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- 83rd Session (2025)
Senate Bill No. 389–Senators Scheible, Stone; and Daly
CHAPTER..........
AN ACT relating to prescription drugs; requiring the Department of
Health and Human Services to select and contract with a state
pharmacy benefit manager to manage pharmacy benefits for
Medicaid and certain other health benefit plans; requiring the
Department to establish certain methodologies for the
payment of and rates of reimbursement for prescription drugs
under Medicaid; requiring the Department to establish a
benchmark to measure certain data relating to the cos t of
prescription drugs; prescribing certain duties of the state
pharmacy benefit manager; requiring that the Department
approve certain contracts entered into by the state pharmacy
benefit manager; prohibiting the state pharmacy benefit
manager from engag ing in certain activities; requiring a
Medicaid managed care organization to contract with and
utilize the state pharmacy benefit manager to manage
pharmacy benefits; requiring a Medicaid managed care
organization to provide certain information to the Department
upon request; and providing other matters properly relating
thereto.
Legislative Counsel’s Digest:
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)
Sections 12 and 15 of this bill instead require the Department to, not later than
January 1, 2030, select and 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 12 and 13 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 methodologies and requirements relating to the
reimbursement and payment of pharmacies for services rendered under the contract
between the Department and the state pharmacy benefit manager. Section 5
requires the methodology established for the reimbursement of certain pharmacies
to: (1) be developed in a manner which would provide the great est amount of
savings to the State; and (2) base the rate of reimbursement for a drug on the actual
cost of acquiring the drug. For that purpose, section 5 also requires the Department
to, if certain conditions are met, establish a benchmark to measure the price of
drugs purchased in this State directly from manufacturers and wholesalers, which is
to be known as the Nevada Average Acquisition Cost. Section 5 requires the
Department to biennially submit a report to the Legislature concerning the savings
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realized by the St ate from the establishment and use of the Nevada Average
Acquisition Cost benchmark.
Section 8 of this bill requires each 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 8 also requires each Medicaid
managed care organization to, upon request of the Department, disclose the
expenditures of the Medicaid managed car e organization associated with providing
pharmacy benefits to recipients of Medicaid.
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 sta te pharmacy benefit manager and the
Department, or any revision, suspension or termination of such a contract between
the state pharmacy benefit manager and a pharmacy, 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.
Sections 2 and 3 of this bill define certain terms, and section 7 of this bill
establishes the applicability of those definitions. Section 9 of this bill appli es
certain other definitions in existing law to sections 4-6. Sections 10, 11, 13 and 14
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 o f
this bill.
EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Chapter 422 of NRS is hereby amended by adding
thereto the provisions set forth as sections 2 to 6, inclusive, of this
act.
Sec. 2. “Medicaid managed care organization” means a
health maintenance organization with which the Department
enters into a contract pursuant to NRS 422.273 to provide health
care services through managed care to recipients of Medicaid.
Sec. 3. “State pharmacy benefit manager” means the
pharmacy benefit manager that enters into a contract with the
Department pursuant to NRS 422.4053.
Sec. 4. 1. A pharmacy benefit manager that meets the
eligibility requirements established pursuant to section 5 of this
act may apply to become the state pharmacy benefit manager by
submitting an application to the Department on a form prescribed
by the Department. The application must include, without
limitation, disclosures of:
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(a) Any activity, policy, practice, contract or agreement of the
applicant that may directly or indirectly present a conflict of
interest in the relationship between the applicant and the
Department or a Medicaid managed care organizatio n, including,
without limitation, any such activity, policy, practice, contract or
agreement that operates solely or partially outside this State;
(b) Any direct or indirect fees, charges or assessments that the
applicant imposes on any pharmacy in this State:
(1) With which the applicant shares common ownership,
management or control;
(2) Which is owned, managed or controlled by any
management, parent or subsidiary of the applicant, any company
jointly held by the applicant or any company otherwise af filiated
with the applicant by a common owner, manager or holding
company;
(3) For which the board of directors of the pharmacy
shares any members in common with the board of directors of the
applicant; or
(4) Which shares any manager in common with th e
applicant;
(c) All common ownership, common management, common
members of a board of directors, shared managers or shared
control between:
(1) The applicant, or any management, parent, subsidiary
or jointly held company of the applicant or any company otherwise
affiliated by a common owner, manager or holding company with
the applicant; and
(2) Any of the following entities:
(I) A Medicaid managed care organization or a
company affiliated with a Medicaid managed care organization;
(II) A phar macy services administrative organization,
any other entity that contracts on behalf of a pharmacy or any
company affiliated with a pharmacy services administrative
organization or such an entity;
(III) A wholesaler, as defined in NRS 639.016, or any
company affiliated with a wholesaler;
(IV) A third party, other than a Medicaid managed care
organization, or any company affiliated with such a third party;
and
(V) A pharmacy or any company affiliated with a
pharmacy; and
(d) All financial arrangem ents, including the terms of each
such arrangement, currently in effect between the applicant and a
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manufacturer or labeler of prescription drugs, including without
limitation, an arrangement for:
(1) The management of a formulary;
(2) Fees relating to data sales; and
(3) Education and support for claims processing.
