Summary of 2014 Legislation of Interest to Pharmacists
This summary includes only those bills enacted by the Tennessee General Assembly in
2014 that are of interest to pharmacists. It does not discuss bills which were considered but not
passed by the General Assembly.
MAC Pricing
Senate Bill 1991 (Overbey)
House Bill 1554 (Shepard)
Chapter 857 of the Public Acts of 2014
This bill amends the statute governing Pharmacy Benefit Managers (PBMs), which was
first passed by the Tennessee General Assembly in 2007 and then amended in 2011.
The current statute (T.C.A. §§ 56-7-3101 through 56-7-3105) regulates contracts between
PBMs and health insurers, calculation of reimbursement, and audits of pharmacies conducted by
PBMs. This bill amends the statute to include regulation of maximum allowable cost (MAC) lists
utilized by PBMs to determine the amount paid to a pharmacist for a particular generic drug or
medical product or device dispensed by the pharmacist.
The bill defines a “MAC list” as “a list of drugs, medical products or devices…for which
a maximum allowable cost has been established” by a PBM. The “maximum allowable cost” is
the maximum amount a PBM will pay a pharmacy for the cost of a particular drug, product or
device dispensed to a patient.
The purpose of this bill is to ensure that the MAC pricing system is fair to both pharmacists
and PBMs. The bill contains the following provisions:
1.
Before a drug may be placed on a MAC list by a PBM, the PBM must find that the
drug is generally available for purchase by Tennessee pharmacies from a national
or regional wholesaler.
2.
If a drug which has been placed on a MAC list ceases to meet the above
requirement, the drug must be removed from the MAC list within five (5) business
days after the PBM becomes aware that the drug no longer meets this requirement.
3.
A PBM must make available to each pharmacy with which the PBM or health
insurer has a contract, at the beginning of a contract and upon renewal of that
contract:
(a)
The sources used to determine the MAC prices for the drugs, products and
devices on each MAC list;
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(b)
(c)
Every MAC price for individual drugs used by that PBM for patients served
by that contracted pharmacy; and
Upon request by the pharmacy, every MAC list used by that PBM for patients
served by the contracted pharmacy.
4.
Every PBM must update the MAC prices on each of its MAC lists at least every
three (3) business days and must utilize these updated MAC prices to calculate
payments made to contracted pharmacies within five (5) business days. A PBM
must make the updated MAC lists available to every contracted pharmacy, and to
every pharmacy in a network of pharmacies served by a pharmacy services
administrative organization (PSAO) with which the PBM has a contract, in a readily
accessible, secure and usable web-based format or other comparable format or
process.
5.
Every PBM must establish a clearly defined appeal process allowing a pharmacy
to contest the placement of a particular drug, product or device on the MAC list or
the establishment of a price for a particular drug, product or device in violation of
this law. The pharmacy must file the appeal within seven (7) business days of its
submission of the initial claim for reimbursement for the drug, product or device.
The PBM must make a final determination resolving the appeal within seven (7)
business days of its receipt of the appeal. If the appeal is denied, the PBM must
state the reason for the denial of the appeal and provide the national drug code of
an equivalent drug that is generally available for purchase by Tennessee pharmacies
from a national or regional wholesaler at a price which is equal to or less than the
MAC price established for that drug, product or device.
6.
If a pharmacy’s appeal is determined to be valid by the PBM, the MAC price for
that drug, product or device shall be adjusted for the appealing pharmacy effective
as of the date the pharmacy’s appeal was filed, and the PBM shall provide
reimbursement to the appealing pharmacy from that date. The PBM may require
the appealing pharmacy to reverse and rebill the claim in question in order to obtain
the corrected reimbursement. Once an appealing pharmacy’s appeal has been
determined to be valid, the PBM shall adjust the MAC price for that drug, product
or device for all similarly situated pharmacies in the network (as determined by the
PBM) with three (3) business days and apply the adjusted price to all claims
submitted in the next payment cycle.
7.
