Health Care Coverage

Florida Senate
-
2026

CS for CS for SB 1760

By
the Committees on Appropriations; and Health Policy; and
Senators Brodeur, Gaetz, Rouson, Massullo, Garcia, and Harrell

576-03338-26 20261760c2
1 A bill to be entitled
2 An act relating to health care coverage; amending s.
3 1.01, F.S.; defining the term “Joint Legislative
4 Committee on Medicaid Oversight”; creating s. 11.405,
5 F.S.; establishing the Joint Legislative Committee on
6 Medicaid Oversight for specified purposes; providing
7 for membership, subcommittees, and meetings of the
8 committee; specifying duties of the committee;
9 authorizing the committee to submit periodic reports
10 to the Legislature; requiring the Auditor General and
11 the Agency for Health Care Administration to enter
12 into and maintain a data sharing agreement for a
13 certain purpose by a specified date; requiring the
14 Auditor General to assist the committee by providing
15 certain staff or consulting services; requiring state
16 agencies, political subdivisions of the state, and
17 entities contracted with state agencies to give the
18 committee access to certain records, papers, and
19 documents; authorizing the committee to compel
20 testimony and evidence according to specified
21 provisions; providing for additional powers of the
22 committee; providing that certain joint rules of the
23 Legislature apply to the proceedings of the committee;
24 requiring the agency to notify the committee of
25 certain changes and provide a report containing
26 specified information to the committee; requiring the
27 agency to submit a copy of certain reports to the
28 committee; amending s. 409.962, F.S.; defining terms;
29 amending s. 409.967, F.S.; revising encounter data
30 reporting requirements for prepaid Medicaid plans;
31 requiring that the agency’s analysis of such encounter
32 data include identification of specified occurrences;
33 requiring the agency to use such analysis in setting
34 managed care plan capitation rates; requiring that
35 managed care plan contracts require any third-party
36 administrative entity contracted with the plan to
37 adhere to specified requirements; specifying
38 additional types of payments which may not be included
39 in calculating income for purposes of the achieved
40 savings rebate; requiring, rather than authorizing,
41 the agency to calculate the medical loss ratio for all
42 managed care plans under certain circumstances;
43 revising requirements for the calculation of medical
44 loss ratios; requiring the agency to report medical
45 loss ratios quarterly and annually for each managed
46 care plan to the Governor and the Legislature within a
47 specified timeframe; requiring the agency to ensure
48 oversight of affiliated entities and related parties
49 paid by managed care plans; requiring the agency to
50 examine specified records and data related to such
51 entities and parties; requiring the agency to consider
52 certain data and findings when developing managed care
53 plan capitation rates; revising the income sharing
54 ratios used to calculate the achieved savings rebate
55 beginning on a specified date; creating s. 409.9675,
56 F.S.; requiring managed care plans to report to the
57 agency and the Office of Insurance Regulation the
58 existence of and specified details relating to certain
59 affiliations by a specified date and annually
60 thereafter; requiring managed care plans to report any
61 change in such information to the agency and the
62 office in writing within a specified timeframe;
63 requiring the agency to calculate, analyze, and
64 publicly report on the agency’s website an assessment
65 of affiliated entity payment transactions in the
66 Medicaid program and certain administrative costs by a
67 specified date and annually thereafter; providing
68 requirements for the assessment; amending s. 626.8825,
69 F.S.; defining the term “affiliated manufacturer”;
70 revising the definition of the term “pharmacy benefits
71 plan or program”; revising requirements for contracts
72 between a pharmacy benefit manager and a participating
73 pharmacy; revising the frequency of and deadlines for
74 certain reports pharmacy benefit managers are required
75 to submit to the office beginning on a specified date;
76 amending s. 626.8827, F.S.; revising and specifying
77 additional practices pharmacy benefit managers are
78 prohibited from engaging in; amending s. 627.42392,
79 F.S.; conforming a cross-reference; providing
80 effective dates.
81
82 Be It Enacted by the Legislature of the State of Florida:
83
84 Section 1. Effective upon this act becoming a law,
85 subsection (20) is added to section 1.01, Florida Statutes, to
86 read:
87 1.01 Definitions.—In construing these statutes and each and
88 every word, phrase, or part hereof, where the context will
89 permit:
90
(20)

The term “Joint Legislative Committee on Medicaid

91
Oversight” means a committee or committees designated by joint

92
rule of the Legislature, by the President of the Senate or the

93
Speaker of the House of Representatives, or by agreement between

94
the President of the Senate and the Speaker of the House of

95
Representatives.

96 Section 2. Effective upon this act becoming a law, section
97 11.405, Florida Statutes, is created to read:
98
11.405
J
oint Legislative Committee on Medicaid

Oversight.

99
The
Joint Legislative Committee on Medicaid
Oversight is created

100
to ensure that the state Medicaid program is operating in

101
accordance with the Legislature’s intent and to promote

102
transparency and efficiency in government spending.

103
(1)

MEMBERSHIP;
SUBCOMMITTEES
;

MEETINGS.—

104
(a)

The committee shall be composed of five

members of the

105
Senate appointed by the President of the Senate
and five
members

106
of the House of Representatives appointed by the Speaker of the

107
House of Representatives
, with each member serving a 2-year

108
term
. The chair and vice chair shall
each
be appointed for 1

109
year terms
,
with the appointments alternating between
the

110
President of the Senate
and
the Speaker of the House of

111
Representatives. The chair and vice chair may not be members of

112
the same house of the Legislature.
If both the chair and vice

113
chair are absent
from
any meeting, the members present
must

114
elect a temporary chair by a majority vote.

