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Legislative Year: 2019 Change

Bill Detail: HB19-1296

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Title Prescription Drug Cost Reduction Measures
Status House Committee on Appropriations Lay Over Unamended - Amendment(s) Failed (05/09/2019)
Bill Subjects
  • Health Care & Health Insurance
  • Insurance
House Sponsors D. Jackson (D)
S. Jaquez Lewis (D)
Senate Sponsors J. Ginal (D)
K. Donovan (D)
House Committee Health and Insurance
Senate Committee
Date Introduced 03/29/2019

Section 1 of the bill enacts the Colorado Prescription Drug Cost
Reduction Act of 2019, which requires:
  • Health insurers, starting in 2020, to submit to the
commissioner of insurance (commissioner) information
regarding prescription drugs covered under their health
insurance plans that the plan paid for in the preceding
calendar year, including information about rebates received
from prescription drug manufacturers, a certification
regarding how rebates were accounted for in insurance
premiums, and a list of all pharmacy benefit management
firms (PBMs) with whom they contract;
  • Prescription drug manufacturers to notify the
commissioner, state purchasers, health insurers, and PBMs
when the manufacturer, on or after January 1, 2020,
increases the price of certain prescription drugs by more
than specified amounts or introduces a new specialty drug
in the commercial market;
  • Prescription drug manufacturers, within 15 days after the
end of each calendar quarter that starts on or after January
1, 2020, to provide specified information to the
commissioner regarding the drugs about which the
manufacturer notified purchasers;
  • Health insurers or, if applicable, PBMs to annually report
specified information to the commissioner regarding
rebates and administrative fees received from
manufacturers for prescription drugs for which they
received the required notice from a manufacturer; and
  • Certain nonprofit organizations to compile and submit to
the commissioner an annual report indicating the amount of
each payment, donation, subsidy, or thing of value received
by the nonprofit organization or its executive director, chief
operating officer, board of directors, or any member of the
board of directors from a prescription drug manufacturer,
PBM, or health insurer and the percentage of the nonprofit
organization's total gross income that is attributable to
those payments, donations, subsidies, or things of value.
The commissioner is required to post the information received
from health insurers, prescription drug manufacturers, PBMs, and
nonprofit organizations on the division of insurance's website, excluding
any information that is proprietary. Additionally, the commissioner, or a
disinterested third-party contractor, is to analyze the data reported by
health insurers, prescription drug manufacturers, PBMs, and nonprofit
organizations and other relevant information to determine the effect of
prescription drug costs on health insurance premiums. The commissioner
is to publish a report each year, submit the report to the governor and
specified legislative committees, and present the report during annual
State Measurement for Accountable, Responsive, and Transparent
(SMART) Government Act hearings. The commissioner is authorized
to adopt rules as necessary to implement the requirements of the bill.
Section 2 prohibits PBMs from retroactively reducing payment on
a clean claim submitted by a pharmacy unless the PBM determines,
through an audit conducted in accordance with state law, that the claim
was not a clean claim. Health insurers that contract with PBMs must
ensure that the PBMs are complying with this prohibition and the
reporting requirements and are subject to penalties for failure to do so.
Section 3 requires a carrier to reduce the cost sharing a covered
person is required to pay for prescription drugs by an amount equal to the
greater of 51% of the average aggregate rebates received by the carrier for
all prescription drugs, including price protection rebates, or an amount
that ensures cost sharing will not exceed 125% of the carrier's cost for the
prescription drug.
Under sections 5 and 6, a prescription drug manufacturer that fails
to notify purchasers or fails to report required data to the commissioner
is subject to discipline by the state board of pharmacy, including a penalty
of up to $10,000 per day for each day the manufacturer fails to comply
with the notice or reporting requirements. The commissioner is to report
manufacturer violations to the state board of pharmacy. Additionally,
health insurers that fail to report the required data are subject to a fine of
up to $10,000 per day.
Sections 7 and 8 of the bill make conforming amendments
necessary to harmonize the bill with the title 12 recodification bill, House
Bill 19-1172.

Committee Reports
with Amendments
Full Text
Full Text of Bill (pdf) (most recent)
Fiscal Notes Fiscal Notes (05/29/2019) (most recent)  
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