Subject 120-2-97 PHARMACY BENEFITS MANAGERS REGULATION
This Regulation is promulgated by the Commissioner of
Insurance pursuant to the authority set forth in O.C.G.A. §§ 33-2-9 and
33-64-1et
seq.
| (1) |
This Regulation applies to any pharmacy
benefits manager as defined in O.C.G.A. Section
33-64-1. |
| (2) |
The purposes of this Regulation include:
| (a) |
Providing the regulation and licensure of
pharmacy benefits managers; |
| (b) |
Promoting the financial responsibility of pharmacy benefits managers; |
| (c) |
Subjecting those business entities
defined in O.C.G.A. § 33-64-1 to
the jurisdiction of the Commissioner of Insurance; and |
| (d) |
Regulating pharmacy benefits managers'
practices in conformity with the general purposes of the Georgia Insurance
Code. |
|
| (1) |
It is unlawful
for any person, business entity, or other entity to act as or hold itself out
to be a pharmacy benefits manager in this State without a valid license issued
by the Commissioner of Insurance. To qualify for and hold a license to act as a
pharmacy benefits manager in this State, a pharmacy benefits manager must
otherwise be in compliance with Chapter 64 of Title 33 of the Official Code of
Georgia Annotated and this Regulation. |
| (2) |
The pharmacy benefits manager shall file
with the Commissioner an application for a license upon a form to be furnished
by the Commissioner. |
| (3) |
An audited
financial statement or such other information as the Commissioner may require
that demonstrates that the applicant possesses a minimum net worth of $200,000.
Letters of credit, backstop guarantees and special corporate structures will
not be taken into consideration by the Commissioner in determining the net
worth requirement. |
| (4) |
A Bond and
proof of Errors and Omissions coverage must be included in the application and
maintained by the pharmacy benefits manager. |
| (5) |
An application for a pharmacy benefits
manager's license shall be accompanied by a fee of $500.00. |
| (6) |
The Commissioner shall not issue a
license or renew an existing license if he or she determines that the pharmacy
benefits manager has:
| (a) |
Misrepresented or
concealed any material fact in the application for the license; |
| (b) |
Has obtained or attempted to obtain the
license by misrepresentation, concealment, or other fraud; or |
| (c) |
Has failed to obtain for initial
licensure or retain for annual renewal a net worth of at least
$200,000. |
|
| (7) |
A license
issued under this section may be issued on a probationary basis in the
discretion of the Commissioner. The probationary license may be issued for not
longer than 12 months and not less than 3 months and is subject to revocation
without a hearing. The Commissioner, at his or her discretion, shall prescribe
the terms of probation, may extend the probationary period, or refuse to grant
a license at the end of any probationary period. |
| (1) |
Every pharmacy
benefits manager shall file a bond with the Commissioner. The pharmacy benefits
manager shall file a certificate of such bond, in a form acceptable by a
corporate surety insurer authorized to transact insurance in this state in
favor of Commissioner of Insurance of the state of Georgia, continuous in form
and in an amount $100,000. |
| (2) |
The
bond shall inure to the benefit of any person damaged by any fraudulent act or
conduct of the pharmacy benefits manager and must be conditioned upon faithful
accounting and application of all money coming into the pharmacy benefits
manager's possession in connection with its activities as an pharmacy benefits
manager. |
| (3) |
The bond remains in
force until released by the Commissioner or canceled by the surety. Without
prejudice to any liability previously incurred, the surety may cancel the bond
upon thirty (30) days' advance notice to the pharmacy benefits manager and the
Commissioner. A pharmacy benefits manager's license shall be suspended if it
does not file with the Commissioner a replacement bond before the date of
cancellation of the previous bond. A replacement bond must meet all
requirements of this section for the initial bond. |
| (4) |
Each pharmacy benefits manager shall
obtain errors and omissions coverage or other appropriate liability insurance,
written by an insurer authorized to transact insurance in this state, in an
amount of at least $250,000. |
| (5) |
Any policy written in accordance with paragraph (4) of this Rule shall be for a
term of at least one year and shall contain provisions that:
| (a) |
Cancellation or termination of the policy
is not effective except upon sixty (60) days' written notice by registered or
certified mail to the other party to the policy and to the Commissioner;
and |
| (b) |
The policy is automatically
renewable at the expiration of the policy period except upon sixty (60) days'
written notice by registered or certified mail by the party not renewing the
policy to the other party to the policy and to the Commissioner. |
|
| (6) |
Compliance by the pharmacy
benefits manager with paragraphs (1) and (4) of this Rule is a prerequisite to
approval of its application by the Commissioner. |
| (7) |
Any bond and errors and omissions
coverage required for licensure and renewal purposes shall be maintained in
place by the pharmacy benefits manager for a period of at least one year
immediately following the surrender, non-renewal or revocation of the
license. |
| (1) |
Each authorized pharmacy benefits manager
shall file with the Commissioner an annual renewal of its license on a form
prescribed by the Commissioner. The statement shall be filed annually on or
before May 1. The annual renewal shall be in such form and contain such matters
as the Commissioner prescribes and shall be verified by at least one officer of
the pharmacy benefits manager. For good cause shown the Commissioner may extend
the time for filing of the annual renewal of the license conditioned upon
payment of a late fee of $15.00 per day as prescribed by law at O.C.G.A. § 33-8-1(W).
