ARS § 20-3335

20-3335 - Pharmacy benefit managers; prescribing; formulary change; notice; exemption; enforcement; applicability; definitions 20-3335. Pharmacy benefit managers; prescribing; formulary change; notice; exemption; enforcement; applicability; definitions A. A pharmacy benefit manager that enters into an agreement with a health care insurer to provide pharmacy benefit management services to covered individuals on behalf of the pharmacy benefit manager or a health care insurer may not limit or exclude coverage of a prescription drug for any covered individual who is on a specific prescription drug if both of the following apply: 1. The prescription drug was previously approved by the pharmacy benefit manager or health care insurer for coverage for the covered individual. 2. The covered individual continues to be an insured, enrollee or subscriber of the health care insurer that the pharmacy benefit manager has contracted with to provide pharmacy benefit management services. B. If subsection A of this section applies, the drug coverage shall continue for a covered individual's specific prescription drug through the last day of the covered individual's health care plan year. C. A pharmacy benefit manager or health care insurer may not change a covered individual from the previously covered prescription drug if the covered individual's prescribing health care provider provides electronic or written notice to the pharmacy benefit manager or health care insurer notifying the pharmacy benefit manager or health care insurer that the covered individual will continue on the current prescription drug. D. If a pharmacy benefit manager or health care insurer makes any formulary change that limits or excludes coverage of a prescription drug, the pharmacy benefit manager or health care insurer shall provide electronic or written notice of the removal of or change for any prescription drug on the drug formulary to each impacted covered individual and the impacted covered individual's prescribing health care provider at least sixty days before the formulary change. The notice shall do both of the following: 1. Set forth the process by which the covered individual's health care provider may notify the pharmacy benefit manager or health care insurer for the continued use of the nonformulary prescription drugs. 2. Include notification to the prescribing health care provider that if the health care provider notifies the pharmacy benefit manager or health care insurer that the insured, enrollee or subscriber will continue on the nonformulary prescription drug for the remainder of the health care plan year, the health care provider will need to apply for a formulary exception pursuant to section 20-3336 for the continued use of the nonformulary prescription drug on renewal of the health care plan. E. This section does not: 1. Prevent a health care provider from prescribing another prescription drug that is covered by the health care insurer of the pharmacy benefit manager if the health care provider deems the prescription drug medically necessary for the covered individual. 2. Prevent a health care insurer or pharmacy benefit manager that is contracted to provide pharmacy benefit management services from: (a) Adding a prescription drug to its formulary. (b) Removing a prescription drug from its formulary if the drug manufacturer has removed the prescription drug for sale in the United States. (c) Making any formulary changes for patients who are not on a previously approved prescription drug. F. If a health care insurer, pharmacy benefit manager or utilization review agent violates this section, the director may enforce this section pursuant to section 20-3333 or chapter 15, article 1 of this title, as applicable. G. This section applies only to pharmacy benefit managers that are subject to section 20-3333. H. For the purposes of this section: 1. "Health care insurer" has the same meaning prescribed in section 20-2501. 2. "Health care plan" means a policy, contract or evidence of coverage that a health care insurer issues to an insured, enrollee or subscriber. 3. "Limit or exclude coverage" means to: (a) Limit or reduce the maximum coverage of prescription drug benefits. (b) Increase cost sharing for a covered prescription drug. (c) Require an additional prior authorization for a patient who is currently approved for a prescription drug based solely on the movement of the prescription drug to a more restrictive formulary tier. (d) Remove a prescription drug from a formulary unless either of the following applies: (i) The United States food and drug administration revokes approval for or removes a prescription drug from the prescription drug market. (ii) The prescription drug manufacturer notifies the United States food and drug administration of a manufacturing discontinuation or a potential discontinuation as required by section 506c of the federal food, drug, and cosmetic act (21 United States Code section 356c). 4. "Utilization review agent" means a utilization review agent as defined in section 20-2530 that is contracted to provide pharmacy benefit management services for a health care insurer.