COMAR 31.10.46 · Chapter 46 Pharmacy Benefits Managers — Maximum Allowable Cost

Administrative History Effective date: Effective March 23, 2020 (47:6 Md. R. 343) Regulation .02B amended effective February 7, 2022 (49:3 Md. R. 141) Regulation .03 amended effective February 7, 2022 (49:3 Md. R. 141) Authority Insurance Article, §§ 15-1601 , 15-1604 , 15-1605 , 15-1607 , 15-1609 , 15-1628 , 15-1628 .1, and 15-1642, Annotated Code of Maryland

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.01 Scope. This chapter applies to all maximum allowable cost pricing claims made to a pharmacy benefits manager for a multisource generic prescription drug, medical product, or device, provided to a beneficiary of a purchaser.

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.02 Definitions. A. In this chapter, the following terms have the meanings indicated. B. Terms Defined. (1) “Appeal decision” means a written or electronic notice issued by a PBM in response to an appeal filed by a contracted pharmacy of the maximum allowable cost used to adjudicate a claim. (2) “Beneficiary” means an individual who receives prescription drug coverage or benefits from a purchaser. (3) “Carrier” has the meaning stated in Insurance Article §15-1601, Annotated Code of Maryland . (4) “Compensation program” has the meaning stated in Insurance Article §15-1601, Annotated Code of Maryland . (5) “Contracted pharmacy” has the meaning stated in Insurance Article, §15-1601, Annotated Code of Maryland . (6) “MAC complaint” means a communication by a contracted pharmacy that disputes the appeal decision, and is submitted on a MAC complaint form to the Commissioner, after the pharmacy benefits manager’s internal appeal process has been exhausted as required by Insurance Article, §15-1628 .1(f), Annotated Code of Maryland. (7) “MAC complaint form” means the form adopted by the Commissioner under Regulation .05 of this chapter . (8) “MAC list” means a list of multisource generic drugs, medical products, and devices for which a MAC has been established by a pharmacy benefits manager or a purchaser. (9) “Maximum allowable cost” or “MAC” has the meaning stated in Insurance Article, §15-1628 .1, Annotated Code of Maryland. (10) “Multisource generic drug” means a generic drug as defined in Health-General Article, §21-2C-01(f), Annotated Code of Maryland, for which there is at least one other drug and does not include a brand name drug as that term is defined in Health Occupations, §12-504, Annotated Code of Maryland . (11) “Participating pharmacy contract” means a contract filed with the Commissioner that is: (a) Between a pharmacy and a: (i) Pharmacy benefits manager; (ii) Pharmacy services administrative organization; or (iii) Group purchasing organization; (b) Filed as required by the Commissioner; (c) Not disapproved by the Commissioner; and (d) In compliance with the requirements stated in this chapter. (12) “Pharmacist” has the meaning stated in Health Occupations Article, §12 –101, Annotated Code of Maryland. (13) “Pharmacy” has the meaning stated in Health Occupations Article, §12 –101, Annotated Code of Maryland. (14) “Pharmacy benefits management services” has the meaning stated in Insurance Article, §15-1601, Annotated Code of Maryland . (15) “Pharmacy benefits manager” or “PBM” has the meaning stated in Insurance Article, §15-1601, Annotated Code of Maryland . (16) “Pharmacy services administration organization” or “PSAO” means an entity that provides a contracted pharmacy with contracting administrative services relating to prescription drug benefits. (17) “Pricing information” means anything used in the mathematical calculation to determine the payment to a contracted pharmacy. (18) “Purchaser” has the meaning stated in Insurance Article, §15-1601, Annotated Code of Maryland . (19) “Source” means the publisher or publishers stated in the participating pharmacy contract, used by the PBM, in any manner, to establish the basis of the PBM’s MAC reimbursement amount to a contracted pharmacy, under a participating pharmacy contract compensation program. (20) “Working day” means any day that the Maryland Insurance Administration is open for business.

