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ENGROSSED HOUSE
BILL NO. 3538 By: Stinson, Turner, and
Cantrell of the House
and
Bullard of the Senate
An Act relating to pharmacy benefits managers;
amending 59 O.S. 2021, Sections 357, as last amended
by Section 2, Chapter 414, O.S.L. 2025, and 360, as
last amended by Section 8, Chapter 300, O.S.L. 2025
(59 O.S. Supp. 2025, Sections 357 and 360), which
relate to definitions and pharmacy benefits manager
contractual duties to provider; defining term;
prohibiting pharmacy benefits manager from refusing
to accept certain documentation; requiring certain
adjusted reimbursement amount if certain appeal is
approved; allowing certain provider to request
certain reversal or rebilling; requiring certain
information to be included in certain appeal;
requiring certain adjustments to include certain
claim-level details within certain time period;
prohibiting certain reimbursement amounts; updating
statutory references; updating statutory language;
and providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 59 O.S. 2021, Section 357, as last
amended by Section 2, Chapter 414, O.S.L. 2025 (59 O.S. Supp. 2025,
Section 357), is amended to read as follows:
Section 357. A. As used in Sections 357 through 360 360.1 of
this title:
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1. "Acquisition cost" means the total amount paid by a provider
to acquire a drug, medical product, or device at the time of
purchase as evidenced by verifiable purchase documentation such as
an invoice or electronic price file. Acquisition cost shall include
purchase price, procurement fees, and associated shipping or
handling charges and shall not include any post-purchase rebates,
discounts, or credits that are not guaranteed and applied at the
time of sale;
2. "Covered entity" means a nonprofit hospital or medical
service organization, for-profit hospital or medical service
organization, insurer, health benefit plan, health maintenance
organization, health program administered by the state in the
capacity of providing health coverage, or an employer, labor union,
or other group of persons that provides health coverage to persons
in this state. This term does not include a health benefit plan
that provides coverage only for accidental injury, specified
disease, hospital indemnity, disability income, or other limited
benefit health insurance policies and contracts that do not include
prescription drug coverage;
2. 3. "Covered individual" means a member, participant,
enrollee, contract holder or policy holder or beneficiary of a
covered entity who is provided health coverage by the covered
entity. A covered individual includes any dependent or other person
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provided health coverage through a policy, contract or plan for a
covered individual;
3. 4. "Department" means the Insurance Department;
4. 5. "Effective rate contracting" means any agreement or
arrangement between a pharmacy or contracting agent acting on behalf
of a pharmacy and a pharmacy benefits manager for pharmaceuticals
based on the effective rate of payment rather than a predetermined
fixed price or fixed discount percentage;
5. 6. "Maximum allowable cost", "MAC", or "MAC list" means the
list of drug products delineating the maximum per-unit reimbursement
for multiple-source prescription drugs, medical product products, or
device devices;
6. 7. "Multisource drug product reimbursement" (reimbursement)
means the total amount paid to a pharmacy inclusive of any reduction
in payment to the pharmacy, excluding prescription dispense fees and
professional fees;
7. 8. "Office" means the Office of the Attorney General;
8. 9. "Pharmacy benefits management" means a service provided
to covered entities to facilitate the provision of prescription drug
benefits to covered individuals within the state, including
negotiating pricing and other terms with drug manufacturers and
providers. Pharmacy benefits management may include any or all of
the following services:
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a. claims processing, retail network management and
payment of claims to pharmacies for prescription drugs
dispensed to covered individuals,
b. clinical formulary development and management
services, or
c. rebate contracting and administration;
9. 10. "Pharmacy benefits manager" or "PBM" means a person,
business, or other entity that performs pharmacy benefits
management. The term shall include a person or entity acting on
behalf of a PBM in a contractual or employment relationship in the
performance of pharmacy benefits management for a managed care
company, nonprofit hospital, medical service organization, insurance
company, third-party payor, or a health program administered by an
agency or department of this state;
10. 11. "Plan sponsor" means the employers, insurance
companies, unions and health maintenance organizations or any other
entity responsible for establishing, maintaining, or administering a
health benefit plan on behalf of covered individuals; and
11. 12. "Provider" means a pharmacy licensed by the State Board
of Pharmacy, or an agent or representative of a pharmacy, including,
but not limited to, the pharmacy's contracting agent, which
dispenses prescription drugs or devices to covered individuals.
B. Nothing in the definition of pharmacy benefits management or
pharmacy benefits manager in the Patient's Right to Pharmacy Choice
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Act, Pharmacy Audit Integrity Act, or Sections 357 through 360 360.1
of this title shall deem an employer a "pharmacy benefits manager"
of its own self-funded health benefit plan, except, to the extent
permitted by applicable law, where the employer, without the
utilization of a third party and unrelated to the employer's own
pharmacy:
a. negotiates,
1. Negotiates directly with drug manufacturers;
b. processes,
2. Processes claims on behalf of its members; or
c. manages
3. Manages its own retail network of pharmacies.
SECTION 2. AMENDATORY 59 O.S. 2021, Section 360, as last
amended by Section 8, Chapter 300, O.S.L. 2025 (59 O.S. Supp. 2025,
Section 360), is amended to read as follows:
Section 360. A. The pharmacy benefits manager (PBM) shall,
with respect to contracts between a pharmacy benefits manager and a
provider, including a pharmacy service administrative organization:
l. Include in such contracts the specific sources utilized to
determine the maximum allowable cost (MAC) pricing of the pharmacy,
update MAC pricing at least every seven (7) calendar days, and
establish a process for providers to readily access the MAC list
specific to that provider;
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2. In order to place a drug on the MAC list, ensure that the
drug is listed as "A" or "B" rated in the most recent version of the
United States Food and Drug Administration (FDA) Approved Drug
Products with Therapeutic Equivalence Evaluations, also known as the
Orange Book, and the drug is generally available for purchase by
pharmacies in the state from national or regional wholesalers and is
not obsolete;
3. Ensure dispensing fees are not included in the calculation
of MAC price reimbursement to pharmacy providers;
4. Provide a reasonable administration appeals procedure to
allow a provider, a provider's representative and a pharmacy service
administrative organization to contest reimbursement amounts within
fourteen (14) calendar days of the final adjusted payment date. The
pharmacy benefits manager shall not prevent the pharmacy or the
pharmacy service administrative organization from filing
reimbursement appeals in an electronic batch format. The pharmacy
benefits manager must PBM shall respond to a provider, a provider's
representative and a pharmacy service administrative organization
who have contested a reimbursement amount through this procedure
within ten (10) calendar days. The pharmacy benefits manager must
PBM shall respond in an electronic batch format to reimbursement
appeals filed in an electronic batch format. The pharmacy benefits
manager PBM shall not require a pharmacy or pharmacy services
administrative organization to log into a system to upload
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individual claim appeals or to download individual appeal responses.
A PBM shall not refuse to accept additional documentation from
providers after submission of the appeal. If a price update is
warranted, the pharmacy benefits manager PBM shall make the change
in the reimbursement amount, permit the dispensing pharmacy to
reverse and rebill the claim in question, and make the reimbursement
amount change retroactive and effective for all contracted
providers;
5. If a below-cost reimbursement appeal is denied, the PBM
shall provide the reason for the denial, including the National Drug
Code (NDC) number from, and the name of, the specific national or
regional wholesalers doing business in this state where the drug is
currently in stock and available for purchase by the dispensing
pharmacy at a price below the PBM's reimbursement price. The PBM
shall include documented proof from the specific national or
regional wholesalers doing business in this state showing that the
drug is currently in stock and available for purchase by the
dispensing pharmacy at a price below the PBM's reimbursement price.;
6. If the NDC number provided by the pharmacy benefits manager
PBM is not available below the acquisition cost obtained from the
pharmaceutical wholesaler from whom the dispensing pharmacy
purchases the majority of the prescription drugs that are dispensed,
the pharmacy benefits manager PBM shall immediately adjust the
reimbursement amount, permit the dispensing pharmacy to reverse and
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rebill the claim in question, and make the reimbursement amount
adjustment retroactive and effective for all contracted providers
effective for all prescriptions of the appealed drug, medical
product, or device for patients covered under the same Bank
Identification Number (BIN) and Processor Control Number (PCN),
retroactive to the date of service of the initially appealed claim.
