CSSB 119(L&C): "An Act relating to the practice of pharmacy; relating to notifications to consumers regarding prescription drug pricing; relating to disclosure of health care services and price information; relating to health care insurers; relating to availability of payment information and estimates of out-of-pocket expenses; relating to an incentive program for electing to receive health care services for less than the average price paid; relating to filing and reporting requirements; and providing for an effective date."
00 CS FOR SENATE BILL NO. 119(L&C) 01 "An Act relating to the practice of pharmacy; relating to notifications to consumers 02 regarding prescription drug pricing; relating to disclosure of health care services and 03 price information; relating to health care insurers; relating to availability of payment 04 information and estimates of out-of-pocket expenses; relating to an incentive program 05 for electing to receive health care services for less than the average price paid; relating 06 to filing and reporting requirements; and providing for an effective date." 07 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 08 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 09 to read: 10 SHORT TITLE. This Act may be known as the Alaska Health Care Consumer's Right 11 to Shop Act. 12 * Sec. 2. AS 08.80.297 is amended to read: 13 Sec. 08.80.297. Prescription prices available to consumer. A pharmacist
01 shall disclose the pharmacy retail price and the consumer's cost sharing of 02 [FILLING] any prescription when requested by the consumer. 03 * Sec. 3. AS 08.80.297 is amended by adding new subsections to read: 04 (b) A pharmacist shall, unless directed otherwise by the consumer, charge a 05 consumer the applicable cost sharing or the current pharmacy retail price for a 06 prescription medication, whichever is less. 07 (c) If a pharmacist, or a person acting at the direction of a pharmacist, 08 determines that the cost sharing for a prescription medication exceeds the current 09 pharmacy retail price, the pharmacist or person acting at the direction of a pharmacist 10 shall notify the consumer of the pharmacy retail price and the consumer's cost sharing. 11 (d) A pharmacy shall post a notice to consumers informing them that they 12 may, at the point of sale, request the current pharmacy retail price for each 13 prescription medication the consumer intends to purchase. 14 (e) No contract or agreement may prohibit a pharmacy or pharmacist from 15 complying with the provisions of this section. 16 (f) In this section, 17 (1) "cost sharing" means the amount owed by the consumer under the 18 terms of the consumer's health care plan; 19 (2) "health care plan" means a policy, contract, benefit, or agreement 20 that provides, delivers, arranges for, pays for, or reimburses any of the costs of health 21 care services under 22 (A) a health care insurance plan as defined under 23 AS 21.54.500; 24 (B) a governmental or employee welfare benefit plan under 29 25 U.S.C. 1001 - 1191 (Employee Retirement Income Security Act of 1974); 26 (C) a plan offered under AS 39.30.090 or 39.30.091; 27 (D) a federal governmental plan as defined under 28 AS 21.54.500; 29 (E) the Medicaid or Medicare program; or 30 (F) a self-insured employer benefit plan; 31 (3) "pharmacy retail price" means
01 (A) the lesser cost of a brand name or an equivalent drug 02 product; or 03 (B) the amount an individual would pay for a prescription 04 medication purchased at a pharmacy without the use of a health care plan. 05 * Sec. 4. AS 08.80 is amended by adding a new section to read: 06 Sec. 08.80.305. Record of prescriptions. A pharmacy shall maintain a record 07 of costs of every prescription dispensed to a consumer. The costs shall include 08 information related to cost sharing and the pharmacy retail price at the time of sale. 09 The pharmacy shall keep the record for at least two years. Upon request, a pharmacist 10 shall provide the record to a consumer during that period. 11 * Sec. 5. AS 08.80.460(a) is amended to read: 12 (a) Except for a violation of AS 08.80.297, a [A] person who violates a 13 provision of this chapter is guilty of a class B misdemeanor. 14 * Sec. 6. AS 08.80.460 is amended by adding new subsections to read: 15 (c) Except as provided in (d) of this section, a pharmacist who violates 16 AS 08.80.297(b) - (e) is liable in a civil action by the attorney general or an aggrieved 17 person for the difference between the consumer's cost sharing and the pharmacy retail 18 price, and is punishable by a fine of $500 for the first violation and $1,000 for the 19 second and each subsequent violation, plus full attorney fees and costs. 20 (d) A violation of AS 08.80.297(b) is exempt from penalties under this section 21 if the pharmacy or pharmacist offers the consumer a refund of the difference between 22 the consumer's cost sharing and the pharmacy retail price within one year after the 23 date of the violation. If a consumer accepts a refund of the difference, the pharmacy 24 shall make reasonable efforts to provide the refund. 25 * Sec. 7. AS 18.15.360(a) is amended to read: 26 (a) The department is authorized to collect, analyze, and maintain databases of 27 information related to 28 (1) risk factors identified for conditions of public health importance; 29 (2) morbidity and mortality rates for conditions of public health 30 importance; 31 (3) community indicators relevant to conditions of public health
