S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 4342--A

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                            February 3, 2011
                               ___________

Introduced  by  M. of A. PERRY, JAFFEE, MAISEL, GUNTHER, JACOBS, CASTRO,
  GIBSON, COLTON -- Multi-Sponsored by -- M. of A.  BURLING,  WEISENBERG
  -- read once and referred to the Committee on Health -- recommitted to
  the  Committee on Health in accordance with Assembly Rule 3, sec. 2 --
  reported  and  referred  to  the  Committee  on  Codes  --   committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN  ACT to amend the public health law, in relation to prohibiting phar-
  macy benefit managers, health maintenance organizations, insurers  and
  other  health  plans from offering incentives to health care providers
  to switch a patient from  a  specific  prescription  drug  to  another
  specific drug, excluding generic substitution

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The public health law is amended by adding  a  new  article
2-B to read as follows:
                               ARTICLE 2-B
                 IMPROPER PAYMENTS FOR PRESCRIPTION DRUG
                           SWITCHES PROHIBITED
SECTION 281.   DEFINITIONS.
        281-A. UNLAWFUL  PAYMENTS  WITH  RESPECT TO HEALTH CARE PROVIDER
                 PRESCRIBING PRACTICES.
        281-B. NO RETALIATION AGAINST HEALTH CARE PROVIDERS.
        281-C. ENFORCEMENT.
  S 281. DEFINITIONS. FOR THE PURPOSE OF THIS ARTICLE: 1. "HEALTH  PLAN"
MEANS  A  NONHOSPITAL  OR  MEDICAL SERVICE ORGANIZATION, INSURER, HEALTH
COVERAGE PLAN OR HEALTH MAINTENANCE ORGANIZATION  LICENSED  PURSUANT  TO
THE  INSURANCE LAW; ANY ORGANIZATION CERTIFIED OR RECOGNIZED PURSUANT TO
ARTICLE FORTY-FOUR OF THIS CHAPTER, INCLUDING  AN  INDEPENDENT  PRACTICE
ASSOCIATION;  OR  AN  EMPLOYER,  LABOR  UNION  OR OTHER GROUP OF PERSONS
ORGANIZED IN THE STATE THAT PROVIDES HEALTH COVERAGE TO PARTICIPANTS WHO

