04/22/2024 03:15 PM House LABOR & COMMERCE

        HB 226-PHARMACIES/PHARMACISTS/BENEFITS MANAGERS                                                                     
                                                                                                                                
4:29:05 PM                                                                                                                    
                                                                                                                                
VICE  CHAIR JUSTIN  RUFFRIDGE announced  that the  next order  of                                                               
business would  be HOUSE BILL  NO. 226,  "An Act relating  to the                                                               
Board   of  Pharmacy;   relating   to   insurance;  relating   to                                                               
pharmacies;  relating   to  pharmacists;  relating   to  pharmacy                                                               
benefits managers;  relating to  patient choice of  pharmacy; and                                                               
providing  for an  effective date."   [Before  the committee  was                                                               
CSHB 226(HSS).]                                                                                                                 
                                                                                                                                
4:29:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER moved  to  adopt  the proposed  committee                                                               
substitute  (CS)  for  HB   226,  Version  33-LS0955\D,  Wallace,                                                               
4/20/24, as a working document.                                                                                                 
                                                                                                                                
VICE CHAIR JUSTIN RUFFRIDGE objected.                                                                                           
                                                                                                                                
4:29:45 PM                                                                                                                    
                                                                                                                                
MS.  HACKENMILLER,  on  behalf of  Representative  Sumner,  prime                                                               
sponsor, read the  explanation of changes in  version D [included                                                               
in   committee  packet],   which   read   as  follows   [original                                                               
punctuation provided]:                                                                                                          
                                                                                                                                
      Title  Amends title removing reference to the Board                                                                       
     of Pharmacy.                                                                                                               
                                                                                                                                
     Ver. R Section 1 removed.                                                                                                  
                                                                                                                                
     Section 1   Ver. R Section 2, no change.                                                                                   
                                                                                                                                
     Section 2   Ver. R Section 3, no change.                                                                                   
                                                                                                                                
     Section 3   Ver. R Section 4, no change.                                                                                   
                                                                                                                                
     Section 4   Ver. R Section 5, no change.                                                                                   
                                                                                                                                
     Section 5   Ver. R Section 6, no change.                                                                                   
                                                                                                                                
     Section 6   Ver. R Section 7, no change.                                                                                   
                                                                                                                                
        AS 21.27.945       Drug pricing list; procedural                                                                        
     requirements:                                                                                                              
                                                                                                                                
          Section  7     Modifies   Ver.  R  Section  8,  AS                                                                    
          21.27.945(a)                                                                                                          
                                                                                                                                
          Modifies  (a)(5),  reinstating language  from  the                                                                    
          original  bill  draft   (Ver.  B)  regarding  list                                                                    
          prices.                                                                                                               
                                                                                                                                
          Section 8  Ver. R Section 9, no change.                                                                               
                                                                                                                                
          Section  9     Modifies  Ver.  R  Section  10,  AS                                                                    
          21.27.945(d)                                                                                                          
                                                                                                                                
          Modifies (d)(3)(A),  removing second  phrase "from                                                                    
          60   percent  or   more   of  the   pharmaceutical                                                                    
          wholesalers doing business in the state."                                                                             
                                                                                                                                
     Section 10   Modifies Ver. R Section 11.                                                                                   
                                                                                                                                
        Removes Patient choice of pharmacy (previous new                                                                        
     section 21.27.951), following sections renumbered.                                                                         
          Sec.  21.27.951.  Patient   access  to  clinician-                                                                    
          administered drugs.                                                                                                   
                                                                                                                                
          Previous  section  21.27.952  with  modifications:                                                                    
          Modifies (a)(2)  removing "or reduce payment  to a                                                                    
          provider"  on line  20.  Removes (a)(3);  replaces                                                                    
          with  new  language.  New (a)(3)  states  that  an                                                                    
          insurer  or  PBM may  not  require  a pharmacy  to                                                                    
          dispense  a   clinician-administered  drug   to  a                                                                    
          covered person to then transport  it to a provider                                                                    
          for  administration.  Removes (a)(5)  and  (a)(6),                                                                    
          following paragraphs renumbered.                                                                                      
                                                                                                                                
     Section 11  Modifies Ver. R Section 12.                                                                                    
                                                                                                                                
     Removes Sec. 21.27.960 Coverage for dispensing fees.                                                                       
                                                                                                                                
          Sec. 21.27.975. Definitions.                                                                                          
          Removes the definition of "independent pharmacy,"                                                                     
          previous paragraph (8).                                                                                               
                                                                                                                                
     Section  12     Modifies  Ver.  R  Section  13,  amends                                                                    
     21.36.520 - Unfair trade practices.                                                                                        
                                                                                                                                
     Removes   Ver.    R   (e)(1),    following   paragraphs                                                                    
     renumbered.   Removes   reference    to   statutes   in                                                                    
     renumbered  (e)(1)  through   (e)(3).  Removes  Ver.  R                                                                    
     (e)(8), following  paragraphs renumbered.  Removes Ver.                                                                    
     R  (e)(10),  following paragraphs  renumbered.  Removes                                                                    
     (f)(7) "mail-order pharmacy."                                                                                              
                                                                                                                                
     Section 13  Ver. R                                                                                                         
                                                                                                                                
     Section 14, no change. Section  14   Ver. R Section 15,                                                                    
     no change.                                                                                                                 
                                                                                                                                
     Section 15  Modifies Ver. R Section 16.                                                                                    
                                                                                                                                
     Updates referenced sections.                                                                                               
                                                                                                                                
     Section 16  Ver. R Section 17, no change.                                                                                  
                                                                                                                                
     Section 17  Modifies Ver. R Section 18.                                                                                    
                                                                                                                                
     Updates referenced transition regulations.                                                                                 
                                                                                                                                