01 importance; 02 (4) longitudinal data on traumatic or acquired brain injury from the 03 registry established under AS 47.80.500(c)(1); [AND] 04 (5) health care services and price information collected under 05 AS 18.23.400; and 06 (6) any other data needed to accomplish or further the mission or goals 07 of public health or provide essential public health services and functions. 08 * Sec. 8. AS 18.23 is amended by adding new sections to read: 09 Article 4. Health Care Services and Price Information. 10 Sec. 18.23.400. Disclosure and reporting of health care services and price 11 information. (a) A health care provider in the state and a health care facility in the 12 state shall annually compile a list, by procedure code, including a brief and easily 13 understandable description, of the top 25 health care services from each of the six 14 sections of Category I, Current Procedural Terminology, adopted by the American 15 Medical Association that a prudent person would consider of value in the management 16 of their own affairs and the price for each service, including any discounts that may be 17 applicable. 18 (b) A health care provider and health care facility shall publish the lists 19 compiled under (a) of this section by January 31 each year 20 (1) by providing the list to the department for posting on the 21 department's public database under AS 18.15.360; 22 (2) by posting a copy of the list in a conspicuous public reception area 23 at the health care provider's office or health care facility where the services are 24 performed; and 25 (3) if the health care provider or health care facility has an Internet 26 website, by posting the list on the website. 27 (c) A health care provider and health care facility may include a disclaimer in 28 the publication under (b) of this section that explains that the price paid by the patient 29 may be higher or lower than the amount listed. 30 (d) The department shall compile and annually update the lists provided under 31 (a) of this section by health care service and, where relevant, health care provider and
01 health care facility name and location, and post the information on the department's 02 Internet website and enter the information in the database maintained under 03 AS 18.15.360. 04 (e) If a health care provider or health care facility in the state performs fewer 05 than 25 health care services in the state from each of the six sections of Category I, 06 Current Procedural Terminology, adopted by the American Medical Association in the 07 annual reporting period under this section, the provider or facility shall provide a list 08 of all of the health care services from each of the six sections of Category I, Current 09 Procedural Terminology, performed by the provider or at the facility. 10 (f) A health care provider or health care facility that fails to comply with the 11 requirements of this section is liable for a civil penalty. The department may impose a 12 civil penalty of not more than $50 for each day after March 31 that a health care 13 provider or health care facility fails to provide and post information as required under 14 (b) of this section. The total penalty may not exceed $2,500. A person penalized under 15 this subsection may file an appeal with the superior court for judicial review of the 16 penalty under AS 44.62.560. 17 (g) If a health care provider or health care facility chooses to pay the 18 maximum penalty instead of complying with the requirements of this section, the 19 department shall disclose to the public that the health care provider or health care 20 facility has failed to make a disclosure in violation of this section. 21 Sec. 18.23.405. Cost estimates for health care services. (a) Upon written 22 request of a patient or the patient's authorized agent, a health care provider shall 23 provide the patient or agent with a comprehensive, good faith estimate of the total 24 charges for a health care service that the patient is receiving or has been recommended 25 to receive if the total charges exceed $250. The health care provider shall provide the 26 estimate of total charges within five business days after receiving the written request 27 and any additional information needed to provide a comprehensive estimate of total 28 charges. 29 (b) The estimate of total charges must indicate, 30 (1) if known, the network status of the health care provider under an 31 insured patient's health care insurance plan;
