Pharmacy Pricing Amendments

43
31A-46-102
31A-46-103
31A-46-303
31A-46-401
0
Pharmacy Pricing Amendments
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Katy Hall
Senate Sponsor: Evan J. Vickers
LONG TITLE
General Description:
This bill amends provisions related to pharmacy benefits.
Highlighted Provisions:
This bill:
defines terms;
amends provisions related to drug maximum allowable cost, including regarding lists,
appeals, and claims;
specifies penalties; and
provides the Insurance Department rulemaking authority.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
31A-46-102
, as last amended by Laws of Utah 2025, Chapter 525
31A-46-303
, as last amended by Laws of Utah 2020, Chapters 198, 275
31A-46-401
, as enacted by Laws of Utah 2019, Chapter 241
ENACTS:
31A-46-103
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section
31A-46-102
is amended to read:
31A-46-102
. Definitions.
As used in this chapter:
(1)
"340B drug" means a drug purchased through the 340B drug discount program by a
340B entity.
(2)
"340B drug discount program" means the 340B drug discount program described in 42
U.S.C. Sec. 256b.
(3)
"340B entity" means:
(a)
an entity participating in the 340B drug discount program;
(b)
a pharmacy of an entity participating in the 340B drug discount program; or
(c)
a pharmacy contracting with an entity participating in the 340B drug discount
program to dispense drugs purchased through the 340B drug discount program.
(4)
"Administrative fee" means any payment, other than a rebate, that a pharmaceutical
manufacturer makes directly or indirectly to a pharmacy benefit manager.
(5)
"Allowable claim amount" means the amount paid by an insurer under the customer's
health benefit plan.
(6)
"Contracting insurer" means an insurer with whom a pharmacy benefit manager
contracts to provide a pharmacy benefit management service.
(7)
"Cost share" means the amount paid by an insured customer under the customer's health
benefit plan.
(8)
"Direct or indirect remuneration" means any adjustment in the total compensation:
(a)
received by a pharmacy from a pharmacy benefit manager for the sale of a drug,
device, or other product or service; and
(b)
that is determined after the sale of the product or service.
(9)
"Dispense" means the same as that term is defined in Section
58-17b-102
.
(10)
"Drug" means the same as that term is defined in Section
58-17b-102
.
(11)
"Insurer" means the same as that term is defined in Section
31A-22-636
.
(12)
"Maximum allowable cost" means:
(a)
a maximum reimbursement amount for a group of pharmaceutically and
therapeutically equivalent drugs; or
(b)
any similar reimbursement amount that is used by a pharmacy benefit manager to
reimburse pharmacies for multiple source drugs.
(13)
"Medicaid program" means the same as that term is defined in Section
26B-3-101
.
(14)
"Obsolete" means a product that may be listed in national drug pricing compendia but
is no longer available to be dispensed based on the expiration date of the last lot
manufactured.
(15)
"Patient counseling" means the same as that term is defined in Section
58-17b-102
.
(16)
"Pharmacy acquisition cost" means the net amount that a pharmaceutical wholesaler
charges for a pharmaceutical product.
(16)
(17)
"Pharmaceutical facility" means the same as that term is defined in Section
58-17b-102
.
(17)
(18)
"Pharmaceutical manufacturer" means a pharmaceutical facility that
manufactures prescription drugs.
(18)
(19)
"Pharmacist" means the same as that term is defined in Section
58-17b-102
.
(19)
(20)
"Pharmacy" means the same as that term is defined in Section
58-17b-102
.
(20)
(21)
"Pharmacy benefits management service" means any of the following services
provided to a health benefit plan, or to a participant of a health benefit plan:
(a)
negotiating the amount to be paid by a health benefit plan for a prescription drug; or
(b)
administering or managing a prescription drug benefit provided by the health benefit
plan for the benefit of a participant of the health benefit plan, including administering
or managing:
(i)
an out-of-state mail service pharmacy;
(ii)
a specialty pharmacy;
(iii)
claims processing;
(iv)
payment of a claim;
(v)
retail network management;
(vi)
clinical formulary development;
(vii)
clinical formulary management services;
(viii)
rebate contracting;
(ix)
rebate administration;
(x)
a participant compliance program;
(xi)
a therapeutic intervention program;
(xii)
a disease management program; or
(xiii)
a service that is similar to, or related to, a service described in Subsection
(20)(a)
or this Subsection
(20)(b)
.
(21)
(22)
"Pharmacy benefit manager" means a person licensed under this chapter to
provide a pharmacy benefits management service.
(22)
(23)
"Pharmacy service" means a product, good, or service provided to an individual
by a pharmacy or pharmacist.
(23)
(24)
"Pharmacy services administration organization" means an entity that contracts
with a pharmacy to assist with third-party payer interactions and administrative services
related to third-party payer interactions, including:
(a)
contracting with a pharmacy benefit manager on behalf of the pharmacy; and
(b)
managing a pharmacy's claims payments from third-party payers.
(24)
(25)
"Pharmacy service entity" means:
(a)
a pharmacy services administration organization; or
(b)
a pharmacy benefit manager.
(25)
(26)
"Prescription device" means the same as that term is defined in Section
58-17b-102
.
(26)
(27)
"Prescription drug" means the same as that term is defined in Section
58-17b-102
.
(27)
(28)
(a)
"Rebate" means a refund, discount, or other price concession that is paid by
a pharmaceutical manufacturer to a pharmacy benefit manager based on a
prescription drug's utilization or effectiveness.
(b)
"Rebate" does not include an administrative fee.
(28)
(29)
(a)
"Reimbursement report" means a report on the adjustment in total
compensation for a claim.
(b)
"Reimbursement report" does not include a report on adjustments made
pursuant to
a
pharmacy audit or reprocessing.
(29)
(30)
"Retail pharmacy" means the same as that term is defined in Section
58-17b-102
.
(30)
(31)
"Sale" means a prescription drug or prescription device claim covered by a
health benefit plan.
(31)
(32)
"Spread pricing" means the practice in which a pharmacy benefit manager
charges a health benefit plan a different amount for pharmacist services than the amount
the pharmacy benefit manager reimburses a pharmacy for pharmacist services.
(32)
(33)
"Wholesale acquisition cost" means the same as that term is defined in 42 U.S.C.
Sec. 1395w-3a.
Section 2. Section
31A-46-103
is enacted to read:
31A-46-103
. Rulemaking.
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
department may make rules to implement this chapter.
Section 3. Section
31A-46-303
is amended to read:
31A-46-303
. Insurer and pharmacy benefit management services -- Registration
-- Maximum allowable cost -- Audit restrictions.
(1)
An insurer and an insurer's pharmacy benefit manager is subject to the pharmacy audit
provisions of Section
58-17b-622
.
(2)
A pharmacy benefit manager shall not use maximum allowable cost as a basis for
reimbursement to a pharmacy unless:
(a)
the drug is listed as "A" or "B" rated in the most recent version of the United States
Food and Drug Administration's approved drug products with therapeutic equivalent
evaluations, also known as the "Orange Book," or has an "NR" or "NA" rating or
similar rating by a nationally recognized reference; and
(b)
the drug is:
(i)
generally available for purchase in this state from a national or regional
wholesaler; and
(ii)
not obsolete.
(3)
The maximum allowable cost may be determined using comparable and current data on
drug prices obtained from multiple nationally recognized, comprehensive data sources,
including wholesalers, drug file vendors, and pharmaceutical manufacturers for drugs
that are available for purchase by pharmacies in the state.
(4)
For every drug for which the pharmacy benefit manager uses maximum allowable cost
to reimburse a contracted pharmacy, the pharmacy benefit manager shall:
(a)
make a list available to a network pharmacy upon request in a format that:
(i)
is electronic;
(ii)
is computer accessible and searchable;
(iii)
identifies all drugs for which maximum allowable costs have been established;
and
(iv)
for each drug specifies:
(A)
the national drug code; and
(B)
the maximum allowable cost;
(b)
include in the contract with the pharmacy information identifying the national drug
pricing compendia and other data sources used to obtain the drug price data;
(b)
(c)
review and make necessary adjustments to the maximum allowable cost, using
the most recent data sources identified in Subsection
(4)(a)
(4)(b)
, at least once per
week;
(c)
(d)
provide a process for the contracted pharmacy to appeal the maximum allowable
cost in accordance with Subsection
(5)
; and
(d)
(e)
include in each contract with a contracted pharmacy a process to obtain an
update to the pharmacy product pricing files used to reimburse the pharmacy in a
format that is readily available and accessible.
(5)
(a)
The right to appeal in Subsection
(4)(c)
(4)(d)
shall be:
(i)
limited to 21 days following the initial claim adjudication; and
(ii)
investigated and resolved by the pharmacy benefit manager within 14 business
days.
(b)
A pharmacy benefit manager shall:
(i)
provide as part of the appeals process:
(A)
a dedicated telephone number, electronic mail address, and website for the
purpose of submitting appeals; and
(B)
the ability for a pharmacy to submit an appeal directly to the pharmacy benefit
manager or through the pharmacy's pharmacy services administrative
organization; and
(ii)
allow a pharmacy to submit documentation in support of the pharmacy's appeal
on paper or electronically.
(c)
If an appeal is denied, the pharmacy benefit manager shall provide the contracted
pharmacy
with
:

