Legislature(2011 - 2012)BARNES 124
04/09/2012 03:15 PM House LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB326 | |
| HB202 | |
| HB259 | |
| SB122 | |
| SB51 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 326 | TELECONFERENCED | |
| += | HB 202 | TELECONFERENCED | |
| += | HB 259 | TELECONFERENCED | |
| += | HB 266 | TELECONFERENCED | |
| += | SB 122 | TELECONFERENCED | |
| + | SB 51 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 259-PHARMACY AUDITS
3:30:14 PM
CHAIR OLSON announced that the next order of business would be
HOUSE BILL NO. 259, "An Act establishing procedures and
guidelines for auditing pharmacy records; and providing for an
effective date."
3:31:04 PM
REPRESENTATIVE JOHNSON made a motion to adopt the proposed
committee substitute (CS), for HB 259, labeled 27LS0675\E,
Martin, 4/9/12, as the working document.
CHAIR OLSON objected for purpose of discussion.
3:31:25 PM
KONRAD JACKSON, Staff, Representative Kurt Olson, Alaska State
Legislature, explained the changes in the proposed committee
substitute (CS), Version E of HB 259. He stated that Version E
contains some minor changes from Version D. He referred to page
2, lines 6-8, which deleted the language from Version D, related
to the 75 prescription cap and the error rate of 10 percent. He
explained that concern was raised that 75 prescriptions was an
insufficient number when auditing larger pharmacies. He further
explained that a new cap was not established and the committee
could consider the appropriate number of prescriptions for
audits.
3:32:43 PM
MR. JACKSON referred to the next change in the proposed CS,
Version E, which relates to language removed on page 2, lines
10-12 of Version D. He explained language was deleted after
"submitted" which read, "...unless a longer time period is
specified in a contract between the pharmacist and the insurer,
managed care company, hospital or medical service corporation,
third-party payor, or pharmacy benefits manager." This change
would mean that unless a longer time period was specified in a
contract the audit of a claim would need to occur within two
years - which essentially restores this paragraph to the
language in the original bill. He related that concern was
expressed that some possibility exists that unilateral changes
could go from two years to a lengthier timeframe which would
totally defeat the purpose of paragraph (4).
3:33:32 PM
MR. JACKSON referred to paragraph (10), to page 2, line 27,
which changes the preliminary audit delivery timeframe from 60
days to 120 days. He explained that to balance this change a
new paragraph was added that reads, "The interest may not accrue
during that time period." Thus from the time the audit is
completed to whenever the preliminary audit report is delivered
interest will not be accruing. He stated this change seems to
provide balance for the pharmacists' concern that interest was
accruing while the PBMs and auditors review and develop the
preliminary report.
3:34:20 PM
MR. JACKSON stated the next change inserts language that was in
the original bill with some minor changes to paragraph (11), as
follows:
to the extent that an audit finds clerical or record
keeping errors in a required document or record, the
pharmacy may not be subject to recoupment unless there
is proof of intent to commit fraud or the clerical or
record keeping error results in actual financial harm
to an insurer, managed care company, hospital or
medical services corporation, third-party payor,
pharmacy benefits manager, or a customer.
MR. JACKSON explained that this goes back to paragraph (6) of
the original bill relating to scrivener's errors. He
highlighted that it was felt that a typographical error would
not rise to level of requiring any compensation.
3:35:44 PM
MR. JACKSON referred to a new paragraph adding the restriction
on confidential information obtained during an audit from being
used for marketing. He recalled previous testimony by
pharmacists, in which pharmacists stated that after an audit a
number of their clients would later receive solicitations from
mail order pharmacies. He explained that this did not seem
quite fair since confidential patient information exists and
access to that information for audit purposes is appropriate,
but not for marketing purposes.
3:36:43 PM
MR. JACKSON stated the next change inserts a new paragraph [3]
limiting subsequent audits to not less than 90 days following an
audit.
3:36:50 PM
REPRESENTATIVE SADDLER asked for the reference to the mail order
solicitations.
MR. JACKSON referred to page 3, lines [25-26].
3:37:19 PM
MR. JACKSON restated the change in paragraph (3), which
prohibits subsequent audits within 90 days following an audit in
which errors were not found. He stated that "error" does not
mean a clerical or record keeping error. He pointed out that
fraud auditors would not be limited to the 90-day period if
significant errors or an attempt to commit fraud was discovered.
He reiterated if significant problems were discovered in an
audit that it seems reasonable for the PBM or auditor to conduct
another audit.
3:37:53 PM
MR. JACKSON pointed out the final change would change the
effective date to January 1, 2013, instead of the fiscal year
listed in Version D.
3:38:14 PM
CHAIR OLSON offered to allow the committee time to digest the
changes.
3:38:36 PM
MR. JACKSON referred to page 3, lines 27-29 to subsection 19
(b), which specifies an exemption for criminal investigation or
investigation or audit by a governmental agency. He suggested
that the committee may wish to consider including schools or
municipalities. He restated this may be a further consideration
the committee may wish to ponder.
[HB 259 was held over.]