N.Y. Insurance Law 2906 – Licensing of a pharmacy benefit manager
§ 2906. Licensing of a pharmacy benefit manager. (a) The superintendent may issue a pharmacy benefit manager's license to any person, firm, association or corporation who or that has complied with the requirements of this article, including regulations promulgated by the superintendent. The superintendent, in consultation with the commissioner of health, shall establish, by regulation, minimum standards for the issuance of a license to a pharmacy benefit manager.
Terms Used In N.Y. Insurance Law 2906
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
(b) The minimum standards established under this subsection shall contain both prerequisites for the issuance of a license and requirements for maintenance of a license and shall address, without limitation:
(1) conflicts of interest between pharmacy benefit managers and health plans or insurers;
(2) deceptive practices in connection with the performance of pharmacy benefit management services;
(3) anti-competitive practices in connection with the performance of pharmacy benefit management services;
(4) unfair claims practices in connection with the performance of pharmacy benefit management services;
(5) pricing models used by pharmacy benefit managers both for their services and for the payment of services to the pharmacy benefit manager;
(6) standards and practices used in the creation of pharmacy networks and contracting with network pharmacies and other providers, including promotion and use of independent and community pharmacies and patient access and minimizing excessive concentration and vertical integration of markets; and
(7) protection of consumers.
(c) For each business entity, the officer or officers and director or directors named in the application shall be designated responsible for the business entity's compliance with the insurance laws, rules and regulations of this state.
(d)(1) Before a pharmacy benefit manager's license shall be issued or renewed, the prospective licensee shall properly file in the office of the superintendent an application therefor in such form or forms and supplements thereto as the superintendent prescribes, and pay a fee of eight thousand dollars for each year or fraction of a year in which a license shall be valid.
(2) Every pharmacy benefit manager's license shall expire thirty-six months after the date of issue. Every license issued pursuant to this section may be renewed for the ensuing period of thirty-six months upon the filing of an application in conformity with this subsection.
(e) If an application for a renewal license shall have been filed with the superintendent at least two months before its expiration, then the license sought to be renewed shall continue in full force and effect either until the issuance by the superintendent of the renewal license applied for or until five days after the superintendent shall have refused to issue such renewal license and given notice of such refusal to the applicant.
(f) The superintendent may refuse to issue a pharmacy benefit manager's license if, in the superintendent's judgment, the applicant or any member, principal, officer or director of the applicant, is not trustworthy and competent to act as or in connection with a pharmacy benefit manager, or that any of the foregoing has given cause for revocation or suspension of such license, or has failed to comply with any prerequisite for the issuance of such license.
(g) Licensees and applicants for a license under this section shall be subject to examination by the superintendent as often as the superintendent may deem it expedient. The superintendent may promulgate regulations establishing methods and procedures for facilitating and verifying compliance with the requirements of this section and such other regulations as necessary.
(h) The superintendent may issue a replacement for a currently in-force license that has been lost or destroyed. Before the replacement license shall be issued, there shall be on file in the office of the superintendent a written application for the replacement license, affirming under penalty of perjury that the original license has been lost or destroyed, together with a fee of eight hundred dollars.
(i) No pharmacy benefit manager shall engage in any practice or action that a health plan is prohibited from engaging in pursuant to this chapter.