New Mexico Register / Volume XXXII, Issue 2 / January 26, 2021
TITLE 13 INSURANCE
CHAPTER 10 HEALTH INSURANCE
PART 30 PHARMACY
BENEFITS MANAGERS
13.10.30.1 ISSUING AGENCY: Office of Superintendent of Insurance
(“OSI”).
[13.10.30.1
NMAC – N, 3/1/2021]
13.10.30.2 SCOPE: This rule applies to every pharmacy benefits
manager (“PBM”) and health insurance carrier subject to the jurisdiction of the
office of superintendent of insurance.
[13.10.30.2
NMAC – N, 3/1/2021]
13.10.30.3 STATUTORY AUTHORITY: Section 59A-2-9 NMSA 1978 and
Subsection C of Section 59A-61-3 NMSA 1978.
[13.10.30.3
NMAC – N, 3/1/2021]
13.10.30.4 DURATION: Permanent.
[13.10.30.4
NMAC – N, 3/1/2021]
13.10.30.5 EFFECTIVE DATE: March 1, 2021, unless a later date is
cited at the end of a section.
[13.10.30.5
NMAC – N, 3/1/2021]
13.10.30.6 OBJECTIVE: The purpose of this rule is to carry
out the requirements of Chapter 59A, Article 61 NMSA 1978 relating to the
regulation of PBMs.
[13.10.30.6
NMAC – N, 3/1/2021]
13.10.30.7 DEFINITIONS: For purposes of this rule and the
Pharmacy Benefits Manager Regulation Act:
A. “Clean claim”
has the definition found in Paragraph (1) of Subsection A
of Section 59A-16-21.1 NMSA 1978.
B. “Formulary” is a
list of prescription drugs that has been developed by a health insurance
carrier or its designee that the carrier or its designee references in
determining applicable coverage and benefit levels.
C. “Health insurance
carrier” or “carrier” has the
definition found in Paragraph (2) of Subsection C of Section 59A-16-21.1 NMSA
1978.
D. “Health benefits
plan” or “health plan” has the
definition found in Paragraph (1) of Subsection C of Section 59A-16-21.1 NMSA
1978.
E. “NCPDP” means
the national council for prescription drug program.
F. “NDC” means
national drug code.
G. “Participating
provider” is a pharmacy that, under an express contract with a health
insurance carrier, or with its contractor or subcontractor, has agreed to
provide pharmacy services to covered persons with an expectation of receiving
payment directly or indirectly from the carrier, subject to any cost-sharing
required by a plan.
H. “Prescription drug claim
administration”
is administrative services performed in connection with the processing,
adjudicating and auditing of claims relating to pharmacy services.
I. “Similarly situated”
refers to a participating provider whose PBM contract is subject to the same
reimbursement for a claim as a pharmacy whose appeal was granted.
[13.10.30.7
NMAC – N, 3/1/2021]
13.10.30.8 REQUIREMENTS FOR LICENSURE:
A. On or before
March 1, 2021, a PBM operating in New Mexico shall apply for a license on a
form prescribed by the superintendent. Each application for a license shall be
verified by an officer or authorized representative of the applicant. The
application shall describe or provide:
(1) The
non-refundable filing fee prescribed by Paragraph (1) of Subsection AA of
Section 59A-6-1 NMSA 1978 for filing an application for a license.
(2) The
name of the legal entity, federal employer identification number (“FEIN”),
business address, phone number and state of residency.
(3) The
name, business address, phone number and e-mail address of a contact person
designated by the PBM to respond to complaints.
(4) The
name, business address, phone number and e-mail address of a contact person
designated by the PBM to respond to inquiries by the superintendent.
(5) Proof
of corporate status.
(6) For
each partner or corporate officer, and each member of the board of directors,
if applicable, the applicant shall provide a background investigation report
through a vendor approved by OSI.
(7) A
statement of whether the applicant has:
(a) been refused a registration, license or certification to act
as or provide the services of a PBM or third-party administrator; or
(b) had any registration, license or certification denied,
suspended, revoked or non-renewed for any reason by any state or federal
entity; and
(c) if either (a) or (b) apply, the PBM shall separately attach
the details of each such action, including the date, nature and disposition of
the action.
