TITLE 18

Insurance Code

Insurance

CHAPTER 33A. Pharmacy Benefits Managers [For application of this chapter, see 80 Del. Laws, c. 245, §  2]

Subchapter II. Maximum Allowable Cost Pricing for Prescription Drugs [For application of this subchapter, see 80 Del. Laws, c. 245, § 2]


As used in this subchapter:

(1) “Claim” means a request from a pharmacy or pharmacist to be reimbursed for the cost of filling or refilling a prescription for a drug or for providing a medical supply or device.

(2) “Contracted pharmacy” means a pharmacy that participates in the network of a pharmacy benefits manager through a contract with a pharmacy benefits manager, a pharmacy services administration organization, or a group purchasing organization.

(3) “Drug shortage list” means a list of drug products listed on the federal Food and Drug Administration’s Drug Shortages website.

(4) “Insurer” means any entity that provides health insurance coverage in this State as defined in § 903 of this title.

(5) “Maximum allowable cost” means the maximum amount that a pharmacy benefits manager will reimburse a pharmacist or pharmacy for the cost of a multi-sourced drug, medical product, or device.

(6) “Maximum allowable cost list” means the multi-source generic drugs, medical products, and devices for which a maximum allowable cost has been established by a pharmacy benefits manager or a purchaser.

(7) “Network providers” means those pharmacists and pharmacies who provide covered health-care services or supplies to an insured or a member pursuant to a contract with an insurer or pharmacy benefits manager.

(8) “Pharmacist” means as defined under § 2502 of Title 24.

(9) “Pharmacy” means as defined under § 2502 of Title 24.

(10) “Pharmacy benefits management services” means as defined under § 3351A of this title.

(11) “Pharmacy benefits manager” means as defined under § 3302A of this title.

(12) “Purchaser” means as defined under § 3351A of this title.

80 Del. Laws, c. 245, § 1; 82 Del. Laws, c. 115, § 1.;

This subchapter does not apply to the Department of Health and Human Services in the performance of its duties in administering fee-for-service Medicaid under Titles XIX and XXI of the Social Security Act [42 U.S.C. §§ 1396 et seq., 1397aa et seq.].

80 Del. Laws, c. 245, § 1.;

(a) To place a drug on a maximum allowable cost list, a pharmacy benefits manager must ensure that the drug meets all of the following requirements:

(1) It is listed as “A” or “B” rated in the most recent version of the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, also known as the Orange Book, or has an “NR” or “NA” rating or a similar rating by a nationally recognized reference.

(2) It is generally available for purchase by pharmacies in this State from national or regional wholesalers.

(3) It is not obsolete, temporarily unavailable, or listed on a drug shortage list as in shortage.

(4) If it is manufactured by more than 1 manufacturer, the drug is available for purchase by a contracted pharmacy, including a contracted retail pharmacy, in this State from a wholesale distributor with a permit in this State.

(5) If it is manufactured by only 1 manufacturer, the drug is generally available for purchase by a contracted pharmacy, including a contracted retail pharmacy, in this State from at least 2 wholesale distributors with a permit in this State.

(b) A pharmacy benefits manager engaging in maximum allowable cost pricing must do all of the following:

(1) Make available to each network provider at the beginning of the term of the network provider’s contract, and upon renewal of the contract, the sources utilized to determine the maximum allowable cost pricing.

(2) Provide a process for a network pharmacy provider to readily access the most recent maximum allowable cost specific to that provider in an electronic format as updated in accordance with the requirements of this section.

(3) Review and update maximum allowable cost price information at least once every 7 business days and update the information when there is a modification of maximum allowable cost pricing.

(4) Ensure that dispensing fees are not included in the calculation of maximum allowable cost.

(5) On the next day after a pricing information update under paragraph (b)(3) of this section, use the updated pricing information in calculating the payments made to all contracted pharmacies.

