304.1 7A-161 Definitions for KRS 304.17A -161, 304.17A -162, 304.17A -163, and 304.17A -165. As used in this section and KRS 304.17A -162, 304.17A -163, and 304.17A -165 unless the context requires otherwise: (1) 'Contracted pharmacy' or 'pharmacy' means a pharmacy located in Kentucky participating in the network of a pharmacy benefit manager through a direct contract or through a contract with a pharmacy services administration organization or group purchasing organization; (2) 'Drug product reimbursement' means th e amount paid by a pharmacy benefit manager to a contracted pharmacy for the cost of the drug dispensed to a patient and does not include a dispensing or professional fee; (3) 'Maximum allowable cost' means the maximum amount that a pharmacy benefit manage r will reimburse a pharmacy for the cost of a generic drug and does not include a dispensing or professional fee; and (4) 'Pharmacy benefit manager' means an entity that, on behalf of a health benefit plan, state agency, insurer, managed care organization providing services under KRS Chapter 205, or other third -party payor: (a) Contracts directly or indirectly with pharmacies to provide prescription drugs to agency, insurer, managed care organization providing services under KRS Chapter 205, or other third -party payor: (a) Contracts directly or indirectly with pharmacies to provide prescription drugs to individuals; (b) Administers a prescription drug benefit; (c) Processes or pays pharmacy claims; (d) Creates or updates prescription drug formularies; (e) Makes or assists in making prior authorization determinations on prescription drugs; (f) Administers rebates on prescription drugs; or (g) Establishes a pharmacy network. Effective: July 15, 2016 History: Amended 2016 Ky. Acts ch. 79, sec. 5, effective July 15, 2016. -- Created 2013 Ky. Acts ch. 109, sec. 1, effective June 25, 2013.
Kentucky Legal Code