Third Session, 45th

General Assembly

55 Elizabeth II,

BILL 50

AN ACT RESPECTING PHARMACEUTICAL

SERVICES

Received

and Read the First Time ...................................................................

Second

Reading ..............................................................................................

Committee ......................................................................................................

Third

Reading .................................................................................................

Royal

Assent ...................................................................................................

HONOURABLE TOM

OSBORNE

Minister of Health

and Community Services

Ordered to be printed by

the Honourable House of Assembly

EXPLANATORY NOTES

This Bill would establish the Newfoundland and

Labrador Prescription Drug Program and consolidate the law with respect to

various pharmaceutical programs and services.

Part I of the Bill would set out the

general administrative parameters of the programs under the Act, including

confidentiality and release of information requirements and the principles upon

which the Act is to be administered.

Part II of the Bill, the Newfoundland and

Labrador Prescription Drug Program would be established, including the various

program components and the ability to set a benefits list describing drugs and

related products for which a beneficiary under the program may be eligible.

The Bill would consolidate the law

with respect to the Interchangeable Drug Formulary and the Tamper Resistant

Prescription Drug Pad Program in Parts III and IV.

Part V of the Bill describes a

process of review of drug utilization by beneficiaries and prescribing patterns

by prescribers .

Parts VI and VII of the Bill relate

to audits of compliance with the Act under the Newfoundland and Labrador

Prescription Drug Program and recovery functions where pharmacies, dispensing

physicians or beneficiaries have erroneously received payments or benefits

under the program.

Part VIII would set out an internal

review process for beneficiaries and an appeal to the appeal board established

under the Income and Employment Support

Act for eligibility and other enumerated matters. With respect to appeals

of audit and recovery, the Bill would establish an external audit appeal board

with appropriate professional representation to hear appeals.

Parts IX and X of the Bill are

general provisions relating to offence and penalty under the Act,

regulation-making powers, consequential amendments and transitional provisions.

A BILL

AN ACT RESPECTING PHARMACEUTICAL SERVICES

Analysis

Short title

Definitions

PART

CONFIDENTIALITY, AGREEMENTS AND GENERAL ADMINISTRATION

Appointments by minister

Confidentiality

Information required

Duties under Act

Agreements, contracts

Programs and pilot projects

Protection for actions in good faith

Review

Delivery principles

PART

NEWFOUNDLAND AND LABRADOR PRESCRIPTION DRUG PROGRAM

Program established

Terms of program

Program components

Benefits lists

Participation in program

Fees and payments

Special authorization review

PART

III

INTERCHANGEABLE DRUG PRODUCTS FORMULARY

Formulary

Advisory committee

Substitute drugs

Price

Requirements of manufacturers

Non-lowest price

Non-formulary

PART

TAMPER RESISTANT PRESCRIPTION DRUG PAD PROGRAM

Tamper resistant prescription drug pads

PART

UTILIZATION AND PRESCRIBING REVIEWS

Utilization review

Prescribing patterns

PART

AUDITING

Audit

Generally accepted auditing standards

Documentation and other information

Deadlines

Further information

Review committee

Annual report

PART

VII

RECOVERY

Recovery from beneficiaries

Notice

Recovery from pharmacies and dispensing

physicians

Notice

PART

VIII

INTERNAL REVIEW AND APPEAL

Internal review

Appeal from

section 40

Audit appeal board

Appeal of audit under

section 38

Powers of board

Further appeal

Alternate dispute resolution

PART

OFFENCE AND PENALTY

Offence

Penalty

Limitation period

PART

GENERAL

Fees and forms

Regulations

Ministerial regulations

SNL2002 cI-0.1 Amdt .

SNL2005 cM-4.01 Amdt .

SNL1994 cP-12.1 Amdt .

NLR 80/98 Amdt .

Transitional

Commencement

Be it enacted by the Lieutenant-Governor and

House of Assembly in Legislative Session convened, as follows:

Short title

1. This

Act may be cited as the Pharmaceutical

Services Act .

