2020 Colorado Revised Statutes
Title 10 - Insurance
Article 16. Health Care Coverage
Section 10-16-122.3. Pharmacy benefit management firm payments - retroactive reduction prohibited - enforcement - rules - definitions. [Editor's note: For the applicability of this section on or after January 1, 2021, see the editor's note following this section.]
(1) (a) A pharmacy benefit management firm shall not reimburse a pharmacy in an amount less than the amount that the pharmacy benefit management firm reimburses any affiliate for the same pharmacy services.
(b) This subsection (1) does not prohibit a pharmacy benefit management firm from reimbursing an affiliate for satisfying the terms of a performance-based contract.
(2) (a) A contract or agreement, including a performance-based or value-based contract or agreement, between a pharmacy benefit management firm and a pharmacy or a pharmacy services administrative organization with respect to prescription drug benefits administered or managed by the pharmacy benefit management firm must provide that after the date the pharmacy benefit management firm receives a clean claim submitted by a pharmacy, the pharmacy benefit management firm shall not retroactively reduce payment on the claim after the point of sale except as the result of an audit conducted in accordance with section 10-16-122.5.
(b) Nothing in this subsection (2) prohibits a pharmacy benefit management firm from retroactively increasing a payment to a pharmacy pursuant to a written agreement between the pharmacy benefit management firm and the pharmacy or making adjustments to claims in the case of a clerical error.
Each carrier that contracts with a pharmacy benefit management firm to manage oradminister prescription drug benefits on the carrier's behalf shall include in a new, amended, or renewed contract with the pharmacy benefit management firm a requirement that the pharmacy benefit management firm comply with this section. The carrier shall annually audit the pharmacy benefit management firm to monitor and ensure compliance with this section.
The division may promulgate rules to establish the manner in which carriers andpharmacy benefit management firms are required to show compliance with this section.
This section applies to contracts and agreements between pharmacy benefit management firms and pharmacies or pharmacy services administrative organizations in effect on or after January 1, 2021.
As used in this section:
"Affiliate" means a pharmacy that directly or indirectly, through one or more intermediaries, owns or controls, is owned or controlled by, or is under common ownership or control with a pharmacy benefit management firm.
"Clean claim" means a claim that has no defect or impropriety, including any lack ofrequired substantiating documentation, or particular circumstance requiring special treatment that prevents timely payment from being made on the claim. "Clean claim" does not include a claim based on fraud, waste, or abuse.
"Pharmacy" means an in-state or nonresident prescription drug outlet, as defined insection 12-280-103 (43); an other outlet, as defined in section 12-280-103 (32); a hospital satellite pharmacy, as defined in section 12-280-103 (20); or other setting, including a practitioner's office or clinic, where a practitioner, as defined in section 12-280-103 (40), dispenses prescription drugs to patients as authorized by section 12-280-120 (6).
Source: L. 2020: Entire section added, (HB 20-1078), ch. 98, p. 381, § 1, effective September 14.
Editor's note: Section 2 of chapter 98 (HB 20-1078), Session Laws of Colorado 2020, provides that the act adding this section applies to contracts and agreements in effect on or after January 1, 2021.
