2021 -- S 0381 SUBSTITUTE A

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATING TO INSURANCE -- PRESCRIPTION DRUG BENEFITS

     Introduced By: Senators McCaffrey, DiPalma, Quezada, and Miller

     Date Introduced: February 25, 2021

     Referred To: Senate Health & Human Services

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 27-20.8-1 and 27-20.8-2 of the General Laws in Chapter 27-20.8

entitled "Prescription Drug Benefits" are hereby amended to read as follows:

     27-20.8-1. Definitions.

     For the purposes of this chapter, the following terms shall mean:

     (1) "Director" shall mean the director of the department of business regulation.

     (2) "Health plan" shall mean an a health insurance carrier as defined in chapters 18, 19, 20

and 41 of this title.

     (3) "Insured" shall mean any person who is entitled to have pharmacy services paid by a

health plan pursuant to a policy, certificate, contract or agreement of insurance or coverage

including those administered for the health plan under a contract with a third-party administrator

that manages pharmacy benefits or pharmacy network contracts.

     (4) "Out-of-pocket expenditure" means a co-payment, coinsurance, deductible, or other

cost-sharing mechanism.

     (5) "Pharmacy benefit manager" means an entity doing business in this state that contracts

to administer or manage prescription drug benefits on behalf of any health plan that provides

prescription drug benefits to residents of this state.

     27-20.8-2. Pharmacy benefit, limits and co-payments.

     Any health plan that offers pharmacy benefits, pursuant to a policy, certificate, contract or

agreement of insurance or coverage including those administered for health plans under a contract

with a third-party administrator that manages pharmacy benefits or pharmacy network contracts

issued on or after January 1, 2022, shall comply with the following:

     (a) When a health plan's pharmacy benefit has a dollar limit, the insured's use of such

benefit shall be determined based on the health plan's contracted rate to purchase the drug minus

the enrollee's applicable co-payment for covered drugs. The balance will apply towards the

enrollee's dollars limit.

     (b) When a health plan charges a co-payment for covered prescription drugs that is based

on a percent of the drug cost, the health plan shall disclose within the group policy or individual

policy benefits description statement whether the co-payment is based on the health plan's

contracted rate to purchase the drug or some other cost basis such as retail price.

     (c) A health benefit plan offered by a health plan or pharmacy benefit manager shall not

include an annual or lifetime dollar limit on prescription drug benefits for any individual.

     (d) A health benefit plan offered by a health plan or pharmacy benefit manager shall limit

a beneficiary's out-of-pocket expenditures for prescription drugs, including specialty drugs, to no

more for self-only and family coverage per year than the minimum dollar amounts in effect under

§ 223(c)(2)(A)(i) of the Internal Revenue Code of 1986 for self-only and family coverage.

     (e) For prescription drug benefits offered in conjunction with a "high-deductible health

plans" (HDHP) as defined in § 223(c)(2)(A)(i) of the Internal Revenue Code of 1986, a health plan

may not provide prescription drug benefits until the expenditures applicable to the deductible under

the HDHP have met the amount of the minimum annual deductibles in effect for self-only and

family coverage under § 223(c)(2)(A)(i) of the Internal Revenue Code of 1986 for self-only and

family coverage, respectively. Once the foregoing expenditure amount has been met under the

HDHP, coverage for prescription drug benefits shall begin, and the limit on out-of-pocket

expenditures for prescription drug benefits shall be as specified in subsection (d) of this section.

     (f) The office of the health insurance commissioner may use any of its enforcement powers

to obtain compliance with this section.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE -- PRESCRIPTION DRUG BENEFITS

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     This act would provide that health plans that provide prescription drug coverage not include

an annual or lifetime dollar limit on drug benefits.

     This act would take effect upon passage.

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