2. As used in this section, “third party” means any insurer or
organization providing health coverage or benefits in accordance
with state or federal law.
Sec. 5. 1. The Department shall adopt regulations
establishing:
(a) The criteria that a pharmacy benefit manager must meet in
order to be eligible to enter into a contract with the Department
pursuant to NRS 422.4053 to serve a s the state pharmacy benefit
manager.
(b) The methodology for reimbursement to pharmacies, other
than those pharmacies described in paragraph (c), for providing
benefits under a contract entered into pursuant to subsection 1 of
NRS 422.4053 or paragraph (a) of subsection 2 of NRS 422.4053.
(c) The methodology for reimbursement to pharmacies owned
by a health care facility that is registered as a covered entity
pursuant to 42 U.S.C. § 256b under a contract entered into
pursuant to subsection 1 of NRS 422.4053 or paragraph (a) of
subsection 2 of NRS 422.4053.
(d) Dispensing fees paid to pharmacies and pharmacists for
providing benefits under a contract entered into pursuant to
subsection 1 of NRS 422.4053 or paragraph (a) of subsection 2 of
NRS 422.4053. In establishing those dispensing fees, the
Department may consider applicable guidance promulgated by the
Centers for Medicare and Medicaid Services of the United States
Department of Health and Human Services.
(e) A requirement that providers must submit to the
Department or state pharmacy benefit manager data from claims,
as prescribed by the Department, relating to the actual acquisition
costs of drugs purchased by the providers from pharmacies owned
by health care facilities that are registered as covered entities
pursuant to 42 U.S.C. § 256b.
2. To the extent authorized by federal law, the dispensing fees
established pursuant to paragraph (d) of subsection 1 may vary by
pharmacy type, including, without limitation, rural and
independently owned pharmacies, pharmacies owned by a
corporation operating in multiple states and pharmacies owned by
a health care facility that is registered as a covered entity pursuant
to 42 U.S.C. § 256b.
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3. To the extent practicable, the methodology f or
reimbursement established pursuant to paragraph (b) of
subsection 1 must:
(a) Generate the maximum amount of savings for the State
with respect to the cost of prescription drugs;
(b) Provide rates of reimbursement for drugs which are based
on the actu al cost of acquiring a drug, to the extent that doing so
would result in a reduction of expenditures on prescription drugs
by the Department; and
(c) Utilize the Nevada Average Acquisition Cost price
benchmark for the purposes set forth in paragraph (b) , if
established pursuant to subsection 4.
4. Except as otherwise provided in this subsection, t he
Department shall establish a pric ing benchmark to be known as
Nevada Average Acquisition Cost to measure the average, actual
cost of prescription drugs purch ased by pharmacies and other
providers in this State directly from manufacturers and
wholesalers of prescription drugs or from any other sources. The
Department shall establish the Nevada Average Acquisition Cost
only if, in the determination of the Depart ment, the development
of the benchmark would result in a reduction of spending on
prescription drugs by the Department or otherwise result in a net
reduction of expenditures by the State . To facilitate the
establishment of the Nevada Average Acquisition Co st price
benchmark, the Department may:
(a) Establish a survey that must be completed periodically by
pharmacies and other providers who purchase prescription drugs;
(b) Utilize any data provided to the Department by the state
pharmacy benefit manager or a health management organization
with which the Department has contracted pursuant to
NRS 422.4053;
(c) Utilize any other data which is accessible to the
Department, including, without limitation, d ata furnished to the
Department by providers;
(d) Utilize methodologies similar to those established by the
Centers for Medicare and Medicaid Services of the United States
Department of Health and Human Services with respect to the
National Average Acquisition Cost pricing benchmark; and
(e) Adopt such regulations as may otherwise be necessary to
carry out the purposes of this section.
