N.Y. Comp. Codes R. & Regs. tit. 11 § 458.2

Current through Register Vol. 46, No. 50, December 11, 2024

Section 458.2 - Prohibited acts and practices

(a) A pharmacy benefit manager shall not cause or knowingly permit the use of any advertisement, promotion, solicitation, representation, proposal or offer that is false, deceptive, or misleading.

(b) No pharmacy benefit manager shall engage in any unfair or deceptive act or practice.

(1) An act or practice is unfair when:

(i) the act or practice causes or is likely to cause substantial injury to a covered individual that is not reasonably avoidable by the covered individual; and

(ii) such substantial injury is not outweighed by countervailing benefits to the covered individual or to competition.

(2) An act or practice is deceptive when:

(i) the act or practice misleads or is likely to mislead a covered individual;

(ii) the covered individual's interpretation of the act or practice is reasonable under the circumstances; and

(iii) the misleading act or practice is material.

(c) A pharmacy benefit manager shall not directly or indirectly:

(1) engage in marketing, advertising, or promotional activities to covered individuals for the purpose of gaining dispensing opportunities at affiliated pharmacies, including providing incentives to a covered individual to use an affiliated pharmacy when unaffiliated pharmacies are available within the same network, provided, however, that nothing in this section shall be construed to restrict a pharmacy benefit manager from communicating or operationalizing any element of plan design elected by a health plan. Subject to the foregoing, a pharmacy benefit manager may include an affiliated pharmacy in communications to covered individuals and prospective covered individuals regarding network pharmacies and prices, provided that the pharmacy benefit manager includes accurate information regarding unaffiliated pharmacies participating in the network, if any, in such communications;

(2) in any manner on any material produced by the pharmacy benefit manager, including identification cards, include the name of any affiliated pharmacy unless it specifically lists two or more unaffiliated pharmacies participating in the relevant pharmacy network, provided unaffiliated pharmacies are participating in the network;

(3) transfer or share records relative to prescription information containing a covered individual's identifiable or prescriber-identifiable data to an affiliated pharmacy; provided, however, that nothing in this paragraph shall be construed to prohibit:

(i) the transfer or sharing of such information necessary for the limited purposes of pharmacy reimbursement, formulary compliance, pharmacy care, or utilization review; or

(ii) a pharmacy benefit manager from notifying a covered individual that a less expensive option for a specific prescription drug is available through a mail-order pharmacy or an affiliated pharmacy, provided the notification shall state that switching to the less expensive option is not mandatory;

(4) require a covered individual to purchase prescription drugs exclusively through a mail-order pharmacy or refer a covered individual to a mail-order pharmacy or an affiliated pharmacy unless contractually required to do so by the health plan;

(5) penalize a covered individual for using an in-network unaffiliated pharmacy, including by requiring a covered individual to pay the full cost for a prescription. Nothing in this paragraph shall be construed to prohibit a health plan's election to use a network or networks that only includes affiliated pharmacies;

(6) remove a specific drug from a formulary or deny coverage of a specific drug for the purpose of incentivizing a specific covered individual to seek coverage from a different health plan;

(7) prohibit or limit any covered individual from selecting an in-network pharmacy of the individual's choice unless specifically required by the health plan for a particular covered individual; or

(8) prohibit a pharmacy from:

(i) discussing with a covered individual information regarding the cost of the prescription to the covered individual;

(ii) disclosing to a covered individual the availability of any therapeutically equivalent alternative medications;

(iii) selling a more affordable alternative to a covered individual if a more affordable alternative is available;

(iv) providing a covered individual with the option of paying the pharmacy's cash price for the purchase of a prescription drug and not filing a claim with the covered individual's health plan if the cash price is less than the covered person's cost-sharing amount;

(v) offering and providing mail or delivery services to a covered individual as an ancillary service of the pharmacy, or charging a shipping, handling, or delivery fee for providing such service.

(d)Maximum Payment Costs. A pharmacy benefit manager shall not require a covered individual purchasing a covered prescription drug to pay an amount greater than the lesser of:

(1) the cost-sharing amount under the terms of the health plan;

(2) the maximum allowable cost for the drug; or

(3) the amount the covered individual would pay for the drug if the covered individual were paying the cash price the pharmacy would charge to a person without health plan coverage.

(e) A pharmacy benefit manager that willfully or recklessly violates any of the provisions of this section shall be deemed to have committed a fraudulent, coercive, or dishonest practice for purposes of Insurance Law section 2907.

N.Y. Comp. Codes R. & Regs. Tit. 11 § 458.2

Adopted New York State Register November 27, 2024/Volume XLVI, Issue 48, eff. 11/27/2024