Senate Bill No. 520
(By Senators Foster and Wells)
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[Introduced March 9, 2009; referred to the Committee on Health
and Human Resources; and then to the Committee on the Judiciary.]
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A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §30-5-12a, relating
to prescription and pharmacy data privacy; establishing
legislative intent; prohibiting disclosure of certain data;
requiring legislative rules; creating penalties; and providing
for enforcement.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §30-5-12a, to read as
follows:
ARTICLE 5. PHARMACISTS, PHARMACY TECHNICIANS, PHARMACY INTERNS
AND PHARMACIES.
§30-5-12a. Prescription Record Privacy Act.
(a)
Findings. -- The Legislature hereby finds:
(1) That the spiraling cost of brand-name prescription drugs is a great concern to the State of West Virginia;
(2) That the commercial use of prescription data mining by
pharmaceutical representatives, which allows them to specifically
target physicians and shape their sales pitches accordingly,
induces physicians to prescribe more expensive brand-name drugs in
the place of equally effective, low-cost generic or alternative
drugs, greatly increasing the cost of health care for private
consumers as well as for state health care programs without
increased health benefits;
(3) That pharmaceutical representatives spend large sums of
money offering physicians all expenses paid speaking engagements,
lucrative consulting opportunities and office luncheons, as well as
free drug samples, pens, notepads, and other gifts of greater or
lesser value;
(4) That, when time is not limiting, pharmaceutical
representatives also spend large sums of money offering physicians
all expenses paid speaking engagements, lucrative consulting
opportunities and office luncheons;
(5) That such gifts and honoraria erode consumer confidence in
the medical profession and are viewed by the public as just as
negatively influential to physician conduct as similar gifts are
negatively influential, and therefore restricted, to public
official conduct;
(6) That the American Medical Association's (A.M.A.) physician data restriction program has been ineffective at best or has been
subject to a conflict of interest in view of the fact that the
association receives over $40 million annually from selling
physician profiles to data mining companies;
(7) That there is an inherent conflict between marketing
agendas and truly evidence-based, individual care policies;
(8) That there are educational, nonprofit and law enforcement
uses of this type of data, which are beneficial; and
(9) That the State of West Virginia has a duty to promote
responsible health care practices among physicians and to promote
the general welfare of its citizens, as well as, a fiscal
responsibility to taxpayers in administering state health care
programs.
(b)
Legislative intent. --
It is the intent of the Legislature to safeguard the
confidentiality of prescribing information, protect the integrity
of the physician-patient relationship, maintain the integrity and
public trust in the medical profession, restrain the undue
influence of pharmaceutical representatives on a physician's
prescribing habits and further the state interest in improving the
quality and lowering the cost of health care.
The Legislature intends to regulate the use of prescription
data for marketing purposes but allow the use in noncommercial
areas.
(c)
Definitions. -- As used in this section:
(1) "Bona fide clinical trial" means any research project that
prospectively assigns human subjects to intervention and comparison
groups to study the cause and effect relationship between a medical
intervention and a health outcome, has received approval from an
appropriate Institutional Review Board and has been registered at
clinicaltrials.gov prior to commencement.
(2) "Individual identifying information" means information
which directly or indirectly identifies a prescriber or a patient
in this state, where the information is derived from or relates to
a prescription for any prescribed product.
(3) "Marketing" means any activity by a company making or
selling prescribed products, or such company's agent, intended to
influence prescribing or purchasing choices of its products
including but not limited to:
(A) Advertising, publicizing, promoting or sharing information
about a product;
(B) Identifying individuals to receive a message promoting use
of a particular product, including but not limited to an
advertisement, brochure or contact by a sales representative, or
identifying individuals to receive any form of gift, product
sample, consultancy or any other item, service, compensation or
employment of value;
(C) Planning the substance of a sales representative visit or communication or the substance of an advertisement or other
promotional message or document; or
(D) Evaluating or compensating sales representatives.
(4) "Person" means a business, individual, corporation, union,
association, firm, partnership, committee or other organization or
group of persons.
(5) "Pharmacy" means an individual or entity licensed by the
Board of Pharmacy to dispense prescribed products.
(6) "Prescribed product" means a biological product as defined
in 42 U.S.C. §262, as amended by section three hundred fifty one of
the Public Health Service Act of 1944 and a device or drug as
defined in 21 U.S.C. §321, as amended by section two hundred one of
the Food, Drug and Cosmetic Act of 1938.
(7) "Regulated record" means information or documentation from
a prescription written by a prescriber doing business in this state
or a prescription dispensed in this state.
(8) "State health care program" means a program for which the
state purchases prescribed products, including, but limited to, a
state pharmaceutical assistance program, a program for state
employees and their dependants, individuals under the supervision
of the Division of Corrections or state retirees and their
dependants, with the exception of the state medical assistance
program, Medicaid.
(d)
Privacy Provisions. --
(1) No person shall knowingly disclose or use regulated
records in this state that include prescription information
containing individual identifying information for marketing a
prescribed product.
(2) A regulated record containing individual identifying
information may be transferred to another entity, including to
another branch or subsidiary of the same firm, only if it carries
satisfactory assurance that the recipient will safeguard the
records from being disclosed or used in the state for a marketing
purpose prohibited under this section.
(3) Regulated records containing individual identifying
information may be disclosed, sold, transferred, exchanged or used
for nonmarketing purposes.
(4) This section does not prohibit conduct involving the
collection, use, transfer or sale of regulated records for
marketing purposes if:
(A) Data is aggregated;
(B) Data does not contain individual identifying information;
and
(C) No reasonable person would believe that the data can be
used to obtain individual identifying information.
(5) This section shall not prevent any person from disclosing
regulated records to the identified individual as long as the
information does not include protected information pertaining to any other person.
(6) Nothing in this section shall be construed to regulate the
content, time, place or manner of any discussion between
prescribers and their patients or between a prescriber and a
representative of a prescription drug manufacturer.
(7) Regulated records held by an agency administering a state
health care program shall only be disclosed in accordance with the
provisions of this section.
(8) The Department of Health and Human Resources as the
administrator of the state medical assistance program under 42
C.F.R. §§430-456, and the Medicaid waiver approved by the centers
for Medicare and Medicaid services shall disclose regulated records
only as provided for under 42 C.F.R. §431 and the federal Privacy
Act of 1974. The department shall ensure that any agent or third-
party contractors are informed of the limitations on disclosure and
use of the data, the department shall promulgate legislative rules,
in accordance with the provision of article three, chapter twenty-
nine-a of this code, to ensure compliance with this section and
with the applicable federal laws and regulations.
(e)
Rulemaking. -- The West Virginia Pharmaceutical Cost
Management Council shall promulgate legislative and emergency rules
in accordance with the provisions of chapter twenty-nine-a of this
code setting standards for complying with the provisions of this
section and enforcing the provisions of this section.
(f)
Enforcement and penalties. --
(1) Any person found guilty of noncompliance with the
provisions of this section or the provisions provided in the
legislative rules adopted pursuant to this section shall be subject
to an administrative penalty of not less than $10,000 nor more than
$50,000 per violation, as assessed by the West Virginia
Pharmaceutical Cost Management Council. Each disclosure of a
regulated record constitutes a separate violation. The Attorney
General shall enforce payment of penalties under this section.
(2) A violation of this section shall also constitute an
unfair or deceptive act in trade or commerce and an unfair method
of competition and may be enforced under section one hundred four,
article six, chapter forty-six-a of this code.
(3) All state and federal laws and regulations relating to
patient privacy and medical record confidentiality shall apply and
are not precluded by the provisions of this section.
NOTE: The purpose of this bill is to restrict the use of
prescription data for marketing purposes and establish penalties
for misuse of prescription data.
§30-5-12a is new; therefore, strike-throughs and underscoring
have been omitted.