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AB773,16,1010 2. Update the maximum allowable cost list on a timely basis.
AB773,16,1211 3. Update the maximum allowable cost list no later than 7 days after any of the
12following occurs:
AB773,16,1513 a. The pharmacy acquisition cost of a pharmaceutical product increases by 10
14percent or more from at least 60 percent of the pharmaceutical wholesalers doing
15business in this state.
AB773,16,1716 b. There is a change in the methodology on which the maximum allowable cost
17list is based or in the value of a variable involved in the methodology.
AB773,16,2018 4. Provide a process for a pharmacy or pharmacist subject to the maximum
19allowable cost list to receive prompt notification of an update to the maximum
20allowable cost list.
AB773,16,2421 (c) Appeal process. 1. A pharmacy benefit manager that uses a maximum
22allowable cost list shall provide a process for a pharmacy or pharmacist to appeal and
23resolve disputes regarding claims that the maximum payment amount for a
24pharmaceutical product is below the pharmacy acquisition cost.
AB773,17,2
12. A pharmacy benefit manager required to provide an appeal process under
2subd. 1. shall do all of the following:
AB773,17,43 a. Provide a dedicated telephone number and email address or website that a
4pharmacy or pharmacist may use to submit an appeal.
AB773,17,65 b. Allow a pharmacy or pharmacist to submit an appeal directly on the
6pharmacy's or pharmacist's own behalf.
AB773,17,87 c. Allow a pharmacy services administrative organization to submit an appeal
8on behalf of a pharmacy or pharmacist.
AB773,17,119 d. Provide at least 7 business days after a customer transaction for a pharmacy
10or pharmacist to submit an appeal under this paragraph concerning a
11pharmaceutical product involved in the transaction.
AB773,17,1512 3. A pharmacy benefit manager that receives an appeal from or on behalf of a
13pharmacy or pharmacist under this paragraph shall resolve the appeal and notify
14the pharmacy or pharmacist of the pharmacy benefit manager's determination no
15later than 7 business days after the appeal is received by doing any of the following:
AB773,17,2216 a. If the pharmacy benefit manager grants the relief requested in the appeal,
17the pharmacy benefit manager shall make the requested change in the maximum
18allowable cost; allow the pharmacy or pharmacist to reverse and rebill the relevant
19claim; provide to the pharmacy or pharmacist the national drug code number
20published in a directory by the federal food and drug administration on which the
21increase or change is based; and make the change effective for each similarly situated
22pharmacy or pharmacist subject to the maximum allowable cost list.
AB773,18,523 b. If the pharmacy benefit manager denies the relief requested in the appeal,
24the pharmacy benefit manager shall provide to the pharmacy or pharmacist a reason
25for the denial, the national drug code number published in a directory by the federal

1food and drug administration for the pharmaceutical product to which the claim
2relates, and the name of a national or regional pharmaceutical wholesaler operating
3in this state that has the pharmaceutical product currently in stock at a price below
4the amount specified in the pharmacy benefit manager's maximum allowable cost
5list.
AB773,18,196 4. Notwithstanding subd. 3. b., a pharmacy benefit manager may not deny a
7pharmacy's or pharmacist's appeal under this paragraph if the relief requested in the
8appeal relates to the maximum allowable cost for a pharmaceutical product that is
9not available for the pharmacy or pharmacist to purchase at a cost that is below the
10pharmacy acquisition cost from the pharmaceutical wholesaler from which the
11pharmacy or pharmacist purchases the majority of pharmaceutical products for
12resale. If this subdivision applies, the pharmacy benefit manager shall revise the
13maximum allowable cost list to increase the maximum allowable cost for the
14pharmaceutical product to an amount equal to or greater than the pharmacy's or
15pharmacist's pharmacy acquisition cost and allow the pharmacy or pharmacist to
16reverse and rebill each claim affected by the pharmacy's or pharmacist's inability to
17procure the pharmaceutical product at a cost that is equal to or less than the
18maximum allowable cost that was the subject of the pharmacy's or pharmacist's
19appeal.