In the event the pharmacy benefits manager does not timely renew its license
prior to the expiration of its license, June 30, the pharmacy benefits manager
will cease to have a valid license and will need to reapply for a new license
prior to commencing its business or initiating new business in Georgia. If the
pharmacy benefits manager fails to renew its license the Commissioner shall
provide notice to the pharmacy benefits manager and the pharmacy benefits
manager may invoke the right to a hearing. |
| (2) |
At the time of filing its annual renewal,
the pharmacy benefits manager shall pay a filing fee of $400.00. |
| (3) |
The pharmacy benefits manager shall at
all times maintain a net worth of $200,000. If the pharmacy benefits manager
fails to maintain a net worth of $200,000 the Commissioner, in his or her
discretion, may enter any disciplinary order as he or she deems appropriate
pursuant to Title 33. In order to verify the net worth of the pharmacy benefits
manager, proof that the applicant possesses a minimum net worth of $200,000
must be included in the annual renewal filing that represents the calendar year
end or fiscal year end of the pharmacy benefits manager. |
| (1) |
The Commissioner or his or her designated
representative is authorized to make a complete on-site examination of the
affairs of each pharmacy benefits manager as often as is deemed necessary.
Whenever the Commissioner shall deem it expedient, he or she shall examine, by
use of an examiner duly authorized by him or her, the affairs, transactions,
accounts, records, documents, assets, liabilities, of a pharmacy benefits
manager and any other facts relative to its business methods, management, and
dealings with a health plan or covered entity. |
| (2) |
Any pharmacy benefits manager being
examined shall provide to the Commissioner or his or her designee convenient
and free access, at all reasonable hours at their offices, to all books,
records, documents and other papers relating to such pharmacy benefits
manager's business affairs. |
| (3) |
At
the direction of the Commissioner the pharmacy benefits manager shall pay the
fees and expenses of the examination. A consolidated account for the
examination shall be filed by the examiner with the Commissioner. |
| (4) |
Nothing in this rule shall limit or
abridge any other investigatory powers of the Commissioner vested in him or her
by Title 33 of the Official Code of Georgia Annotated. |
Standard pharmacy benefits manager forms are required and
will be supplied upon request by the Commissioner's office either in paper form
or electronically over the internet. Applicants and licensed pharmacy benefits
managers shall utilize all applicable forms in preparing applications,
statements, notices of required information, and other required submissions
required under Chapter 64 of Title 33 of the Official Code of Georgia
Annotated.
| (1) |
Any person,
business entity, or other entity acting as a pharmacy benefits manager without
a license shall be subject to a monetary penalty of up to $1,000.00 for each
and every transaction in violation of the chapter. Any person, business entity,
or other entity willfully acting as a pharmacy benefits manager without a
license shall be subject to a monetary penalty of up to $5,000.00 for each and
every act in violation. |
| (2) |
In
addition to all other penalties provided for under this title, the Commissioner
shall have the authority to place any pharmacy benefits manager on probation
for a period of time not to exceed one year for each and every act in violation
of this chapter and may subject such pharmacy benefits manager to a monetary
penalty of up to $1,000.00 for each and every act in violation of this chapter.
If the pharmacy benefits manager willfully acted in violation of this chapter
the monetary penalty may be increased up to $5,000.00 for each and every act in
violation. |
If any provision of this Regulation Chapter, or the
application thereof to any person, business entity, or other entity or
circumstance, is held invalid by a court of competent jurisdiction, the
remainder of the Regulation Chapter or the applicability of such provision to
other persons or circumstances shall not be affected.
