SENATE, No. 728

STATE OF NEW JERSEY

218th LEGISLATURE

 

PRE-FILED FOR INTRODUCTION IN THE 2018 SESSION

 


 

Sponsored by:

Senator  LINDA R. GREENSTEIN

District 14 (Mercer and Middlesex)

Senator  VIN GOPAL

District 11 (Monmouth)

 

 

 

 

SYNOPSIS

     Prohibits pharmacy benefits managers from making certain retroactive reductions in claim payments to pharmacies.

 

CURRENT VERSION OF TEXT

     Introduced Pending Technical Review by Legislative Counsel.

  


An Act concerning pharmacy benefits managers and supplementing P.L.2015, c.179 (C.17B:27F-1 et seq.).

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    a. After the date of receipt of a clean claim for payment made by a pharmacy, a pharmacy benefits manager shall not retroactively reduce payment on the claim, either directly or indirectly, through aggregated effective rate or otherwise, except if the claim is found not to be a clean claim during the course of a routine audit performed pursuant to an agreement between the pharmacy benefits manager and the pharmacy.  Nothing in this section shall be construed to prohibit any retroactive increase in payment to a pharmacy pursuant to a written agreement between the pharmacy benefits manager and the pharmacy.

     b.    For the purposes of this section, “clean claim” means a claim that has no defect or impropriety, including a lack of any required substantiating documentation, or particular circumstance requiring special treatment that prevents timely payment from being made on the claim.

 

     2.    This act shall take effect immediately.

 

 

STATEMENT

 

     This bill prohibits a pharmacy benefits manager from retroactively reducing payment on a properly filed claim for payment by a pharmacy.  These retroactive reductions in payment are often, particularly in the case of Medicare Part D, referred to as direct and indirect remuneration (DIR) fees.  Since these fees are commonly “clawed back” retroactively, and in many cases months after the claim is made, this process makes it difficult for pharmacies to operate with predictable revenues. 

     Specifically, the bill provides that, after the date of receipt of a clean claim for payment made by a pharmacy, a pharmacy benefits manager shall not retroactively reduce payment on the claim, either directly or indirectly, through aggregated effective rate or otherwise, except if the claim is found not to be clean during the course of a routine audit performed pursuant to an agreement between the pharmacy benefits manager and the pharmacy.  Nothing in the bill prohibits any retroactive increase in payment to a pharmacy pursuant to a written agreement between the pharmacy benefits manager and the pharmacy.

     A “clean claim” is defined as a claim that has no defect or impropriety, including a lack of any required substantiating documentation, or particular circumstance requiring special treatment that prevents timely payment from being made on the claim.