AB773,18,2520 (d) Affiliated reimbursements. A pharmacy benefit manager may not
21reimburse a pharmacy or pharmacist in this state an amount less than the amount
22that the pharmacy benefit manager reimburses a pharmacy benefit manager
23affiliate for providing the same pharmaceutical product. The reimbursement
24amount shall be calculated on a per unit basis based on the same generic product
25identifier or generic code number, if applicable.
AB773,19,5
1(e) Declining to dispense. A pharmacy or pharmacist may decline to provide a
2pharmaceutical product to an individual or pharmacy benefit manager if, as a result
3of the applicable maximum allowable cost list, the pharmacy or pharmacist would
4be paid less than the pharmacy acquisition cost of the pharmacy or pharmacist
5providing the pharmaceutical product.
AB773,20 6Section 20. 632.865 (2h) of the statutes is created to read:
AB773,19,167 632.865 (2h) Professional dispensing fees. A pharmacy benefit manager
8shall pay a pharmacy or pharmacist a professional dispensing fee at a rate not less
9than is paid by this state under the medical assistance program under subch. IV of
10ch. 49 for each pharmaceutical product that the pharmacy or pharmacist dispenses
11to an individual. The fee shall be calculated on a per unit basis based on the same
12generic product identifier or generic code number, if applicable. The pharmacy
13benefit manager shall pay the professional dispensing fee in addition to the amount
14the pharmacy benefit manager reimburses the pharmacy or pharmacist for the cost
15of the pharmaceutical product that the pharmacy or pharmacist dispenses to the
16individual.
AB773,21 17Section 21. 632.865 (2p) of the statutes is created to read:
AB773,19,2218 632.865 (2p) Pharmacy benefit manager-imposed fees prohibited. A
19pharmacy benefit manager may not assess, charge, or collect any form of
20remuneration that passes from a pharmacy or pharmacist to the pharmacy benefit
21manager, including claim-processing fees, performance-based fees,
22network-participation fees, or accreditation fees.
AB773,22 23Section 22 . 632.865 (2t) of the statutes is created to read:
AB773,20,224 632.865 (2t) Fiduciary duty and disclosures to health benefit plan sponsors.
25(a) A pharmacy benefit manager owes a fiduciary duty to the health benefit plan

1sponsor to act according to the health benefit plan sponsor's instructions and in the
2best interests of the health benefit plan sponsor.
AB773,20,53 (b) A pharmacy benefit manager shall annually provide, no later than the date
4and using the method prescribed by the commissioner by rule, the health benefit plan
5sponsor with all of the following information from the previous calendar year:
AB773,20,76 1. The indirect profit received by the pharmacy benefit manager from owning
7any interest in a pharmacy or service provider.
AB773,20,98 2. Any payment made by the pharmacy benefit manager to a consultant or
9broker who works on behalf of the health benefit plan sponsor.
AB773,20,1310 3. From the amounts received from all drug manufacturers, the amounts
11retained by the pharmacy benefit manager, and not passed through to the health
12benefit plan sponsor, that are related to the health benefit plan sponsor's claims or
13bona fide service fees.
AB773,20,1814 4. The amounts, including pharmacy access and audit recovery fees, received
15from all pharmacies and pharmacists that are in the pharmacy benefit manager's
16network or have a contract to be in the network and, from these amounts, the amount
17retained by the pharmacy benefit manager and not passed through to the health
18benefit plan sponsor.
AB773,23 19Section 23. 632.865 (4) of the statutes is renumbered 632.865 (4) (a).
AB773,24 20Section 24. 632.865 (4) (b) of the statutes is created to read:
AB773,20,2521 632.865 (4) (b) A pharmacy benefit manager may not use any certification or
22accreditation requirement as a determinant of pharmacy network participation that
23is inconsistent with, more stringent than, or in addition to the federal requirements
24for licensure as a pharmacy and the requirements for licensure as a pharmacy under
25s. 450.06 or 450.065.
