Revises provisions governing the administration of pharmacy benefits under Medicaid. (BDR 38-224)

Existing law authorizes the Department of Health and Human Services to enter into a contract with a pharmacy benefit manager or a health maintenance organization to manage coverage of prescription drugs under the State Plan for Medicaid, the Children's Health Insurance Program and certain other health benefit plans that elect to use the list of preferred prescription drugs established for Medicaid as their formulary. (NRS 422.4025, 422.4053) Section 13 of this bill instead requires the Department to enter into a contract with one pharmacy benefit manager, known as the state pharmacy benefit manager, to manage all such coverage of prescription drugs. Sections 13 and 14 of this bill prescribe certain required terms of such a contract. Section 4 of this bill prescribes the required contents of an application to serve as the state pharmacy benefit manager. Section 5 of this bill requires the Department to adopt regulations establishing: (1) the criteria that a pharmacy benefit manager must meet in order to serve as the state pharmacy benefit manager; and (2) certain requirements relating to the payment of pharmacies for services rendered under the contract between the Department and the state pharmacy benefit manager. Section 9 of this bill requires a Medicaid managed care organization to contract with and utilize the state pharmacy benefit manager to administer all pharmacy benefits for recipients of Medicaid who receive such benefits through the Medicaid managed care organization. Section 6 of this bill requires that the Department approve any contract between the state pharmacy benefit manager and a pharmacy or an entity that contracts on behalf of a pharmacy if the contract is for the provision of benefits under the contract between the state pharmacy benefit manager and the Department, or any revision, suspension or termination of such a contract, in order for the contract, revision, suspension or termination to become effective. Section 6 also authorizes the Department to change certain payment arrangements as necessary to comply with federal requirements. Finally, section 6 prohibits the state pharmacy benefit manager from entering into, renewing or amending a contract that conflicts with the obligations of the state pharmacy benefit manager under the provisions of this bill. Section 7 of this bill: (1) prohibits the state pharmacy benefit manager from taking certain actions to avoid paying reimbursement owed to pharmacies; and (2) authorizes the Department to impose a monetary penalty on the state pharmacy benefit manager for violating that prohibition. Sections 2 and 3 of this bill define certain terms, and section 8 of this bill establishes the applicability of those definitions. Section 10 of this bill applies certain other definitions in existing law to sections 4-7. Sections 11, 12 and 15 of this bill make conforming changes to transfer certain duties to the state pharmacy benefit manager and revise certain references in accordance with the provisions of this bill.