Definitions

2. In

this Act

(a) "appellant" means a person who

appeals to an appeal board under

Part VIII;

(b) " beneficiary "

means a person who receives a benefit under the Newfoundland and

Labrador Prescription Drug Program;

(c) "benefit" means a benefit conferred

on a person who is eligible under this Act or the regulations;

(d) "benefits list" means the list of drugs

and drug related items for which a beneficiary may be considered eligible;

(e) "department" means the department presided

over by the minister;

(f) "dispense" means to provide a

substance or item ordered by prescription but does not include the

administration of that substance or item to a person or animal;

(g) "drug" means drug as defined in the Pharmacy Act;

(h) "drug formulary" means the Interchangeable

Drug Formulary established under

Part III;

(i) "interchangeable drug products"

means pharmaceutical equivalents or pharmaceutical alternatives that are the

therapeutic equivalents of and that have the same route of administration as a

reference product;

(j) "minister" means the minister appointed

under the Executive Council Act to

administer this Act;

(k) "payment" means

(

i) a payment to a participating pharmacy or

dispensing physician to reimburse the cost of dispensing a drug or related item

from the benefits lists, and may include a fee for professional services, or

(ii) a payment directly to

a beneficiary under subsection 17(4);

(l) "personal information" means

personal information as defined in the Access

to Information and Protection of Privacy Act;

(m) "pharmaceutical alternatives" means

drug products that contain the same or similar amount of the same or similar medicinal

ingredients, in comparable dosage forms but do not necessarily contain the same

non-medicinal ingredients;

(n) " pharmaceutical

equivalents" means drug products that contain the identical amounts of the

identical medicinal ingredients, but do not necessarily contain the same

non-medicinal ingredients;

(o) "pharmacist" means a person

registered under the Pharmacy Act, and

includes a pharmacy as the context requires;

(p) "prescriber" means a person who is

entitled to prescribe drugs under the laws of the province and includes

(

i) a medical

practitioner licensed under the Medical

Act, 2005 ,

(ii) a dentist or dental surgeon licensed under the

Dental Act ,

(iii) an optometrist licensed under the Optometry Act, 2004,

(iv) a veterinarian licensed under the Veterinary Medical Act, 2004 , and

(

v) a nurse practitioner licensed under the Registered Nurses Act ; and

(q) " therapeutic

equivalents" means pharmaceutical equivalents or pharmaceutical

alternatives that have been shown to be bioequivalent to a reference product as

demonstrated by bioavailability, pharmacodynamic or clinical studies.

PART I

CONFIDENTIALITY, AGREEMENTS AND GENERAL ADMINISTRATION

Appointments by minister

(1) The minister may appoint those officers, auditors or other persons considered

necessary for the operation of this Act who shall be responsible for the duties

and functions that the minister may determine.

(2) The minister may, in writing, delegate a power

or duty under this Act to a person referred to in subsection (1), except the

power to report to the police under subsection 27(7).

Confidentiality

(1) A

person employed in the administration of this Act shall preserve secrecy with

respect to all matters that come to his or her knowledge in the course of that

person's employment and shall not communicate the matters to another person,

including a person employed by the government, except

(

a) to a prescriber for a purpose relating to drugs

or drug products that have been prescribed or dispensed to a beneficiary;

(

b) to a pharmacy for a purpose relating to drugs

or drug products which have been prescribed or dispensed to a beneficiary;

(

c) for the purpose of the administration of this

Act;

(

d) for purpose of consultation between the

minister and a board or governing body of the professions referred to in paragraphs

2(

o) and (p);

(

e) at the discretion of

the minister, to a regional health authority established under the Regional Health Authorities Act ;

(

f) to a person where the

disclosure of that information is required by law;

(

g) at the discretion of

the minister, to a person engaged in health or medical research;

(

h) to a professional

body, for the purpose of reporting possible conduct deserving sanction;

(

i) to the police for the

purpose of reporting a matter under subsection 27(7); and

(

j) in other

circumstances that may be prescribed by order of the Lieutenant-Governor in

Council

and the information released under this

section shall only be used for

the purpose for which it was released.