5. On or before February 1 of each odd-numbered year
occurring after the establishment of the Nevada Average
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Acquisition Cost price benchmark , if established, the Department
shall:
(a) Compile a report concerning the actual or estimated
savings generated for the State during the immediately preceding
two calendar years from the establishment and utilization of the
Nevada Average Acquisition Cost price benchmark; and
(b) Submit the report compiled pursuant to paragraph (a) to
the Director of the Legislative Counsel Bureau for transmittal to
the next regular session of the Legislature.
6. As used in this section:
(a) “Actual acquisition cost” has the meaning ascribed to it in
42 C.F.R. § 447.502.
(b) “Provider” means a person or entity who participates in
Medicaid as a provider of goods or services.
Sec. 6. 1. The state pharmacy benefit manager shall submit
to the Department for review:
(a) Each contract for the provision of benefits under the
contract entered into pursuant to NRS 422.4053 between the state
pharmacy benefit manager and a pharmacy or an entity that
contracts on behalf of such a pharmacy;
(b) Each revision to the terms and conditions of a contract
described in paragraph (a); and
(c) Each suspension or termination of a contract described in
paragraph (a).
2. The Department shall review each submission received
pursuant to subsection 1 and approve or deny the contract,
revision, suspension or termination, as applicable. A contract,
revision, suspension or termination is not effective until the
contract, revision, suspension or termination, as applicable, is
approved by the Department.
3. The Department may change a payment arrangement
between the Department and a Medicaid managed care
organization, the Department and the state pharmacy benefit
manager or a Medicaid managed care organization and the state
pharmacy benefit manager in order to comply with federal or state
law or regulations or any other agreement between the
Department and the Federal Government.
4. The state pharmacy benefit manager shall not enter into,
renew or amend any contract that is inconsistent with:
(a) The terms and conditions of the contract entered into by
the state pharmacy benefit manager with the Department pursuant
to NRS 422.4053; or
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(b) The reimbursement methodologies and dispensing fees
established by the Department pursuant to subsection 1 of section
5 of this act.
5. Any contract entered into by the state pharmacy benefit
manager in violation of subsection 4 is void and unenforceable.
Sec. 7. NRS 422.001 is hereby amended to read as follows:
422.001 As used in this chapter, unless the context otherwise
requires, the words and terms defined in NRS 422.003 to 422.054,
inclusive, and sections 2 and 3 of this act have the meanings
ascribed to them in those sections.
Sec. 8. NRS 422.273 is hereby amended to read as follows:
422.273 1. For any Medicaid managed care program
established in the State of Nevada, the Depar tment shall contract
only with a health maintenance organization that has:
(a) Negotiated in good faith with a federally -qualified health
center to provide health care services for the health maintenance
organization;
(b) Negotiated in good faith with th e University Medical Center
of Southern Nevada to provide inpatient and ambulatory services to
recipients of Medicaid; and
(c) Negotiated in good faith with the University of Nevada
School of Medicine to provide health care services to recipients of
Medicaid.
Nothing in this section shall be construed as exempting a
federally-qualified health center, the University Medical Center of
Southern Nevada or the University of Nevada School of Medicine
from the requirements for contracting with the health mainte nance
organization.
2. During the development and implementation of any
Medicaid managed care program, the Department shall cooperate
with the University of Nevada School of Medicine by assisting in
the provision of an adequate and diverse group of patie nts upon
which the school may base its educational programs.
3. The University of Nevada School of Medicine may establish
a nonprofit organization to assist in any research necessary for the
development of a Medicaid managed care program, receive and
accept gifts, grants and donations to support such a program and
assist in establishing educational services about the program for
recipients of Medicaid.
4. For the purpose of contracting with a Medicaid managed
care program pursuant to this section, a hea lth maintenance
organization is exempt from the provisions of NRS 695C.123.
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5. A Medicaid managed care program must require each
health maintenance organization that enters into a contract with
the Department pursuant to this section to contract with and
utilize the state pharmacy benefit manager for the purpose of
administering all pharmacy benefits for recipients of Medicaid
who receive pharmacy benefits through the health maintenance
organization.
6. Each health maintenance organization that enters i nto a
contract with the Department pursuant to this section shall, upon
the request of the Department and in the form prescribed by the
Department, disclose the expenditures of the health maintenance
organization associated with providing pharmacy benefits for
recipients of Medicaid.
7. The provisions of this section apply to any managed care
organization, including a health maintenance organization, that
provides health care services to recipients of Medicaid under the
State Plan for Medicaid or the Chil dren’s Health Insurance Program
pursuant to a contract with the Division. Such a managed care
organization or health maintenance organization is not required to
establish a system for conducting external reviews of adverse
determinations in accordance with chapter 695B, 695C or 695G of
NRS. This subsection does not exempt such a managed care
organization or health maintenance organization for services
provided pursuant to any other contract.
[6.] 8. As used in this section, unless the context otherwise
requires:
(a) “Federally-qualified health center” has the meaning ascribed
to it in 42 U.S.C. § 1396d(l)(2)(B).
(b) “Health maintenance organization” has the meaning ascribed
to it in NRS 695C.030.
(c) “Managed care organization” has the meaning ascribed to it
in NRS 695G.050.
Sec. 9. NRS 422.401 is hereby amended to read as follows:
422.401 As used in NRS 422.401 to 422.406, inclusive, and
sections 4, 5 and 6 of this act, unless the context otherwise requires,
the words and terms defined in NRS 422.4015 to 422.4024,
inclusive, have the meanings ascribed to them in those sections.
Sec. 10. NRS 422.4025 is hereby amended to read as follows:
422.4025 1. The Department shall [:
(a) By] , b y regulation, develop a list of preferred prescription
drugs to be used for the Medicaid program and the Children’s
Health Insurance Program, and each public or nonprofit health
benefit plan that elects to use the list of preferred prescription drugs
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as its formulary pursuant to NRS 287.012, 287.0433 or 687B.407 .
[; and
(b) Negotiate and enter into agreements to purchase the drugs
included on the list of preferred prescription drugs on behalf of the
health benefit plans described in paragraph (a) or enter into a
contract pursuant to NRS 422.4053 with a pharmacy benefit
manager, health maintenance organization or one or more public or
private entities in this State, the District of Columbia or other states
or territories of the United States, as appropriate , to negotiate such
agreements.]
2. The Department shall, by regulation, establish a list of
prescription drugs which must be excluded from any restrictions that
are imposed by the Medicaid program on drugs that are on the list of
preferred prescription drugs established pursuant to subsection 1.
The list established pursuant to this subsection must include,
without limitation:
(a) Prescription drugs that are prescribed for the treatment of the
human immunodeficiency virus, including, without limitation,
antiretroviral medications;
(b) Antirejection medications for organ transplants;
(c) Antihemophilic medications; and
(d) Any prescription drug which the Board identifies as
appropriate for exclusion from any restrictions that are imposed by
the Medicai d program on drugs that are on the list of preferred
prescription drugs.
3. The regulations must provide that the Board makes the final
determination of:
(a) Whether a class of therapeutic prescription drugs is included
on the list of preferred prescrip tion drugs and is excluded from any
restrictions that are imposed by the Medicaid program on drugs that
are on the list of preferred prescription drugs;
(b) Which therapeutically equivalent prescription drugs will be
reviewed for inclusion on the list of preferred prescription drugs and
for exclusion from any restrictions that are imposed by the Medicaid
program on drugs that are on the list of preferred prescription drugs;
and
(c) Which prescription drugs should be excluded from any
restrictions that are imposed by the Medicaid program on drugs that
are on the list of preferred prescription drugs based on continuity of
care concerning a specific diagnosis, condition, class of therapeutic
prescription drugs or medical specialty.
4. The list of preferred prescription drugs established pursuant
to subsection 1 must include, without limitation:
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(a) Any prescription drug determined by the Board to be
essential for treating sickle cell disease and its variants; and
(b) Prescription drugs to prevent the acqui sition of human
immunodeficiency virus.
5. The regulations must provide that each new pharmaceutical
product and each existing pharmaceutical product for which there is
new clinical evidence supporting its inclusion on the list of preferred
prescription drugs must be made available pursuant to the Medicaid
program with prior authorization until the Board reviews the product
or the evidence.
6. The Medicaid program must cover a prescription drug that is
not included on the list of preferred prescription drugs as if the drug
were included on that list if:
(a) The drug is:
(1) Used to treat hepatitis C;
(2) Used to provide medication -assisted treatment for opioid
use disorder;
(3) Used to support safe withdrawal from substance use
disorder; or
(4) In the same class as a drug on the list of preferred
prescription drugs; and
(b) All preferred prescription drugs within the same class as the
drug are unsuitable for a recipient of Medicaid because:
(1) The recipient is allergic to all preferred prescription drugs
within the same class as the drug;
(2) All preferred prescription drugs within the same class as
the drug are contraindicated for the recipient or are likely to interact
in a harmful manner with another drug that the recipient is taking;
(3) The recipient has a history of adverse reactions to all
preferred prescription drugs within the same class as the drug; or
(4) The drug has a unique indication that is supported by
peer-reviewed clinical evidence or approved by the United States
Food and Drug Administration.