(8) A
statement of whether the applicant ever had a business relationship terminated
for any alleged fraudulent or illegal activities in connection with the
administration of a pharmacy benefits plan and a description of each
termination.
(9) The
application shall be signed on behalf of the PBM by an officer or partner duly
authorized by the PBM.
(10) Any
other information that is deemed necessary by the superintendent in evaluating
the application to evidence compliance with Chapter 59A, Article 61 NMSA 1978
or the requirements of rules promulgated by the superintendent.
(11) An
applicant who believes its submission contains confidential information shall
so inform OSI staff and request express confidential treatment of the filing before
submission. The superintendent shall determine whether proffered information
shall be deemed confidential. Any submission made without an express
determination of confidentiality, or after the superintendent rejects a request
for confidential treatment, shall be deemed a public record.
B. Review and approval process for initial
licensure. Within thirty days of receipt of an application pursuant to
Subsection A of this section, the superintendent will review the application
and:
(1) if the application is incomplete, notify the applicant in
writing that additional information is needed, and allow the applicant thirty
days to cure any deficiency in the application.
(2) approve the
application and issue a PBM license to the applicant if the superintendent
determines that the applicant meets the requirements for licensure; or
(3) deny the
application if the superintendent determines that the applicant does not meet
the requirements for licensure
C. Content and scope of
license.
(1) Content. A license issued by the
superintendent under this rule will state the name and business address of the
PBM; the capacity of the licensee to act as a PBM in New Mexico; the effective
and expiration dates of the license and such other information as the
superintendent deems pertinent.
(2) Scope.
A license issued under this regulation entitles the PBM to act for one or more
authorized insurance carriers, plans or persons that self-insure without being
required to obtain a separate license with respect to each insurance carrier,
plan or person that self-insures.
D. License renewal. An application for
renewal shall be submitted by March 1 of each year. A renewal application shall
include the non-refundable fee for annual continuation of a license required by
Paragraph (2) of Subsection AA of Section 59A-6-1 NMSA 1978, as well as updates
to any items required by the initial application for licensure. For
disapprovals or denials of a renewal licensure by the superintendent, the
superintendent will provide written notice to the applicant that the licensure
renewal was denied and state the reason or basis for the denial.
E. Corrective
action plan. In lieu of a denial for initial licensure or renewal application,
the superintendent may require the PBM to submit a corrective action plan to
cure or correct deficiencies in its application.
[13.10.30.8
– N, 3/1/2021]
13.10.30.9 PHARMACY SERVICES ADMINISTRATIVE ORGANIZATION (“PSAO”)
REGISTRATION:
A. Registration required. A PSAO currently
operating in this state shall register with the superintendent on or before
March 1, 2021. A PSAO that intends to operate in this state shall register with
the superintendent at least 30 days prior to initiating operations.
B. A PSAO’s
registration application shall include:
(1) Full
business name of PSAO;
(2) Name,
business address, phone number and e-mail address for primary contact;
(3) Name,
business address, phone number and e-mail address for contact designated to
handle complaints; and
(4) Federal
Employer Identification Number (FEIN).
[13.10.30.9
– N, 3/1/2021]
13.10.30.10 OSI COMPLAINT PROCESS:
A. Complaints by a pharmacy against a PBM.
(1) A
pharmacy may file a complaint with the superintendent for an alleged violation
of the pharmacy benefits regulation act.
(2) A
complaint by a pharmacy against a PBM shall be in writing on a form provided by
the superintendent.
(3) A
pharmacy shall submit a complaint within six months from the date the pharmacy
knew or should have known of the alleged violation.
(4) A
complaint may allege multiple violations against a single PBM.
(5) A
pharmacy may provide supporting documentation.
(6) The
superintendent will transmit any complaints to the e-mail contact designated by
the PBM to receive complaints.
(7) The
superintendent will specify the documentation necessary to address the
complaint.
B. Response by a PBM to a complaint.
(1) A
PBM shall have seven business days from receipt of the complaint to respond in
writing.
