bill barring insurers from shortchanging 340B providers

The text as introduced · 860 words

89R14852 RDS-D

By: Rose
H.B. No. 4422

A BILL TO BE ENTITLED

AN ACT

relating to discriminatory practices by a health benefit plan

issuer, pharmacy benefit manager, and third-party payor with

respect to certain entities participating in a federal drug

discount program.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Chapter 1369, Insurance Code, is amended by

adding Subchapter O to read as follows:

SUBCHAPTER O. PROHIBITION ON DISCRIMINATION WITH RESPECT TO

FEDERAL 340B DRUG DISCOUNT PROGRAM

Sec. 1369.701. DEFINITIONS. In this subchapter:

(1) "Covered entity" has the meaning assigned by 42

U.S.C. Section 256b(a)(4).

(2) "Non-covered entity" means an entity that is not a

covered entity.

(3) "Pharmacy benefit manager" has the meaning

assigned by Section 4151.151.

(4) "Third-party payor" means any person, other than a

pharmacy benefit manager, health benefit plan issuer, patient, or

individual paying for a patient's drugs on the patient's behalf,

that makes payment for drugs dispensed by a pharmacist or pharmacy

or administered by a health care professional.

Sec. 1369.702. APPLICABILITY OF SUBCHAPTER. (a) This

subchapter applies only to a health benefit plan that provides

benefits for medical or surgical expenses incurred as a result of a

health condition, accident, or sickness, including an individual,

group, blanket, or franchise insurance policy or insurance

agreement, a group hospital service contract, or an individual or

group evidence of coverage or similar coverage document that is

issued by:

(1) an insurance company;

(2) a group hospital service corporation operating

under Chapter 842;

(3) a health maintenance organization operating under

Chapter 843;

(4) an approved nonprofit health corporation that

holds a certificate of authority under Chapter 844;

(5) a multiple employer welfare arrangement that holds

a certificate of authority under Chapter 846;

(6) a stipulated premium company operating under

Chapter 884;

(7) a fraternal benefit society operating under

Chapter 885;

(8) a Lloyd's plan operating under Chapter 941; or

(9) an exchange operating under Chapter 942.

(b) Notwithstanding any other law, this subchapter applies

to:

(1) a small employer health benefit plan subject to

Chapter 1501, including coverage provided through a health group

cooperative under Subchapter B of that chapter;

(2) a standard health benefit plan issued under

Chapter 1507;

(3) a basic coverage plan under Chapter 1551;

(4) a basic plan under Chapter 1575;

(5) a primary care coverage plan under Chapter 1579;

(6) a plan providing basic coverage under Chapter

1601;

(7) nonprofit agricultural organization health

benefits offered by a nonprofit agricultural organization under

Chapter 1682;

(8) alternative health benefit coverage offered by a

subsidiary of the Texas Mutual Insurance Company under Subchapter

M, Chapter 2054;

(9) health benefits provided by or through a church

benefits board under Subchapter I, Chapter 22, Business

Organizations Code;

(10) group health coverage made available by a school

district in accordance with Section 22.004, Education Code;

(11) the state Medicaid program, including the

Medicaid managed care program operated under Chapter 540,

Government Code;

(12) the child health plan program under Chapter 62,

Health and Safety Code;

(13) a regional or local health care program operated

under Section 75.104, Health and Safety Code;

(14) a self-funded health benefit plan sponsored by a

professional employer organization under Chapter 91, Labor Code;

(15) county employee group health benefits provided

under Chapter 157, Local Government Code; and

(16) health and accident coverage provided by a risk

pool created under Chapter 172, Local Government Code.

Sec. 1369.703. PROHIBITION ON DISCRIMINATORY ACTIONS. A

health benefit plan issuer, pharmacy benefit manager, or

third-party payor may not:

(1) reimburse a covered entity or a pharmacist or

pharmacy that is under contract with the entity for a prescription

drug at a rate lower than the rate paid to a non-covered entity for

the same drug;

(2) impose a term on a covered entity that differs from

the terms applied to non-covered entities on the basis that the

entity is a covered entity, including:

(A) a fee, chargeback, or other adjustment that

is not placed on non-covered entities; or

(B) a restriction or requirement regarding

participation in a health benefit plan issuer, pharmacy benefit

manager, or third-party payor network, including a requirement that

a covered entity enter into a contract with a specific pharmacy or

pharmacist; or

(3) create a restriction applicable to or impose an

additional charge on a patient who chooses to receive a

prescription drug from a covered entity.

SECTION 2. Subchapter O, Chapter 1369, Insurance Code, as

added by this Act, applies only to a health benefit plan delivered,

issued for delivery, or renewed on or after January 1, 2026.

SECTION 3. It is the intent of the legislature that every

provision, section, subsection, sentence, clause, phrase, or word

in this Act, and every application of the provisions in this Act to

every person, group of persons, or circumstances, is severable from

each other. If any application of any provision in this Act to any

person, group of persons, or circumstances is found by a court to be

invalid for any reason, the remaining applications of that

provision to all other persons and circumstances shall be severed

and may not be affected.

SECTION 4. This Act takes effect September 1, 2025.