115
(
b
)

Members shall serve without compensation but may be

116
reimbursed for per diem and travel expenses pursuant to s.

117
112.061.

118
(
c
)

The chair may establish subcommittees
as needed
to

119
fulfill
the committee’s
duties
.

120
(
d
)

The committee shall convene at
least
twice a year,
and

121
as often as necessary
to conduct
its
business as required
under

122
this section
.
M
eetings may be held
through
teleconference or

123
other electronic means.

124
(2)

COMMITTEE DUTIES.—

125
(a)

The
c
ommittee shall evaluate all aspects of the
state

126
Medicaid program related to program financing, quality
of care

127
and
health
outcomes, administrative functions, and operational

128
functions to ensure
that

the program
is provid
ing
transparency

129
in the
provision
of health care plans and providers,
en
sur
ing

130
Medicaid recipients have
access to quality
health care
service
s

131
and
providing
stability to
the state
’s budget
through
a health

132
care delivery system designed to contain cost
s
.

133
(
b
)

The committee shall identify and recommend policies

134
that limit Medicaid spend
ing
growth while improving health care

135
outcomes for
Medicaid
recipients.
In developing its

136
recommendations, t
he committee shall
do all of the following
:

137
1.

Evaluate legislation for its long-term impact on
the

138
state
Medicaid
program.

139
2.

Review data submitted
to the Agency for Health Care

140
Administration
by the
Medicaid
managed care plans pursuant to

141
statutory and contract requirements
,
including
,
but not limited

142
to
,
timeliness of provider credentialing, timely payment of

143
claims, rate of claim denial
s
, prior authorizations
for

144
services,
and consumer complaints.

145
3.

Review
the Medicaid
managed care plan
s’
encounter data,

146
financial
data,
and audits
and the
data used to calculat
e the

147
plans’
achieved savings rebate
s
and medical loss ratio
s.

148
4.

Review data related to
health
outcomes
of Medicaid

149
recipients,
including
,
but not limited to
,
Health
care

150
Effectiveness Data and Information Set measure
s developed by the

151
National Committee for Quality Assurance
, for each Medicaid

152
managed care plan,
each
Medicaid managed care
plan’s performance

153
improvement projects
,
and outcome data related to all quality

154
goals included in the Medicaid managed care organization

155
contracts
to
improve quality for
recipients.

156
5.

Identify
any areas for
improvement in
the laws and rules

157
relat
ing
to the
state
Medicaid program
.

158
6.

Develop a plan of action for the future of the
state

159
Medicaid program.

160
(
c
)

The committee may
submit
periodic reports, including

161
recommendations, to the Legislature on issues related to
the

162
state Medicaid program and any affiliated
programs.

163
(3)

COOPERATION.—

164
(a)

The Auditor General and the Agency for Health Care

165
Administration shall enter into and maintain a data

sharing

166
agreement by July 1, 202
6,
to ensure the
c
ommittee ha
s
full

167
access to all data needed to fulfill
its
responsibilities.

168
(b)

The Auditor General shall assist the
c
ommittee in its

169
work by providing credentialed professional staff or consulting

170
services
, including, but not limited to,
an actuary not

171
associated with
the state
Medicaid
p
rogram or any Medicaid

172
managed care organization who currently has a contract with the

173
state.

174
(c)

The
c
ommittee
, in the course
of
its
official duties,

175
must be given
access to any
relevant record,
paper
,
or document

176
in possession of a state agency, any political subdivision of

177
the state, or any entity engaged in business or under contract

178
with a state agency,
and may compel the attendance
and testimony

179
of any
s
tate official or employee before the
c
ommittee or secure

180
any evidence
as provided in s. 11.143. The committee may also

181
have any other powers conferred on it by
joint rules of the

182
Senate and the House of Representatives, and any joint rules of

183
the Senate and the House of Representatives applicable to joint

184
legislative committees
apply to the proceedings of the
c
ommittee

185
under this section
.

186
(4)

AGENCY REPORTS.—

187
(a)

Before
implementing any change to the Medicaid managed

188
care capitation rates, the
Agency for Health Care Administration

189
shall notify
the committee of the change
and appear before the

190
c
ommittee
to
provide a report detailing the managed care

191
capitation rates and administrative costs built into the

192
capitation rates. The report
must
include the
agency
’s

193
historical and projected Medicaid program expenditure and

194
utilization trend rates by Medicaid program and service category

195
for the rate year, an explanation of
the manner in which
the

196
trend rates were calculated
,
and the policy decisions that were

197
included in
setting
the capitation rates.

198
(b)

If
the
Agency for Health Care Administration
or any

199
division within the
a
gency is required by law to report to the

200
Legislature or to any
legislative
committee or subcommittee on

201
matters relating to the
state
Medicaid program, the
a
gency
must

202
also

submit
a copy of the report to the
c
ommittee.

203 Section 3. Present subsections (2) through (5), (6) through
204 (10), and (11) through (18) of section 409.962, Florida
205 Statutes, are redesignated as subsections (3) through (6), (8)
206 through (12), and (14) through (21), respectively, and new
207 subsections (2), (7), and (13) are added to that section, to
208 read:
209 409.962 Definitions.—As used in this part, except as
210 otherwise specifically provided, the term:
211
(2) “Affiliate
,
” including the terms “affiliated with” and

212
“affiliation
,
” means a person
, as construed in s. 1.01(3),
who
:

213
(a)

D
irectly or indirectly
,
through one or more

214
intermediaries
,
controls, is controlled by, or is under common

215
control with a specified entity or person
, including
parent
and

216
subsidiary
entities; or

217
(b)

Is deemed a “related party” according to the standards

218
adopted by the Financial Accounting Standards Board.

