) Germany.
40(C) Mexico.
P4 1(b) In contracting with a pharmaceutical manufacturer for the
2purchase of a prescription drug, a health insurer or its contracting
3pharmacy benefits manager, if any, shall require the pharmaceutical
4manufacturer to disclose to the insurer the cost
of the prescription
5drug in United States dollars in Canada, Germany, and Mexico.
6If the pharmaceutical manufacturer fails to provide that
7information, the health insurer may take that failure into account
8in determining whether to include the prescription drug in the
9insurer’s drug formulary or in which tier of the insurer’s drug
10formulary to place the prescription drug.
11
(b) The publicly available, nonproprietary wholesale acquisition
12cost (WAC) of a prescription drug.
No reimbursement is required by this act pursuant to
14Section 6 of Article XIII B of the California Constitution because
15the only costs that may be incurred by a local agency or school
16district will be incurred because this act creates a new crime or
17infraction, eliminates a crime or infraction, or changes the penalty
18for a crime or infraction, within the meaning of Section 17556 of
19the Government Code, or changes the definition of a crime within
20the meaning of Section 6 of Article XIII B of the California
21Constitution.
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