7. The Medicaid program must automatically cover any typical
or atypical antipsychotic medication or anticonvulsant medication
that is not on the list of preferred prescription drugs upon the
demonstrated therapeutic failure of one drug on that list to
adequately treat the condition of a recipient of Medicaid.
8. On or before February 1 of each year, the Department shall:
(a) Compile a report concerning the [agreements negotiated
pursuant to paragraph (b) of subsection 1 and contracts] contract
entered into pursuant to subsection 1 of NRS 422.4053 with the
state pharmacy benefit manager and any contracts entered into
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pursuant to subsection 2 of NRS 422.4053, which must include,
without limitation, the financial effects of obtaining prescription
drugs through [those agreements and contracts, in total and
aggregated separately for agreements negotiated by the Department,
contracts with a pharmacy benefit manager , contracts with a health
maintenance organization and contracts with public and private
entities from this State, the District of Columbia and other states and
territories of the United States;] each such contract; and
(b) Post the report on an Internet website maintained by the
Department and submit the report to the Director of the Legislative
Counsel Bureau for transmittal to:
(1) In odd-numbered years, the Legislature; or
(2) In even-numbered years, the Legislative Commission.
Sec. 11. NRS 422.4032 is hereby amended to read as follows:
422.4032 1. The Department [or a ] , the state pharmacy
benefit manager or a health maintenance organization with which
the Department contracts pursuant to NRS 422.4053 to manage
prescription drug benefits shall allow a recipient of Medicaid who
has been diagnosed with stage 3 or 4 cancer or the attending
practitioner of the recip ient to apply for an exemption from step
therapy that would otherwise be required pursuant to NRS 422.403
to instead use a prescription drug prescribed by the attending
practitioner to treat the cancer or any symptom thereof of the
recipient of Medicaid. The application process must:
(a) Allow the recipient or attending practitioner, or a designated
advocate for the recipient or attending practitioner, to present to the
Department, state pharmacy benefit manager or health maintenance
organization, as appl icable, the clinical rationale for the exemption
and any relevant medical information.
(b) Clearly prescribe the information and supporting documents
that must be submitted with the application, the criteria that will be
used to evaluate the request and t he conditions under which an
expedited determination pursuant to subsection 4 is warranted.
(c) Require the review of each application by at least one
physician, registered nurse or pharmacist.
2. The information and supporting documentation required
pursuant to paragraph (b) of subsection 1:
(a) May include, without limitation:
(1) The medical history or other health records of the
recipient demonstrating that the recipient has:
(I) Tried other drugs included in the pharmacological
class of drugs for which the exemption is requested without success;
or
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(II) Taken the requested drug for a clinically appropriate
amount of time to establish stability in relation to the cancer and the
guidelines of the prescribing practitioner; and
(2) Any other relevant clinical information.
(b) Must not include any information or supporting
documentation that is not necessary to make a determination about
the application.
3. Except as otherwise provided in subsection 4, the
Department, state pharmacy benefit manager or health maintenance
organization, as applicable, [that receives ] upon receiving an
application for an exemption pursuant to subsection 1 , shall:
(a) Make a determination concerning the application if the
application is complete, or request add itional information or
documentation necessary to complete the application not later than
72 hours after receiving the application; and
(b) If [it] the state pharmacy benefit manager or health
maintenance organization requests additional information or
documentation, make a determination concerning the application not
later than 72 hours after receiving the requested information or
documentation.
4. If, in the opinion of the attending practitioner, step therapy
may seriously jeopardize the life or heal th of the recipient, the
Department, state pharmacy benefit manager or health maintenance
organization , [that receives an application for an exemption
pursuant to subsection 1,] as applicable, must make a determination
concerning the application as expedi tiously as necessary to avoid
serious jeopardy to the life or health of the recipient.
5. The Department, state pharmacy benefit manager or health
maintenance organization, as applicable, shall disclose to a recipient
or attending practitioner who submit s an application for an
exemption from step therapy pursuant to subsection 1 the
qualifications of each person who will review the application.
