Sponsored by:
Assemblyman JOHN F. MCKEON
District 27 (Essex and Morris)
SYNOPSIS
Removes exception of self-insured health benefits plans from law concerning pharmacy benefits managers.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning pharmacy benefits managers, and amending and supplementing P.L.2015, c.179.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 1 of P.L.2015, c.179 (C.17B:27F-1) is amended to read as follows:
1. As used in this act:
“Carrier” means an insurance company, health service corporation, hospital service corporation, medical service corporation, or health maintenance organization authorized to issue health benefits plans in this State.
“Contracted pharmacy” means a pharmacy that participates in the network of a pharmacy benefits manager through a contract with:
a. the pharmacy benefits manager directly;
b. a pharmacy services administration organization or
c. a pharmacy group purchasing organization.
“Covered person” means a person on whose behalf a carrier or other entity, who is the sponsor of the health benefits plan, is obligated to pay benefits pursuant to a health benefits plan.
“Drug” means a drug or device as defined in R.S.24:1-1.
“Health benefits plan” means a benefits plan which pays hospital or medical expense benefits for covered services, or prescription drug benefits for covered services, and is delivered or issued for delivery in this State by or through a carrier or any other sponsor. For the purposes of this act, health benefits plan shall not include the following plans, policies or contracts: accident only, credit disability, long-term care, Medicare supplement coverage; TRICARE supplement coverage, coverage for Medicare services pursuant to a contract with the United States government, the State Medicaid program established pursuant to P.L.1968, c. 413 (C.30:4D-1 et seq.), coverage arising out of a worker’s compensation or similar law, the State Health Benefits Program, the School Employees’ Health Benefits Program, [or a self-insured health benefits plan governed by the provisions of the federal “Employee Retirement Income Security Act of 1974,” 29 U.S.C. s.1001 et seq.,] coverage under a policy of private passenger automobile insurance issued pursuant to P.L.1972, c. 70 (C.39:6A-1 et seq.), or hospital confinement indemnity coverage.
“Pharmacy” means any place in
the State where drugs are dispensed or pharmaceutical care is provided by a
licensed pharmacist, but shall not include a medical office under the control
of a licensed physician.
“Pharmacy benefits manager” means a corporation business, or other entity, or unit within a corporation, business, or other entity, that administers prescription drug benefits on behalf of a purchaser.
“Pharmacy benefits management services” means the provision of any of the following services on behalf of a purchaser: the procurement of prescription drugs at a negotiated rate for dispensation within this State; the processing of prescription drug claims; or the administration of payments related to prescription drug claims.
“Prescription” means a prescription as defined in section 5 of P.L.1977, c.240 (C.24:6E-4).
“Prescription drug benefits” means the benefits provided for prescription drugs and pharmacy services for covered services under a health benefits plan contract.
“Purchaser” means any sponsor of a health benefits plan who enters into an agreement with a pharmacy benefits management company for the provision of pharmacy benefits management services to covered persons.
(cf: P.L.2019, c.274, s.2)
2. Section 6 of P.L.2019, c. 274 (C.17B:27F-9) is amended to read as follows:
6. P.L.2015, c. 179 (C.17B:27F-1 et seq.) shall apply to all pharmacy benefits managers operating in the State of New Jersey, except for any agreement by a pharmacy benefits manager to administer prescription drug benefits on behalf of the State Health Benefits Plan, the School Employees Health Benefits Plan, or the State Medicaid program established pursuant to P.L.1968, c. 413 (C.30:4D-1 et seq.)[, or a self-insured health benefits plan governed by the provisions of the federal “Employee Retirement Income Security Act of 1974,” 29 U.S.C. s. 1001 et seq].
(cf: P.L.2019, c.274, s.6)
3. (New section) On or before December 31, 2021, the Department of Banking and Insurance shall issue a report, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Senate Commerce Committee and the Assembly Financial Institutions and Insurance Committee examining the implications of Rutledge v. Pharmaceutical Care Management Association, ___ U.S. ___ (2020) (slip opinion at 1), on P.L.2015, c. 179 (C.17B:27F-1 et seq.).
4. This act shall take effect on the first day of the fourth month next following enactment and shall apply to health benefits plans initiated or renewed on or after that date.
STATEMENT
This bill removes the exemption that exists under current law of
self-insured health benefits plans, governed by the federal Employee Retirement Income Security Act of 1974, from certain laws concerning pharmacy benefits managers. This bill also requires DOBI to report on the implications of a recent US Supreme Court opinion, Rutledge v. Pharmaceutical Care Management Association, ___ U.S. ___ (2020) (slip opinion at 1), on State law governing pharmacy benefits managers.