Kentucky Statutes 304.17A-161 – Definitions for KRS 304.17A-161, 304.17A-162, 304.17A-163, and 304.17A-165
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As used in this section and KRS § 304.17A-162, 304.17A-163, and 304.17A-165 unless the context requires otherwise:
(1) “Contracted pharmacy” or “pharmacy” means a pharmacy located in Kentucky participating in the network of a pharmacy benefit manager through a direct contract or through a contract with a pharmacy services administration organization or group purchasing organization;
(2) “Drug product reimbursement” means the amount paid by a pharmacy benefit manager to a contracted pharmacy for the cost of the drug dispensed to a patient and does not include a dispensing or professional fee;
(3) “Maximum allowable cost” means the maximum amount that a pharmacy benefit manager will reimburse a pharmacy for the cost of a generic drug and does not include a dispensing or professional fee; and
(4) “Pharmacy benefit manager” means an entity that, on behalf of a health benefit plan, state agency, insurer, managed care organization providing services under KRS Chapter 205, or other third-party payor:
(a) Contracts directly or indirectly with pharmacies to provide prescription drugs to individuals;
(b) Administers a prescription drug benefit; (c) Processes or pays pharmacy claims;
(d) Creates or updates prescription drug formularies;
(e) Makes or assists in making prior authorization determinations on prescription drugs;
(f) Administers rebates on prescription drugs; or
(g) Establishes a pharmacy network.
Effective: July 15, 2016
History: Amended 2016 Ky. Acts ch. 79, sec. 5, effective July 15, 2016. — Created
2013 Ky. Acts ch. 109, sec. 1, effective June 25, 2013.
(1) “Contracted pharmacy” or “pharmacy” means a pharmacy located in Kentucky participating in the network of a pharmacy benefit manager through a direct contract or through a contract with a pharmacy services administration organization or group purchasing organization;
Terms Used In Kentucky Statutes 304.17A-161
- Contract: A legal written agreement that becomes binding when signed.
- Insurer: means any insurance company. See Kentucky Statutes 304.17A-005
- Managed care: means systems or techniques generally used by third-party payors or their agents to affect access to and control payment for health care services and that integrate the financing and delivery of appropriate health care services to covered persons by arrangements with participating providers who are selected to participate on the basis of explicit standards for furnishing a comprehensive set of health care services and financial incentives for covered persons using the participating providers and procedures provided for in the plan. See Kentucky Statutes 304.17A-005
- State: when applied to a part of the United States, includes territories, outlying possessions, and the District of Columbia. See Kentucky Statutes 446.010
(2) “Drug product reimbursement” means the amount paid by a pharmacy benefit manager to a contracted pharmacy for the cost of the drug dispensed to a patient and does not include a dispensing or professional fee;
(3) “Maximum allowable cost” means the maximum amount that a pharmacy benefit manager will reimburse a pharmacy for the cost of a generic drug and does not include a dispensing or professional fee; and
(4) “Pharmacy benefit manager” means an entity that, on behalf of a health benefit plan, state agency, insurer, managed care organization providing services under KRS Chapter 205, or other third-party payor:
(a) Contracts directly or indirectly with pharmacies to provide prescription drugs to individuals;
(b) Administers a prescription drug benefit; (c) Processes or pays pharmacy claims;
(d) Creates or updates prescription drug formularies;
(e) Makes or assists in making prior authorization determinations on prescription drugs;
(f) Administers rebates on prescription drugs; or
(g) Establishes a pharmacy network.
Effective: July 15, 2016
History: Amended 2016 Ky. Acts ch. 79, sec. 5, effective July 15, 2016. — Created
2013 Ky. Acts ch. 109, sec. 1, effective June 25, 2013.