Indiana Code 27-1-24.5-25. Contract holder’s right to audit; disclosure of data; amounts paid; consideration
(1) Rebate amounts secured on prescription drugs, whether product specific or general rebates, that were provided by a pharmaceutical manufacturer. The information provided under this subdivision must identify the prescription drugs by therapeutic category.
Terms Used In Indiana Code 27-1-24.5-25
- Commissioner: means the "insurance commissioner" of this state. See Indiana Code 27-1-2-3
- Contract: A legal written agreement that becomes binding when signed.
- contract holder: means :
Indiana Code 27-1-24.5-0.7
- Department: means "the department of insurance" of this state. See Indiana Code 27-1-2-3
- Electronic funds transfer: The transfer of money between accounts by consumer electronic systems-such as automated teller machines (ATMs) and electronic payment of bills-rather than by check or cash. (Wire transfers, checks, drafts, and paper instruments do not fall into this category.) Source: OCC
- Insurance: means a contract of insurance or an agreement by which one (1) party, for a consideration, promises to pay money or its equivalent or to do an act valuable to the insured upon the destruction, loss or injury of something in which the other party has a pecuniary interest, or in consideration of a price paid, adequate to the risk, becomes security to the other against loss by certain specified risks; to grant indemnity or security against loss for a consideration. See Indiana Code 27-1-2-3
- pharmacist: means an individual licensed as a pharmacist under IC 25-26. See Indiana Code 27-1-24.5-9
- pharmacist services: means products, goods, and services provided as part of the practice of pharmacy. See Indiana Code 27-1-24.5-10
- pharmacy: means the physical location:
Indiana Code 27-1-24.5-11
- pharmacy benefit manager: means an entity that, on behalf of a health plan, state agency, insurer, managed care organization, or other third party payor:
Indiana Code 27-1-24.5-12
- rebate: means a discount or other price concession that is:
Indiana Code 27-1-24.5-16
- Year: means a calendar year, unless otherwise expressed. See Indiana Code 1-1-4-5
(A) The CMS-1500 form or its successor form.
(B) The HCFA-1500 form or its successor form.
(C) The HIPAA X12 837P electronic claims transaction for professional services, or its successor transaction.
(D) The HIPAA X12 837I institutional form or its successor form.
(E) The CMS-1450 form or its successor form.
(F) The UB-04 form or its successor form.
The forms or transaction may be modified as necessary to comply with the federal Health Insurance Portability and Accountability Act (HIPAA) (P.L. 104-191) or to redact a trade secret (as defined in IC 24-2-3-2).
(3) Pharmaceutical and device claims payments or electronic funds transfer or remittance advice notices provided by the pharmacy benefit manager as ASC X12N 835 files or a successor format. The files may be modified as necessary to comply with the federal Health Insurance Portability and Accountability Act (HIPAA) (P.L. 104-191) or to redact a trade secret (as defined in IC 24-2-3-2). In the event that paper claims are provided, the pharmacy benefit manager shall convert the paper claims to the ASC X12N 835 electronic format or a successor format.
(4) Any other revenue and fees derived by the pharmacy benefit manager from the contract, including all direct and indirect remuneration from pharmaceutical manufacturers regardless of whether the remuneration is classified as a rebate, fee, or another term.
(b) A pharmacy benefit manager may not impose the following:
(1) Fees for:
(A) requesting an audit under this section; or
(B) selecting an auditor other than an auditor designated by the pharmacy benefit manager.
(2) Conditions that would restrict a contract holder’s right to conduct an audit under this section, including restrictions on the:
(A) time period of the audit;
(B) number of claims analyzed;
(C) type of analysis conducted;
(D) data elements used in the analysis; or
(E) selection of an auditor as long as the auditor:
(i) does not have a conflict of interest;
(ii) meets a threshold for liability insurance specified in the contract between the parties;
(iii) does not work on a contingent fee basis; and
(iv) does not have a history of breaching nondisclosure agreements.
(c) A pharmacy benefit manager shall disclose, upon request from a contract holder, to the contract holder the actual amounts directly or indirectly paid by the pharmacy benefit manager to the pharmacist or pharmacy for the drug and for pharmacist services related to the drug.
(d) A pharmacy benefit manager shall provide notice to a contract holder contracting with the pharmacy benefit manager of any consideration, including direct or indirect remuneration, that the pharmacy benefit manager receives from a pharmaceutical manufacturer or group purchasing organization for formulary placement or any other reason.
(e) The commissioner may establish a procedure to release information from an audit performed by the department to a contract holder that has requested an audit under this section in a manner that does not violate confidential or proprietary information laws.
(f) A contract that is entered into, issued, amended, or renewed after June 30, 2024, may not contain a provision that violates this section.
(g) A pharmacy benefit manager shall:
(1) obtain any information requested in an audit under this section from a group purchasing organization or other partner entity of the pharmacy benefit manager; and
(2) confirm receipt of a request for an audit under this section to the contract holder not later than ten (10) business days after the information is requested.
(h) Information provided in an audit under this section must be provided in accordance with the federal Health Insurance Portability and Accountability Act (HIPAA) (P.L. 104-191).
As added by P.L.68-2020, SEC.1. Amended by P.L.32-2021, SEC.81; P.L.152-2024, SEC.12.