Signed by Governor Laura Kelly

Vote Smart's Synopsis:

Vote to adopt a conference report that establishes regulations on pharmacy benefit managers in Kansas.

Highlights:

• Requires an auditing entity that is conducting a pharmacy audit to keep information confidential, provide the pharmacy with a written notice 14 calendar days prior, accept paper or electronic signature logs, provide a complete list of pharmacy records, and provide a written preliminary report of the audit to the pharmacy (Sec. 1). 

• Authorizes an auditing entity to have access to previous audit reports and to not collect penalties from a pharmacy until an appeal has been filed (Sec. 1). 

• Restricts an auditing company from compensating a pharmacy's employees or contractors, use extrapolation to calculate penalties, seek any fine or charge, or initiate or schedule a pharmacy audit averaging more than 600 prescriptions during the first five days of any month (Sec. 1). 

• Requires anyone to register with the commissioner before operating as an auditing entity  and requires a certificate of registration (Sec. 2). 

• Requires a registered auditing entity to provide a completed application of renewal by March 31 of each year (Sec. 2). 

• Authorizes the commissioner to examine the affairs of the pharmacy benefits manager for compliance (Sec. 4). 

• Prohibits any confidential patient information from being provided to the commissioner (Sec. 4). 

• Requires every pharmacy benefits manager contract to provide the pharmacy a copy of any contract, amendment, payment schedule, or reimbursement rate within 10 calendar days after the execution or amendment of this contract (Sec. 6). 

• Authorizes other parts of this bill to apply in law even if another part of this bill is found invalid (Sec. 7). 

• Authorizes the commissioner to make a direct financial examination of any pharmacy benefits manager that conducts business in Kansas (Sec. 8). 

• Requires the commissioner to review the application of renewal and any relevant information within 90 days after a receipt of the completed application has been submitted (Sec. 13). 

• Authorizes a pharmacy benefits manager’s license to be revoked or suspended until a renewal fee and penalty has been paid (Sec. 13).

• Specifies that this provision does not apply to any policy or certificate providing coverage for a specified disease or accident (Sec. 18). 

• Specifies that this Act is effective immediately upon passage (Sec. 20).

Full Bill Text

Vote Smart's Synopsis:

Vote to adopt a conference report that establishes regulations on pharmacy benefit managers in Kansas.

Highlights:

• Requires an auditing entity that is conducting a pharmacy audit to keep information confidential, provide the pharmacy with a written notice 14 calendar days prior, accept paper or electronic signature logs, provide a complete list of pharmacy records, and provide a written preliminary report of the audit to the pharmacy (Sec. 1). 

• Authorizes an auditing entity to have access to previous audit reports and to not collect penalties from a pharmacy until an appeal has been filed (Sec. 1). 

• Restricts an auditing company from compensating a pharmacy's employees or contractors, use extrapolation to calculate penalties, seek any fine or charge, or initiate or schedule a pharmacy audit averaging more than 600 prescriptions during the first five days of any month (Sec. 1). 

• Requires anyone to register with the commissioner before operating as an auditing entity  and requires a certificate of registration (Sec. 2). 

• Requires a registered auditing entity to provide a completed application of renewal by March 31 of each year (Sec. 2). 

• Authorizes the commissioner to examine the affairs of the pharmacy benefits manager for compliance (Sec. 4). 

• Prohibits any confidential patient information from being provided to the commissioner (Sec. 4). 

• Requires every pharmacy benefits manager contract to provide the pharmacy a copy of any contract, amendment, payment schedule, or reimbursement rate within 10 calendar days after the execution or amendment of this contract (Sec. 6). 

• Authorizes other parts of this bill to apply in law even if another part of this bill is found invalid (Sec. 7). 

• Authorizes the commissioner to make a direct financial examination of any pharmacy benefits manager that conducts business in Kansas (Sec. 8). 

• Requires the commissioner to review the application of renewal and any relevant information within 90 days after a receipt of the completed application has been submitted (Sec. 13). 

• Authorizes a pharmacy benefits manager’s license to be revoked or suspended until a renewal fee and penalty has been paid (Sec. 13).

• Specifies that this provision does not apply to any policy or certificate providing coverage for a specified disease or accident (Sec. 18). 

• Specifies that this Act is effective immediately upon passage (Sec. 20).

Full Bill Text