SENATE COMMERCE COMMITTEE

STATEMENT TO

SENATE COMMITTEE SUBSTITUTE FOR

SENATE, Nos. 2690 and 2727

STATE OF NEW JERSEY

DATED:  JANUARY 17, 2019

      The Senate Commerce Committee reports favorably Senate Committee Substitute for Senate Bill Nos. 2690 and 2727.

      This bill, a committee substitute for Senate Bill Nos. 2690 and 2727, addresses “clawback schemes” by prohibiting a pharmacy benefits manager, in connection with any contract or arrangement with a private health insurer, prescription benefit plan, or the State Health Benefits Program or School Employees’ Health Benefits Program, from charging a covered person a copayment for a prescription drug benefit in an amount that exceeds the cost of the prescription drug that the pharmacy would charge to persons who do not purchase the drug through their health insurance coverage.

      The substitute also addresses “gag clauses” by requiring a pharmacy benefits manager to not prohibit a network pharmacy from disclosing to a covered person lower cost prescription drug options, including those that are available to the covered person if the covered person purchases the prescription drug without using health insurance coverage.

      The bill makes a provision of a contract that conflicts with the bill’s prohibitions on “gag clauses” void and unenforceable.  The bill also provides that a violation of any provision of the bill is a violation of New Jersey’s consumer fraud act.

      The bill also provides that a pharmacist at a pharmacy practice site shall inform each patient, at the time of taking an order from the patient for home delivery or at the time of dispensing a prescription drug to the patient at the practice site:

      (1)  of the lowest cost option for the prescription drug; and

      (2)  whether there is an alternative drug that is less expensive and interchangeable with the prescription drug, and if needed, that the consumer can discuss with the prescribing health care provider whether the alternative drug would be appropriate for the consumer.

      The bill provides that when a carrier provides coverage for a prescription drug under a covered person’s health insurance policy or health benefits plan, and the covered person elects not to use that coverage to purchase the prescription drug but instead purchases the prescription drug at a lesser cost than the covered person’s copayment for that prescription drug if the covered person purchased the prescription drug using that coverage, then the carrier must apply the amount of the lesser cost actually paid toward any individual or family out-of-pocket limits for that covered person’s policy for that policy period, provided the covered person provides the carrier with a sales receipt that documents the amount the covered person paid for the prescription drug.

      The bill requires carriers to provide an annual notice to covered persons regarding the right of covered persons to have the costs that they actually paid applied to out-of-pocket limits for the policy.

      Finally, the bill requires the Commissioner of Health to develop a public information campaign to educate consumers in this State about the lowest cost options for prescription drugs.  As part of the information campaign, the commissioner must develop a method that informs consumers about these rights, in a highly visible location near the point of purchase for prescription drugs.  The bill requires the commissioner to integrate the consumer notification with other consumer informational requirements for pharmacists.