219
(7) “Control,” including the terms “controlling,”

220
“controlled by,” and “under common control with,” means the

221
possession, direct or indirect, of the power to direct or cause

222
the direction of the management and policies of a person,

223
whether through the ownership or voting securities, by contract

224
other than a commercial contract for goods or nonmanagement

225
services, or otherwise, unless the power is the result of an

226
official position with or corporate office held by the person.

227
This definition applies
regardless of whether such power is

228
affirmative or negative
or
whether such power is actually used
.

229
Control
is
presumed to exist, but is not limited to, when any

230
affiliate
or
person
, as construed in s. 1.01(3)
:

231
(a)

Directly or indirectly owns, controls, holds the power

232
to vote, or holds proxies representing 10 percent or more of any

233
class of the voting securities of any other person.

234
(b)

Shares common ownership with any person
;
has an

235
investor or is a holder of an ownership interest
in
any person
;

236
exercises control in any manner over the election of a majority

237
of the directors or of individuals exercising similar functions

238
of any person
;
has the power to exercise controlling influence

239
over the management of any person
;
or serves as a working

240
majority of the board of directors,
the
managers, or the

241
officers of a person, who is:

242
1.

A provider
or a member of a
provider group or group

243
practice
as
defined in s. 456.053
(3) under
the managed care

244
plan
;
or

245
2.

A person responsible for providing any pharmacy

246
services, pharmaceuticals, diagnostics, care coordination, care

247
delivery, health care services, medical equipment,

248
administrative services, or financial services
under
the managed

249
care plan.

250
(13)
“
Market rate
”
means t
he price that a willing buyer

251
will
pay and a willing seller
will
accept in an arm
’
s-length

252
transaction
which
is beneficial to both parties.

253 Section 4. Subsections (1) and (2), paragraph (h) of
254 subsection (3), and subsection (4) of section 409.967, Florida
255 Statutes, are amended, and subsection (5) is added to that
256 section, to read:
257 409.967 Managed care plan accountability.—
258 (1)
CONTRACT PROCUREMENT PROCESS.—
Beginning with the
259 contract procurement process initiated during the 2023 calendar
260 year, the agency shall establish a 6-year contract with each
261 managed care plan selected through the procurement process
262 described in s. 409.966. A plan contract may not be renewed;
263 however, the agency may extend the term of a plan contract to
264 cover any delays during the transition to a new plan. The agency
265 shall extend until December 31, 2024, the term of existing plan
266 contracts awarded pursuant to the invitation to negotiate
267 published in July 2017.
268 (2)
CONTRACT REQUIREMENTS.—
The agency shall establish such
269 contract requirements as are necessary for the operation of the
270 statewide managed care program. In addition to any other
271 provisions the agency may deem necessary, the contract must
272 require:
273 (a)
Physician compensation.
—Managed care plans are expected
274 to coordinate care, manage chronic disease, and prevent the need
275 for more costly services. Effective care management should
276 enable plans to redirect available resources and increase
277 compensation for physicians. Plans achieve this performance
278 standard when physician payment rates equal or exceed Medicare
279 rates for similar services. The agency may impose fines or other
280 sanctions on a plan that fails to meet this performance standard
281 after 2 years of continuous operation.
282 (b)
Emergency services.
—Managed care plans shall pay for
283 services required by ss. 395.1041 and 401.45 and rendered by a
284 noncontracted provider. The plans must comply with s. 641.3155.
285 Reimbursement for services under this paragraph is the lesser
286 of:
287 1. The provider’s charges;
288 2. The usual and customary provider charges for similar
289 services in the community where the services were provided;
290 3. The charge mutually agreed to by the entity and the
291 provider within 60 days after submittal of the claim; or
292 4. The Medicaid rate, which, for the purposes of this
293 paragraph, means the amount the provider would collect from the
294 agency on a fee-for-service basis, less any amounts for the
295 indirect costs of medical education and the direct costs of
296 graduate medical education that are otherwise included in the
297 agency’s fee-for-service payment, as required under 42 U.S.C. s.
298 1396u-2(b)(2)(D). For the purpose of establishing the amounts
299 specified in this subparagraph, the agency shall publish on its
300 website annually, or more frequently as needed, the applicable
301 fee-for-service fee schedules and their effective dates, less
302 any amounts for indirect costs of medical education and direct
303 costs of graduate medical education that are otherwise included
304 in the agency’s fee-for-service payments.
305 (c)
Access.
—
306 1. The agency shall establish specific standards for the
307 number, type, and regional distribution of providers in managed
308 care plan networks to ensure access to care for both adults and
309 children. Each plan must maintain a regionwide network of
310 providers in sufficient numbers to meet the access standards for
311 specific medical services for all recipients enrolled in the
312 plan. The exclusive use of mail-order pharmacies may not be
313 sufficient to meet network access standards. Consistent with the
314 standards established by the agency, provider networks may
315 include providers located outside the region. Each plan shall
316 establish and maintain an accurate and complete electronic
317 database of contracted providers, including information about
318 licensure or registration, locations and hours of operation,
319 specialty credentials and other certifications, specific
320 performance indicators, and such other information as the agency
321 deems necessary. The database must be available online to both
322 the agency and the public and have the capability to compare the
323 availability of providers to network adequacy standards and to
324 accept and display feedback from each provider’s patients. Each
325 plan shall submit quarterly reports to the agency identifying
326 the number of enrollees assigned to each primary care provider.
327 The agency shall conduct, or contract for, systematic and
328 continuous testing of the provider network databases maintained
329 by each plan to confirm accuracy, confirm that behavioral health
330 providers are accepting enrollees, and confirm that enrollees
331 have access to behavioral health services.
332 2. Each managed care plan must publish any prescribed drug
333 formulary or preferred drug list on the plan’s website in a
334 manner that is accessible to and searchable by enrollees and
335 providers. The plan must update the list within 24 hours after
336 making a change. Each plan must ensure that the prior
337 authorization process for prescribed drugs is readily accessible
338 to health care providers, including posting appropriate contact
339 information on its website and providing timely responses to
340 providers. For Medicaid recipients diagnosed with hemophilia who
341 have been prescribed anti-hemophilic-factor replacement
342 products, the agency shall provide for those products and
343 hemophilia overlay services through the agency’s hemophilia
344 disease management program.
345 3. Managed care plans, and their fiscal agents or
346 intermediaries, must accept prior authorization requests for any
347 service electronically.
348 4. Managed care plans serving children in the care and
349 custody of the Department of Children and Families must maintain
350 complete medical, dental, and behavioral health encounter
351 information and participate in making such information available
352 to the department or the applicable contracted community-based
353 care lead agency for use in providing comprehensive and
354 coordinated case management. The agency and the department shall
355 establish an interagency agreement to provide guidance for the
356 format, confidentiality, recipient, scope, and method of
357 information to be made available and the deadlines for
358 submission of the data. The scope of information available to
359 the department shall be the data that managed care plans are
360 required to submit to the agency. The agency shall determine the
361 plan’s compliance with standards for access to medical, dental,
362 and behavioral health services; the use of medications; and
363
follow-up

followup
on all medically necessary services
364 recommended as a result of early and periodic screening,
365 diagnosis, and treatment.
366 (d)
Quality care.
—Managed care plans shall provide, or
367 contract for the provision of, care coordination to facilitate
368 the appropriate delivery of behavioral health care services in
369 the least restrictive setting with treatment and recovery
370 capabilities that address the needs of the patient. Services
371 shall be provided in a manner that integrates behavioral health
372 services and primary care. Plans shall be required to achieve
373 specific behavioral health outcome standards, established by the
374 agency in consultation with the department.
375 (e)
Encounter data.
—The agency shall maintain and operate a
376 Medicaid Encounter Data System to collect, process, store, and
377 report on covered services provided to all Medicaid recipients
378 enrolled in prepaid plans.
379 1. Each prepaid plan must comply with the agency’s
380 reporting requirements for the Medicaid Encounter Data System.
381 Prepaid plans must submit encounter data
, including data on

382
encounters for which payment was denied and encounters for which

383
a health care provider was reimbursed by the plan on a capitated

384
basis,
electronically in a format that complies with the Health
385 Insurance Portability and Accountability Act provisions for
386 electronic claims and in accordance with deadlines established
387 by the agency. Prepaid plans must certify that the data reported
388 is accurate and complete.
389 2. The agency is responsible for validating the data
390 submitted by the plans. The agency shall develop methods and
391 protocols for ongoing analysis of the encounter data that
392 adjusts for differences in characteristics of prepaid plan
393 enrollees to allow comparison of service utilization among plans
394 and against expected levels of use. The analysis shall be used
395 to identify possible cases of
overspending on administrative

396
costs, payments by plans in excess of market rates,
systemic
397 underutilization or denials of claims and inappropriate service
398 utilization such as higher-than-expected emergency department
399 encounters
, and potential
managed care plan
fraud, waste, and

400
abuse
. The analysis shall provide periodic feedback to the plans
401 and enable the agency to establish corrective action plans when
402 necessary. One of the focus areas for the analysis shall be the
403 use of prescription drugs.
The analysis shall be used in managed

404
care plan
capitation
rate
-
setting processes provided under this

405
part.

406 3. The agency shall make encounter data available to those
407 plans accepting enrollees who are assigned to them from other
408 plans leaving a region.
409 4. The agency shall annually produce a report entitled
410 “Analysis of Potentially Preventable Health Care Events of
411 Florida Medicaid Enrollees.” The report must include, but need
412 not be limited to, an analysis of the potentially preventable
413 hospital emergency department visits, hospital admissions, and
414 hospital readmissions that occurred during the previous state
415 fiscal year which may have been prevented with better access to
416 primary care, improved medication management, or better
417 coordination of care, reported by age, eligibility group,
418 managed care plan, and region, including conditions contributing
419 to each potentially preventable event or category of potentially
420 preventable events. The agency may include any other data or
421 analysis parameters to augment the report which it deems
422 pertinent to the analysis. The report must demonstrate trends
423 using applicable historical data. The agency shall submit the
424 report to the Governor, the President of the Senate, and the
425 Speaker of the House of Representatives by October 1, 2024, and
426 each October 1 thereafter. The agency may contract with a third
427 party vendor to produce the report required under this
428 subparagraph.
429 (f)
Continuous improvement.
—The agency shall establish
430 specific performance standards and expected milestones or
431 timelines for improving performance over the term of the
432 contract.
433 1. Each managed care plan shall establish an internal
434 health care quality improvement system, including enrollee
435 satisfaction and disenrollment surveys. The quality improvement
436 system must include incentives and disincentives for network
437 providers.
438 2. Each managed care plan must collect and report the
439 Healthcare Effectiveness Data and Information Set (HEDIS)
440 measures, the federal Core Set of Children’s Health Care Quality
441 measures, and the federal Core Set of Adult Health Care Quality
442 Measures, as specified by the agency. Each plan must collect and
443 report the Adult Core Set behavioral health measures beginning
444 with data reports for the 2025 calendar year. Each plan must
445 stratify reported measures by age, sex, race, ethnicity, primary
446 language, and whether the enrollee received a Social Security
447 Administration determination of disability for purposes of
448 Supplemental Security Income beginning with data reports for the
449 2026 calendar year. A plan’s performance on these measures must
450 be published on the plan’s website in a manner that allows
451 recipients to reliably compare the performance of plans. The
452 agency shall use the measures as a tool to monitor plan
453 performance.
454 3. Each managed care plan must be accredited by the
455 National Committee for Quality Assurance, the Joint Commission,
456 or another nationally recognized accrediting body, or have
457 initiated the accreditation process, within 1 year after the
458 contract is executed. For any plan not accredited within 18
459 months after executing the contract, the agency shall suspend
460 automatic assignment under ss. 409.977 and 409.984.
461 (g)
Program integrity.
—Each managed care plan shall
462 establish program integrity functions and activities to reduce
463 the incidence of fraud and abuse, including, at a minimum:
464 1. A provider credentialing system and ongoing provider
465 monitoring, including maintenance of written provider
466 credentialing policies and procedures which comply with federal
467 and agency guidelines;
468 2. An effective prepayment and postpayment review process
469 including, but not limited to, data analysis, system editing,
470 and auditing of network providers;
471 3. Procedures for reporting instances of fraud and abuse
472 pursuant to chapter 641;
473 4. Administrative and management arrangements or
474 procedures, including a mandatory compliance plan, designed to
475 prevent fraud and abuse; and
476 5. Designation of a program integrity compliance officer.
477 (h)
Grievance resolution.
—Consistent with federal law, each
478 managed care plan shall establish and the agency shall approve
479 an internal process for reviewing and responding to grievances
480 from enrollees. Each plan shall submit quarterly reports on the
481 number, description, and outcome of grievances filed by
482 enrollees.
483 (i)
Penalties.
—
484 1. Withdrawal and enrollment reduction.—Managed care plans
485 that reduce enrollment levels or leave a region before the end
486 of the contract term must reimburse the agency for the cost of
487 enrollment changes and other transition activities. If more than
488 one plan leaves a region at the same time, costs must be shared
489 by the departing plans proportionate to their enrollments. In
490 addition to the payment of costs, departing provider services
491 networks must pay a per-enrollee penalty of up to 3 months’
492 payment and continue to provide services to the enrollee for 90
493 days or until the enrollee is enrolled in another plan,
494 whichever occurs first. In addition to payment of costs, all
495 other departing plans must pay a penalty of 25 percent of that
496 portion of the minimum surplus maintained pursuant to s.
497 641.225(1) which is attributable to the provision of coverage to
498 Medicaid enrollees. Plans shall provide at least 180 days’
499 notice to the agency before withdrawing from a region. If a
500 managed care plan leaves a region before the end of the contract
501 term, the agency shall terminate all contracts with that plan in
502 other regions pursuant to the termination procedures in
503 subparagraph 3.
504 2. Encounter data.—If a plan fails to comply with the
505 encounter data reporting requirements of this section for 30
506 days, the agency must assess a fine of $5,000 per day for each
507 day of noncompliance beginning on the 31st day. On the 31st day,
508 the agency must notify the plan that the agency will initiate
509 contract termination procedures on the 90th day unless the plan
510 comes into compliance before that date.
511 3. Termination.—If the agency terminates more than one
512 regional contract with the same managed care plan due to
513 noncompliance with the requirements of this section, the agency
514 shall terminate all the regional contracts held by that plan.
515 When terminating multiple contracts, the agency must develop a
516 plan to provide for the transition of enrollees to other plans,
517 and phase in the terminations over a time period sufficient to
518 ensure a smooth transition.
519 (j)
Prompt payment.
—Managed care plans shall comply with
520 ss. 641.315, 641.3155, and 641.513.
521 (k)
Electronic claims.
—Managed care plans, and their fiscal
522 agents or intermediaries, shall accept electronic claims in
523 compliance with federal standards.
524 (l)
Fair payment.
—Provider service networks must ensure
525 that no entity licensed under chapter 395 with a controlling
526 interest in the network charges a Medicaid managed care plan
527 more than the amount paid to that provider by the provider
528 service network for the same service.
529 (m)
Itemized payment.
—Any claims payment to a provider by a
530 managed care plan, or by a fiscal agent or intermediary of the
531 plan, must be accompanied by an itemized accounting of the
532 individual claims included in the payment including, but not
533 limited to, the enrollee’s name, the date of service, the
534 procedure code, the amount of reimbursement, and the
535 identification of the plan on whose behalf the payment is made.
536 (n)
Provider dispute resolution.
—Disputes between a plan
537 and a provider may be resolved as described in s. 408.7057.
538 (o)
Transparency.
—Managed care plans shall comply with ss.
539 627.6385(3) and 641.54(7).
540
(p)
Third-party administrators.—
The agency′s contract with

541
a managed care plan must require that any third-party

542
administrative entity contracted by the plan adheres to all

543
pertinent requirements
of the Medicaid program
placed on the

544
plan
under
the plan′s contract with the agency.

545 (3) ACHIEVED SAVINGS REBATE.—
546 (h) The following may not be included as allowable expenses
547 in calculating income for determining the achieved savings
548 rebate:
549 1. Payment of achieved savings rebates.
550 2. Any financial incentive payments made to the plan
551 outside of the capitation rate.
552 3. Any financial disincentive payments levied by the state
553 or Federal Government.
554 4. Expenses associated with any lobbying or political
555 activities.
556 5. The cash value or equivalent cash value of bonuses of
557 any type paid or awarded to the plan’s executive staff, other
558 than base salary.
559 6. Reserves and reserve accounts.
560 7. Administrative costs, including, but not limited to,
561 reinsurance expenses, interest payments, depreciation expenses,
562 bad debt expenses, and outstanding claims expenses in excess of
563 actuarially sound maximum amounts set by the agency.
564
8. Payments to affiliate
s as defined in s. 409.962
in

565
excess of market rates.

566
567 The agency shall consider these and other factors in developing
568 contracts that establish shared savings arrangements.
569 (4) MEDICAL LOSS
RATIOS

RATIO
.—
570
(a)
If required
by federal regulations or
as a condition of
571 a waiver, the agency
must

may
calculate
a
medical loss
ratios

572
ratio
for
all
managed care plans
contracted with the agency

573
under this part
. The
calculation
s must

calculation shall
use
574 uniform financial data collected from all plans
and shall be

575
computed for each plan on a statewide basis
.
If a plan

576
participates in the managed medical assistance program, the

577
long-term care managed care program, or the pilot program for

578
individuals with developmental disabilities, the agency must

579
calculate medical loss ratios for the plan’s participation in

580
each program separately and, if the plan participates in more

581
than one of these programs, for the plan’s overall participation

582
in statewide
Medicaid
managed care.

Medical loss ratios must be

583
calculated and

The method for calculating the medical loss ratio

584
shall meet the following criteria:

585
(a) Except as provided in paragraphs (b) and (c),

586 expenditures
must

shall
be classified in a manner consistent
587 with
42 C.F.R. part 438

45 C.F.R. part 158
.
588 (b)
The agency shall report medical loss ratios quarterly

589
and annually for each
managed care
plan
contracted with the

590
agency under this part
to the Governor, the President of the

591
Senate, and the Speaker of the House of Representatives no later

592
than 6 months after the end of each
such
period

Funds provided

593
by plans to graduate medical education institutions to

594
underwrite the costs of residency positions shall be classified

595
as medical expenditures, provided the funding is sufficient to

596
sustain the positions for the number of years necessary to

597
complete the residency requirements and the residency positions

598
funded by the plans are active providers of care to Medicaid and

599
uninsured patients.

600
(c) Before final determination of the medical loss ratio

601
for any period, a plan may contribute to a designated state

602
trust fund for the purpose of supporting Medicaid and indigent

603
care and have the contribution counted as a medical expenditure

604
for the period. Funds contributed for this purpose shall be

605
deposited into the Grants and Donations Trust Fund
.
606
(5) AFFILIATED ENTITIES AND RELATED PARTIES.—

607
(a) The agency shall ensure oversight of affiliated

608
entities and related parties paid by managed care plans under

609
this part, including, but not limited to, examining financial

610
records and self-referral data of any managed care plan

611
providing services within the
s
tatewide
m
anaged
c
are program

612
which uses
affiliated entities and related parties.

613
(b) The agency shall consider data examined under paragraph

614
(a) and the findings of the annual
assessment
required under s.

615
409.9675(4) when developing managed care plan capitation rates

616
under this part.

617 Section 5. Effective January 1, 2027, paragraph (f) of
618 subsection (3) of section 409.967, Florida Statutes, is amended,
619 and paragraph (g) of that subsection is republished, to read:
620 409.967 Managed care plan accountability.—
621 (3) ACHIEVED SAVINGS REBATE.—
622 (f) Achieved savings rebates validated by the certified
623 public accountant are due within 30 days after the report is
624 submitted. Except as provided in paragraph (h), the achieved
625 savings rebate is established by determining pretax income as a
626 percentage of revenues and applying the following income sharing
627 ratios:
628 1. One hundred percent of income up to and including
3

5

629 percent of revenue shall be retained by the plan.
630 2.
Thirty

Fifty
percent of income above
3

5
percent and up
631 to 10 percent shall be retained by the plan, and the other
70

50

632 percent shall be refunded to the state and adjusted for the
633 Federal Medical Assistance Percentages. The state share shall be
634 transferred to the General Revenue Fund, unallocated, and the
635 federal share shall be transferred to the Medical Care Trust
636 Fund, unallocated.
637 3. One hundred percent of income above 10 percent of
638 revenue shall be refunded to the state and adjusted for the
639 Federal Medical Assistance Percentages. The state share shall be
640 transferred to the General Revenue Fund, unallocated, and the
641 federal share shall be transferred to the Medical Care Trust
642 Fund, unallocated.
643 (g) A plan that exceeds agency-defined quality measures in
644 the reporting period may retain an additional 1 percent of
645 revenue. For the purpose of this paragraph, the quality measures
646 must include plan performance for preventing or managing
647 complex, chronic conditions that are associated with an elevated
648 likelihood of requiring high-cost medical treatments.
649 Section 6. Section 409.9675, Florida Statutes, is created
650 to read:
651
409.9675
Affiliated entities and controlling interests;