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08555-04-2
              

A. 4342--A                          2

ARE EMPLOYED OR RESIDE IN THE STATE. "HEALTH PLAN" DOES  NOT  INCLUDE  A
HEALTH PLAN THAT PROVIDES COVERAGE ONLY FOR ACCIDENTAL INJURY, SPECIFIED
DISEASE,  HOSPITAL  INDEMNITY,  MEDICARE  SUPPLEMENT, DISABILITY INCOME,
LONG-TERM  CARE  OR  OTHER LIMITED BENEFIT HEALTH INSURANCE POLICIES AND
CONTRACTS.
  2. "HEALTH CARE PROVIDER" MEANS A LICENSED HEALTH CARE PROVIDER LEGAL-
LY AUTHORIZED TO PRESCRIBE DRUGS UNDER THE PROVISIONS OF  THE  EDUCATION
LAW.
  3.  "PRESCRIPTION  DRUG  PRODUCT"  MEANS  ANY  PRODUCT  SUBJECT TO THE
REQUIREMENTS OF SECTION SIXTY-EIGHT HUNDRED ELEVEN-A  OF  THE  EDUCATION
LAW.
  4.  "PHARMACY  BENEFIT MANAGER" OR "PBM" MEANS A PERSON OR ENTITY THAT
PROVIDES PHARMACY BENEFIT MANAGEMENT SERVICES TO A HEALTH PLAN.
  5. "PHARMACY BENEFIT MANAGEMENT SERVICES" MEANS THE NEGOTIATION OF THE
AMOUNT TO BE PAID FOR PRESCRIPTION DRUGS BY THE HEALTH PLAN FOR  PARTIC-
IPANTS  IN  THE  STATE, THE ADMINISTRATION OR MANAGEMENT OF PRESCRIPTION
DRUG BENEFITS PROVIDED BY A HEALTH PLAN OR INSURER FOR  THE  BENEFIT  OF
PARTICIPANTS,  OR  ANY  OF THE SERVICES LISTED IN PARAGRAPHS (A) THROUGH
(G) OF THIS SUBDIVISION THAT ARE PROVIDED WITH REGARD  TO  THE  ADMINIS-
TRATION OF PARTICIPANTS' PHARMACY BENEFITS:
  (A) MAIL SERVICE PHARMACY;
  (B) SPECIALTY PHARMACY;
  (C) CLAIMS PROCESSING, RETAIN NETWORK MANAGEMENT AND PAYMENT OF CLAIMS
TO PHARMACIES FOR PRESCRIPTION DRUGS DISPENSED TO PARTICIPANTS;
  (D) CLINICAL FORMULARY DEVELOPMENT AND MANAGEMENT SERVICES;
  (E) REBATE CONTRACTING AND ADMINISTRATION;
  (F)  PATIENT  COMPLIANCE, THERAPEUTIC INTERVENTION AND GENERIC SUBSTI-
TUTION PROGRAMS; AND
  (G) DISEASE MANAGEMENT PROGRAMS.
  6. "PATIENT" MEANS AN INDIVIDUAL WHO RECEIVES PRESCRIPTION DRUG  BENE-
FITS FROM A HEALTH PLAN OR PBM.
  7.  "THERAPEUTIC  ALTERNATIVE  PRESCRIPTION DRUG" MEANS A PRESCRIPTION
DRUG WITH THE SAME OR SIMILAR INDICATIONS TO ANOTHER  PRESCRIPTION  DRUG
BUT  WHICH, WHETHER A SINGLE SOURCE OR MULTIPLE SOURCE PRODUCT, IS NOT A
GENERIC OF, OR LISTED AS A THERAPEUTICALLY EQUIVALENT  VERSION  OF,  THE
OTHER  PRESCRIPTION DRUG ON THE LIST REQUIRED BY PARAGRAPH (O) OF SUBDI-
VISION ONE OF SECTION TWO HUNDRED SIX OF THIS CHAPTER.
  8. "PRESCRIPTION DRUG SWITCH" MEANS AN ATTEMPT BY A HEALTH PLAN OR PBM
TO ENCOURAGE  HEALTH  CARE  PROVIDERS  WHO  HAVE  PRESCRIBED  A  CERTAIN
PRESCRIPTION  DRUG  PRODUCT TO THEIR PATIENTS TO CHANGE THE PRESCRIPTION
DRUG PRODUCT WHEN SUCH AN ATTEMPT IS  PART  OF  A  CONCERTED  EFFORT  TO
EFFECT  ON  THE  PART OF THE HEALTH PLAN OR PBM TO HAVE SAID HEALTH CARE
PROVIDER CHANGE SAID PRESCRIPTION DRUG PRODUCT IN EXCHANGE FOR  ANYTHING
OF  AN ECONOMIC VALUE PROVIDED DIRECTLY OR INDIRECTLY BY THE HEALTH PLAN
OR PBM.
  S 281-A. UNLAWFUL  PAYMENTS  WITH  RESPECT  TO  HEALTH  CARE  PROVIDER
PRESCRIBING  PRACTICES.  (A) IMPROPER PRESCRIPTION DRUG SWITCH PAYMENTS.
NO HEALTH PLAN OR PBM SHALL, BY CONTRACT, WRITTEN POLICY OR PROCEDURE OR
ANY OTHER AGREEMENT OR COURSE OF CONDUCT, OFFER OR  FURNISH  PAYMENT  OR
ANY  OTHER  INCENTIVE  TO  A  HEALTH  CARE  PROVIDER  TO  COMPLY  WITH A
PRESCRIPTION DRUG SWITCH AS DEFINED IN THIS ARTICLE.
  (B) OTHER IMPROPER PAYMENTS RELATING TO HEALTH CARE PROVIDER PRESCRIB-
ING DECISIONS. NO HEALTH PLAN OR PBM SHALL, BY CONTRACT, WRITTEN  POLICY
OR  PROCEDURE  OR  ANY  OTHER  AGREEMENT  OR COURSE OF CONDUCT, OFFER OR
FURNISH PAYMENT OR ANY OTHER INCENTIVE TO  A  HEALTH  CARE  PROVIDER  TO
COMPLY  WITH  A  DIRECTION  TO PRESCRIBE A SPECIFIC PRESCRIPTION DRUG OR