A PBM shall make available on its secure website information about the appeal
process, including but not limited to a telephone number or process that a pharmacy
may use to submit MAC appeals.
8.
The medical products and devices subject to this law are limited to the products and
devices included as a pharmacy benefit under the pharmacy benefits contract.
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9.
A violation shall subject the violator to any of the penalties provided by current
laws (T.C.A. § 56-2-305) enforced by the Department of Commerce and Insurance.
10.
A pharmacy is prohibited from disclosing to any third party the MAC lists and any
related information it receives from a PBM, although a pharmacy may share such
information with a PSAO or other similar entity which provides administrative
services to a pharmacy. The PSAOs are bound by the same requirement of
confidentiality as the pharmacies.
11.
This law becomes effective on January 1, 2015, and applies to all contracts entered
into or renewed after that date.
Collaborative Pharmacy Practice Agreements
Senate Bill 1992 (Overbey)
House Bill 2139 (Shepard)
Chapter 832 of the Public Acts of 2014
This new law was an initiative of the Tennessee Pharmacists Association. It does several
things:
a) It revises the definition of the “practice of pharmacy” in the Pharmacy Practice Act by
adding the following language: “provision of patient care services and activities
pursuant to a collaborative pharmacy practice agreement”.
b) A collaborative pharmacy practice agreement is defined to be a written signed
agreement between one or more pharmacists and one or more prescribers that provides
for collaborative pharmacy practice. All the parties to such an agreement must be
licensed in Tennessee and must be in active practice providing patient care services in
Tennessee.
c) Collaborative pharmacy practice involves the practice of pharmacy under such an
agreement to provide patient care services and achieve optimal medication use and
desired patient outcomes. Under such an agreement, pharmacists may be allowed to
prescribe prescription drugs when required to carry out a medical order or perform
other activities under the agreement.
d) A collaborative pharmacy practice agreement must define the nature and scope of
patient care services which are to be provided by the pharmacist. Any patient care
services provided by a pharmacist must be documented in the patient’s record and
communicated to the prescriber within three (3) business days.
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e) A collaborative practice agreement entered into by an advanced practice nurse or
physician assistant must also be signed by that person’s supervising physician.
f) A prescriber who enters into a collaborative practice agreement must be available for
consultation with the pharmacist as needed.
g) A collaborative practice agreement must be maintained at the places of practice of the
prescriber and of the pharmacist and must be reviewed and renewed at least biennially.
h) The Board of Pharmacy, in consultation with the Board of Medical Examiners and the
Board of Osteopathic Examination, is authorized to promulgate rules establishing
minimum standards for provisions to be included in a collaborative practice agreement.
State-Funded Pharmacy Benefit Plans
Senate Bill 2296 (McNally)
House Bill 1787 (Kane)
Chapter 896 of the Public Acts of 2014
This bill, known as the Fair Disclosure of State Funded Payments for Pharmacists’ Services
Act, amends the section of the Code dealing with pharmacy benefits managers (PBMs). It applies
only to PBMs funded by state dollars, i.e., TennCare and the state employees health program.
When seeking payment for pharmacist services under such a program, a PBM must itemize
by individual claim:
a) the amount actually paid or to be paid to the pharmacy for the pharmacist services;
b) the identity of the pharmacy paid; and
c) the prescription number or other identifier of the pharmacist services.
The bill does not:
a) require a PBM to set specific fees, rates, or schedules for payment for pharmacist
services;
b) prohibit a PBM from charging for any services in addition to pharmacist services; or
c) require a PBM to pay a pharmacy more on a claim than the amount disclosed.
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The term “pharmacist services” is defined to mean products, goods, or services provided
as a part of the practice of pharmacy to individuals who reside or are employed in Tennessee.
Identification Requirements for Persons Picking Up Drugs
Senate Bill 1832 (Yager)
House Bill 1466 (Ramsey)
Chapter 872 of the Public Acts of 2014
This new law provides that a pharmacy must require a person picking up a prescribed drug
which is a Schedule II-IV opioid, benzodiazepine, zolpidem, barbiturate, or carisoprodol (more
than a 7-day supply) to present a valid government-issued identification or a public or private
insurance card (unless the person is personally known to the pharmacist). This requirement applies
to pharmacists, pharmacy technicians, pharmacy interns, and any other person authorized to
dispense these controlled substances.