(6) Maintain a procedure to eliminate products from the maximum allowable cost list as necessary to do all of the following:

a. Remain consistent with price changes.

b. Remove from the maximum allowable cost list a drug that no longer meets the requirements of subsection (a) of this section.

c. Reflect the most recent availability of drugs in the marketplace.

80 Del. Laws, c. 245, § 1; 82 Del. Laws, c. 115, § 2.;

(a) A pharmacy benefits manager must establish a process by which a contracted pharmacy can appeal the provider’s reimbursement for a drug subject to maximum allowable cost pricing. A contracted pharmacy has 10 calendar days after the applicable fill date to appeal a maximum allowable cost if the reimbursement for the drug is less than the net amount that the network provider paid to the supplier of the drug. A pharmacy benefits manager must respond with notice that the challenge has been denied or sustained within 10 calendar days of the contracted pharmacy making the claim for which an appeal has been submitted.

(b) At the beginning of the term of a network provider’s contract, and upon renewal, a pharmacy benefits manager must provide to network providers a telephone number or e-mail address at which a network provider can contact the pharmacy benefits manager to process an appeal under this section.

(c) If an appeal is denied, the pharmacy benefits manager must provide the reason for the denial and the name and the national drug code number from national or regional wholesalers operating in Delaware.

(d) If the appeal is sustained, the pharmacy benefits manager shall do the following:

(1) For an appealing pharmacy, do all of the following:

a. Adjust the maximum allowable cost for the drug as of the date of the original claim for payment.

b. Without requiring the appealing pharmacy to reverse and rebill the claims, provide reimbursement for the claim and any subsequent and similar claims under similarly applicable contracts with the pharmacy benefits manager as follows:

1. For the original claim, in the first remittance to the pharmacy after the date the appeal was determined.

2. For subsequent and similar claims under similarly applicable contracts, in the second remittance to the pharmacy after the date the appeal was determined.

(2) For a similarly situated contracted pharmacy in this State, do all of the following:

a. Adjust the maximum allowable cost for the drug as of the date the appeal was determined.

b. Provide notice to the pharmacy or the pharmacy’s contracted agent of all of the following:

1. That an appeal was upheld.

2. That without filing a separate appeal, the pharmacy or the pharmacy’s contracted agent may reverse and rebill a similar claim.

(e) A pharmacy benefits manager shall make available on its website information about the appeal process, including all of the following:

(1) A telephone number at which the contracted pharmacy may contact the department or office responsible for processing appeals for the pharmacy benefits manager to speak to an individual specifically or leave a message for an individual or office who is responsible for processing appeals.

(2) An email address of the department or office responsible for processing appeals to which an individual who responsible for processing appeals has access.

(f) A pharmacy benefits manager may not charge a contracted pharmacy a fee related to the re-adjudication of a claim resulting from a sustained appeal under subsection (d) of this section or the upholding of an appeal under subsection (h) of this section.

(g) A pharmacy benefits manager may not retaliate against a contracted pharmacy for exercising its right to appeal or filing a complaint with the Commissioner, as permitted under this section.

(h) (1) If a pharmacy benefits manager denies an appeal and a contract pharmacy files a complaint with the Commissioner, the Commissioner shall do all of the following:

a. Review the pharmacy benefits manager’s compensation program to ensure that the reimbursement for pharmacy benefits management services paid to the pharmacist or a pharmacy complies with this subchapter and the terms of the contract.

b. Based on a determination made by the Commissioner under paragraph (h)(1)a. of this section, do 1 of the following:

1. Dismiss the appeal.

2. Uphold the appeal and order the pharmacy benefits manager to pay the claim in accordance with the Commissioner’s findings.

(2) All pricing information and data collected by the Commissioner during a review required by paragraph (h)(1) of this section is confidential and not subject to subpoena or the Freedom of Information Act, Chapter 100 of Title 29.

80 Del. Laws, c. 245, § 1; 82 Del. Laws, c. 115, § 3.;