A. 4342--A                          3

WITH FORMULARY OR OTHER GUIDELINES FOR SELECTION  OF  PRESCRIPTION  DRUG
PRODUCTS, OR PROVIDE ANY DISINCENTIVE FOR NON-COMPLIANCE.
  (C) GENERIC SUBSTITUTION EXCEPTED. NOTHING IN THIS SECTION PROHIBITS A
HEALTH  PLAN  OR  PBM,  BY  CONTRACT, WRITTEN POLICY OR PROCEDURE OR ANY
OTHER AGREEMENT OR  COURSE  OF  CONDUCT,  FROM  OFFERING  OR  FURNISHING
PAYMENT  OR  ANY OTHER INCENTIVE TO A HEALTH CARE PROVIDER FOR EFFECTING
GENERIC SUBSTITUTIONS OF PRESCRIPTION DRUG PRODUCTS,  OR  PROVIDING  ANY
DISINCENTIVE FOR FAILING TO EFFECT SUCH SUBSTITUTION.
  S  281-B.  NO  RETALIATION  AGAINST HEALTH CARE PROVIDERS. IT SHALL BE
UNLAWFUL FOR ANY HEALTH PLAN OR PBM TO DEPRIVE OR  THREATEN  TO  DEPRIVE
ANY  HEALTH  CARE PROVIDER OF EMPLOYMENT OR TO TERMINATE THE HEALTH CARE
PROVIDER'S ENGAGEMENT FOR SERVICES, TAKE OR THREATEN TO TAKE ANY RETALI-
ATORY ACTION AGAINST ANY HEALTH CARE PROVIDER, OR DIRECTLY OR INDIRECTLY
INTIMIDATE, THREATEN, COERCE, COMMAND OR ATTEMPT TO INTIMIDATE,  THREAT-
EN, COERCE, OR COMMAND ANY HEALTH CARE PROVIDER BECAUSE SUCH HEALTH CARE
PROVIDER  HAS  MADE PRESCRIBING CHOICES FOR PATIENTS THAT DO NOT CONFORM
TO A DIRECTION TO PRESCRIBE A SPECIFIC PRESCRIPTION DRUG OR WITH  FORMU-
LARY  OR  OTHER  GUIDELINES FOR SELECTION OF PRESCRIPTION DRUG PRODUCTS,
PROVIDED THAT SUCH DECISIONS ARE BASED ON  THE  HEALTH  CARE  PROVIDER'S
INDEPENDENT  CLINICAL  JUDGMENT  REGARDING  THE APPROPRIATE PRESCRIPTION
DRUG FOR EACH PATIENT FOR WHOM THE NON-CONFORMING CHOICE HAS BEEN MADE.
  S 281-C. ENFORCEMENT. (A) ANY  HEALTH  CARE  PROVIDER  THAT  HAS  BEEN
INJURED  BY  REASON  OF THE VIOLATION BY A HEALTH PLAN OR PBM OF SECTION
TWO HUNDRED EIGHTY-ONE-B OF THIS ARTICLE MAY BRING AN ACTION FOR EQUITA-
BLE RELIEF AND TO RECOVER THE PROVIDER'S  ACTUAL  DAMAGES  AND  A  CIVIL
PENALTY TO BE PAID TO THE HEALTH CARE PROVIDER NOT TO EXCEED THREE TIMES
THE HEALTH CARE PROVIDER'S ACTUAL DAMAGES.
  (B)  THE  COMMISSIONER MAY ASSESS A CIVIL PENALTY OF UP TO TWENTY-FIVE
THOUSAND DOLLARS FOR EACH VIOLATION OF SECTION TWO HUNDRED  EIGHTY-ONE-A
OF THIS ARTICLE.
  S 2. This act shall take effect immediately.