(2) The
superintendent may request additional documentation. The PBM shall provide any
additional documentation in writing within seven business days from the date of
the superintendent’s request.
(3) The
superintendent may grant a PBM’s request for an extension of time.
(4) The
superintendent will send a copy of all submissions received in connection to a
complaint to the opposing party.
(5) All
documentation received in connection to a complaint is confidential.
C. Enforcement Proceedings:
(1) If
the superintendent makes a finding of probable cause that a violation occurred,
the superintendent may issue a notice of contemplated action.
(2) A
notice of contemplated action may set a hearing pursuant to Chapter 59A,
Article 4 NMSA 1978.
(3) At
the superintendent’s discretion, the superintendent may approve a stipulated
agreement to resolve any violation.
(4) For
good cause shown, the superintendent may grant a variance from these
procedures, if doing so would be in the public interest.
D. Prohibited
practices. Repeated violations established through substantiated complaints
may be considered willful and intentional individually or in the aggregate, or
both, and may be penalized pursuant to Subsection B of Section 59A-1-18 NMSA
1978.
[13.10.30.10
NMAC – N, 3/1/2021]
13.10.30.11 PAYMENT OF CLAIMS: Claims for reimbursement by a pharmacy
are subject to Section 59A-16-21.1 NMSA 1978.
[13.10.30.11
NMAC – N, 3/1/2021]
13.10.30.12 MAXIMUM ALLOWABLE COST (“MAC”) APPEALS:
A. Submission of appeal. A pharmacy may
submit a MAC appeal, within 21 business days after a pharmacy receives notice
of the reimbursement amount, through a PSAO or directly to the PBM.
B. Appeals mechanism. A PBM shall provide
a mechanism for submitting MAC appeals, including the dedicated phone number
pursuant to Paragraph (5) of Subsection D of Section 59A-61-4 NMSA 1978. The
phone number shall be manned at a minimum during the hours of 8:00 a.m. to 5:00
p.m., mountain time. Information about MAC appeals
mechanisms shall be prominently displayed in any contract or manual provided by
a PBM to a pharmacy.
C. Appeal instructions on website. The
PBM’s website shall prominently display instructions for submitting a MAC
appeal and instructions for seeking assistance in navigating the website.
D. Response to appeal. The PBM’s response
to a MAC appeal shall include:
(1) the
source or sources used, including NDC and name of supplier, to determine
pricing for the maximum allowable cost list specific to that provider and how
it was applied to the maximum allowable cost (MAC) price at issue;
(2) the date of the last MAC list update for the drug which is
the subject of the MAC appeal;
(3) documentation
evidencing that the drug was available for purchase by a pharmacy in New Mexico
at the MAC price from a national or regional wholesaler at the time of claim
submission; and
(4) any other information the PBM deems relevant to the MAC
appeal.
E. Nonresponse to appeal. The MAC appeal
shall be deemed granted if the PBM does not respond within 14 business days
pursuant to Paragraph (6) of Subsection D of Section 59A-61-4 NMSA 1978.
F. Notice of granting appeal. If a MAC
appeal is granted or deemed granted, a PBM shall:
(1) within
one day, notify by email the challenging pharmacy and any similarly situated
network pharmacy and their PSAO(s) that a MAC appeal was granted, the NDC of
the drug, the MAC price challenged and the updated MAC price; and
(2) permit
the appealing pharmacy and any similarly situated pharmacy to resubmit the
claim at the updated price.
G. Request
for MAC list. A
PBM shall provide a MAC list to a pharmacy or the superintendent within seven
business days upon request.
[13.10.30.12
NMAC – N, 3/1/2021]
13.10.30.13 SUBMISSION OF A MAC APPEAL:
A. Information demonstrating completion. A
MAC appeal submission by a pharmacy or a PSAO to a PBM for an appeal shall
consist of:
(1) fill date;
(2) BIN
number (six digits);
(3) NCPDP
(seven digits);
(4) Rx
number (seven digits);
(5) NDC
11 (11 digits);
(6) drug name;
(7) drug strength;
(8) purchase price of drug (whole dollar with two decimal
places);
(9) total reimbursement (whole dollar with two decimal places);
(10) reason for review;
(11) any information required by contract; and
(12) notes (optional).
