Requirements for Use of Maximum Allowable Cost Pricing by Pharmacy Benefits Managers; Appeals; Enforcement Authority

  1. Law
  2. Georgia Code
  3. Insurance
  4. Regulation and Licensure of Pharmacy Benefits Managers
  5. Requirements for Use of Maximum Allowable Cost Pricing by Pharmacy Benefits Managers; Appeals; Enforcement Authority

Checkout our iOS App for a better way to browser and research.

  1. Upon each contract execution or renewal between a pharmacy benefits manager and a pharmacy or between a pharmacy benefits manager and a pharmacy's contracting representative or agent, such as a pharmacy services administrative organization, a pharmacy benefits manager shall, with respect to such contract or renewal:
    1. Include in such contract or renewal the sources utilized to determine multi-source generic drug pricing, such as maximum allowable cost or any successive benchmark pricing formula, and update such pricing information at least every five business days, provided that such pricing information update shall be at least every 14 business days for those contracts pursuant to Article 7 of Chapter 4 of Title 49; and
    2. Maintain a procedure to eliminate products from the multi-source generic list of drugs subject to such pricing or modify multi-source generic drug pricing within five business days when such drugs do not meet the standards and requirements of this Code section in order to remain consistent with pricing changes in the marketplace.
  2. A pharmacy benefits manager shall reimburse pharmacies for drugs subject to multi-source generic drug pricing based upon pricing information which has been updated within five business days as set forth in paragraph (1) of subsection (a) of this Code section.
  3. A pharmacy benefits manager may not place a drug on a multi-source generic list unless there are at least two therapeutically equivalent, multi-source generic drugs, or at least one generic drug available from only one manufacturer, generally available for purchase by network pharmacies from national or regional wholesalers.
  4. All contracts between a pharmacy benefits manager and a contracted pharmacy or between a pharmacy benefits manager and a pharmacy's contracting representative or agent, such as a pharmacy services administrative organization, shall include a process to internally appeal, investigate, and resolve disputes regarding multi-source generic drug pricing. The process shall include the following:
    1. The right to appeal shall be limited to 14 calendar days following reimbursement of the initial claim; and
    2. A requirement that the health benefit plan issuer or pharmacy benefits manager shall respond to an appeal described in subsection (a) of this Code section no later than 14 calendar days after the date the appeal was received by such health benefit plan issuer or pharmacy benefits manager.
  5. For appeals that are denied, the pharmacy benefits manager shall provide the reason for the denial and identify the national drug code of a drug product that may be purchased by contracted pharmacies at a price at or below the maximum allowable cost.
  6. If the appeal is successful, the health benefit plan issuer or pharmacy benefits manager shall:
    1. Adjust the maximum allowable cost price that is the subject of the appeal effective on the day after the date the appeal is decided;
    2. Apply the adjusted maximum allowable cost price to all similarly situated pharmacists and pharmacies as determined by the health plan issuer or pharmacy benefits manager; and
    3. Allow the pharmacist or pharmacy that succeeded in the appeal to reverse and rebill the pharmacy benefits claim giving rise to the appeal.
  7. Appeals shall be upheld if:
    1. The pharmacy being reimbursed for the drug subject to the multi-source generic drug pricing in question was not reimbursed as required in subsection (b) of this Code section; or
    2. The drug subject to the multi-source generic drug pricing in question does not meet the requirements set forth in subsection (c) of this Code section.
  8. The Commissioner shall have enforcement authority over this Code section.

(Code 1981, §33-64-9, enacted by Ga. L. 2015, p. 337, § 4/HB 470.)


Download our app to see the most-to-date content.