6. The Department, state pharmacy benefit manager or health
maintenance organization, as applicable, must gran t an exemption
from step therapy in response to an application submitted pursuant
to subsection 1 if:
(a) Any treatment otherwise required under the step therapy or
any drug in the same pharmacological class or having the same
mechanism of action as the d rug for which the exemption is
requested has not been effective at treating the cancer or symptom
of the recipient when prescribed in accordance with clinical
indications, clinical guidelines or other peer-reviewed evidence;
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(b) Delay of effective treatme nt would have severe or
irreversible consequences for the recipient and the treatment
otherwise required under the step therapy is not reasonably expected
to be effective based on the physical or mental characteristics of the
recipient and the known characteristics of the treatment;
(c) Each treatment otherwise required under the step therapy:
(1) Is contraindicated for the recipient or has caused or is
likely, based on peer-reviewed clinical evidence, to cause an adverse
reaction or other physical harm to the recipient; or
(2) Has prevented or is likely to prevent the recipient from
performing the responsibilities of his or her occupation or engaging
in activities of daily living, as defined in 42 C.F.R. § 441.505; or
(d) The condition of the recipien t is stable while being treated
with the prescription drug for which the exemption is requested and
the recipient has previously received approval for coverage of that
drug.
7. If the Department, state pharmacy benefit manager or health
maintenance organization, as applicable, approves an application for
an exemption from step therapy pursuant to this section, the State
must pay the nonfederal share of the cost of the prescription drug to
which the exemption applies. The Department, state pharmacy
benefit manager or health maintenance organization may initially
limit the coverage to a 1 -week supply of the drug for which the
exemption is granted. If the attending practitioner determines after 1
week that the drug is effective at treating the cancer or sympt om for
which it was prescribed, the State must continue to pay the
nonfederal share of the cost of the drug for as long as it is necessary
to treat the recipient for the cancer or symptom. The Department,
state pharmacy benefit manager or health maintenance organization,
as applicable, may conduct a review not more frequently than once
each quarter to determine, in accordance with available medical
evidence, whether the drug remains necessary to treat the recipient
for the cancer or symptom. The Department, state pharmacy benefit
manager or health maintenance organization, as applicable, shall
provide a report of the review to the recipient.
8. The Department , [and any ] the state pharmacy benefit
manager [or] and each health maintenance organization with which
the Department contracts pursuant to NRS 422.4053 [to manage
prescription drug benefits] shall post in an easily accessible location
on an Internet website maintained by the Department , state
pharmacy benefit manager or health maintenance organization, as
applicable, a form for requesting an exemption pursuant to this
section.
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9. As used in this section, “attending practitioner” means the
practitioner, as defined in NRS 639.0125, who has primary
responsibility for the treatment of the can cer or any symptom of
such cancer of a recipient.
Sec. 12. NRS 422.4053 is hereby amended to read as follows:
422.4053 1. [Except as otherwise provided in subsection 2,
the] The Department shall [directly] :
(a) Evaluate applications received pursuant to section 4 of this
act and choose an applicant to serve as the state pharmacy benefit
manager; and
(b) Enter into a contract with the state pharmacy benefit
manager chosen pursuant to paragraph (a) to, except as otherwise
provided in subsection 2, manage, direct and coordinate [all]
payments and rebates for any prescription drugs included on the list
of preferred prescription drugs developed pursuant to NRS
422.4025, any other prescription drugs listed in the contract and
all other services and payments relating to the provision of such
prescription drugs under the State Plan for Medicaid , [and] the
Children’s Health Insurance Program [.] and the other health
benefit plans described in subsection 1 of NRS 422.4025.
2. The Department may enter into a contract with:
(a) [A pharmacy benefit manager for the provision of any
services described in subsection 1.
(b)] A health maintenance organization pursuant to NRS
422.273 for the provision of any of the services described in
subsection 1 through the contract entered into pursuant to
subsection 5 of NRS 422.273 for recipients of Medicaid or
recipients of insurance through the Children’s Health Insurance
Program who receive coverage through a Medicaid managed care
program.
[(c)] (b) One or more public or private entities from this State,
the District of Columbia or other states or territories of the United
States for the collaborative purchasing of prescription drugs in
accordance with subsection 3 of NRS 277.110.
3. [A] The contract entered into pursuant to [paragraph (a) or
(b) of] subsection [2] 1 must:
(a) Include the provisions required by NRS 422.4056;
(b) Require the state pharmacy benefit manager [or health
maintenance organization, as applicable, ] to di sclose to the
Department any information relating to the services covered by the
contract, including, without limitation, information concerning
dispensing fees, measures for the control of costs, rebates collected
and paid , [and] any fees and charges imposed by the state pharmacy
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benefit manager [or health maintenance organization ] pursuant to
the contract [;] and any other sources of payment received by the
state pharmacy benefit manager for prescription drugs covered by
the contract;
(c) Require the state pharmacy benefit manager [or health
maintenance organization ] to comply with the provisions of this
chapter regarding the provision of prescription drugs under the State
Plan for Medicaid and the Children’s Health Insurance Pro gram to
the same extent as the Department [.
4. In addition to meeting the requirements of subsection 3, a
contract entered into pursuant to:
(a) Paragraph (a) of subsection 2 may require] ;
(d) Require the state pharmacy benefit manager to c omply
with all other applicable state and federal laws;
(e) Require the state pharmacy benefit manager to negotiate
and enter into agreements to purchase the drugs included on the
list of preferred prescription drugs developed pursuant to NRS
422.4025, except wher e those drugs are purchased through a
contract entered into pursuant to subsection 2; and
(f) Require the state pharmacy benefit manager to provide the
entire amount of any rebates received for the purchase of
prescription drugs, including, without limitation, rebates for the
purchase of prescription drugs by an entity other than the
Department, to the Department.
[(b) Paragraph (b) of subsection 2 must require the health
maintenance organization to provide to the Department the entire
amount of any rebates received for the purchase of prescription
drugs, including, without limitation, rebates for the purchase of
prescription drugs by an entity other than the Department, less an
administrative fee in an amount prescribed by the contract. The
Department shall adopt policies prescribing the maximum amount
of such an administrative fee.]
4. In addition to meeting the requirements of subsection 3, a
contract entered into pursuant to subsection 1 must prohibit the
state pharmacy benefit manager from:
(a) Using spread pricing;
(b) Paying a pharmacy a professional dispensing fee for a
drug which is less than the applicable dispensing fee established
pursuant to section 5 of this act , if the applicable dispensing fee
established pursuant to that section has been included in the State
Plan for Medicaid and approved by the Centers for Medicare and
Medicaid Services of the United States Department of Health and
Human Services;
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(c) Creating, modifying, implementing or indirectly
establishing any fee to be imposed upon a pharmacy, a pharmacist
or a recipient of benefits under the contract without first seeking
and obtaining written approval from the Department;
(d) Requiring a recipient of benefits under the contract to
obtain a specialty drug from a specialty pharmacy owned by or
otherwise associated with the state pharmacy benefit manager;
(e) Requiring a recipient of benefits under the contract to use
a specific pharmacy; and
(f) Requiring a recipient of benefits under the contract to use a
mail order pharmacy or Internet pharmacy.
5. A contract entered into with a health maintenance
organization pursuant to paragraph (a) of subsection 2 must:
(a) Include the provisions required by NRS 422.4056;
(b) Require the health maintenance organization to disclose to
the Department any information relating to the services covered by
the contract, including, without limitation, information
concerning dispensing fees, m easures for the control of costs,
rebates collected and any fees and charges imposed by the health
maintenance organization imposed by the contract;
(c) Require the health maintenance organization to comply
with the provisions of this chapter regarding th e provision of
prescription drugs under the State Plan for Medicaid and the
Children’s Health Insurance Program to the same extent as the
Department; and
(d) Require the health maintenance organization to provide to
the Department the entire amount of any rebates received for the
purchase of prescription drugs, including, without limitation,
rebates for the purchase of prescription drugs by an entity other
than the Department.
6. As used in this section:
(a) “Internet pharmacy” has the meaning ascribed to it in
NRS 639.00865.
(b) “Professional dispensing fee” has the meaning ascribed to
it in 42 C.F.R. § 447.502.
(c) “Spread pricing” means any technique by which a
pharmacy benefit manager charges or claims an amount from an
insurer for drugs or service s provided by a pharmacy or
pharmacist that is different from the amount the pharmacy benefit
manager pays the pharmacy or pharmacist, as applicable, for
those drugs or services.
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Sec. 13. NRS 422.4056 is hereby amended to read as follows:
422.4056 1. [Any] The contract between the Department and
[a] the state pharmacy benefit manager [or] and any contract
between the Department and a health maintenance organization
entered into pursuant to NRS 422.4053 must require the state
pharmacy benefit manager or health maintenance organization, as
applicable, to:
(a) Submit to and cooperate with an annual audit by the
Department to evaluate the compliance of the state pharmacy
benefit manager or health maintenance organization wit h the
agreement and generally accepted accounting and business
practices. The audit must analyze all claims processed by the state
pharmacy benefit manager or health maintenance organization
pursuant to the agreement.
