Florida Senate - 2026 COMMITTEE AMENDMENT
Bill No. SB 1760
Ì620456,Î620456
LEGISLATIVE ACTION
Senate . House
Comm: RCS .
02/11/2026 .
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The Committee on Health Policy (Brodeur) recommended the
following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Effective upon this act becoming a law,
6 subsection (20) is added to section 1.01, Florida Statutes, to
7 read:
8 1.01 Definitions.—In construing these statutes and each and
9 every word, phrase, or part hereof, where the context will
10 permit:
11 (20) The term “Joint Legislative Committee on Medicaid
12 Oversight” means a committee or committees designated by joint
13 rule of the Legislature, by the President of the Senate or the
14 Speaker of the House of Representatives, or by agreement between
15 the President of the Senate and the Speaker of the House of
16 Representatives.
17 Section 2. Effective upon this act becoming a law, section
18 11.405, Florida Statutes, is created to read:
19 11.405 Joint Legislative Committee on Medicaid Oversight.
20 The Joint Legislative Committee on Medicaid Oversight is created
21 to ensure that the state Medicaid program is operating in
22 accordance with the Legislature’s intent and to promote
23 transparency and efficiency in government spending.
24 (1) MEMBERSHIP; SUBCOMMITTEES; MEETINGS.—
25 (a) The committee shall be composed of five members of the
26 Senate appointed by the President of the Senate and five members
27 of the House of Representatives appointed by the Speaker of the
28 House of Representatives, with each member serving a 2-year
29 term. The chair and vice chair shall each be appointed for 1
30 year terms, with the appointments alternating between the
31 President of the Senate and the Speaker of the House of
32 Representatives. The chair and vice chair may not be members of
33 the same house of the Legislature. If both the chair and vice
34 chair are absent at any meeting, the members present must elect
35 a temporary chair by a majority vote.
36 (b) Members shall serve without compensation but may be
37 reimbursed for per diem and travel expenses pursuant to s.
38 112.061.
39 (c) The chair may establish subcommittees as needed to
40 fulfill the committee’s duties.
41 (d) The committee shall convene at least twice a year, and
42 as often as necessary to conduct its business as required under
43 this section. Meetings may be held through teleconference or
44 other electronic means.
45 (2) COMMITTEE DUTIES.—
46 (a) The committee shall evaluate all aspects of the state
47 Medicaid program related to program financing, quality of care
48 and health outcomes, administrative functions, and operational
49 functions to ensure that the program is providing transparency
50 in the provision of health care plans and providers, ensuring
51 Medicaid recipients have access to quality health care services
52 and providing stability to the state’s budget through a health
53 care delivery system designed to contain costs.
54 (b) The committee shall identify and recommend policies
55 that limit Medicaid spending growth while improving health care
56 outcomes for Medicaid recipients. In developing its
57 recommendations, the committee shall do all of the following:
58 1. Evaluate legislation for its long-term impact on the
59 state Medicaid program.
60 2. Review data submitted to the Agency for Health Care
61 Administration by the Medicaid managed care plans pursuant to
62 statutory and contract requirements, including, but not limited
63 to, timeliness of provider credentialing, timely payment of
64 claims, rate of claim denials, prior authorizations for
65 services, and consumer complaints.
66 3. Review the Medicaid managed care plans’ encounter data,
67 financial data, and audits and the data used to calculate the
68 plans’ achieved savings rebates and medical loss ratios.
69 4. Review data related to health outcomes of Medicaid
70 recipients, including, but not limited to, Healthcare
71 Effectiveness Data and Information Set measures developed by the
72 National Committee for Quality Assurance, for each Medicaid
73 managed care plan, each Medicaid managed care plan’s performance
74 improvement projects, and outcome data related to all quality
75 goals included in the Medicaid managed care organization
76 contracts to improve quality for recipients.
77 5. Identify any areas for improvement in statute and rule
78 relating to the state Medicaid program.
79 6. Develop a plan of action for the future of the state
80 Medicaid program.
81 (c) The committee may submit periodic reports, including
82 recommendations, to the Legislature on issues related to the
83 state Medicaid program and any affiliated programs.
84 (3) COOPERATION.—
85 (a) The Auditor General and the Agency for Health Care
86 Administration shall enter into and maintain a data sharing
87 agreement by July 1, 2026, to ensure the committee has full
88 access to all data needed to fulfill its responsibilities.
89 (b) The Auditor General shall assist the committee in its
90 work by providing credentialed professional staff or consulting
91 services, including, but not limited to, an actuary not
92 associated with the state Medicaid program or any Medicaid
93 managed care organization who currently has a contract with the
94 state.
95 (c) The committee, in the course of its official duties,
96 must be given access to any relevant record, paper, or document
97 in possession of a state agency, any political subdivision of
98 the state, or any entity engaged in business or under contract
99 with a state agency, and may compel the attendance and testimony
100 of any state official or employee before the committee or secure
101 any evidence as provided in s. 11.143. The committee may also
102 have any other powers conferred on it by joint rules of the
103 Senate and the House of Representatives, and any joint rules of
104 the Senate and the House of Representatives applicable to joint
105 legislative committees apply to the proceedings of the committee
106 under this section.
107 (4) AGENCY REPORTS.—
108 (a) Before implementing any change to the Medicaid managed
109 care capitation rates, the Agency for Health Care Administration
110 shall notify the committee of the change and appear before the
111 committee to provide a report detailing the managed care
112 capitation rates and administrative costs built into the
113 capitation rates. The report must include the agency’s
114 historical and projected Medicaid program expenditure and
115 utilization trend rates by Medicaid program and service category
116 for the rate year, an explanation of how the trend rates were
117 calculated, and the policy decisions that were included in
118 setting the capitation rates.
119 (b) If the Agency for Health Care Administration or any
120 division within the agency is required by law to report to the
121 Legislature or to any legislative committee or subcommittee on
122 matters relating to the state Medicaid program, the agency must
123 also submit a copy of the report to the committee.
