AB773,,65 4. The brand effective rate or generic effective rate for each pharmaceutical product.

AB773,,66 5. Any applicable discount indexing.

AB773,,67 6. The federal upper limit for each pharmaceutical product published by the federal centers for medicare and medicaid services.

AB773,,68 7. The wholesale acquisition cost of each pharmaceutical product.

AB773,,69 8. Any other terms that are used to establish the maximum allowable costs.

AB773,,70 (ar) Regulation of maximum allowable cost lists. A pharmacy benefit manager may place or continue a particular pharmaceutical product on a maximum allowable cost list only if all of the following apply to the pharmaceutical product:

AB773,,71 1. The pharmaceutical product is listed as a drug product equivalent, as defined in s. 450.13 (1e), or is rated by a nationally recognized reference, such as Medi-Span or Gold Standard Drug Database, as “not rated” or “not available.”

AB773,,72 2. The pharmaceutical product is available for purchase by all pharmacies and pharmacists in this state from national or regional pharmaceutical wholesalers operating in this state.

AB773,,73 3. The pharmaceutical product has not been determined by the drug manufacturer to be obsolete.

AB773,,74 (b) Access and update obligations. A pharmacy benefit manager that uses a maximum allowable cost list shall do all of the following:

AB773,,75 1. Provide access to the maximum allowable cost list to each pharmacy or pharmacist subject to the maximum allowable cost list.

AB773,,76 2. Update the maximum allowable cost list on a timely basis.

AB773,,77 3. Update the maximum allowable cost list no later than 7 days after any of the following occurs:

AB773,,78 a. The pharmacy acquisition cost of a pharmaceutical product increases by 10 percent or more from at least 60 percent of the pharmaceutical wholesalers doing business in this state.

AB773,,79 b. There is a change in the methodology on which the maximum allowable cost list is based or in the value of a variable involved in the methodology.

AB773,,80 4. Provide a process for a pharmacy or pharmacist subject to the maximum allowable cost list to receive prompt notification of an update to the maximum allowable cost list.

AB773,,81 (c) Appeal process. 1. A pharmacy benefit manager that uses a maximum allowable cost list shall provide a process for a pharmacy or pharmacist to appeal and resolve disputes regarding claims that the maximum payment amount for a pharmaceutical product is below the pharmacy acquisition cost.

AB773,,82 2. A pharmacy benefit manager required to provide an appeal process under subd. 1. shall do all of the following:

AB773,,83 a. Provide a dedicated telephone number and email address or website that a pharmacy or pharmacist may use to submit an appeal.

AB773,,84 b. Allow a pharmacy or pharmacist to submit an appeal directly on the pharmacy’s or pharmacist’s own behalf.

AB773,,85 c. Allow a pharmacy services administrative organization to submit an appeal on behalf of a pharmacy or pharmacist.

AB773,,86 d. Provide at least 7 business days after a customer transaction for a pharmacy or pharmacist to submit an appeal under this paragraph concerning a pharmaceutical product involved in the transaction.

AB773,,87 3. A pharmacy benefit manager that receives an appeal from or on behalf of a pharmacy or pharmacist under this paragraph shall resolve the appeal and notify the pharmacy or pharmacist of the pharmacy benefit manager’s determination no later than 7 business days after the appeal is received by doing any of the following:

AB773,,88 a. If the pharmacy benefit manager grants the relief requested in the appeal, the pharmacy benefit manager shall make the requested change in the maximum allowable cost; allow the pharmacy or pharmacist to reverse and rebill the relevant claim; provide to the pharmacy or pharmacist the national drug code number published in a directory by the federal food and drug administration on which the increase or change is based; and make the change effective for each similarly situated pharmacy or pharmacist subject to the maximum allowable cost list.

AB773,,89 b. If the pharmacy benefit manager denies the relief requested in the appeal, the pharmacy benefit manager shall provide to the pharmacy or pharmacist a reason for the denial, the national drug code number published in a directory by the federal food and drug administration for the pharmaceutical product to which the claim relates, and the name of a national or regional pharmaceutical wholesaler operating in this state that has the pharmaceutical product currently in stock at a price below the amount specified in the pharmacy benefit manager’s maximum allowable cost list.

AB773,,90 4. Notwithstanding subd. 3. b., a pharmacy benefit manager may not deny a pharmacy’s or pharmacist’s appeal under this paragraph if the relief requested in the appeal relates to the maximum allowable cost for a pharmaceutical product that is not available for the pharmacy or pharmacist to purchase at a cost that is below the pharmacy acquisition cost from the pharmaceutical wholesaler from which the pharmacy or pharmacist purchases the majority of pharmaceutical products for resale. If this subdivision applies, the pharmacy benefit manager shall revise the maximum allowable cost list to increase the maximum allowable cost for the pharmaceutical product to an amount equal to or greater than the pharmacy’s or pharmacist’s pharmacy acquisition cost and allow the pharmacy or pharmacist to reverse and rebill each claim affected by the pharmacy’s or pharmacist’s inability to procure the pharmaceutical product at a cost that is equal to or less than the maximum allowable cost that was the subject of the pharmacy’s or pharmacist’s appeal.

AB773,,91 (d) Affiliated reimbursements. A pharmacy benefit manager may not reimburse a pharmacy or pharmacist in this state an amount less than the amount that the pharmacy benefit manager reimburses a pharmacy benefit manager affiliate for providing the same pharmaceutical product. The reimbursement amount shall be calculated on a per unit basis based on the same generic product identifier or generic code number, if applicable.

AB773,,92 (e) Declining to dispense. A pharmacy or pharmacist may decline to provide a pharmaceutical product to an individual or pharmacy benefit manager if, as a result of the applicable maximum allowable cost list, the pharmacy or pharmacist would be paid less than the pharmacy acquisition cost of the pharmacy or pharmacist providing the pharmaceutical product.

AB773,20 Section 20. 632.865 (2h) of the statutes is created to read: