An Act Regarding Maximum Allowable Cost Pricing Lists Used by Pharmacy Benefit Managers
Maine Legislature, Session 127, LD 1150
Committee: Insurance and Financial Services
Sponsors: BROOKS, WHITTEMORE, BEAVERS, BECK, MORRISON, NUTTING, PICCHIOTTI, PRESCOTT, ROTUNDO, KATZ
Amends: 24-A MRSA §4317

Legislative Document 
No. 1150 
H.P. 788 
House of Representatives, March 31, 2015 
An Act Regarding Maximum Allowable Cost Pricing Lists Used by 
Pharmacy Benefit Managers 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
ROBERT B. HUNT 
Clerk 
Presented by Representative BROOKS of Lewiston. 
Cosponsored by Senator WHITTEMORE of Somerset and 
Representatives: BEAVERS of South Berwick, BECK of Waterville, MORRISON of South 
Portland, NUTTING of Oakland, PICCHIOTTI of Fairfield, PRESCOTT of Waterboro, 
ROTUNDO of Lewiston, Senator: KATZ of Kennebec. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  24-A MRSA §4317, sub-§12 is enacted to read: 
12.  Maximum allowable cost.  This subsection governs the maximum allowable 
cost for a prescription drug as determined by a pharmacy benefits manager. 
A.  As used in this subsection, unless the context otherwise indicates, the following 
terms have the following meanings. 
(1)  "Maximum allowable cost" means the maximum amount that a pharmacy 
benefits manager pays toward the cost of a prescription drug. 
(2)  "Nationally available" means available to all pharmacies in this State for 
purchase, without limitation, from regional or national wholesalers and not 
obsolete or temporarily available. 
(3)  "Therapeutically equivalent drug substitute" means a prescription drug 
identified as therapeutically or pharmaceutically equivalent to another 
prescription drug as evidenced by an "A" code in the most recent version of the 
United States Food and Drug Administration's "Approved Drug Products with 
Therapeutic Equivalence Evaluations," also known as "the Orange Book," or an 
equivalent rating from a successor publication. 
B.  A pharmacy benefits manager may set a maximum allowable cost for a 
prescription drug, or allow a prescription drug to continue on a maximum allowable 
cost list, only if that prescription drug is nationally available and has 3 or more 
nationally available therapeutically equivalent drug substitutes with a significant cost 
difference. 
C.  A pharmacy benefits manager shall remove or modify a maximum allowable cost 
for a prescription drug as necessary for the cost of the prescription drug to remain 
consistent with changes to such costs in the national marketplace for prescription 
drugs. A removal or modification made under this paragraph must be made in a 
timely fashion. 
D.  A pharmacy benefits manager shall disclose to a pharmacy for which the 
pharmacy benefits manager processes claims, makes payment of claims or procures 
drugs: 
(1)  By January 1st, the basis of the methods and the sources used to establish the 
maximum allowable costs used by the pharmacy benefits manager; 
(2)  Promptly, by written notification, any change made to a maximum allowable 
cost; and 
(3)  At least once every 7 days, the maximum allowable costs used by the 
pharmacy benefits manager. 
E.  A pharmacy benefits manager shall disclose to a carrier with which the pharmacy 
benefits manager has entered into a contract: 
(1)  By January 1st, the basis of the methods and the sources used to establish the 
maximum allowable costs used by the pharmacy benefits manager; 
(2)  As soon as practicable, any change made to a maximum allowable cost; 
(3)  The maximum allowable costs for prescription drugs dispensed at a retail 
pharmacy if a similar maximum allowable cost list is not used for prescription 
drugs dispensed by mail, not later than 21 business days after these costs are set; 
and 
(4)  Whether the pharmacy benefits manager bills the carrier for a prescription 
drug an amount consistent with the maximum allowable cost for that drug used 
for reimbursing a pharmacy and, if the pharmacy benefits manager does not bill 
and reimburse consistent amounts, the difference between the amount billed and 
the amount reimbursed. 
F.  A pharmacy benefits manager shall provide a reasonable administrative appeal 
procedure, including a right to appeal that is limited to 60 days following the initial 
claim, to allow pharmacies to challenge maximum allowable costs for a specified 
drug if one of the following conditions is met: 
(1)  The prescription drug does not meet the requirements of paragraph B; and 
(2)  The maximum allowable cost is below the pharmacy's acquisition cost. 
G.  The pharmacy benefits manager shall respond to, investigate and resolve an 
appeal under paragraph F within 7 days after the receipt of the appeal.  The pharmacy 
benefits manager shall respond to an appeal as follows: 
(1)  If the appeal is upheld, the pharmacy benefits manager shall make the 
appropriate adjustment in the maximum allowable cost, permit the challenging 
pharmacy or pharmacist to reverse and rebill the claim in question retroactive to 
the date of the initial claim adjudication and make the adjustment for each 
similarly situated pharmacy in the State that is within the network within 5 
business days; or 
(2)  If the appeal is denied, the pharmacy benefits manager shall provide the 
challenging pharmacy or pharmacist the national drug code from national or 
regional wholesalers operating in the State of a comparable prescription drug that 
may be purchased at or below the maximum allowable cost. 
H.  The superintendent may enforce this section under sections 220 and 223 and other 
provisions of this Title.  A person who violates this section is subject to a civil 
penalty of not less than $1,000 per violation. 
SUMMARY 
This bill establishes requirements for maximum allowable cost pricing lists used by 
pharmacy benefits managers and requires pharmacy benefits managers to make 
disclosures regarding that pricing and the methods used to establish that pricing to plan 
sponsors.  It establishes an appeal process for pharmacies for disputes relating to 
maximum allowable cost pricing. The bill also provides for financial penalties for 
violations.