     Section 18  Modifies Ver. R Section 19.                                                                                    
                                                                                                                                
     Updates referenced  section and changes  effective date                                                                    
     from July 1, 2025, to January 1, 2026.                                                                                     
                                                                                                                                
REPRESENTATIVE FIELDS asked Steve Ramos to speak to Version D.                                                                  
                                                                                                                                
4:34:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  FIELDS shared  his understanding  that Version  D                                                               
eliminates the  ability to do  spread pricing within in  Title 21                                                               
plans;  however,  he asked  whether  AlaskaCare  could still  use                                                               
spread pricing.                                                                                                                 
                                                                                                                                
STEVE  RAMOS,  Acting  Chief Health  Administrator,  Division  of                                                               
Retirement  & Benefits,  Department  of Administration,  answered                                                               
yes; however, that's not the intent.                                                                                            
                                                                                                                                
REPRESENTATIVE  FIELDS said  if the  provision of  spread pricing                                                               
were prohibited,  per Version  D, would  it preserve  the ability                                                               
for AlaskaCare to use spread pricing.                                                                                           
                                                                                                                                
MR. RAMOS said his answer remained the same.                                                                                    
                                                                                                                                
4:36:11 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PRAX  asked how Version  D would affect  the plans                                                               
Mr. Ramos manages for the state.                                                                                                
                                                                                                                                
MR. RAMOS said it would not  affect [the division].  He explained                                                               
that the  provisions in the  previous version of bill  that would                                                               
have  added  expenses  were  removed.   In  addition,  the  plans                                                               
regulated under  AS 39.30.090-AS  39.30.091 were removed,  so the                                                               
bill no longer applies to the division.                                                                                         
                                                                                                                                
4:37:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE FIELDS sought to  confirm that both AlaskaCare and                                                               
Arisa plans could  continue to use spread pricing  if they wished                                                               
with no direct impact on cost.                                                                                                  
                                                                                                                                
MS. WING-HEIER answered  yes.  She explained that  the only plans                                                               
that  could be  touched by  Version D  are plans  regulated under                                                               
Title 21.                                                                                                                       
                                                                                                                                
4:38:18 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PRAX  asked  how  much of  the  market  would  be                                                               
impacted by the bill.                                                                                                           
                                                                                                                                
MS. WING-HEIER  answered 15  percent of  the total  population of                                                               
Alaska.                                                                                                                         
                                                                                                                                
4:38:56 PM                                                                                                                    
                                                                                                                                
VICE CHAIR JUSTIN RUFFRIDGE asked  Ms. Wing-Heier to speak to the                                                               
fiscal note from DCCED.                                                                                                         
                                                                                                                                
MS. WING-HEIER  said there was  a concern  that the bill  may not                                                               
make  it to  the  floor before  the  end of  session  due to  its                                                               
finance  referrals and  large fiscal  notes; consequently,  there                                                               
were  discussions  about removing  all  fiscal  notes, which  was                                                               
accomplished  in  Version  D.    She  noted  that  the  following                                                               
important provisions to  protect independent pharmacists remained                                                               
in  the bill:  prohibiting  spread pricing  and  brown and  white                                                               
bagging;  requiring   pharmacists  to  register;   the  fiduciary                                                               
section of the bill; and  the unfair trade practices that provide                                                               
important consumer  protections.  Anything to  do with dispensing                                                               
fees or  reimbursements were  removed from the  bill, as  well as                                                               
references to AlaskaCare, Arisa plans, and government entities.                                                                 
                                                                                                                                
4:40:33 PM                                                                                                                    
                                                                                                                                
SYLVAN ROBB,  Director, Division  of Corporations,  Business, and                                                               
Professional  Licensing,  Department  of  Commerce,  Community  &                                                               
Economic Development, said the Version  D removes sections of the                                                               
bill that would  impact the division, resulting in  a zero fiscal                                                               
note.                                                                                                                           
                                                                                                                                
4:41:09 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PRAX  expressed  concern  that  Version  D  would                                                               
increase prices for 15 percent of the market.                                                                                   
                                                                                                                                
MS. HACKENMILLER  emphasized the  importance of the  bill, adding                                                               
that this would  not be the last the committee  sees of reform to                                                               
the pharmacy benefit managers.                                                                                                  
                                                                                                                                
VICE  CHAIR  RUFFRIDGE declared  a  conflict  of interest,  as  a                                                               
pharmacist  and a  pharmacy  owner  in Alaska.    He opined  that                                                               
guardrails  are necessary  and rejected  the idea  that the  bill                                                               
would increase the cost of healthcare.   He stated that Version D                                                               
would set sideboards  and help Alaskans get  their medications in                                                               
a timeframe that works for  them, which is particularly important                                                               
at a time when pharmacies are being eroded in the state.                                                                        
                                                                                                                                
4:45:15 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PRAX empathized  with  pharmacies and  reiterated                                                               
that  only 15  percent of  the market  would be  dealt with.   He                                                               
shared  his belief  that providers  and insurers  need to  have a                                                               
conversation to figure out what works for everyone.                                                                             
                                                                                                                                
REPRESENTATIVE  FIELDS  said passing  the  bill  would teach  the                                                               
legislature by providing  insight into 15 percent  of the market.                                                               
He  acknowledged the  complexity of  the problem  and opined  the                                                               
further  action could  be considered  after  observing a  limited                                                               
part of the market.                                                                                                             
                                                                                                                                
4:47:17 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER moved  to  report CSHB  226, Version  33-                                                               
LS0955\D,  Wallace, 4/20/24,  out  of  committee with  individual                                                               
recommendations and the accompanying  fiscal notes. no objection,                                                               
bill  advanced.   There  being no  objection,  CSHB 226(L&C)  was                                                               
reported from the House Labor and Commerce Standing Committee.