When a minor or a homeless person who does not have a valid ID seeks to pick up one of
the above drugs, the pharmacy shall use professional judgment in determining whether to dispense
the drug to that minor or homeless person.
This new law:
a) does not require that the person picking up the prescribed drug be the same as the person
for whom the prescription was written;
b) does not apply to drug samples dispensed by a licensed healthcare professional;
c) does not apply to prescriptions written for patients in a hospital or other institution; and
d) does not apply to patients receiving prescriptions from mail order pharmacies or
patients receiving home deliveries from pharmacies.
This new law becomes effective on July 1, 2014.
Drugs Dispensed by Local Health Departments
Senate Bill 1632 (Norris)
House Bill 1428 (McCormick)
Chapter 585 of the Public Act of 2014
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This new law proposed by the Haslam Administration requires the Board of Pharmacy to
consult with the Department of Health regarding drugs to be dispensed at local health departments
or clinics. Current law required the Board to approve these drugs by rule – a cumbersome
requirement which has become unworkable.
Submission of Information to the Controlled Substance Database
Senate Bill 2547 (Hensley)
House Bill 2400 (Doss)
Chapter 1011 of the Public Acts of 2014
This new law revises the time frame within which pharmacists and other dispensers of
controlled substances must submit the required information to the Controlled Substance Database.
Current law requires the information to be submitted at least once every seven (7) days for all
controlled substances dispensed during the preceding seven-day period. Beginning January 1,
2016, the required information on controlled substances dispensed on one day must be reported to
the Database by the close of business on the next business day.
Failure to report the information within this time frame is not considered a violation of the
law if a good faith effort to report the information was made by the pharmacist and the failure of
the report to be transmitted was due to technical difficulties or the inability of the Database to
receive the report. Technical difficulties include the failure of the pharmacist’s system or switch
used to transmit the report, electrical problems, natural disasters, fires, flooding, or other
unforeseen circumstance as defined in rules promulgated by the Board of Pharmacy.
Use of Information from the Controlled Substance Database
Senate Bill 1630 (Norris)
House Bill 1426 (McCormick)
Chapter 622 of the Public Acts of 2014
This new law was proposed by the Haslam Administration. It does two things:
a) Information from the Controlled Substance Database may be placed in a patient’s
medical record, and when it is so placed, it is subject to disclosure under the same terms
as other information in the patient’s medical records.
b) Persons engaged in the analysis of information in the Database may publish aggregate
unidentifiable personal data derived from the Database for the purpose of educational
outreach.
New Requirements Applicable to Drug Wholesalers and Prescribers Who Dispense Drugs
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Senate Bill 1663 (Kelsey)
House Bill 1512 (Shipley)
Chapter 983 of the Public Acts of 2014
This new law, which is effective on January 1, 2015, does several things:
a) A health care practitioner who works at a pain management clinic must notify his/her
licensing board within ten (10) days of starting work and of ending work at the clinic.
b) New requirements are imposed by section 2 of the law on drug wholesalers, who must:
1) design and operate a system for identifying suspicious orders of controlled
substances, which include orders of unusual size, orders deviating substantially
from a normal pattern, and orders of unusual frequency;
2) inform the Board of Pharmacy (and the prescriber’s licensing board, if the order
is from a prescriber) when a suspicious order is discovered; and
3) in the event of theft or other significant loss of controlled substances, report
such theft or loss to the Controlled Substance Database Committee and to local
law enforcement within one (1) business day of the discovery.
c) Section 4 of the law defines the term “health care prescriber” to include physicians,
dentists, nurses, podiatrists, optometrists, and physician assistants. Section 3 prohibits
such health care prescribers from dispensing opioids or benzodiazepines. Excepted
from this prohibition are drugs dispensed as samples or in connection with a surgical
procedure (7-day supply) or in a clinical trial or to a patient of a licensed health care
facility.
d) Section 3(b) requires all health care prescribers to ensure that their undispensed
inventory of opioids and benzodiazepines are returned to a licensed third party reverse
distributor or turned in to local law enforcement by January 10, 2015. Section 3(c)
requires wholesalers to buy back the undispensed inventory of opioids and
benzodiazepines which are in the manufacturer’s original packaging, unopened, and in
date.