(2) The Crown is not liable for damages caused to

a person as a result of the release of information under subsection (1).

Information required

5. Records

or other information required to be submitted under this Act shall be submitted

in a form required by the minister, and may be submitted in electronic form.

Duties under Act

(1) Pharmacies,

pharmacists, dispensing physicians, prescribers and beneficiaries participating

in the programs established under this Act shall comply with this Act and the

by the minister in the administration of this Act and the regulations.

(2) Pharmacists, dispensing physicians and

prescribers participating in the programs under this Act shall at all times

abide by all applicable federal and provincial legislation relating to their

professional practice, as well as the by-laws and codes of practice set by

their relevant governing bodies.

Agreements, contracts

7. The

minister may make and enter into

(

a) agreements on behalf of the department with

the government of a province or territory of Canada or an agency of either of them

or with a private entity or agency with respect to a matter under this Act

including

(

i) information sharing

agreements,

(ii) memoranda of

understanding,

(iii) agreements to verify

income for the purposes of eligibility, including ongoing eligibility, and

(iv) agreements with the Pharmacists' Association

of Newfoundland and Labrador ; and

(

b) contracts with third parties with respect to

the provision of programs and services.

Programs and

pilot projects

(1) The

minister shall provide services under programs established by this Act from

funds appropriated by the legislature for the purpose.

(2) In providing services under subsection (1),

the minister may provide for pilot projects, demonstration projects and

innovations in drug programs and services in all or part of the province.

Protection for

actions in good faith

(1) An

action for damages does not lie against

(

a) the minister, or an officer, employee or

committee appointed by the minister; or

(

b) a pharmacy, pharmacist, dispensing physician

or prescriber

for any proceeding initiated or taken in

good faith under this Act, for

an act done or omitted to be done in good faith

in carrying out his or her duties or obligations under this Act, the

authority of this Act, or a decision or order made or enforced in good faith

under this Act.

(2) An action does not lie against a person for

the disclosure of information or a document or anything in it under this Act if

that disclosure was made in good faith.

(3) An action for damages does not lie against a pharmacy,

pharmacist, dispensing physician or prescriber or any other person for disclosing

information, books, records, papers and other documents in their possession or

control when disclosed in good faith as required by this Act.

Review

10. The

minister shall, every 5 years, perform a review of this Act and the regulations

made under it, the principles upon which it is based and consider the areas in

which it may be improved and report his or her findings to the

Lieutenant-Governor in Council.

Delivery

principles

11. The

following principles apply to the delivery of programs and services under this

Act:

(

a) access to the program and services shall be

provided in a timely manner with appropriate consideration of a person's unique

circumstances and needs, as departmental resources, including budgetary

appropriations, permit;

(

b) funding decisions for drugs and related

products shall be made on the best clinical and economic evidence available and

shall be openly communicated in as timely a manner as possible;

(

c) there shall be transparency and accountability

through review of this Act and the regulations made under it; and

(

d) this Act, the regulations made under it, and

the policies and procedures of the department, shall, to the extent possible,

be available to the public upon reasonable request in the manner determined by

the minister.

PART II

NEWFOUNDLAND AND LABRADOR PRESCRIPTION DRUG PROGRAM

Program

established

(1) There

is established a program entitled the Newfoundland and

Labrador Prescription Drug Program.

(2) The program is administered and operated by

the minister.

(3) The objects of the program are to provide appropriate

prescription drugs and other related benefits in a cost effective manner to

those eligible for them.

(4) The minister may require that a beneficiary

contribute to the cost of a benefit at a rate of co-pay prescribed by the

regulations, and that rate may vary according to the component of the program

under which the benefit is received.