01 (2) if known, whether the health care services of another health care 02 provider are necessary or recommended to complete the health care service being 03 recommended or provided; and 04 (3) if health care services from another provider are necessary or 05 recommended for the health care service being recommended or provided, that the 06 patient or the patient's authorized agent must make a separate request to the other 07 health care provider for 08 (A) an estimate of the charges for health care services to be 09 provided by the other health care provider; and 10 (B) information on the network status of the other health care 11 provider under an insured patient's health care insurance plan. 12 (c) If the patient is uninsured, the health care provider shall 13 (1) include in the estimate of total charges any financial assistance 14 available to the patient from the health care provider; and 15 (2) direct the patient or the patient's authorized agent to Internet 16 websites, if available, that provide information about standard charges for the type of 17 health care provider that provides the health care service. 18 (d) The patient or the patient's authorized agent may request that the 19 information required under this section be provided in writing or electronically. 20 (e) The estimate of total charges 21 (1) must represent a good faith effort to provide accurate information 22 to the patient or the patient's authorized agent; 23 (2) is not a binding contract between the parties; and 24 (3) is not a guarantee that the estimate of total charges will be the 25 amount actually charged or will account for unforeseen conditions. 26 (f) This section does not apply to health care services provided for the 27 treatment of an emergency medical condition or for the treatment of an emergency 28 medical condition that results in hospitalization. 29 Sec. 18.23.420. Definitions. In AS 18.23.400 - 18.23.420, 30 (1) "department" means the Department of Health and Social Services; 31 (2) "emergency medical condition" has the meaning given in
01 AS 21.07.250; 02 (3) "health care facility" means a private, municipal, state, or federal 03 hospital, psychiatric hospital, independent diagnostic testing facility, residential 04 psychiatric treatment center as defined in AS 47.32.900, tuberculosis hospital, kidney 05 disease treatment center (including freestanding hemodialysis units), the offices of 06 private physicians or dentists whether in individual or group practice, an ambulatory 07 surgical center as defined in AS 47.32.900, a free-standing birth center as defined in 08 AS 47.32.900, and a rural health clinic as defined in AS 47.32.900; "health care 09 facility" does not include an Alaska tribal health organization or another federally 10 operated hospital or facility; 11 (4) "health care insurance plan" has the meaning given in 12 AS 21.54.500; 13 (5) "health care provider" means an individual licensed, certified, or 14 otherwise authorized or permitted by law to provide health care services in the 15 ordinary course of business or practice of a profession; 16 (6) "health care service" means a service or procedure provided in 17 person or remotely by telehealth or other means by a health care provider or at a health 18 care facility for the purpose of or incidental to the care, prevention, or treatment of a 19 physical or mental illness or injury; 20 (7) "price" means the charges billed directly to a recipient for services 21 rendered without complications or exceptional circumstances; "price" does not include 22 a negotiated discount for in-network, out-of-network, or self-insured services rendered 23 or the costs paid by a third party for those services; 24 (8) "recipient" means an individual to whom health care services are 25 provided in the state by a health care provider or at a health care facility; 26 (9) "telehealth" has the meaning given in AS 47.05.270(e); 27 (10) "third party" means a public or private entity, association, or 28 organization that provides, by contract, agreement, or other arrangement, insurance, 29 payment, price discount, or other benefit for all or a portion of the cost of health care 30 services provided to a recipient; "third party" does not include a member of the 31 recipient's immediate family.
01 * Sec. 9. AS 21.06.110 is amended to read: 02 Sec. 21.06.110. Director's annual report. As early in each calendar year as is 03 reasonably possible, the director shall prepare and deliver an annual report to the 04 commissioner, who shall notify the legislature that the report is available, showing, 05 with respect to the preceding calendar year, 06 (1) a list of the authorized insurers transacting insurance in this state, 07 with a summary of their financial statement as the director considers appropriate; 08 (2) the name of each insurer whose certificate of authority was 09 surrendered, suspended, or revoked during the year and the cause of surrender, 10 suspension, or revocation; 11 (3) the name of each insurer authorized to do business in this state 12 against which delinquency or similar proceedings were instituted and, if against an 13 insurer domiciled in this state, a concise statement of the facts with respect to each 14 proceeding and its present status; 15 (4) a statement in regard to examination of rating organizations, 16 advisory organizations, joint underwriters, and joint reinsurers as required by 17 AS 21.39.120; 18 (5) the receipts [RECEIPT] and expenses of the division for the year; 19 (6) recommendations of the director as to amendments or 20 supplementation of laws affecting insurance or the office of director; 21 (7) statistical information regarding health insurance, including the 22 number of individual and group policies sold or terminated in the state; this paragraph 23 does not authorize the director to require an insurer to release proprietary information; 24 (8) the annual percentage of health claims paid in the state that meets 25 the requirements of AS 21.36.495(a) and (d); 26 (9) the total amount of contributions reported and the total amount of 27 credit claimed under AS 21.96.070 and 21.96.075; 28 (10) the total number of public comments received and the director's 29 efforts, to the extent allowable by law, to improve or maintain public access to 30 information on individual health insurance rate filings before they become effective; 31 [AND]