B. No additional information required. A
MAC appeal shall be deemed a complete, clean claim if it contains the
information contained in Subsection A of this section. A PBM shall not require
or request additional information in order to process the appeal.
[13.10.30.13
NMAC – N, 3/1/2021]
13.10.30.14 SEARCHABLE ONLINE DATABASE OF DRUG PRICES:
A. Update timeframe. A PBM shall update
its MAC list at least once every seven days pursuant to Paragraph (2) of
Subsection D of Section 59A-61-4 NMSA 1978.
B. Searchable online database required. A
PBM shall establish a searchable online database that will allow a network
pharmacy to search MAC list prices for a particular drug. The PBM’s provider
manual shall include instructions for accessing the price list on their
website. The provider manual shall be transmitted to a newly joined pharmacy
within 10 business days from the date of execution of a contract with the PBM.
A PBM shall provide an updated version of its provider manual within 30 days of
any revisions to all network pharmacies.
C. Search requirements. The database shall
be searchable by NDC or drug name, and date of fill for a specific network
plan.
D. Drug information. The information
provided for the drug shall contain:
(1) NDC;
(2) NDC
description;
(3) MAC
list price; and
(4) effective date.
E. Instructions required. The provider
manual shall contain instructions for searching the MAC list and contain instructions
for requesting the sources used to establish the MAC price. A network pharmacy
may request the sources through a PBM’s website, e-mail, facsimile or letter.
The PBM shall respond with each derivative source within ten business days from
the date of the request.
F. Website requirements. The PBM’s website
shall contain a prominent link to request the sources used to establish the MAC
price.
G. Accessibility. All network pharmacies
and, upon request, the superintendent shall have access to the database to
determine compliance with these rules or to resolve a dispute.
[13.10.30.14
NMAC – N, 3/1/2021]
13.10.30.15 HISTORICAL MAC LIST DATABASE:
A. Searchable list of drugs. Beginning March
1, 2021, a PBM shall maintain an online, searchable database containing all MAC
list pricing. The database shall be searchable by these criteria:
(1) NDC
number;
(2) drug name;
(3) date
of fill;
(4) specific health plan; and
(5) removal data.
B. Reason for removal. When a drug is
removed from the MAC database, the database shall indicate the reason for its
removal.
C. Obsolete drugs. The database shall
include obsolete drugs. If a drug is removed because it is obsolete, the
database shall indicate the date it became obsolete.
D. List dated. The database shall
specifically indicate the date a drug price was updated and posted to the
website.
E. Provider manual requirement. A PBM’s
provider manual shall contain instructions for accessing the list of drugs
removed from its MAC list.
F. Accessibility. All network pharmacies
and, upon request, the superintendent shall have access to the database to
determine compliance with these rules or to resolve a dispute.
G. Legacy data. Data shall remain in the
database and be searchable for at least five years.
[13.10.30.15
NMAC – N, 3/1/2021]
13.10.30.16 ANNUAL REPORT BY PBM:
A. Annual report required. A pharmacy
benefits manager applying for license renewal shall submit the required annual
report and fees, including the annual continuation fee, as set forth in Section
59A-6-1 NMSA 1978. Failure to comply with these requirements shall result in
cancellation of the license. Instructions for completing the annual report,
which is due on or before March 1, are available on the OSI website.
B. Confidentiality. The annual report
shall be deemed confidential pursuant to Subsection B of Section 59A-2-12 NMSA
1978. Notwithstanding this confidential treatment, the superintendent may
publish aggregate data culled from confidential reports.
[13.10.30.16
NMAC – N, 3/1/2021]
13.10.30.17 RETALIATION: A PBM shall not retaliate against a
pharmacy for invoking its rights under these rules or the Pharmacy Benefits
Manager Regulation Act. Selecting a pharmacy that has filed a
complaint with the superintendent for audit at a rate disproportionately higher
than for other network pharmacies may be considered retaliation.