(i)
the reason for the denial
and
;

(ii)
the identification of the national drug code of the drug that may be purchased by
the pharmacy at a price at or below the price determined by the pharmacy benefit
manager
.
; and
(iii)
the specific basis upon which the pharmacy benefit manager can show that the
drug is available for purchase at or below the maximum allowable cost.
(d)
If an appeal is upheld or the pharmacy benefit manager cannot show the drug is
available for purchase at or below the maximum allowable cost for a similarly
situated pharmacy as the pharmacy that submitted the appeal, the pharmacy benefit
manager shall:
(i)
make an adjustment for the pharmacy that appealed;
(ii)
permit the dispensing pharmacy to reverse the claim and resubmit an adjusted
claim without an additional charge; and
(iii)
consider additional action consistent with the outcome of the appeal.
(6)
The contract with each pharmacy shall contain a dispute resolution mechanism in the
event either party breaches the terms or conditions of the contract.
(7)
This section does not apply to a pharmacy benefit manager when the pharmacy benefit
manager is providing pharmacy benefit management services on behalf of the Medicaid
program.
Section 4. Section
31A-46-401
is amended to read:
31A-46-401
. Penalties.
A person that violates a provision of this chapter is subject to the penalties
described in Section
31A-2-308
.
(1)
The commissioner may order a pharmacy benefit manager who violates this chapter to
forfeit to the state not more than $2,500 for each violation.
(2)
Each day the violation continues is a separate violation.
Section 5.
Effective Date.
This bill takes effect on
May 6, 2026
.
3-12-26 9:07 AM