01 (11) the most recent incentive program report compiled under 02 AS 21.96.235; and 03 (12) other pertinent information and matters the director considers 04 proper. 05 * Sec. 10. AS 21.96 is amended by adding new sections to read: 06 Sec. 21.96.200. Access to payment information. A health care insurer shall 07 establish an interactive mechanism for use by a covered person on the publicly 08 accessible Internet website of the health care insurer that allows a covered person to 09 request and obtain from the health care insurer, or a designated third party, 10 information on the payments made by the health care insurer to network health care 11 providers for health care services. The interactive mechanism must allow a covered 12 person seeking information about the cost of a particular health care service to 13 compare prices among network health care providers for the incentive program under 14 AS 21.96.210. 15 Sec. 21.96.205. Estimate of out-of-pocket expenses. (a) Upon request of a 16 covered person, within five working days, a health care insurer shall disclose a good 17 faith estimate of the amount of out-of-pocket expenses that the covered person will be 18 responsible to pay for a nonemergency health care service that is a medically 19 necessary benefit covered by the health care insurance plan of the covered person, 20 including any copayment, coinsurance, or other out-of-pocket amount, based on the 21 information available to the health care insurer at the time of the request. 22 (b) Nothing in this section prohibits a health care insurer from imposing the 23 cost-sharing requirements disclosed under the health care insurance plan of the 24 covered person for unforeseen health care services or additional costs that arise out of 25 the nonemergency health care service or services that were not included in the 26 estimate provided under (a) of this section. 27 (c) The health care insurer shall disclose to the covered person that an estimate 28 provided under (a) of this section is an estimated cost and that the actual amount that 29 the covered person will be responsible to pay may vary because of unforeseen health 30 care services or additional costs that arise out of the nonemergency health care service 31 or services.
01 Sec. 21.96.210. Incentive program. (a) A health care insurer shall develop 02 and implement a program that provides an incentive for a covered person enrolled in a 03 health care insurance plan to elect to receive a health care service that is covered under 04 the health care insurance plan from a health care provider that charges less than the 05 average price paid by the health care insurer for that health care service. At a 06 minimum, a health care insurer shall include the following categories of health care 07 services, and any other categories adopted by the director by regulation, in the health 08 care insurer's incentive program: 09 (1) physical and occupational therapy services; 10 (2) obstetrical and gynecological services; 11 (3) radiology and imaging services; 12 (4) laboratory services; 13 (5) infusion therapy; 14 (6) dental services; 15 (7) vision services; 16 (8) behavioral health services; 17 (9) inpatient or outpatient surgical procedures; and 18 (10) outpatient nonsurgical diagnostic tests or procedures. 19 (b) A health care insurer shall provide an incentive as a cash payment to the 20 covered person as provided under this subsection. An incentive may be calculated as a 21 percentage of the difference in price, as a flat dollar amount, or by some other 22 reasonable methodology adopted by regulation. If a covered person receives coverage 23 under a group health insurance policy offered by an employer, an incentive must 24 provide a covered person with at least 33.4 percent of the savings for the health care 25 insurer resulting from the covered person's election to receive a health care service 26 from a health care provider that charges less than the average price paid by the health 27 care insurer for that health care service, and the employer shall receive at least 33.3 28 percent of the savings resulting from the covered person's election. If a covered person 29 receives coverage under a health insurance policy offered in the individual market, an 30 incentive must provide a covered person with at least 50 percent of the savings for the 31 health care insurer resulting from the covered person's election.