(b) Obtain from an independent accountant, at the expense of the
state pharmacy benefit manager or health maintenance organization,
as applicable, an annual audit of internal controls to ensure the
integrity of financial transactions and claims processing.
2. The Department shall post the results of any audit conducted
pursuant to paragraph (a) of subsection 1 on an Internet website
maintained by the Department.
Sec. 14. NRS 683A.1785 is hereby amended to read as
follows:
683A.1785 1. A pharmacy benefit manager shall not:
(a) Discriminate against a covered entity, a contract pharmacy or
a 340B drug in the amount of reimbursement for any item or service
or the procedures for obtaining such reimbursement;
(b) Assess any fee, chargeback, clawback or adjustm ent against
a covered entity or contract pharmacy on the basis that the covered
entity or contract pharmacy dispenses a 340B drug or otherwise
limit the ability of a covered entity or contract pharmacy to receive
the full benefit of purchasing the 340B dru g at or below the ceiling
price, as calculated pursuant to 42 U.S.C. § 256b(a)(1);
(c) Exclude a covered entity or contract pharmacy from any
network because the covered entity or contract pharmacy dispenses
a 340B drug;
(d) Restrict the ability of a pe rson to receive a 340B drug,
including, without limitation, by imposing a copayment,
coinsurance, deductible or other cost -sharing obligation on the drug
that is different from a similar drug on the basis that the drug is a
340B drug;
(e) Restrict the met hods by which a covered entity or contract
pharmacy may dispense or deliver a 340B drug or the entity through
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which a covered entity may dispense or deliver such a drug in a
manner that does not apply to drugs that are not 340B drugs; or
(f) Prohibit a co vered entity or contract pharmacy from
purchasing a 340B drug or interfere with the ability of a covered
entity or contract pharmacy to purchase a 340B drug.
2. This section does not:
(a) Apply to [a] the state pharmacy benefit manager [that has
entered into a contract with the Department of Health and Human
Services pursuant to NRS 422.4053 ] when the state pharmacy
benefit manager is managing prescription drug benefits under
Medicaid, including, without limitation, where such benefits are
delivered through a Medicaid managed care organization.
(b) Prohibit the Department of Health and Human Services, the
Division of Health Care Financing and Policy of the Department of
Health and Human Services or a Medicaid managed care
organization from taking such actions as are necessary to:
(1) Prevent duplicate discounts or rebates where prohibited
by 42 U.S.C. § 256b(a)(5)(A); or
(2) Ensure the financial stability of the Medicaid program,
including, without limitation, by including or enforcing provisions
in [any] the contract with [a] the state pharmacy benefit manager .
[entered into pursuant to NRS 422.4053.]
3. As used in this section:
(a) “340B drug” means a prescription drug that is purchased by
a covered entity under the 340B Program.
(b) “340B Program” means the drug pricing program established
by the United States Secretary of Health and Human Services
pursuant to section 340B of the Public Health Service Act, 42
U.S.C. § 256b, as amended.
(c) “Contract pharmacy” means a pharmacy that enters into a
contract with a covered entity to dispense 340B drugs and provide
related pharmacy services to the patients of the covered entity.
(d) “Covered entity” has the meaning ascribed to it in 42 U.S.C.
§ 256b(a)(4).
(e) “Medicaid managed care organization” has the meaning
ascribed to it in 42 U.S.C. § 1396b(m).
(f) “Network” means a defined set of providers of health care
who are under contract with a pharmacy benefit manager or third
party to provide health care services to covered persons.
(g) “State pharmacy benefit manager” has the meaning
ascribed to it in section 3 of this act.
Sec. 15. 1. The initial contract between the Department of
Health and Human Services and the state pharmacy benefit manager
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entered into pursuant to NRS 422.4053, as amended by section 12
of this act, must become effective on or before January 1, 2030.
2. As use d in this section, “state pharmacy benefit manager”
has the meaning ascribed to it in section 3 of this act.
Sec. 16. The provisions of NRS 218D.380 do not apply to any
provision of this act which adds or revises a requirement to submit a
report to the Legislature.
Sec. 17. 1. This section becomes effective upon passage and
approval.
2. Sections 1 to 16, inclusive, of this act become effective:
(a) Upon passage and approval for the purpos e of adopting any
regulations and performing any preparatory administrative tasks that
are necessary to carry out the provisions of this act; and
(b) On the effective date of the initial contract entered into
between the Department of Health and Human Ser vices and the
state pharmacy benefit manager pursuant to NRS 422.4053, as
amended by section 12 of this act, for all other purposes.
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