AB773,25
1Section 25. 632.865 (5) (e) of the statutes is repealed.
AB773,26 2Section 26. 632.865 (5d), (5h), (5p) and (5t) of the statutes are created to read:
AB773,21,53 632.865 (5d) Discriminatory reimbursement prohibited. (a) In this
4subsection, “3rd-party payer” means an entity, other than a patient or health care
5provider, that reimburses for and manages health care expenses.
AB773,21,66 (b) A pharmacy benefit manager may not do any of the following:
AB773,21,87 1. Refuse to reimburse a 340B covered entity or a pharmacy or pharmacist
8contracted with a 340B covered entity for dispensing 340B drugs.
AB773,21,119 2. Impose requirements or restrictions on 340B covered entities or pharmacies
10or pharmacists contracted with 340B covered entities that are not imposed on other
11entities, pharmacies, or pharmacists.
AB773,21,1512 3. Reimburse a 340B covered entity or a pharmacy or pharmacist contracted
13with a 340B covered entity for a 340B drug at a rate lower than the amount paid for
14the same drug to pharmacies or pharmacists that are not 340B covered entities or
15pharmacies or pharmacists contracted with a 340B covered entity.
AB773,21,1816 4. Assess a fee, charge back, or other adjustment against a 340B covered entity
17or a pharmacy or pharmacist contracted with a 340B covered entity after a claim has
18been paid or adjudicated.
AB773,21,2319 5. Restrict the access of a 340B covered entity or a pharmacy or pharmacist
20contracted with a 340B covered entity to a 3rd-party payer's pharmacy network
21solely because the 340B covered entity or the pharmacy or pharmacist contracted
22with a 340B covered entity participates in the 340B drug pricing program under 42
23USC 256b
.
AB773,22,3
16. Require a 340B covered entity or a pharmacy or pharmacist contracted with
2a 340B covered entity to contract with a specific pharmacy or pharmacist or health
3benefit plan in order to access a 3rd-party payer's pharmacy network.
AB773,22,64 7. Impose a restriction or an additional charge on a patient who obtains a 340B
5drug from a 340B covered entity or a pharmacy or pharmacist contracted with a 340B
6covered entity.
AB773,22,97 8. Restrict the methods by which a 340B covered entity or a pharmacy or
8pharmacist contracted with a 340B covered entity may dispense or deliver 340B
9drugs.
AB773,22,1210 9. Require a 340B covered entity or a pharmacy or pharmacist contracted with
11a 340B covered entity to share pharmacy bills or invoices with a pharmacy benefit
12manager, a 3rd-party payer, or a health benefit plan.
AB773,22,15 13(5h) Regulation of pharmacy networks and individual choice. All of the
14following apply to a pharmacy benefit manager that sells access to networks of
15pharmacies or pharmacists that operate in this state:
AB773,22,2316 (a) The pharmacy benefit manager shall allow a participant or beneficiary of
17a pharmacy benefits plan or program that the pharmacy benefit manager serves to
18use any pharmacy or pharmacist in this state that is licensed to dispense the
19pharmaceutical product that the participant or beneficiary seeks to obtain, provided
20that the pharmacy or pharmacist accepts the same terms and conditions that the
21pharmacy benefit manager has established for at least one of the networks of
22pharmacies or pharmacists the pharmacy benefit manager has established to serve
23individuals in this state.
AB773,23,624 (b) The pharmacy benefit manager may establish a preferred network of
25pharmacies or pharmacists and a nonpreferred network of pharmacies or

1pharmacists, but the pharmacy benefit manager may not prohibit a pharmacy or
2pharmacist from participating in either type of network in this state, provided that
3the pharmacy or pharmacist is licensed by this state and the federal government and
4accepts the same terms and conditions that the pharmacy benefit manager has
5established for other pharmacies or pharmacists participating in the network that
6the pharmacy or pharmacist wants to join.