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.03 Disclosures to a Contracted Pharmacy. A. A PBM, whether its contract is directly with a pharmacy or indirectly with a pharmacy through a PSAO or group purchasing organization, shall disclose to a contracted pharmacy at the time of entering into a contract with a pharmacy and at least 30 working days before any contract change for a contracted pharmacy: (1) The applicable terms, conditions, and reimbursement rates, including: (a) The sources; and (b) The terms of the compensation program; (2) The process and procedures for verifying pharmacy benefits and beneficiary eligibility; (3) The dispute resolution, internal appeal process under Regulation .04 of this chapter , and audit appeals process; and (4) The process and procedures for verifying the prescription drugs included on the formularies used by the PBM. B. A PBM, whether its contract is directly with a pharmacy or indirectly with a pharmacy through a PSAO or group purchasing organization, shall: (1) Update its pricing information at least every 7 days; (2) Establish a reasonable process by which a contracted pharmacy has access to the current and applicable MAC lists and price list in an electronic format as updated in accordance with the requirements of this section; and (3) Immediately after a pricing information update occurs pursuant to this regulation, use the updated pricing information in calculating the payments made to all contracted pharmacies. C. A claim paid on behalf of a carrier to a contracted pharmacy under a participating pharmacy contract is subject to the requirements of Insurance Article, §§ 15-1005 , 15-1008 , 15-1009 , and 15-1631 , Annotated Code of Maryland.

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.04 Internal Appeal Procedures. A. Each PBM subject to this chapter shall establish written procedures to investigate and resolve disputes filed by a contracted pharmacy. B. The internal appeal procedures established by the PBM shall: (1) Be in writing; and (2) Contain administrative processes and safeguards designed to ensure and verify that the MAC pricing was determined in accordance with the participating pharmacy contract and Maryland law, and that the contract provisions have not been applied in an arbitrary or capricious manner. C. The procedures established by the PBM may not require: (1) More than one appeal before filing a complaint with the Commissioner; or (2) The payment of a fee to file an appeal. D. The internal appeal procedures established by the PBM shall be provided to the Commissioner on request.

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.05 MAC Complaint Process. A. Prior to filing a MAC complaint with the Commissioner, a contracted pharmacy or its designee shall exhaust the internal appeal process established in the participating pharmacy contract and used by the PBM to appeal, investigate, and resolve a dispute regarding the MAC claim amount. B. A contracted pharmacy or its designee may file a MAC complaint with the Commissioner to dispute a PBM’s appeal decision for the following reasons: (1) The PBM’s MAC pricing did not meet the requirements of Insurance Article, Title 15, Subtitle 16, Annotated Code of Maryland , related to MAC pricing; or (2) The PBM’s MAC pricing did not meet the applicable terms of the applicable participating pharmacy contract. C. A MAC complaint is properly completed and may be filed if a contracted pharmacy or designee: (1) Completes all applicable portions of the Commissioner’s MAC complaint form; (2) Provides a copy of the relevant contract or the provisions that are related to the MAC appeal, including but not limited to: (a) MAC; (b) MAC pricing; (c) Sources; (d) Pricing information; and (e) The compensation program of the applicable participating pharmacy contract; and (3) Provides a copy of the appeal decision. D. A MAC complaint may not include more than ten appeal decisions using a single MAC complaint form. E. Notification of the MAC Complaint to the PBM. (1) Upon receipt of a completed MAC complaint form, the Commissioner shall provide a copy of the submitted MAC complaint form to the PBM. (2) Within 5 working days of receiving the Commissioner’s notice, the PBM shall provide the Commissioner: (a) A complete, unredacted copy of the applicable portion of the participating pharmacy contract relating to the compensation program and the complaint filed with the Commissioner, including any other contract under which the pricing information is determined; (b) A copy of the applicable source and pricing information used to calculate the MAC; (c) The MAC calculated on a per unit basis based on the same generic product identifier or national drug code number; (d) A mathematical calculation that demonstrates how the reimbursement amount was determined; (e) All information required to complete the response portion of the MAC complaint form; and (f) Any other information the Commissioner may require for the purposes of determining a PBM’s compliance with: (i) Insurance Article, Annotated Code of Maryland ; (ii) This chapter; (iii) The compensation program; or (iv) The applicable terms of the applicable participating pharmacy contract.

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