Reprinted
April 12, 2001
ENGROSSED
HOUSE BILL No. 1958
_____
DIGEST OF HB 1958
(Updated April 11, 2001 3:05 PM - DI 77)
Citations Affected: IC 24-5; IC 27-8; IC 27-13; noncode.
Synopsis: Prescription discount and benefit cards. Provides that a
person may not sell, market, promote, advertise, or distribute a card,
device, or other purchasing mechanism that is not insurance that
purports to offer discounts or access to discounts from a pharmacy for
prescription drug or device purchases if certain conditions exist.
Provides penalties for violations. Establishes uniform requirements for
prescription drug information or other technology issued by an insurer,
a health maintenance organization, or certain other entities. Provides
that prescription drug cards do not have to issued more than every 12
months.
Effective: July 1, 2001.
Brown C
, Becker
(SENATE SPONSORS _ JOHNSON, ROGERS, SIMPSON)
January 17, 2001, read first time and referred to Committee on Public Health.
February 14, 2001, amended, reported _ Do Pass.
February 19, 2001, read second time, ordered engrossed.
February 20, 2001, engrossed. Read third time, passed. Yeas 94, nays 0.
SENATE ACTION
February 27, 2001, read first time and referred to Committee on Health and Provider
Services.
April 5, 2001, amended, reported favorably _ Do Pass.
April 11, 2001, read second time, amended, ordered engrossed.
Reprinted
April 12, 2001
First Regular Session 112th General Assembly (2001)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in
this style type, and deletions will appear in
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Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in
this style type. Also, the
word
NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in
this style type or
this style type reconciles conflicts
between statutes enacted by the 2000 General Assembly.
ENGROSSED
HOUSE BILL No. 1958
A BILL FOR AN ACT to amend the Indiana Code concerning
insurance.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 24-5-21; (01)EH1958.2.1. -->
SECTION 1. IC 24-5-21 IS ADDED TO THE INDIANA CODE AS
A
NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2001]:
Chapter 21. Prescription Drug Discount Cards
Sec. 1. This chapter does not apply to the following:
(1) Eye or vision care services, glasses, or contact lenses
provided by an optometrist or ophthalmologist.
(2) A card, device, or other purchasing mechanism that is not
insurance but that is administered in conjunction with a
health or medical benefit by an insurance company, a
nonprofit health service plan corporation, or a health
maintenance organization.
(3) A benefit administered by or under contract with the state
of Indiana.
(4) A customer discount or membership card issued by a store
or buying club for use at that store or buying club.
Sec. 2. As used in this chapter, "person" has the meaning set
forth in IC 24-5-0.5-2.
Sec. 3. A person may not sell, market, promote, advertise, or
distribute a card, device, or other purchasing mechanism that
purports to offer discounts or access to discounts from a pharmacy
for prescription drug or device purchases in the following
situations:
(1) The card, device, or other purchasing mechanism does not
expressly state in bold and prominent type, which is
prominently placed, that the discounts are not insurance.
(2) The discounts are not specifically authorized by an
individual and separate contract with each pharmacy listed
with the card, device, or other purchasing mechanism.
(3) The discounts or access to discounts offered, or the range
of discounts or access to the range of discounts offered are
deceptive or misleading.
Sec. 4. A person who is not exempt under section 1 of this
chapter and who sells, markets, promotes, advertises, or distributes
a card, device, or other purchasing mechanism that purports to
offer discounts or access to discounts from a pharmacy for
prescription drug or device purchases shall designate a resident in
Indiana as an agent for service of process and register the agent
with the secretary of state.
Sec. 5. A contract entered into to purchase a card, device, or
other purchasing mechanism that purports to offer discounts or
access to discounts from a pharmacy for prescription drug or
device purchases that does not comply with this chapter is voidable
by the purchaser.
Sec. 6. (a) The attorney general, a prosecuting attorney, or an
individual may maintain an action to enjoin any act that is in
violation of this chapter and for the recovery of damages.
(b) An action brought under this section may be brought in the
county where:
(1) the plaintiff resides or conducts business;
(2) the defendant resides or conducts business; or
(3) the card, device, or other purchasing mechanism that
purports to offer discounts or access to discounts from a
pharmacy for prescription drug or device purchases was sold,
marketed, promoted, advertised, or distributed.
(c) If the court finds that the defendant violated any provision
of this chapter, the court shall enjoin the defendant from
continuing the acts that are in violation of this chapter.
(d) A plaintiff who prevails in an action under this chapter may
recover the following:
(1) A sum equal to one hundred dollars ($100) per card,
device, or other purchasing mechanism that is sold or
distributed in Indiana by the defendant or ten thousand
dollars ($10,000), whichever is greater.
(2) Three (3) times the amount of actual damages, if any.
(3) Reasonable attorney's fees.
(4) Court costs.
(5) Any other relief that the court considers proper.
Sec. 7. (a) The provisions of this chapter are not exclusive and
do not relieve a person from compliance with other applicable
provisions of law.
(b) The penalties in this chapter are cumulative and in addition
to any other applicable penalties.
(c) A person that violates this chapter is subject to the penalties
set forth in IC 24-5-0.5.
(d) All actions brought under this chapter must be brought
within two (2) years after the date on which the violation of this
chapter occurred.