Methamphetamine
1. Senate Bill 1751 (Norris)
House Bill 1574 (McCormick)
Chapter 906 of the Public Acts of 2014
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After much discussion, the General Assembly modified and passed Governor Haslam’s
proposal to address the “meth” problem in Tennessee:
a) The new law prohibits the sale to any person by a pharmacy (and the purchase by any
person) of products containing more than 5.76 grams of ephedrine or pseudoephedrine
base or their salts, isomers or salts of isomers during any 30-day period or of products
containing 28.8 grams of such substances in any 1-year period. Current law allows the
sale (or purchase) of up to 3.6 grams per day and 9 grams per 30-day period.
b) As in current law, the new limit does not apply when the person obtains the products
pursuant to a valid prescription issued by a licensed health care practitioner or a valid
pharmacist-generated prescription order.
c) The new law, effective July 1, 2014, also prohibits the purchase by a person under 18
years of age of any product containing any immediate methamphetamine precursor,
except pursuant to a valid prescription.
2. Senate Bill 1904 (Haile)
House Bill 1858 (Spivey)
Chapter 828 of the Public Acts of 2014
This new law requires pharmacies to correct data entry errors regarding information
submitted to NPLEx so that NPLEx will not generate an inappropriate stop-sale alert which might
prevent a person from purchasing an over-the-counter product containing pseudoephedrine or
ephedrine.
3. Senate Bill 1596 (Green)
House Bill 1456 (Lamberth)
Chapter 904 of the Public Acts of 2014
This new law adds a new section to the State’s criminal code which is specific to
methamphetamine. It is a criminal offense to manufacture, deliver, sell, possess, or casually
exchange methamphetamine. It establishes the penalties for such a crime.
4. Senate Bill 2021 (Beavers)
House Bill 1661 (T. Hill)
Chapter 970 of the Public Acts of 2014
This new law provides that a person convicted of manufacturing methamphetamine must
be sent to jail for at least 180 days, and shall serve 100% of the sentence. The person may receive
credit for participation in a drug treatment program certified by the Department of Mental Health
and Substance Abuse.
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The new law also provides that a person convicted of the knowing possession or casual
exchange of any amount of methamphetamine must be sent to jail for at least 30 days, must serve
100% of the sentence, and may receive credit for participation in a drug treatment program.
Use of Naloxone Hydrochloride
Senate Bill 1631 (Norris)
House Bill 1427 (McCormick)
Chapter 623 of the Public Acts of 2014
This new law was proposed by the Haslam Administration. It authorizes prescribers to
prescribe naloxone hydrochloride (an opioid antagonist) to persons at risk of experiencing an
opiate-related drug overdose or to a family member or friend in a position to assist someone who
has experienced such an overdose. If this is done in good faith through the exercise of reasonable
care, the prescriber and the person who administers the opioid antagonist are immune from civil
liability and disciplinary action. The Department of Health is required to create an online
education program to educate the public on opioid antagonists.
Pain Management Clinics
Senate Bill 2000 (Yager)
House Bill 1939 (Dunn)
Chapter 700 of the Public Acts of 2014
This new law revises the requirements for registration as a pain management clinic.