Terms of program

13. The

program shall be the payor of last resort and shall pay prescription drug costs

and other related benefits in the manner prescribed by this Act for which a

person is eligible only where those services are not, or are no longer,

reimbursable by a third party.

Program components

(1) The

components of the Newfoundland and Labrador Prescription Drug Program are:

(

a) the Income Support component;

(

b) the Senior Citizens component;

(

c) the Low Income component; and

(

d) the Special Needs component.

(2) The Lieutenant-Governor in Council may, by

regulation, prescribe eligibility criteria for the components referred to in

subsection (1), and those criteria may vary according to the component of the

program to which they apply.

(3) Eligibility referred to in this

section shall

include initial and ongoing eligibility.

(4) The eligibility of a person under the program

components referred to in subsection (1) or the consideration of a person for

coverage under subsection (8) shall be determined by the minister based on the

information provided by that person and any other information available to the

minister for that purpose.

(5) The minister may request and a person shall

provide in a timely manner information required to

determine eligibility under the program and the minister may seek verification

of that information as he or she considers necessary.

(6) Participation by a beneficiary in a component of

the program, including use of a drug card for the purpose of obtaining benefits

under the program, shall be considered to be consent by the beneficiary for the

release to the minister of the information required

(

a) to determine that

person's eligibility for the component of the program;

(

b) for audits under the

program, including the release of copies of prescriptions as part of that

process;

(

c) to determine special

authorization requests, if made; and

(

d) for review of

utilization under

section 27.

(7) A person shall be a resident of the province

for the purposes of eligibility, including continued eligibility under the

program.

(8) Where a person is not eligible under a

component of the program the minister may, in his or her discretion,

(

a) based on a financial

assessment performed in the manner prescribed by regulation; or

(

b) in exceptional

circumstances as prescribed by regulation

provide coverage under the program and the minister may prescribe the

limits of that coverage.

Benefits lists

(1) The

minister shall, by regulation, establish benefits lists which shall

(

a) set out the drugs and related products which

shall be covered under each component of the program, and the limitations of that

coverage; and

(

b) prescribe the amount to

be paid for the drugs and related products referred to in paragraph (

a) calculated in the manner determined by the minister.

(2) The benefits list shall be on file with the

minister and may be available electronically on the Internet.

Participation in

program

(1) A

pharmacy may apply for participation in the program, and shall, in order to

participate in the program, obtain a provider number under subsection (2).

(2) The minister may issue a provider number to a

pharmacy that applies to participate in the program and the minister may cancel

or suspend a provider number in the circumstances prescribed by the regulations.

(3) The minister may prescribe the terms and

conditions of participation in the program and where a pharmacy has applied under

subsection (1) and has been approved, the pharmacy and all pharmacists working

in it shall, by participation in the program, be considered to have accepted

(4) Notwithstanding subsections (1) and (2), a

dispensing physician may apply and the minister may issue a provider number to a

dispensing physician who applies for participation in the program where that dispensing

physician practices in a geographically remote or isolated area of the province.

(5) The minister may prescribe terms and

conditions of participation in the program by a dispensing physician and where

that dispensing physician has applied and been approved for participation in

the program, the dispensing physician shall, by his or her participation, be

them.

Fees and payments

(1) Payments

to pharmacies and dispensing physicians under the program shall be processed in

the manner determined by the minister.

(2) Claims submitted for processing shall include

the information that the minister may require, and may be submitted electronically.

(3) The minister may set professional fees to be

paid under this Act, and the minister may consult with the Pharmacists' Association

of Newfoundland and Labrador in setting those fees.

(4) Where drugs or related products

(

a) have been obtained

from a participating pharmacy by a person who is later determined to be a

beneficiary eligible for those benefits; or

(

b) have been obtained

from a pharmacy that is not a participating pharmacy under this Act but that are

benefits for which a beneficiary is eligible

the department may reimburse a beneficiary for the costs of his or her

benefits directly.

Special authorization

review

(1) A

prescriber may, on behalf of a beneficiary, request a drug for which special

authorization is required under the program.