[13.10.30.17
NMAC – N, 3/1/2021]
13.10.30.18 AUDIT:
A. Examination. The superintendent may
examine a PBM for compliance with the requirements of the Pharmacy Benefits
Manager Regulation Act pursuant to Chapter 59A, Article 4, NMSA
1978.
B. Audit compliance. The superintendent
may also examine the audits of pharmacies conducted by PBMs to determine whether
they are in compliance with Section 61-11-18.2 NMSA 1978.
[13.10.30.18
NMAC – N, 3/1/2021]
13.10.30.19 COMPENSATION:
A. Use
of an unlicensed PBM prohibited. A health insurance carrier doing business in
this state shall not pay, directly or indirectly, any compensation or fee or
any further consideration of value to any PBM for PBM services within this
state, unless the PBM is duly licensed to transact such business in New Mexico.
B. Claims
payment by unlicensed PBM. The prohibition contained in the preceding
paragraph does not prevent the payment of claims to pharmacies solely because a
PBM does not hold a valid license.
[13.10.30.19 NMAC – N, 3/1/2021]
13.10.30.20 RESPONSIBILITIES OF THE HEALTH INSURANCE
CARRIER:
A. Oversight
required. If a health insurance carrier utilizes the services of a PBM, the
carrier shall ensure an adequate pharmaceutical network, timely and fair claims
payment to pharmacies, appropriate appeals procedures, lack of retaliation
against pharmacies and appropriate formulary development and tier structures.
Assignment of the responsibilities of the carrier to a PBM as to any of these
matters shall be set forth in the written agreement between the PBM and the
carrier.
B. Program
administration. The ultimate responsibility for competent administration of
a health insurance carrier’s programs lies with the carrier.
C. Records
maintenance. A health insurance carrier shall maintain for a minimum of
five years reviews conducted of the operations of its PBM(s). A carrier shall
produce such records at the superintendent’s request.
[13.10.30.21 NMAC – N,
3/1/2021]
13.10.30.21 MAINTENANCE
OF INFORMATION: Every PBM shall maintain at its principal administrative office
for the duration of the written agreement referred to in Section 59A-12A-4 NMSA
1978 and five years thereafter adequate books and records of all transactions
between it, health insurance carriers and pharmacies. Such books and records
shall be maintained in accordance with prudent standards of insurance record
keeping. The superintendent shall have access to such books and records for the
purpose of examination, audit and inspection. Any trade secrets contained
therein shall be deemed confidential, except that the superintendent may use
such information in any proceedings instituted against the PBM. The health
insurance carrier shall retain the right to continuing access to such books and
records to permit the carrier to fulfill all of its contractual obligations to
insured persons, subject to any restrictions in the written agreement between
the insurance carrier and the PBM regarding the proprietary rights of the
parties in such books and records.
[13.10.30.21 NMAC – N,
3/1/2021]
13.10.30.22 DISCRIMINATION
PROHIBITED: A health insurance
carrier and its representatives shall ensure that a health benefits plan issued
in this state does not contain provisions that are discriminatory against
individuals on the basis of health status; medical condition, including both
physical and mental illnesses; claims experience; receipt of health care;
medical history; genetic information; evidence of insurability, including acts
arising out of domestic violence; disability; gender; national origin; sexual
orientation or any other health-status-related factor that the superintendent
specifies. Gender neutral language shall be used in a policy, plan or written
communication.
[13.10.30.22 NMAC – N,
3/1/2021]
13.10.30.23 HEARING RIGHTS: Any person aggrieved by any
action, threatened action, or failure to act by the superintendent shall have
the same right to a hearing before the superintendent with respect thereto as
provided for in general under Chapter 59A, Article 4 NMSA 1978 and the
implementing rules.
[13.10.30.23 NMAC – N,
3/1/2021]
13.10.30.24 RULE
NONCOMPLIANCE: Failure to comply with
any provision of these rules is a violation of the Insurance Code and
punishable pursuant to Subsection B of Section 59A-1-18 NMSA 1978.
[13.10.30.24 NMAC – N,
3/1/2021]
History of 13.10.30 NMAC: [RESERVED]