The definition of “pain management clinic” is revised so that it reads as follows:
(6)(A) “Pain management clinic” means a privately-owned
clinic, facility or office in which any health care provider licensed
under this title provides chronic non-malignant pain treatment to a
majority of its patients for ninety (90) days or more in a twelve (12)
month period. For purposes of determining if a clinic, facility, or
office qualifies as a pain management clinic under this subdivision
(6)(A), the entire clinic, facility, or office caseload of patients who
received medical care services from all medical doctors, osteopathic
physicians, advanced practice nurses and physician assistants who
serve in the clinic, facility or office shall be counted;
(B) “Pain management clinic” also means a privately-owned
clinic, facility, or office which advertises in any medium for pain
management services of any type. A pain management clinic shall
not include any clinic, facility, or office which provides
interventional pain management as defined in §63-6-244 and whose
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clinic, facility or office does not provide chronic non-malignant pain
treatment to a majority of the patients of a clinic, facility, or office
for ninety (90) days or more in a twelve (12) month period;
(C) “Pain management clinic” does not mean a clinic,
facility or office that is wholly owned and operated by a physician
multispecialty practice in which one or more board-eligible or
board-certified medical specialists who have also completed
fellowships in pain medicine approved by the Accreditation Council
for Graduate Medical Education, or who are also board-certified in
pain medicine by the American Board of Pain Medicine or a board
approved by the American Board of Medical Specialties, the
American Association of Physician Specialists, or the American
Osteopathic Association perform the pain management services for
chronic pain patients.
This new law also requires the Department of Health to adopt rules regarding urine drug
screening compliance plans.
Dispensing of Schedule V Controlled Subtances at Pain Management Clinics
Senate Bill 2302 (McNally)
House Bill 1657 (Sexton)
Chapter 842 of the Public Acts of 2014
This new law allows a pain management clinic to dispense a sample of a non-narcotic
Schedule V controlled substance in a quantity limited to an amount which is adequate to treat the
patient for a maximum of fourteen (14) days.
Professional Privilege Tax
Senate Bill 1636 (Norris)
House Bill 1432 (McCormick)
Chapter 763 of the Public Acts of 2014
This new law was proposed by the Department of Revenue to facilitate the collection of
tax, penalties and interest from persons subject to the professional privilege tax (PPT) who fail to
pay the amount they owe in a timely manner. Each licensing board will be notified on a monthly
basis of all licensees who are more than ninety (90) days delinquent in paying the PPT. The
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licensing board will not be permitted to process the license renewal of anyone on this list. In the
case of pharmacists, this process will be administered by the Board of Pharmacy.
Licensure Applications and Investigations of Healthcare Professionals
Senate Bill 1629 (Norris)
House Bill 1425 (McCormick)
Chapter 949 of the Public Acts of 2014
This new law does two things:
(a) It amends the practice acts of several professions (including the Pharmacy Practice
Act) to make clear that licensure applications and renewal applications can be
submitted electronically.
(b) It also provides that investigative materials are not a public record before formal
disciplinary charges are filed against a health care provider. Even after charges are
filed, only the materials on which the charges are based are a matter of public record.
The identity of the complainant and of a witness who requests anonymity, as well as a
patient’s identifying information and medical record, are not public record. However,
healthcare facility and pharmacy survey inspection reports are public record.
Volunteer Health Services
1. Senate Bill 1473 (Overbey)
House Bill 2073 (Farmer)
Chapter 615 of the Public Acts of 2014
This new law makes a minor change in the Volunteer Health Care Services Act, which
gives civil immunity to health care providers that provide services at a facility sponsored by an
organization that registers with the Department of Health and charges patients on a sliding scale
based on income or a fixed fee which does not exceed $10 per visit. The new law allows the
facility to charge up to $50 (rather than $10) per visit.
2. Senate Bill 1674 (Southerland)
House Bill 1928 (Goins)
Chapter 575 of the Public Acts of 2014
This new law adds a definition of “free clinic” to the Volunteer Health Services Act. The
law provides immunity from civil liability (except for gross negligence or willful misconduct) for
the healthcare services of any licensed healthcare professional delivered to a patient of a free clinic
or a patient of a sponsoring organization which has registered with the Department of Health. The
sponsoring organization may provide the services free of charge or may charge the patients based
on a sliding scale according to income, but the healthcare professional may not retain any of the
payments made by the patients.
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