652
reports required
.—

653
(1) Each managed care plan contracted by the agency under

654
this part shall report
all of
the following by March 31, 2027,

655
for the prior calendar year,
and annually thereafter, to the

656
agency and the Office of Insurance Regulation in
a
manner

657
prescribed by the agency:

658
(a)

Any person controlled by or affiliated with the managed

659
care plan, including, but not limited to, any provider, provider

660
group, group practice defined in s. 456.053
(3)
, or person

661
responsible for providing any pharmacy services,

662
pharmaceuticals, diagnostics, care coordination, care delivery,

663
health care services, medical equipment, administrative

664
services, or financial services for, to, or on behalf of the

665
managed care plan.

666
(b)

Any affiliation of any kind or nature with any person

667
wh
o
has, either directly or indirectly through one or more

668
intermediaries, an investment or ownership interest representing

669
10 percent or more, shares common ownership with, or has an

670
investor or a holder of an ownership interest representing 10

671
percent or more
with
any person providing pharmacy services,

672
diagnostics, care coordination, care delivery, health care

673
services, medical equipment, administrative services, or

674
financial services for, to, or on behalf of the managed care

675
plan.

676
(2)
For any affiliation reported by a
managed care plan

677
under subsection (1)
, the report must include all of the

678
following
:

679
(a) The percentage of ownership or control of any person or

680
affiliate with whom the managed care plan has had business

681
transactions totaling in the aggregate more than $25,000 during

682
the
prior
12-month period in the annual achieved savings rebate

683
financial r
eport
ing required under s. 409.967(3)
and

684
identif
ication of
the specific contract or contracts involved in

685
such business transactions
.

686
(b) Any significant business transactions between the

687
managed care plan and any affiliated person during the 12-month

688
period in the annual achieved savings rebate
financial r
eport
ing

689
required under s. 409.967(3)
.

690
(3) Each managed care plan shall report any change in

691
information required by subsection (1) to the agency and the

692
Office of Insurance Regulation in writing
within
60 days after

693
the change occurs.

694
(4)
By December 31, 2026, and annually thereafter, the

695
agency shall calculate, analyze
,
and publicly report on the

696
agency’s website an assessment of affiliated entity payment

697
transactions in the Medicaid
p
rogram for medical benefit and

698
administrative costs as reported for purposes of the achieved

699
savings rebate. The baseline assessment, at a minimum,
must

700
include
a
chieved
s
avings
r
ebate transactions
for the years
2021,

701
2022, and 2023
;
the amount and associated percentage of

702
affiliated entity payments within the medical loss ratio
;
and

703
the payment deviation percentages and associated amounts at the

704
Healthcare Common Procedure Cod
ing System
level for affiliated

705
entities as compared to nonaffiliated entities.

The assessment

706
must
also compare payment amounts for value-based or alternative

707
payment arrangements
.

708 Section 7. Present paragraphs (b) through (x) of subsection
709 (1) of section 626.8825, Florida Statutes, are redesignated as
710 paragraphs (c) through (z), respectively, a new paragraph (b) is
711 added to that subsection, and present paragraph (u) of
712 subsection (1) and paragraphs (c) and (h) of subsection (3) of
713 that section are amended, to read:
714 626.8825 Pharmacy benefit manager transparency and
715 accountability.—
716 (1) DEFINITIONS.—As used in this section, the term:
717
(
b
)

“Affiliated manufacturer” means a prescription drug

718
manufacturer permitted under
c
hapter 4
99 or
a private label

719
distributor as defined in 21 C.F.R. s. 207.1 which
directly or

720
indirectly through one or more intermediaries:

721
1. Has an investment or ownership interest in a pharmacy

722
benefit manager holding a certificate of authority issued under

723
this part;

724
2. Shares common ownership with a pharmacy benefit manager

725
holding a certificate of authority issued under this part; or

726
3. Has an investor or a holder of an ownership interest

727
which is a pharmacy benefit manager holding a certificate of

728
authority issued under this part.

729
(
v
)
(u)
“Pharmacy benefits plan or program” means a plan or
730 program that pays for, reimburses, covers the cost of, or
731 provides access to discounts on pharmacist services provided by
732 one or more pharmacies to covered persons who reside in, are
733 employed by, or receive pharmacist services from this state.
734 1. The term includes, but is not limited to, health
735 maintenance organizations, health insurers, self-insured
736 employer health plans, discount card programs, and government
737 funded health plans, including the Statewide Medicaid Managed
738 Care program established pursuant to part IV of chapter 409 and
739 the state group insurance program pursuant to part I of chapter
740 110.
741 2. The term excludes such a plan or program under
s. 430.84

742
or
chapter 440.
743 (3) CONTRACTS BETWEEN A PHARMACY BENEFIT MANAGER AND A
744 PARTICIPATING PHARMACY.—In addition to other requirements in the
745 Florida Insurance Code, a participation contract executed,
746 amended, adjusted, or renewed on or after July 1, 2023, that
747 applies to pharmacist services on or after January 1, 2024,
748 between a pharmacy benefit manager and one or more pharmacies or
749 pharmacists, must include, in substantial form, terms that
750 ensure compliance with all of the following requirements, and
751 that, except to the extent not allowed by law, shall supersede
752 any contractual terms in the participation contract to the
753 contrary:
754 (c) A prohibition of financial clawbacks, reconciliation
755 offsets, or offsets to adjudicated claims. A pharmacy benefit
756 manager may not charge, withhold,
offset,
or recoup
any
direct
757 or indirect remuneration fees, dispensing fees, brand name or
758 generic effective rate adjustments through reconciliation, or
759 any other monetary charge, withholding, or recoupments as
760 related to discounts, multiple network reconciliation offsets,
761 adjudication transaction fees, and any other instance when
an