A PBM shall notify the provider that an increase has been granted
because of a reimbursement appeal. If a claim subject to an
approved appeal is not reversed and reprocessed within thirty (30)
calendar days after the final appeal determination, the PBM shall
remit to the provider the full reimbursement amount required by the
approved appeal, including any retroactive adjustments, and shall
not require the provider to refund or otherwise return any portion
of the reimbursement paid for that claim;
6. 7. Any appeal that results in an increase in the
reimbursement from the PBM that continues to be below the pharmacy's
acquisition cost shall be considered a denial under this section.
Any denial of an appeal shall follow the requirements of paragraph
paragraphs 5 and 6 of this subsection; and
7. 8. The PBM shall not require a pharmacy to collect
additional monies following a successful below-cost reimbursement
appeal from any person or entity other than the PBM who adjudicated
the drug claim, including the patient or plan sponsor; and
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9. Any adjustment to provider reimbursement shall be
accompanied by complete claim-level detail sufficient to reconcile
the adjustment, including identification of the original claim
payment values and the revised values for all affected fields. An
adjustment for which such claim-level detail is not provided
contemporaneously shall be deemed incomplete.
B. The reimbursement appeal requirements in this section shall
apply to all drugs, medical products, or devices reimbursed
according to any payment methodology, including, but not limited to:
1. Average acquisition cost, including the National Average
Drug Acquisition Cost;
2. Average manufacturer price;
3. Average wholesale price;
4. Brand effective rate or generic effective rate;
5. Discount indexing;
6. Federal upper limits;
7. Wholesale acquisition cost; and
8. Any other term that a pharmacy benefits manager PBM or an
insurer of a health benefit plan may use to establish reimbursement
rates to a pharmacist or pharmacy for pharmacist services.
C. The pharmacy benefits manager PBM shall not place a drug on
a MAC list, unless there are at least two therapeutically
equivalent, multiple-source drugs, generally available for purchase
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by dispensing retail pharmacies from national or regional
wholesalers.
D. In the event that a drug is placed on the FDA Drug Shortages
Database, pharmacy benefits managers PBMs shall reimburse claims to
pharmacies at no less than the wholesale acquisition cost for the
specific NDC number being dispensed.
E. The pharmacy benefits manager PBM shall not require
accreditation or licensing of providers, or any entity licensed or
regulated by the State Board of Pharmacy, other than by the State
Board of Pharmacy or federal government entity as a condition for
participation as a network provider.
F. A pharmacy or pharmacist may decline to provide the
pharmacist clinical or dispensing services to a patient or pharmacy
benefits manager if the pharmacy or pharmacist is to be paid less
than the pharmacy's cost for providing the pharmacist clinical or
dispensing services.
G. The pharmacy benefits manager PBM shall provide a dedicated
telephone number, email address and names of the personnel with
decision-making authority regarding MAC appeals and pricing.
H. A PBM shall not reimburse a provider for a prescription drug
or pharmacy service in an amount less than the national average drug
acquisition cost for the prescription drug or pharmacy service at
the time the drug is administered or dispensed, plus a professional
dispensing fee of no less than the Medicaid fee-for-service
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professional dispensing fee rate established under rules promulgated
by the Oklahoma Health Care Authority Board. If the national
average drug acquisition cost is not available at the time a drug is
administered or dispensed, a PBM shall not reimburse in an amount
that is less than the wholesale acquisition cost of the drug
pursuant to 42 U.S.C., Section 1395w-3a(c)(6)(B), and shall
reimburse a professional dispensing fee of no less than the rate
established by the Board. The dispensing fee shall be evaluated
every two (2) years and shall be adjusted for inflation in even-
numbered years beginning November 1, 2026.
SECTION 3. This act shall become effective November 1, 2026.
Passed the House of Representatives the 25th day of March, 2026.
Presiding Officer of the House
of Representatives
Passed the Senate the ___ day of __________, 2026.
Presiding Officer of the Senate