124 Section 3. Present subsections (2) through (5), (6) through
125 (10), and (11) through (18) of section 409.962, Florida
126 Statutes, are redesignated as subsections (3) through (6), (8)
127 through (12), and (14) through (21), respectively, and new
128 subsections (2), (7), and (13) are added to that section, to
129 read:
130 409.962 Definitions.—As used in this part, except as
131 otherwise specifically provided, the term:
132 (2) “Affiliate,” including the terms “affiliated with” and
133 “affiliation,” means a person, as construed in s. 1.01(3), who:
134 (a) Directly or indirectly, through one or more
135 intermediaries, controls, is controlled by, or is under common
136 control with a specified entity or person, including parent and
137 subsidiary entities; or
138 (b) Is deemed a “related party” according to the standards
139 adopted by the Financial Accounting Standards Board.
140 (7) “Control,” including the terms “controlling,”
141 “controlled by,” and “under common control with,” means the
142 possession, direct or indirect, of the power to direct or cause
143 the direction of the management and policies of a person,
144 whether through the ownership or voting securities, by contract
145 other than a commercial contract for goods or nonmanagement
146 services, or otherwise, unless the power is the result of an
147 official position with or corporate office held by the person.
148 This definition applies regardless of whether such power is
149 affirmative or negative or whether such power is actually used.
150 Control is presumed to exist, but is not limited to, when any
151 affiliate or person, as construed in s. 1.01(3):
152 (a) Directly or indirectly owns, controls, holds the power
153 to vote, or holds proxies representing 10 percent or more of any
154 class of the voting securities of any other person.
155 (b) Shares common ownership with any person; has an
156 investor or is a holder of an ownership interest in any person;
157 exercises control in any manner over the election of a majority
158 of the directors or of individuals exercising similar functions
159 of any person; has the power to exercise controlling influence
160 over the management of any person; or serves as a working
161 majority of the board of directors, the managers, or the
162 officers of a person, who is:
163 1. A provider or a member of a provider group or group
164 practice as defined in s. 456.053(3) under the managed care
165 plan; or
166 2. A person responsible for providing any pharmacy
167 services, pharmaceuticals, diagnostics, care coordination, care
168 delivery, health care services, medical equipment,
169 administrative services, or financial services under the managed
170 care plan.
171 (13) “Market rate” means the price that a willing buyer
172 will pay and a willing seller will accept in an arm’s-length
173 transaction which is beneficial to both parties.
174 Section 4. Subsections (1) and (2), paragraph (h) of
175 subsection (3), and subsection (4) of section 409.967, Florida
176 Statutes, are amended, and subsection (5) is added to that
177 section, to read:
178 409.967 Managed care plan accountability.—
179 (1) CONTRACT PROCUREMENT PROCESS.—Beginning with the
180 contract procurement process initiated during the 2023 calendar
181 year, the agency shall establish a 6-year contract with each
182 managed care plan selected through the procurement process
183 described in s. 409.966. A plan contract may not be renewed;
184 however, the agency may extend the term of a plan contract to
185 cover any delays during the transition to a new plan. The agency
186 shall extend until December 31, 2024, the term of existing plan
187 contracts awarded pursuant to the invitation to negotiate
188 published in July 2017.
189 (2) CONTRACT REQUIREMENTS.—The agency shall establish such
190 contract requirements as are necessary for the operation of the
191 statewide managed care program. In addition to any other
192 provisions the agency may deem necessary, the contract must
193 require:
194 (a) Physician compensation.—Managed care plans are expected
195 to coordinate care, manage chronic disease, and prevent the need
196 for more costly services. Effective care management should
197 enable plans to redirect available resources and increase
198 compensation for physicians. Plans achieve this performance
199 standard when physician payment rates equal or exceed Medicare
200 rates for similar services. The agency may impose fines or other
201 sanctions on a plan that fails to meet this performance standard
202 after 2 years of continuous operation.
203 (b) Emergency services.—Managed care plans shall pay for
204 services required by ss. 395.1041 and 401.45 and rendered by a
205 noncontracted provider. The plans must comply with s. 641.3155.
206 Reimbursement for services under this paragraph is the lesser
207 of:
208 1. The provider’s charges;
209 2. The usual and customary provider charges for similar
210 services in the community where the services were provided;
211 3. The charge mutually agreed to by the entity and the
212 provider within 60 days after submittal of the claim; or
213 4. The Medicaid rate, which, for the purposes of this
214 paragraph, means the amount the provider would collect from the
215 agency on a fee-for-service basis, less any amounts for the
216 indirect costs of medical education and the direct costs of
217 graduate medical education that are otherwise included in the
218 agency’s fee-for-service payment, as required under 42 U.S.C. s.
219 1396u-2(b)(2)(D). For the purpose of establishing the amounts
220 specified in this subparagraph, the agency shall publish on its
221 website annually, or more frequently as needed, the applicable
222 fee-for-service fee schedules and their effective dates, less
223 any amounts for indirect costs of medical education and direct
224 costs of graduate medical education that are otherwise included
225 in the agency’s fee-for-service payments.
226 (c) Access.—
227 1. The agency shall establish specific standards for the
228 number, type, and regional distribution of providers in managed
229 care plan networks to ensure access to care for both adults and
230 children. Each plan must maintain a regionwide network of
231 providers in sufficient numbers to meet the access standards for
232 specific medical services for all recipients enrolled in the
233 plan. The exclusive use of mail-order pharmacies may not be
234 sufficient to meet network access standards. Consistent with the
235 standards established by the agency, provider networks may
236 include providers located outside the region. Each plan shall
237 establish and maintain an accurate and complete electronic
238 database of contracted providers, including information about
239 licensure or registration, locations and hours of operation,
240 specialty credentials and other certifications, specific
241 performance indicators, and such other information as the agency
242 deems necessary. The database must be available online to both
243 the agency and the public and have the capability to compare the
244 availability of providers to network adequacy standards and to
245 accept and display feedback from each provider’s patients. Each
246 plan shall submit quarterly reports to the agency identifying
247 the number of enrollees assigned to each primary care provider.
248 The agency shall conduct, or contract for, systematic and
249 continuous testing of the provider network databases maintained
250 by each plan to confirm accuracy, confirm that behavioral health
251 providers are accepting enrollees, and confirm that enrollees
252 have access to behavioral health services.
253 2. Each managed care plan must publish any prescribed drug
254 formulary or preferred drug list on the plan’s website in a
255 manner that is accessible to and searchable by enrollees and
256 providers. The plan must update the list within 24 hours after
257 making a change. Each plan must ensure that the prior
258 authorization process for prescribed drugs is readily accessible
259 to health care providers, including posting appropriate contact
260 information on its website and providing timely responses to
261 providers. For Medicaid recipients diagnosed with hemophilia who
262 have been prescribed anti-hemophilic-factor replacement
263 products, the agency shall provide for those products and
264 hemophilia overlay services through the agency’s hemophilia
265 disease management program.
266 3. Managed care plans, and their fiscal agents or
267 intermediaries, must accept prior authorization requests for any
268 service electronically.
269 4. Managed care plans serving children in the care and
270 custody of the Department of Children and Families must maintain
271 complete medical, dental, and behavioral health encounter
272 information and participate in making such information available
273 to the department or the applicable contracted community-based
274 care lead agency for use in providing comprehensive and
275 coordinated case management. The agency and the department shall
276 establish an interagency agreement to provide guidance for the
277 format, confidentiality, recipient, scope, and method of
278 information to be made available and the deadlines for
279 submission of the data. The scope of information available to
280 the department shall be the data that managed care plans are
281 required to submit to the agency. The agency shall determine the
282 plan’s compliance with standards for access to medical, dental,
283 and behavioral health services; the use of medications; and
284 follow-up followup on all medically necessary services
285 recommended as a result of early and periodic screening,
286 diagnosis, and treatment.
287 (d) Quality care.—Managed care plans shall provide, or
288 contract for the provision of, care coordination to facilitate
289 the appropriate delivery of behavioral health care services in
290 the least restrictive setting with treatment and recovery
291 capabilities that address the needs of the patient. Services
292 shall be provided in a manner that integrates behavioral health
293 services and primary care. Plans shall be required to achieve
294 specific behavioral health outcome standards, established by the
295 agency in consultation with the department.
296 (e) Encounter data.—The agency shall maintain and operate a
297 Medicaid Encounter Data System to collect, process, store, and
298 report on covered services provided to all Medicaid recipients
299 enrolled in prepaid plans.
300 1. Each prepaid plan must comply with the agency’s
301 reporting requirements for the Medicaid Encounter Data System.
302 Prepaid plans must submit encounter data, including data on
303 encounters for which payment was denied and encounters for which
304 a health care provider was reimbursed by the plan on a capitated
305 basis, electronically in a format that complies with the Health
306 Insurance Portability and Accountability Act provisions for
307 electronic claims and in accordance with deadlines established
308 by the agency. Prepaid plans must certify that the data reported
309 is accurate and complete.
310 2. The agency is responsible for validating the data
311 submitted by the plans. The agency shall develop methods and
312 protocols for ongoing analysis of the encounter data that
313 adjusts for differences in characteristics of prepaid plan
314 enrollees to allow comparison of service utilization among plans
315 and against expected levels of use. The analysis shall be used
316 to identify possible cases of overspending on administrative
317 costs, payments by plans in excess of market rates, systemic
318 underutilization or denials of claims and inappropriate service
319 utilization such as higher-than-expected emergency department
320 encounters, and potential managed care plan fraud, waste, and
321 abuse. The analysis shall provide periodic feedback to the plans
322 and enable the agency to establish corrective action plans when
323 necessary. One of the focus areas for the analysis shall be the
324 use of prescription drugs. The analysis shall be used in managed
325 care plan capitation rate-setting processes provided under this
326 part.
327 3. The agency shall make encounter data available to those
328 plans accepting enrollees who are assigned to them from other
329 plans leaving a region.
330 4. The agency shall annually produce a report entitled
331 “Analysis of Potentially Preventable Health Care Events of
332 Florida Medicaid Enrollees.” The report must include, but need
333 not be limited to, an analysis of the potentially preventable
334 hospital emergency department visits, hospital admissions, and
335 hospital readmissions that occurred during the previous state
336 fiscal year which may have been prevented with better access to
337 primary care, improved medication management, or better
338 coordination of care, reported by age, eligibility group,
339 managed care plan, and region, including conditions contributing
340 to each potentially preventable event or category of potentially
341 preventable events. The agency may include any other data or
342 analysis parameters to augment the report which it deems
343 pertinent to the analysis. The report must demonstrate trends
344 using applicable historical data. The agency shall submit the
345 report to the Governor, the President of the Senate, and the
346 Speaker of the House of Representatives by October 1, 2024, and
347 each October 1 thereafter. The agency may contract with a third
348 party vendor to produce the report required under this
349 subparagraph.
350 (f) Continuous improvement.—The agency shall establish
351 specific performance standards and expected milestones or
352 timelines for improving performance over the term of the
353 contract.
354 1. Each managed care plan shall establish an internal
355 health care quality improvement system, including enrollee
356 satisfaction and disenrollment surveys. The quality improvement
357 system must include incentives and disincentives for network
358 providers.
359 2. Each managed care plan must collect and report the
360 Healthcare Effectiveness Data and Information Set (HEDIS)
361 measures, the federal Core Set of Children’s Health Care Quality
362 measures, and the federal Core Set of Adult Health Care Quality
363 Measures, as specified by the agency. Each plan must collect and
364 report the Adult Core Set behavioral health measures beginning
365 with data reports for the 2025 calendar year. Each plan must
366 stratify reported measures by age, sex, race, ethnicity, primary
367 language, and whether the enrollee received a Social Security
368 Administration determination of disability for purposes of
369 Supplemental Security Income beginning with data reports for the
370 2026 calendar year. A plan’s performance on these measures must
371 be published on the plan’s website in a manner that allows
372 recipients to reliably compare the performance of plans. The
373 agency shall use the measures as a tool to monitor plan
374 performance.
375 3. Each managed care plan must be accredited by the
376 National Committee for Quality Assurance, the Joint Commission,
377 or another nationally recognized accrediting body, or have
378 initiated the accreditation process, within 1 year after the
379 contract is executed. For any plan not accredited within 18
380 months after executing the contract, the agency shall suspend
381 automatic assignment under ss. 409.977 and 409.984.
382 (g) Program integrity.—Each managed care plan shall
383 establish program integrity functions and activities to reduce
384 the incidence of fraud and abuse, including, at a minimum:
385 1. A provider credentialing system and ongoing provider
386 monitoring, including maintenance of written provider
387 credentialing policies and procedures which comply with federal
388 and agency guidelines;
389 2. An effective prepayment and postpayment review process
390 including, but not limited to, data analysis, system editing,
391 and auditing of network providers;
392 3. Procedures for reporting instances of fraud and abuse
393 pursuant to chapter 641;
394 4. Administrative and management arrangements or
395 procedures, including a mandatory compliance plan, designed to
396 prevent fraud and abuse; and
397 5. Designation of a program integrity compliance officer.
398 (h) Grievance resolution.—Consistent with federal law, each
399 managed care plan shall establish and the agency shall approve
400 an internal process for reviewing and responding to grievances
401 from enrollees. Each plan shall submit quarterly reports on the
402 number, description, and outcome of grievances filed by
403 enrollees.
404 (i) Penalties.—
405 1. Withdrawal and enrollment reduction.—Managed care plans
406 that reduce enrollment levels or leave a region before the end
407 of the contract term must reimburse the agency for the cost of
408 enrollment changes and other transition activities. If more than
409 one plan leaves a region at the same time, costs must be shared
410 by the departing plans proportionate to their enrollments. In
411 addition to the payment of costs, departing provider services
412 networks must pay a per-enrollee penalty of up to 3 months’
413 payment and continue to provide services to the enrollee for 90
414 days or until the enrollee is enrolled in another plan,
415 whichever occurs first. In addition to payment of costs, all
416 other departing plans must pay a penalty of 25 percent of that
417 portion of the minimum surplus maintained pursuant to s.
418 641.225(1) which is attributable to the provision of coverage to
419 Medicaid enrollees. Plans shall provide at least 180 days’
420 notice to the agency before withdrawing from a region. If a
421 managed care plan leaves a region before the end of the contract
422 term, the agency shall terminate all contracts with that plan in
423 other regions pursuant to the termination procedures in
424 subparagraph 3.
425 2. Encounter data.—If a plan fails to comply with the
426 encounter data reporting requirements of this section for 30
427 days, the agency must assess a fine of $5,000 per day for each
428 day of noncompliance beginning on the 31st day. On the 31st day,
429 the agency must notify the plan that the agency will initiate
430 contract termination procedures on the 90th day unless the plan
431 comes into compliance before that date.
432 3. Termination.—If the agency terminates more than one
433 regional contract with the same managed care plan due to
434 noncompliance with the requirements of this section, the agency
435 shall terminate all the regional contracts held by that plan.
436 When terminating multiple contracts, the agency must develop a
437 plan to provide for the transition of enrollees to other plans,
438 and phase in the terminations over a time period sufficient to
439 ensure a smooth transition.
440 (j) Prompt payment.—Managed care plans shall comply with
441 ss. 641.315, 641.3155, and 641.513.
442 (k) Electronic claims.—Managed care plans, and their fiscal
443 agents or intermediaries, shall accept electronic claims in
444 compliance with federal standards.
445 (l) Fair payment.—Provider service networks must ensure
446 that no entity licensed under chapter 395 with a controlling
447 interest in the network charges a Medicaid managed care plan
448 more than the amount paid to that provider by the provider
449 service network for the same service.
450 (m) Itemized payment.—Any claims payment to a provider by a
451 managed care plan, or by a fiscal agent or intermediary of the
452 plan, must be accompanied by an itemized accounting of the
453 individual claims included in the payment including, but not
454 limited to, the enrollee’s name, the date of service, the
455 procedure code, the amount of reimbursement, and the
456 identification of the plan on whose behalf the payment is made.
457 (n) Provider dispute resolution.—Disputes between a plan
458 and a provider may be resolved as described in s. 408.7057.
459 (o) Transparency.—Managed care plans shall comply with ss.
460 627.6385(3) and 641.54(7).
461 (p) Third-party administrators.—The agency′s contract with
462 a managed care plan must require that any third-party
463 administrative entity contracted by the plan adheres to all
464 pertinent requirements of the Medicaid program placed on the
465 plan under the plan′s contract with the agency.
466 (3) ACHIEVED SAVINGS REBATE.—
467 (h) The following may not be included as allowable expenses
468 in calculating income for determining the achieved savings
469 rebate:
470 1. Payment of achieved savings rebates.
471 2. Any financial incentive payments made to the plan
472 outside of the capitation rate.
473 3. Any financial disincentive payments levied by the state
474 or Federal Government.
475 4. Expenses associated with any lobbying or political
476 activities.
477 5. The cash value or equivalent cash value of bonuses of
478 any type paid or awarded to the plan’s executive staff, other
479 than base salary.
480 6. Reserves and reserve accounts.
481 7. Administrative costs, including, but not limited to,
482 reinsurance expenses, interest payments, depreciation expenses,
483 bad debt expenses, and outstanding claims expenses in excess of
484 actuarially sound maximum amounts set by the agency.
485 8. Payments to affiliates as defined in s. 409.962 in
486 excess of market rates.
487
488 The agency shall consider these and other factors in developing
489 contracts that establish shared savings arrangements.
490 (4) MEDICAL LOSS RATIOS RATIO.—
491 (a) If required by federal regulations or as a condition of
492 a waiver, the agency must may calculate a medical loss ratios
493 ratio for all managed care plans contracted with the agency
494 under this part. The calculations must calculation shall use
495 uniform financial data collected from all plans and shall be
496 computed for each plan on a statewide basis. If a plan
497 participates in the managed medical assistance program, the
498 long-term care managed care program, or the pilot program for
499 individuals with developmental disabilities, the agency must
500 calculate medical loss ratios for the plan’s participation in
501 each program separately and, if the plan participates in more
502 than one of these programs, for the plan’s overall participation
503 in statewide Medicaid managed care. Medical loss ratios must be
504 calculated and The method for calculating the medical loss ratio
505 shall meet the following criteria:
506 (a) Except as provided in paragraphs (b) and (c),
507 expenditures must shall be classified in a manner consistent
508 with 42 C.F.R. part 438 45 C.F.R. part 158.
509 (b) The agency shall report medical loss ratios quarterly
510 and annually for each managed care plan contracted with the
511 agency under this part to the Governor, the President of the
512 Senate, and the Speaker of the House of Representatives no later
513 than 6 months after the end of each such period Funds provided
514 by plans to graduate medical education institutions to
515 underwrite the costs of residency positions shall be classified
516 as medical expenditures, provided the funding is sufficient to
517 sustain the positions for the number of years necessary to
518 complete the residency requirements and the residency positions
519 funded by the plans are active providers of care to Medicaid and
520 uninsured patients.
521 (c) Before final determination of the medical loss ratio
522 for any period, a plan may contribute to a designated state
523 trust fund for the purpose of supporting Medicaid and indigent
524 care and have the contribution counted as a medical expenditure
525 for the period. Funds contributed for this purpose shall be
526 deposited into the Grants and Donations Trust Fund.
527 (5) AFFILIATED ENTITIES AND RELATED PARTIES.—
528 (a) The agency shall ensure oversight of affiliated
529 entities and related parties paid by managed care plans under
530 this part, including, but not limited to, examining financial
531 records and self-referral data of any managed care plan
532 providing services within the statewide managed care program
533 which uses affiliated entities and related parties.
534 (b) The agency shall consider data examined under paragraph
535 (a) and the findings of the annual assessment required under s.
536 409.9675(4) when developing managed care plan capitation rates
537 under this part.
538 Section 5. Effective January 1, 2027, paragraph (f) of
539 subsection (3) of section 409.967, Florida Statutes, is amended,
540 and paragraph (g) of that subsection is republished, to read:
541 409.967 Managed care plan accountability.—
542 (3) ACHIEVED SAVINGS REBATE.—
543 (f) Achieved savings rebates validated by the certified
544 public accountant are due within 30 days after the report is
545 submitted. Except as provided in paragraph (h), the achieved
546 savings rebate is established by determining pretax income as a
547 percentage of revenues and applying the following income sharing
548 ratios:
549 1. One hundred percent of income up to and including 3 5
550 percent of revenue shall be retained by the plan.
551 2. Thirty Fifty percent of income above 3 5 percent and up
552 to 10 percent shall be retained by the plan, and the other 70 50
553 percent shall be refunded to the state and adjusted for the
554 Federal Medical Assistance Percentages. The state share shall be
555 transferred to the General Revenue Fund, unallocated, and the
556 federal share shall be transferred to the Medical Care Trust
557 Fund, unallocated.
558 3. One hundred percent of income above 10 percent of
559 revenue shall be refunded to the state and adjusted for the
560 Federal Medical Assistance Percentages. The state share shall be
561 transferred to the General Revenue Fund, unallocated, and the
562 federal share shall be transferred to the Medical Care Trust
563 Fund, unallocated.
564 (g) A plan that exceeds agency-defined quality measures in
565 the reporting period may retain an additional 1 percent of
566 revenue. For the purpose of this paragraph, the quality measures
567 must include plan performance for preventing or managing
568 complex, chronic conditions that are associated with an elevated
569 likelihood of requiring high-cost medical treatments.
570 Section 6. Section 409.9675, Florida Statutes, is created
571 to read:
572 409.9675 Affiliated entities and controlling interests;
573 reports required.—
574 (1) Each managed care plan contracted by the agency under
575 this part shall report all of the following by March 31, 2027,
576 for the prior calendar year, and annually thereafter, to the
577 agency and the Office of Insurance Regulation in a manner
578 prescribed by the agency:
579 (a) Any person controlled by or affiliated with the managed
580 care plan, including, but not limited to, any provider, provider
581 group, group practice defined in s. 456.053(3), or person
582 responsible for providing any pharmacy services,
583 pharmaceuticals, diagnostics, care coordination, care delivery,
584 health care services, medical equipment, administrative
585 services, or financial services for, to, or on behalf of the
586 managed care plan.
587 (b) Any affiliation of any kind or nature with any person
588 which has, either directly or indirectly through one or more
589 intermediaries, an investment or ownership interest representing
590 10 percent or more, shares common ownership with, or has an
591 investor or a holder of an ownership interest representing 10
592 percent or more with any person providing pharmacy services,
593 diagnostics, care coordination, care delivery, health care
594 services, medical equipment, administrative services, or
595 financial services for, to, or on behalf of the managed care
596 plan.
597 (2) For any affiliation reported by a managed care plan
598 under subsection (1), the report must include all of the
599 following:
600 (a) The percentage of ownership or control of any person or
601 affiliate with whom the managed care plan has had business
602 transactions totaling in the aggregate more than $25,000 during
603 the prior 12-month period in the annual achieved savings rebate
604 financial reporting required under s. 409.967(3) and
605 identification of the specific contract or contracts involved in
606 such business transactions.
607 (b) Any significant business transactions between the
608 managed care plan and any affiliated person during the 12-month
609 period in the annual achieved savings rebate financial reporting
610 required under s. 409.967(3).
611 (3) Each managed care plan shall report any change in
612 information required by subsection (1) to the agency and the
613 Office of Insurance Regulation in writing within 60 days after
614 the change occurs.
615 (4) By December 31, 2026, and annually thereafter, the
616 agency shall calculate, analyze, and publicly report on the
617 agency’s website an assessment of affiliated entity payment
618 transactions in the Medicaid program for medical benefit and
619 administrative costs as reported for purposes of the achieved
620 savings rebate. The baseline assessment, at a minimum, must
621 include achieved savings rebate transactions for the years 2021,
622 2022, and 2023; the amount and associated percentage of
623 affiliated entity payments within the medical loss ratio; and
624 the payment deviation percentages and associated amounts at the
625 Healthcare Common Procedure Coding System level for affiliated
626 entities as compared to nonaffiliated entities. The assessment
627 must also compare payment amounts for value-based or alternative
628 payment arrangements.
629 Section 7. Present paragraphs (b), (c), and (d), and (e)
630 through (x) of subsection (1) of section 626.8825, Florida
631 Statutes, are redesignated as paragraphs (c), (d), and (e), and
632 (g) through (z), respectively, new paragraphs (b) and (f) are
633 added to that subsection, and present paragraph (u) of
634 subsection (1), paragraphs (e) and (g) of subsection (2), and
635 paragraphs (c) and (h) of subsection (3) of that section are
636 amended, to read:
637 626.8825 Pharmacy benefit manager transparency and
638 accountability.—
639 (1) DEFINITIONS.—As used in this section, the term:
640 (b) “Affiliated manufacturer” means a prescription drug
641 manufacturer permitted under chapter 499 or a private label
642 distributor as defined in 21 C.F.R. s. 207.1 which directly or
643 indirectly through one or more intermediaries:
644 1. Has an investment or ownership interest in a pharmacy
645 benefit manager holding a certificate of authority issued under
646 this part;
647 2. Shares common ownership with a pharmacy benefit manager
648 holding a certificate of authority issued under this part; or
649 3. Has an investor or a holder of an ownership interest
650 which is a pharmacy benefit manager holding a certificate of
651 authority issued under this part.
652 (f) “Covered prescription drug” means any drug or biologic
653 included in a pharmacy benefit manager’s formulary which is paid
654 for as a pharmacy benefit under the plan at any of the plan’s
655 network pharmacies.
656 (w)(u) “Pharmacy benefits plan or program” means a plan or
657 program that pays for, reimburses, covers the cost of, or
658 provides access to discounts on pharmacist services provided by
659 one or more pharmacies to covered persons who reside in, are
660 employed by, or receive pharmacist services from this state.
661 1. The term includes, but is not limited to, health
662 maintenance organizations, health insurers, self-insured
663 employer health plans, discount card programs, and government
664 funded health plans, including the Statewide Medicaid Managed
665 Care program established pursuant to part IV of chapter 409 and
666 the state group insurance program pursuant to part I of chapter
667 110.
668 2. The term excludes such a plan or program under s. 430.84
669 or chapter 440.
670 (2) CONTRACTS BETWEEN A PHARMACY BENEFIT MANAGER AND A
671 PHARMACY BENEFITS PLAN OR PROGRAM.—In addition to any other
672 requirements in the Florida Insurance Code, all contractual
673 arrangements executed, amended, adjusted, or renewed on or after
674 July 1, 2023, which are applicable to pharmacy benefits covered
675 on or after January 1, 2024, between a pharmacy benefit manager
676 and a pharmacy benefits plan or program must include, in
677 substantial form, terms that ensure compliance with all of the
678 following requirements and that, except to the extent not
679 allowed by law, shall supersede any contractual terms to the
680 contrary:
681 (e) Include network adequacy requirements that meet or
682 exceed Medicare Part D program standards for convenient access
683 to the network pharmacies set forth in 42 C.F.R. s.
684 423.120(a)(1) and that:
685 1. Do not limit a network to solely include affiliated
686 pharmacies;
687 2. Require a pharmacy benefit manager to offer a provider
688 contract to licensed pharmacies physically located on the
689 physical site of providers that are:
690 a. Within the pharmacy benefits plan’s or program’s
691 geographic service area and that have been specifically
692 designated as essential providers by the Agency for Health Care
693 Administration pursuant to s. 409.975(1)(a);
694 b. Designated as cancer centers of excellence under s.
695 381.925, regardless of the pharmacy benefits plan’s or program’s
696 geographic service area;
697 c. Organ transplant hospitals, regardless of the pharmacy
698 benefits plan’s or program’s geographic service area;
699 d. Hospitals licensed as specialty children’s hospitals as
700 defined in s. 395.002; or
701 e. Regional perinatal intensive care centers as defined in
702 s. 383.16(2), regardless of the pharmacy benefits plan’s or
703 program’s geographic service area.
704
705 Such provider contracts must be solely for the administration
706 and or dispensing of covered prescription drugs, including
707 biological products, which are administered through infusions,
708 intravenously injected, or inhaled during a surgical procedure
709 or are covered parenteral drugs, as part of onsite outpatient
710 care;
711 3. Do not require a covered person to receive a
712 prescription drug by United States mail, common carrier, local
713 courier, third-party company or delivery service, or pharmacy
714 direct delivery unless the prescription drug cannot be acquired
715 at any retail pharmacy in the pharmacy benefit manager’s network
716 for the covered person’s pharmacy benefits plan or program. This
717 subparagraph does not prohibit a pharmacy benefit manager from
718 operating mail order or delivery programs on an opt-in basis at
719 the sole discretion of a covered person, provided that the
720 covered person is not penalized through the imposition of any
721 additional retail cost-sharing obligations or a lower allowed
722 quantity limit for choosing not to select the mail order or
723 delivery programs;
724 4. For the in-person administration of covered prescription
725 drugs, prohibit requiring a covered person to receive pharmacist
726 services from an affiliated pharmacy or an affiliated health
727 care provider; and
728 5. Prohibit offering or implementing pharmacy networks that
729 require or provide a promotional item or an incentive, defined
730 as anything other than a reduced cost-sharing amount or enhanced
731 quantity limit allowed under the benefit design for a covered
732 drug, to a covered person to use an affiliated pharmacy or an
733 affiliated health care provider for the in-person administration
734 of covered prescription drugs; or advertising, marketing, or
735 promoting an affiliated pharmacy to covered persons. Subject to
736 the foregoing, a pharmacy benefit manager may include an
737 affiliated pharmacy in communications to covered persons
738 regarding network pharmacies and prices, provided that the
739 pharmacy benefit manager includes information, such as links to
740 all nonaffiliated network pharmacies, in such communications and
741 that the information provided is accurate and of equal
742 prominence. This subparagraph may not be construed to prohibit a
743 pharmacy benefit manager from entering into an agreement with an
744 affiliated pharmacy to provide pharmacist services to covered
745 persons.
746 (g) Prohibit a pharmacy benefit manager from instituting a
747 network that requires a pharmacy to meet accreditation standards
748 inconsistent with or more stringent than applicable federal and
749 state requirements for licensure and operation as a pharmacy in
750 this state. However, a pharmacy benefit manager may specify
751 additional specialty networks that require enhanced standards
752 related to the safety and competency necessary to meet the
753 United States Food and Drug Administration’s limited
754 distribution requirements for dispensing any drug that, on a
755 drug-by-drug basis, requires extraordinary special handling,
756 provider coordination, or clinical care or monitoring when such
757 extraordinary requirements cannot be met by a retail pharmacy.
758 For purposes of this paragraph, drugs requiring extraordinary
759 special handling are limited to drugs that are subject to a risk
760 evaluation and mitigation strategy approved by the United States
761 Food and Drug Administration and that:
762 1. Require special certification of a health care provider
763 to prescribe, receive, dispense, or administer; or
764 2. Require special handling due to the molecular complexity
765 or cytotoxic properties of the biologic or biosimilar product or
766 drug.
767
768 For participation in a specialty network, a pharmacy benefit
769 manager may not require a pharmacy to meet requirements for
770 participation beyond those necessary to demonstrate the
771 pharmacy’s ability to dispense the drug in accordance with the
772 United States Food and Drug Administration’s approved
773 manufacturer labeling.
774 (3) CONTRACTS BETWEEN A PHARMACY BENEFIT MANAGER AND A
775 PARTICIPATING PHARMACY.—In addition to other requirements in the
776 Florida Insurance Code, a participation contract executed,
777 amended, adjusted, or renewed on or after July 1, 2023, that
778 applies to pharmacist services on or after January 1, 2024,
779 between a pharmacy benefit manager and one or more pharmacies or
780 pharmacists, must include, in substantial form, terms that
781 ensure compliance with all of the following requirements, and
782 that, except to the extent not allowed by law, shall supersede
783 any contractual terms in the participation contract to the
784 contrary:
785 (c) A prohibition of financial clawbacks, reconciliation
786 offsets, or offsets to adjudicated claims. A pharmacy benefit
787 manager may not charge, withhold, offset, or recoup any direct
788 or indirect remuneration fees, dispensing fees, brand name or
789 generic effective rate adjustments through reconciliation, or
790 any other monetary charge, withholding, or recoupments as
791 related to discounts, multiple network reconciliation offsets,
792 adjudication transaction fees, and any other instance when an
793 amount a fee may be recouped from a pharmacy if such action
794 would result in a reduction in the amount paid to the pharmacy
795 or pharmacist. This prohibition does not apply to:
796 1. Any incentive payments provided by the pharmacy benefit
797 manager to a network pharmacy for meeting or exceeding
798 predefined quality measures, such as Healthcare Effectiveness
799 Data and Information Set measures; recoupment due to an
800 erroneous claim, fraud, waste, or abuse; a claim adjudicated in
801 error; a maximum allowable cost appeal pricing adjustment; or an
802 adjustment made as part of a pharmacy audit pursuant to s.
803 624.491.
804 2. Any recoupment that is returned to the state for
805 programs in chapter 409 or the state group insurance program in
806 s. 110.123.
807 (h) The pharmacy benefit manager shall provide a reasonable
808 administrative appeal procedure to allow a pharmacy or
809 pharmacist to challenge the maximum allowable cost pricing
810 information and the reimbursement made under the maximum
811 allowable cost as defined in s. 627.64741 for a specific drug as
812 being below the acquisition cost available to the challenging
813 pharmacy or pharmacist.
814 1. The administrative appeal procedure must include a
815 telephone number and e-mail address, or a website, for the
816 purpose of submitting the administrative appeal. The appeal may
817 be submitted by the pharmacy or an agent of the pharmacy
818 directly to the pharmacy benefit manager or through a pharmacy
819 service administration organization. The administrative appeal
820 process must allow a pharmacy or pharmacist the option to submit
821 an electronic spreadsheet or similar electronic document
822 containing a consolidated administrative appeal representing
823 multiple adjudicated claims that share the same drug and day
824 supply and have a date of service occurring within the same
825 calendar month. The pharmacy or pharmacist must be given at
826 least 30 business days after a maximum allowable cost update or
827 after an adjudication for an electronic claim or reimbursement
828 for a nonelectronic claim to file the administrative appeal.
829 2. The pharmacy benefit manager must respond to the
830 administrative appeal within 30 business days after receipt of
831 the appeal.
832 3. If the appeal is upheld, the pharmacy benefit manager
833 must:
834 a. Update the maximum allowable cost pricing information to
835 at least the acquisition cost available to the pharmacy;
836 b. Permit the pharmacy or pharmacist to reverse and rebill
837 the claim in question;
838 c. Provide to the pharmacy or pharmacist the national drug
839 code on which the increase or change is based; and
840 d. Make the increase or change effective for each similarly
841 situated pharmacy or pharmacist who is subject to the applicable
842 maximum allowable cost pricing information.
843 4. If the appeal is denied, the pharmacy benefit manager
844 must provide to the pharmacy or pharmacist the national drug
845 code and the name of the national or regional pharmaceutical
846 wholesalers operating in this state which have the drug
847 currently in stock at a price below the maximum allowable cost
848 pricing information.
849 5. Beginning August 15, 2026 Every 90 days, a pharmacy
850 benefit manager shall report to the office the total number of
851 appeals received and denied in the preceding quarter 90-day
852 period, with an explanation or reason for each denial, for each
853 specific drug for which an appeal was submitted pursuant to this
854 paragraph. The deadlines for each filing are March 1 for the
855 preceding year′s fourth quarter; May 15 for each year′s first
856 quarter; August 15 for each year′s second quarter; and November
857 15 for each year′s third quarter.
858 Section 8. Subsection (7) of section 626.8827, Florida
859 Statutes, is amended, and subsections (8), (9), and (10) are
860 added to that section, to read:
861 626.8827 Pharmacy benefit manager prohibited practices.—In
862 addition to other prohibitions in this part, a pharmacy benefit
863 manager may not do any of the following:
864 (7) Fail to comply with the requirements in s. 624.491 or
865 s. 626.8825, or breach contractual terms required under s.
866 626.8825.
867 (8) Prohibit or restrict a pharmacy from declining to
868 dispense a drug if the reimbursement rate for the drug is less
869 than the actual acquisition cost to the pharmacy.
870 (9) Reimburse a pharmacy less than it reimburses an
871 affiliate pharmacy.
872 (10) Maintain an ownership interest, investment interest,
873 or common ownership with an affiliated manufacturer, or share
874 any investor or holder of an ownership interest with an
875 affiliated manufacturer.
876 Section 9. Subsection (1) of section 627.42392, Florida
877 Statutes, is amended to read:
878 627.42392 Prior authorization.—
879 (1) As used in this section, the term “health insurer”
880 means an authorized insurer offering health insurance as defined
881 in s. 624.603, a managed care plan as defined in s. 409.962 s.
882 409.962(10), or a health maintenance organization as defined in
883 s. 641.19(12).
884 Section 10. Except as otherwise provided in this act and
885 except for this section, which shall take effect upon this act
886 becoming a law, this act shall take effect July 1, 2026.
887
888 ================= T I T L E A M E N D M E N T ================
889 And the title is amended as follows:
890 Delete everything before the enacting clause
891 and insert:
892 A bill to be entitled
893 An act relating to health care coverage; amending s.
894 1.01, F.S.; defining the term “Joint Legislative
895 Committee on Medicaid Oversight”; creating s. 11.405,
896 F.S.; establishing the Joint Legislative Committee on
897 Medicaid Oversight for specified purposes; providing
898 for membership, subcommittees, and meetings of the
899 committee; specifying duties of the committee;
900 authorizing the committee to submit periodic reports
901 to the Legislature; requiring the Auditor General and
902 the Agency for Health Care Administration to enter
903 into and maintain a data sharing agreement for a
904 certain purpose by a specified date; requiring the
905 Auditor General to assist the committee by providing
906 certain staff or consulting services; requiring that
907 state agencies, political subdivisions of the state,
908 and entities contracted with state agencies give the
909 committee access to certain records, papers, and
910 documents; authorizing the committee to compel
911 testimony and evidence according to specified
912 provisions; providing for additional powers of the
913 committee; providing that certain joint rules of the
914 Legislature apply to the proceedings of the committee;
915 requiring the agency to notify the committee of
916 certain changes and provide a report containing
917 specified information to the committee; requiring the
918 agency to submit a copy of certain reports to the
919 committee; amending s. 409.962, F.S.; defining terms;
920 amending s. 409.967, F.S.; revising encounter data
921 reporting requirements for prepaid Medicaid plans;
922 requiring the agency’s analysis of such encounter data
923 to include identification of specified occurrences;
924 requiring the agency to use such analysis in setting
925 managed care plan capitation rates; requiring that
926 managed care plan contracts require any third-party
927 administrative entity contracted with the plan to
928 adhere to specified requirements; specifying
929 additional types of payments which may not be included
930 in calculating income for purposes of the achieved
931 savings rebate; requiring, rather than authorizing,
932 the agency to calculate the medical loss ratio for all
933 managed care plans under certain circumstances;
934 revising requirements for the calculation of medical
935 loss ratios; requiring the agency to report medical
936 loss ratios quarterly and annually for each managed
937 care plan to the Governor and the Legislature within a
938 specified timeframe; requiring the agency to ensure
939 oversight of affiliated entities and related parties
940 paid by managed care plans; requiring the agency to
941 examine specified records and data related to such
942 entities and parties; requiring the agency to consider
943 certain data and findings when developing managed care
944 plan capitation rates; revising the income sharing
945 ratios used to calculate the achieved savings rebate
946 beginning on a specified date; creating s. 409.9675,
947 F.S.; requiring managed care plans to report to the
948 agency and the Office of Insurance Regulation the
949 existence of and specified details relating to certain
950 affiliations by a specified date and annually
951 thereafter; requiring managed care plans to report any
952 change in such information to the agency and the
953 office in writing within a specified timeframe;
954 requiring the agency to calculate, analyze, and
955 publicly report on the agency’s website an assessment
956 of affiliated entity payment transactions in the
957 Medicaid program and certain administrative costs by a
958 specified date and annually thereafter; providing
959 requirements for the assessment; amending s. 626.8825,
960 F.S.; defining the terms “affiliated manufacturer” and
961 “covered prescription drug”; revising the definition
962 of the term “pharmacy benefits plan or program”;
963 revising requirements for contracts between a pharmacy
964 benefit manager and a pharmacy benefits plan or
965 program and a participating pharmacy; revising the
966 frequency of and deadlines for certain reports
967 pharmacy benefit managers are required to submit to
968 the office beginning on a specified date; amending s.
969 626.8827, F.S.; revising and specifying additional
970 practices pharmacy benefit managers are prohibited
971 from engaging in; amending s. 627.42392, F.S.;
972 conforming a cross-reference; providing effective
973 dates.