§ 38-71-2330 — Duties of pharmacy service administrative organizations; contracts with pharmacies.

South Carolina § 38-71-2330

• Jurisdiction: South Carolina
• Title 38: INSURANCE
• Ch. 71: ACCIDENT AND HEALTH INSURANCE

Text

(A) A pharmacy service administrative organization must: (1) perform its duties to a pharmacy exercising good faith and fair dealing; (2) in the event of a dispute between a pharmacy and a pharmacy benefits manager or third-party payer, ensure and facilitate timely communication from the pharmacy to the pharmacy benefits manager or third-party payer; (3) forward any and all notices of appeals from a pharmacy to the pharmacy benefits manager or third-party payer in a timely manner and provide in a timely manner information that has been requested as part of an appeal to the external review organization and, upon request, the department; (4) provide during normal business hours a phone number through which a pharmacy or pharmacist can obtain answers within a reasonable time to questions regarding networks, contracts, appeals, and other contractual or service issues; and (5) provide a detailed breakdown of the prescription numbers, amounts, and contractual basis for each recoupment and regular updates on the status of appeals. (B) In connection with any appeal, a third-party payer or pharmacy benefits manager's notice or provision of information to a PSAO is deemed to be notice or provision of information to the pharmacy on whose behalf the PSAO has contracted. (C) A PSAO-pharmacy contract must include a provision that requires the PSAO to provide to the pharmacy a copy of any contract, amendments, payment schedules, or reimbursement rates within three calendar days after the execution of a contract, or an amendment to a contract, signed on behalf of the pharmacy. (D) Prior to entering into a PSAO-pharmacy contract, a PSAO must furnish to a pharmacy a written disclosure of ownership or control. This disclosure must include the extent of any ownership or control by any parent company, subsidiary, or other organization that: (1) provides pharmacy services; (2) provides prescription drug or devices services; or (3) manufactures, sells, or distributes prescription drugs, biologicals, or medical devices. (E) Any PSAO-pharmacy contract must provide that the PSAO must notify the pharmacy in writing within five calendar days of any material change in its ownership or control related to any company, subsidiary, or other organization outlined in subsection (D). (F) A PSAO that owns or is owned by, in whole or in part, any entity that manufactures, sells, or distributes prescription drugs, biologicals, or medical devices must not, as a condition of entering into a PSAO-pharmacy contract, require that the pharmacy purchase any drugs or medical devices from the entity with which the PSAO has an ownership interest, or an entity with an ownership interest in the PSAO. (G) A PSAO that owns or is owned by, in whole or in part, any entity that manufactures, sells, or distributes prescription drugs, biologicals, or medical devices must disclose to the Department of Insurance any agreement with a pharmacy in which the pharmacy purchases prescription drugs, biologicals, or medical devices from a PSAO or any entity that owns or is owned by, in whole or in part, the PSAO.

Legislative History

HISTORY: 2023 Act No. 30 (S.520), SECTION 3, eff January 1, 2024; 2024 Act No. 166 (S.962), SECTION 1, eff May 20, 2024. Editor's Note 2023 Act No. 30, SECTION 7, provides as follows: "SECTION 7. This act takes effect January 1, 2024, but the recurring examinations by the Department of Insurance provided for in Sections 38-71-2250(B)(1) and 38-71-2340(B)(1) must not begin before January 1, 2025." Effect of Amendment 2024 Act No. 166, SECTION 1, in (A)(1), deleted "act as a fiduciary to a pharmacy and" from the beginning.