01 (c) A health care insurer shall base the average price for a health care service 02 under this section on the average amount paid to in-network health care providers for 03 the health care service within a reasonable period of time, but not to exceed one year. 04 Sec. 21.96.215. Availability of program; notice. A health care insurer shall 05 make an incentive program under AS 21.96.210 available as a component of all health 06 care insurance plans offered in this state. Annually, at enrollment or renewal, a health 07 care insurer shall provide notice about the availability of the program to any person 08 covered under a health care insurance plan eligible for the program. 09 Sec. 21.96.220. Filing requirements. Before offering an incentive program 10 under AS 21.96.210, a health care insurer shall file a description of the program with 11 the director in the manner determined by the director. The director may review the 12 filing to determine whether the incentive program complies with the requirements of 13 AS 21.96.200 - 21.96.300. 14 Sec. 21.96.225. Out-of-network health care providers. If a covered person 15 participates in an incentive program under AS 21.96.210 and elects to receive a health 16 care service listed under AS 21.96.210(a) from an out-of-network health care provider 17 that results in a savings for the health care insurer, the health care insurer shall apply 18 the amount paid for the health care service toward the cost sharing owed by the 19 covered person as specified in the applicable health care insurance plan as if the health 20 care services were provided by an in-network health care provider. 21 Sec. 21.96.230. Classification as administrative expense. An incentive 22 program payment made under AS 21.96.210 is not an administrative expense of the 23 health care insurer for rate development or rate filing purposes. 24 Sec. 21.96.235. Reporting requirements. (a) A health care insurer shall 25 annually file a report with the director relating to an incentive program under 26 AS 21.96.210 for the most recent calendar year that includes 27 (1) the total number of incentive program payments; 28 (2) information on the use of the incentive program by category of 29 service; 30 (3) the total amount of incentive program payments; 31 (4) the average amount of each incentive program payment for each
01 category of service; 02 (5) the total savings achieved below the average price of the health 03 care service in each category of service; and 04 (6) the total number and percentage of covered persons who 05 participated in the incentive program. 06 (b) Annually, by April 1, beginning April 1, 2019, the director shall submit an 07 aggregate report for all health care insurers with the information required under (a) of 08 this section to the chairs of the committee in each house of the legislature with 09 jurisdiction over labor and commerce. 10 Sec. 21.96.300. Definitions. In AS 21.96.200 - 21.96.300, 11 (1) "emergency medical condition" has the meaning given in 12 AS 21.07.250; 13 (2) "health care insurance plan" has the meaning given in 14 AS 21.54.500; 15 (3) "health care insurer" has the meaning given in AS 21.54.500; 16 (4) "health care provider" has the meaning given in AS 18.23.420; 17 (5) "health care service" has the meaning given in AS 18.23.420; 18 (6) "nonemergency" does not include treatment of an emergency 19 medical condition. 20 * Sec. 11. AS 29.10.200 is amended by adding a new paragraph to read: 21 (68) AS 29.35.142 (disclosure and reporting of health care services and 22 price information). 23 * Sec. 12. AS 29.35 is amended by adding a new section to read: 24 Sec. 29.35.142. Regulation of disclosure and reporting of health care 25 services and price information. (a) The authority to regulate the disclosure or 26 reporting of price information for health care services by health care providers, health 27 care facilities, or health care insurers is reserved to the state, and, except as 28 specifically provided by statute, a municipality may not enact or enforce an ordinance 29 regulating the disclosure or reporting of price information for health care services by 30 health care providers, health care facilities, or health care insurers. 31 (b) This section applies to home rule and general law municipalities.
01 (c) In this section, 02 (1) "health care facility" has the meaning given in AS 18.23.420; 03 (2) "health care insurer" has the meaning given in AS 21.54.500; 04 (3) "health care provider" has the meaning given in AS 18.23.420; 05 (4) "health care service" has the meaning given in AS 18.23.420. 06 * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new section to 07 read: 08 DEPARTMENT OF ADMINISTRATION ANALYSIS; REPORT TO 09 LEGISLATURE. The Department of Administration shall analyze whether the state or 10 employees covered by a group health care insurance policy for a participating governmental 11 unit would benefit if a group health care insurance policy obtained or provided under 12 AS 39.30.090 or 39.30.091 were required to comply with the provisions of AS 21.96.200 - 13 21.96.300, added by sec. 10 of this Act. The Department of Administration shall complete the 14 analysis and compile the information into a report to the legislature, submit the report to the 15 senate secretary and chief clerk of the house of representatives before January 31, 2019, and 16 notify the legislature that the report is available. 17 * Sec. 14. The uncodified law of the State of Alaska is amended by adding a new section to 18 read: 19 APPLICABILITY. AS 08.80.297(a), as amended by sec. 2 of this Act, and 20 AS 08.80.297(b) - (f), enacted by sec. 3 of this Act, apply to contracts entered into or renewed 21 on or after the effective date of secs. 2 and 3 of this Act. 22 * Sec. 15. The uncodified law of the State of Alaska is amended by adding a new section to 23 read: 24 TRANSITION: REGULATIONS. The Department of Commerce, Community, and 25 Economic Development may adopt regulations necessary to implement this Act. The 26 regulations take effect under AS 44.62 (Administrative Procedure Act), but not before the 27 effective date of the law implemented by the regulation. 28 * Sec. 16. Sections 13 and 15 of this Act take effect immediately under AS 01.10.070(c). 29 * Sec. 17. Except as provided in sec. 16 of this Act, this Act takes effect January 1, 2019.