762
amount

a fee
may be recouped from a pharmacy
if such action

763
would result in a reduction in the amount paid to the pharmacy

764
or pharmacist
. This prohibition does not apply to:
765 1. Any incentive payments provided by the pharmacy benefit
766 manager to a network pharmacy for meeting or exceeding
767 predefined quality measures, such as Healthcare Effectiveness
768 Data and Information Set measures; recoupment due to an
769 erroneous claim, fraud, waste, or abuse; a claim adjudicated in
770 error; a maximum allowable cost appeal pricing adjustment; or an
771 adjustment made as part of a pharmacy audit pursuant to s.
772 624.491.
773 2. Any recoupment that is returned to the state for
774 programs in chapter 409 or the state group insurance program in
775 s. 110.123.
776 (h) The pharmacy benefit manager shall provide a reasonable
777 administrative appeal procedure to allow a pharmacy or
778 pharmacist to challenge the maximum allowable cost pricing
779 information and the reimbursement made under the maximum
780 allowable cost as defined in s. 627.64741 for a specific drug as
781 being below the acquisition cost available to the challenging
782 pharmacy or pharmacist.
783 1. The administrative appeal procedure must include a
784 telephone number and e-mail address, or a website, for the
785 purpose of submitting the administrative appeal. The appeal may
786 be submitted by the pharmacy or an agent of the pharmacy
787 directly to the pharmacy benefit manager or through a pharmacy
788 service administration organization.
The administrative appeal

789
process must allow a pharmacy or pharmacist the option to submit

790
an electronic spreadsheet or similar electronic document

791
containing a consolidated administrative appeal representing

792
multiple adjudicated claims that share the same drug
and
day

793
supply and ha
ve
a date of service occurring within the same

794
calendar month.
The pharmacy or pharmacist must be given at
795 least 30 business days after a maximum allowable cost update or
796 after an adjudication for an electronic claim or reimbursement
797 for a nonelectronic claim to file the administrative appeal.
798 2. The pharmacy benefit manager must respond to the
799 administrative appeal within 30 business days after receipt of
800 the appeal.
801 3. If the appeal is upheld, the pharmacy benefit manager
802 must:
803 a. Update the maximum allowable cost pricing information to
804 at least the acquisition cost available to the pharmacy;
805 b. Permit the pharmacy or pharmacist to reverse and rebill
806 the claim in question;
807 c. Provide to the pharmacy or pharmacist the national drug
808 code on which the increase or change is based; and
809 d. Make the increase or change effective for each similarly
810 situated pharmacy or pharmacist who is subject to the applicable
811 maximum allowable cost pricing information.
812 4. If the appeal is denied, the pharmacy benefit manager
813 must provide to the pharmacy or pharmacist the national drug
814 code and the name of the national or regional pharmaceutical
815 wholesalers operating in this state which have the drug
816 currently in stock at a price below the maximum allowable cost
817 pricing information.
818 5.
Beginning August 15, 2026

Every 90 days
, a pharmacy
819 benefit manager shall report to the office the total number of
820 appeals received and denied in the preceding
quarter

90-day

821
period
, with an explanation or reason for each denial, for each
822 specific drug for which an appeal was submitted pursuant to this
823 paragraph.
The deadlines for each filing are March 1 for the

824
preceding year
′
s
fourth
quarter; May 15 for
the
year
′
s
first

825
quarter; August 15 for
the
year
′
s
second
quarter; and November

826
15 for
the
year
′
s
third
quarter.

827 Section 8. Subsection (7) of section 626.8827, Florida
828 Statutes, is amended, and subsections (8), (9), and (10) are
829 added to that section, to read:
830 626.8827 Pharmacy benefit manager prohibited practices.—In
831 addition to other prohibitions in this part, a pharmacy benefit
832 manager may not do any of the following:
833 (7) Fail to comply with the requirements in s. 624.491 or
834 s. 626.8825
, or breach contractual terms required under s.

835
626.8825
.
836
(8) Prohibit or restrict a pharmacy from declining to

837
dispense a drug if the reimbursement rate for the drug is less

838
than the actual acquisition cost to the pharmacy.

839
(
9
) Reimburse a pharmacy less than it reimburses an

840
affiliate pharmacy.

841
(
10
) Maintain an ownership interest, investment interest,

842
or common ownership with an affiliated manufacturer, or share

843
any investor or holder of an ownership interest with an

844
affiliated manufacturer.

845 Section 9. Subsection (1) of section 627.42392, Florida
846 Statutes, is amended to read:
847 627.42392 Prior authorization.—
848 (1) As used in this section, the term “health insurer”
849 means an authorized insurer offering health insurance as defined
850 in s. 624.603, a managed care plan as defined in
s. 409.962

s.

851
409.962(10)
, or a health maintenance organization as defined in
852 s. 641.19(12).
853 Section 10. Except as otherwise provided in this act and
854 except for this section, which shall take effect upon this act
855 becoming a law, this act shall take effect July 1, 2026.