COMAR 31.10.49 · Chapter 49 Pharmacy Services Administrative Organizations

Administrative History Effective date: December 26, 2022 (49:26 Md. R. 1081) Authority Insurance Article, §§ 15-2001 — 15-2019 , Annotated Code of Maryland

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.01 Scope. This chapter applies to all contractual agreements between a pharmacy services administrative organization and an independent pharmacy in which a pharmacy services administrative organization negotiates on behalf of an independent pharmacy with purchasers or pharmacy benefit managers for prescription drug coverage or benefits, medical devices, or biologics 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 in response to an appeal under this chapter provided to a contracted pharmacy that includes a reason for the appeal denial. (2) “Contracted pharmacy” means an independent pharmacy in a pharmacy services administrative contract. (3) “Delivered by electronic means” includes: (a) Delivery to an electronic mail address at which an independent pharmacy or contracted pharmacy has consented to receive notice; and (b) Posting on an electronic network, together with separate notice to an independent pharmacy or contracted pharmacy directed to the electronic mail address at which the independent pharmacy or contracted pharmacy has consented to receive notice of the posting. (4) “Independent pharmacy” has the meaning stated in Insurance Article, §15-2001(b), Annotated Code of Maryland . (5) “Material change” means a change in control or business operations of a pharmacy services administrative organization after a purchase, merger, or acquisition of a parent company, subsidiary, or other organization. (6) Medical Device. (a) “Medical device” means a device used in the diagnosis, treatment, or prevention of disease. (b) “Medical device” does not include: (i) Any surgical or dental instrument; (ii) Physical therapy equipment; (iii) Any x-ray apparatus; or (iv) Any component or accessory of any of these items. (7) “Pharmacy benefits manager (PBM)” has the meaning stated in Insurance Article, §15-1601, Annotated Code of Maryland . (8) “Pharmacy services administrative contract” has the meaning stated in Insurance Article, §15-2001(d), Annotated Code of Maryland . (9) “Pharmacy services administrative organization” or “PSAO” has the meaning stated in Insurance Article, §15-2001(e), Annotated Code of Maryland . (10) “Purchaser” has the meaning stated in Insurance Article, §15-2001(f), Annotated Code of Maryland . (11) “Working days” means any day that the Maryland Insurance Administration is open for business.

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.03 Disclosures to an Independent Pharmacy. A. A PSAO shall provide to a contracted pharmacy an electronic or paper copy of any contracts, amendments, payment schedules, or reimbursement rates within 5 working days after the execution of a contract, or an amendment to a contract, signed on behalf of the contracted pharmacy by the PSAO. B. A PSAO shall provide written notice to an independent pharmacy of any ownership interest or control by a parent company, subsidiary, or other organization before entering into a pharmacy services administrative contract with the independent pharmacy. C. A PSAO shall disclose to a contracted pharmacy in writing within 5 working days of any material change of ownership or control or a parent company, subsidiary, or other organization. D. The written disclosures required in §§B and C of this regulation shall identify the extent of any ownership interest or control, to include the percent of shares owned, by a parent company, subsidiary, or other organization that: (1) Provides pharmacy services, prescription drug, or device services; or (2) Manufactures, sells, or distributes prescription drugs, biologics, or medical devices. E. The written disclosures required in §§B and C of this regulation may be delivered by electronic means provided: (1) The independent pharmacy or contracted pharmacy has affirmatively consented to that method of delivery and has not withdrawn the consent; (2) The independent pharmacy or contracted pharmacy, before giving consent, is provided with a clear and conspicuous statement informing the pharmacy of: (a) Any right or option of the pharmacy to have the notice provided or made available in paper or another nonelectronic form; (b) The right of the pharmacy to withdraw consent to have notice delivered by electronic means and any fees, conditions, or consequences imposed in the event consent is withdrawn; (c) Whether the consent applies: (i) Only to notices or communications related to a particular transaction; or (ii) To identified categories of notices that may be delivered by electronic means during the course of the parties’ relationship; and (d) The procedures the pharmacy must use to withdraw consent to have notice delivered by electronic means and to update information needed to contact the party electronically; (3) The independent pharmacy or contracted pharmacy, before giving consent, is provided with a statement of the hardware and software requirements for access to and retention of a notice delivered by electronic means; and (4) The process used to obtain consent of the independent pharmacy or contracted pharmacy to have notice delivered by electronic means meets the requirements of Commercial Law Article, Title 21, Subtitle 1, Annotated Code of Maryland .

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.04 Internal Appeal Procedures. A. Each PSAO subject to this chapter shall establish written procedures to investigate and resolve disputes filed against the PSAO by a contracted pharmacy. B. The internal appeal procedures shall: (1) Be in writing; and (2) Contain administrative processes and safeguards designed to ensure and verify that a PSAO remits payment to a contracted pharmacy in accordance with the pharmacy services administrative 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 PSAO 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 PSAO shall be provided to the Commissioner on request.

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.05 Compliant Process. A. Prior to filing a complaint with the Commissioner, a contracted pharmacy or its designee shall exhaust the internal appeal process established by the PSAO. B. A complaint is properly completed and may be filed if a contracted pharmacy or designee for the pharmacy: (1) Completes all applicable portions of the Commissioner’s complaint form; and (2) Provides a copy of the relevant contract or the provisions that are related to the internal dispute, including but not limited to any applicable remittance and copy of any appeal decision. C. Notification of the complaint to the PSAO. (1) Upon receipt of a completed complaint form, the Commissioner shall provide a copy to the PSAO. (2) Within 15 working days of receiving the Commissioner’s notice, the PSAO shall provide the Commissioner with: (a) A complete, unredacted copy of the applicable portion of the pharmacy services administrative contract relating to the complaint filed with the Commissioner, including any other contract applicable to the complaint; and (b) Any other information the Commissioner may require for the purposes of determining a PSAO’s compliance with: (i) The Insurance Article, Annotated Code of Maryland ; (ii) This chapter; or (iii) The applicable terms of the applicable pharmacy services administrative contract, PBM contract, or applicable purchaser’s contract.

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Previous Chapter 48 Pharmacy Benefits Managers — Informational Filing of Contracts and Amendments

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Next Chapter 50 Filing of PSAO Contracts and Amendments

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