SOURCE: IC 27-8-5.8; (01)EH1958.2.2. -->
SECTION 2. IC 27-8-5.8 IS ADDED TO THE INDIANA CODE
AS A
NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2001]:
Chapter 5.8. Insurance Benefit Cards
Sec. 1. As used in this chapter, "accident and sickness insurance
policy" means an insurance policy that provides at least one (1) of
the types of insurance described in IC 27-1-5-1, Classes 1(b) and
2(a), and is issued on a group basis. The term does not include the
following:
(1) Accident only, credit, dental, vision, Medicare, Medicare
supplement, long term care, or disability income insurance.
(2) Coverage issued as a supplement to liability insurance.
(3) Automobile medical payment insurance.
(4) A specified disease policy.
(5) A limited benefit health insurance policy.
(6) A short term insurance plan that:
(A) may not be renewed; and
(B) has a duration of not more than six (6) months.
(7) A policy that provides a stipulated daily, weekly, or
monthly payment to an insured during hospital confinement,
without regard to the actual expense of the confinement.
(8) Worker's compensation or similar insurance.
(9) A student health insurance policy.
Sec. 2. As used in this chapter, "commissioner" means the
insurance commissioner appointed under IC 27-1-1-2.
Sec. 3. As used in this chapter, "insured" means an individual
who is entitled to coverage under an accident and sickness
insurance policy.
Sec. 4. (a) This section applies to an insurer that:
(1) issues an accident and sickness insurance policy that
provides coverage for prescription drugs or devices; and
(2) issues a card or other technology for claims processing.
This section also applies to a third party administrator for
self-insured plans, a pharmacy benefit manager, or a health benefit
plan administered by the state if the administrator, manager, or
plan issues a card or other technology described in subdivision (2).
(b) The card or other technology issued by an insurer or another
entity referred to in subsection (a) must contain uniform
prescription drug information that complies with the requirements
established under subsection (c).
(c) Prescription drug information cards or other technology
must meet either of the following criteria:
(1) Be in a format and contain information fields approved by
the National Council for Prescription Drug Programs
(NCPDP) as contained in the National Council for
Prescription Drug Programs Pharmacy ID Card
Implementation Guide in effect on the October 1 most
immediately preceding the issuance of the card.
(2) Contain the following information:
(A) The health benefit plan's name.
(B) The insured's name, group number, and identification
number.
(C) A telephone number to inquire about pharmacy related
issues.
(D) The issuer's international identification number or
ANSI BIN number, labeled as RxBIN.
(E) The processor control number, labeled as RxPCN.
(F) The insured's pharmacy benefits group number if
different than medical group number, labeled as RxGRP.
(3) Only those fields listed in (A) through (F) above that are
required for proper adjudication of the claim must appear on
the card. If the card is used to adjudicate non-pharmacy
claims, then the designation "Rx" listed in the fields (D)
through (F) is not required to be utilized by the issuer.
(d) An insurer its agents, contractors, or administrators,
including pharmacy benefits managers, may not be required to
issue a prescription drug information card or other technology to
a person more than one (1) time during a twelve (12) month period.
(e) The prescription drug information cards or other technology
issued under this section may be used for health insurance
coverage other than the coverage to which this chapter applies.
SOURCE: IC 27-13-9-5; (01)EH1958.2.3. -->
SECTION 3. IC 27-13-9-5 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2001]: Sec. 5. (a) This section applies to a health maintenance
organization that provides coverage for prescription drugs or
devices and issues a card or other technology for claims processing.
(b) The card or other technology issued by a health maintenance
organization must contain uniform prescription drug information
that complies with the requirements established under subsection
(c).
(c) Prescription drug information cards or other technology
must meet either of the following criteria:
(1) Be in a format and contain information fields approved by
the National Council for Prescription Drug Programs
(NCPDP) as contained in the National Council for
Prescription Drug Programs Pharmacy ID Card
Implementation Guide in effect on the October 1 most
immediately preceding the issuance of the card.
(2) Contain the following information:
(A) The health benefit plan's name.
(B) The enrollee's name, group number, and identification
number.
(C) A telephone number to inquire about pharmacy related
issues.
(D) The issuer's international identification number or
ANSI BIN number, labeled as RxBIN.
(E) The processor control number, labeled as RxPCN.
(F) The insured's pharmacy benefits group number if
different than medical group number, labeled as RxGRP.
(3) Only those fields listed in (A) through (F) above that are
required for proper adjudication of the claim must appear on
the card. If the card is used to adjudicate non-pharmacy
claims, then the designation "Rx" listed in the fields (D)
through (F) is not required to be utilized by the issuer.
(d) A health maintenance organization may not be required to
issue a prescription drug information card or other technology to
a person more than one (1) time during a twelve (12) month period.
(e) The prescription drug information cards or other technology
issued under this section may be used for health care service
coverage other than the coverage to which this chapter applies.
SOURCE: ; (01)EH1958.2.4. -->
SECTION 4. [EFFECTIVE JULY 1, 2001]
(a) Notwithstanding
IC 27-8-5.8 and IC 27-13-9-5, both as added by this act, an insurer
or a health maintenance organization its agents, contractors, or
administrators, including pharmacy benefits managers, is not
required to issue prescription drug information cards or other
technology that meet the requirements established under
IC 27-8-5.8 and IC 27-13-9-5, both as added by this act, for a
contract issued or renewed before July 1, 2002.
(b) This SECTION expires July 1, 2002.