AB773,23,127 (c) The pharmacy benefit manager may not charge a participant or beneficiary
8of a pharmacy benefits plan or program that the pharmacy benefit manager serves
9a different copayment obligation or additional fee, or provide any inducement or
10financial incentive, for the participant or beneficiary to use a pharmacy or
11pharmacist in a particular network of pharmacies or pharmacists the pharmacy
12benefit manager has established to serve individuals in this state.
AB773,23,22 13(5p) Gag clauses prohibited. A pharmacy benefit manager may not prohibit
14a pharmacy or pharmacist that dispenses a pharmaceutical product from, nor may
15a pharmacy benefit manager penalize the pharmacy or pharmacist for, informing an
16individual about the cost of the pharmaceutical product, the amount in
17reimbursement that the pharmacy or pharmacist receives for dispensing the
18pharmaceutical product, the cost and clinical efficacy of a less expensive alternative
19to the pharmaceutical product, or any difference between the cost to the individual
20under the individual's pharmacy benefits plan or program and the cost to the
21individual if the individual purchases the pharmaceutical product without making
22a claim for benefits under the individual's pharmacy benefits plan or program.
AB773,24,2 23(5t) Exclusion of pharmacies prohibited. No pharmacy benefit manager,
243rd-party payer, or health benefit plan may exclude a pharmacy or pharmacist from
25its network because the pharmacy or pharmacist serves less than a certain portion

1of the population of the state or serves a population living with certain health
2conditions.
AB773,27 3Section 27 . 632.865 (6) (bm) of the statutes is created to read:
AB773,24,54 632.865 (6) (bm) Requirements of audits. An entity that conducts audits of
5pharmacists of pharmacies shall ensure all of the following:
AB773,24,86 1. Each pharmacist or pharmacy audited by the entity is audited under the
7same standards and parameters as other similarly situated pharmacists or
8pharmacies audited by the entity.
AB773,24,109 2. The entity randomizes the prescriptions that the entity audits and the entity
10audits the same number of prescriptions in each prescription benefit tier.
AB773,24,13113. Each audit of a prescription reimbursed under Part D of Medicare under 42
12USC 1395w-101
et seq. is conducted separately from audits of prescriptions
13reimbursed under other policies or plans.
AB773,28 14Section 28 . 632.865 (6) (c) 3. of the statutes is amended to read:
AB773,24,2115 632.865 (6) (c) 3. Deliver to the pharmacist or pharmacy a final audit report,
16which may be delivered electronically, within 90 days of the date the pharmacist or
17pharmacy receives the preliminary report or the date of the final appeal of the audit,
18whichever is later. The final audit report under this subdivision shall include specific
19documentation of any alleged errors and shall include
any response provided to the
20auditor by the pharmacy or pharmacist and consider and address the pharmacy's or
21pharmacist's response.
AB773,29 22Section 29 . 632.865 (6) (c) 3m. of the statutes is created to read:
AB773,25,223 632.865 (6) (c) 3m. If an entity delivers to the pharmacist or pharmacy a
24preliminary report of the audit or final audit report that references a billing code,

1drug code, or other code associated with audits, the entity shall provide an electronic
2link to a plain language explanation of the code.
AB773,30 3Section 30 . 632.865 (6g) of the statutes is created to read:
AB773,25,74 632.865 (6g) Recoupment. (a) No pharmacy benefit manager may recoup
5reimbursement made to a pharmacist or pharmacy for errors that have no actual
6financial harm to an enrollee, policy, or plan unless the error is the result of the
7pharmacist or pharmacy failing to comply with a formal corrective action plan.
AB773,25,128 (b) No pharmacy benefit manager may use extrapolation in calculating
9reimbursements that it may recoup. The finding of errors for which reimbursement
10will be recouped shall be based on an actual error in reimbursement and not on a
11projection of the number of patients served having a similar diagnosis or on a
12projection of the number of similar orders or refills for similar prescription drugs.
AB773,25,1613 (c) A pharmacy benefit manager that recoups any reimbursement made to a
14pharmacist or pharmacy for an error that was the cause of financial harm shall
15return the recouped reimbursement to the individual or the policy or plan sponsor
16who was harmed by the error.
AB773,31 17Section 31 . 632.865 (6r) of the statutes is created to read:
AB773,25,2118 632.865 (6r) Quality programs. No pharmacy benefit manager may base any
19criteria of a quality program in a contract between a pharmacy and a pharmacy
20benefit manager on a factor for which the pharmacy does not have complete and
21exclusive control.
AB773,32 22Section 32. 632.865 (8) of the statutes is created to read:
AB773,25,2423 632.865 (8) Retaliation prohibited. (a) In this subsection, “retaliate” includes
24any of the following actions taken by a pharmacy benefit manager:
AB773,25,2525 1. Terminating or refusing to renew a contract with a pharmacy or pharmacist.
AB773,26,1
12. Subjecting a pharmacy or pharmacist to increased audits.
AB773,26,32 3. Failing to promptly pay a pharmacy or pharmacist any money the pharmacy
3benefit manager owes to the pharmacy or pharmacist.
AB773,26,64 (b) A pharmacy benefit manager may not retaliate against a pharmacy or
5pharmacist for reporting an alleged violation of this section or for exercising a right
6or remedy under this section.
AB773,26,117 (c) In addition to any other remedies provided by law, a pharmacy or
8pharmacist may bring an action in court for injunctive relief based on a violation of
9par. (b). In addition to equitable relief, the court may, notwithstanding s. 814.04 (1),
10award a pharmacy or pharmacist that prevails in such an action reasonable attorney
11fees and costs in prosecuting the action.
AB773,33 12Section 33. Initial applicability.
AB773,26,1513 (1) Affiliated reimbursements. Except as provided in sub. (4 ), the treatment
14of s. 632.865 (2d) (d) first applies to a reimbursement amount paid for on a claim for
15reimbursement submitted on the effective date of this subsection.
AB773,26,1816 (2) Professional dispensing fees. Except as provided in sub. (4 ), the treatment
17of s. 632.865 (2h) first applies to a pharmaceutical product that is dispensed on the
18effective date of this subsection.
AB773,26,2119 (3) Pharmacy benefit manager-imposed fees. Except as provided in sub. (4 ),
20the treatment of s. 632.865 (2p) first applies to remuneration collected by a pharmacy
21benefit manager on the effective date of this subsection.
AB773,27,322 (4) Contracts. The treatment of ss. 632.861 (1m), (3g), (3r), and (4) (a) and (e)
23and 632.865 (1) (ab), (ac), (ae), (an), (aq), (at), (bm), (cg), and (cr), (2), (2d), (2h), (2p),
24(2t), (5) (e), (5d), (5h), (5p), (5t), (6) (bm) and (c) 3. and 3m., (6g), (6r), and (8), the
25renumbering of s. 632.865 (4), and the creation of s. 632.865 (4) (b) first apply to a

1pharmacy benefit manager that is affected by a contract that contains a provisions
2inconsistent with those treatments on the day on which the contract expires or is
3extended, modified, or renewed, whichever occurs first.
AB773,27,44 (5) Application of prescription drug payments.
AB773,27,85 (a) For policies and plans containing provisions inconsistent with the
6treatment of s. 632.862, that treatment first applies to policy or plan years beginning
7on January 1 of the year following the year in which this paragraph takes effect,
8except as provided in par. (b).
AB773,27,139 (b) For policies or plans that are affected by a collective bargaining agreement
10containing provisions inconsistent with the treatment of s. 632.862, that treatment
11first applies to policy or plan years beginning on the effective date of this paragraph
12or on the day on which the collective bargaining agreement is newly established,
13extended, modified, or renewed, whichever is later.
AB773,34 14Section 34. Effective dates. This act takes effect on the day after publication,
15except as follows:
AB773,27,1716 (1) Application of prescription drug payments. The treatment of s. 632.862
17takes effect on the first day of the 4th month beginning after publication.
AB773,27,1818 (End)
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