(2) A request shall be considered in accordance

with criteria developed by

(

a) the National Common Drug Review or the Joint

Atlantic Common Drug Review or their successor organizations; or

(

b) other committees or processes as determined by

the minister

and adopted by the minister.

(3) If a request for special authorization has

been declined based on the criteria referred to in subsection (2), a prescriber

may request an internal review of the matter.

(4) If, after consideration in an internal review

the request for special authorization is again denied, a prescriber may apply

to the senior medical consultant designated by the minister for a review of the

decision and the decision of that consultant with respect to the special

authorization is final.

PART III

INTERCHANGEABLE DRUG PRODUCTS FORMULARY

Formulary

(1) The

minister shall, by regulation, establish an Interchangeable Drug Products

Formulary setting out

(

a) drugs that may be used interchangeably with

other drugs upon approval for entry into the formulary;

(

b) maximum prices to be charged for drugs listed

in the formulary;

(

c) submission requirements for interchangeable

drugs; and

(

d) the review process for determining

interchangeable drug products.

(2) Drugs that may be used interchangeably with

other drugs in the formulary shall be the pharmaceutical equivalents or the

pharmaceutical alternatives that are the therapeutic equivalents of and have

the same route of administration as the reference drug.

(3) The formulary shall be on file with the

minister and may be available electronically on the Internet.

(4) The minister may remove a drug from the formulary

where

(

a) the manufacturer is not adhering to the price

quoted for the drug upon approval for entry into the formulary;

(

b) removal from the

formulary is advisable in the public interest; or

(

c) the minister

considers it necessary to do so.

Advisory

committee

(1) The

minister shall appoint an advisory committee consisting of 2 pharmacists, 2

physicians, the deputy minister of the department or his or her designate and

those other persons that he or she may wish to appoint, to advise on the contents

of the formulary and other matters relating to drugs.

(2) The minister shall consult with the Pharmacists'

Association of Newfoundland and Labrador and the Newfoundland and Labrador Medical Association on the appointments to be made

under subsection (1) from their respective professions.

(3) The minister shall designate one of the

members to be chairperson of the advisory committee.

Substitute drugs

(1) Where a pharmacist or dispensing physician is given a prescription

directing the dispensing of a drug by its brand, chemical or generic name, that

pharmacist or dispensing physician shall dispense a substitute drug other than

the drug specifically prescribed where

(

a) the drug to be substituted is listed in the

formulary as a drug that may be used interchangeably with the drug prescribed;

and

(

b) the drug to be substituted is less expensive

than the drug prescribed.

(2) Subsection (1) does not apply where the

prescription contains a specific written direction in the handwriting of the person

prescribing the drug that the drug shall not be substituted.

(3) Where a drug is prescribed that must be

dispensed in accordance with subsection (1) has a number of substitutes listed

in the formulary, the person dispensing the drug

(

a) shall dispense the

lowest priced substitute drug listed in the formulary at the price listed in

the formulary plus a professional fee; or

(

b) shall, if the lowest priced drug is not

available, dispense another drug listed in the formulary as a substitute for

the prescribed drug,

(

i) at the price of the

lowest priced substitute drug listed in the formulary plus a professional fee

where the lowest priced substitute drug is generally available within the

province, or

(ii) where the lowest

priced substitute drug is not generally available within the province, at the

price of the lowest priced substitute drug that is so available plus a professional

fee.

Price

22. Where

a prescription contains a written direction that the prescribed drug is not to

be substituted, the person dispensing that specific prescribed drug shall not

charge more for the drug than the price listed in the formulary, where the drug

is so listed, plus a professional fee.

Requirements of

manufacturers

(1) Where a drug is to be included on the formulary, the manufacturer

of that drug shall provide a guaranteed price for that drug for the time period

required by the minister.

(2) The guaranteed price for a generic drug under

subsection (1) shall be the best price available in any other province or territory of Canada .

(3) The guaranteed price of a drug referred to in

subsection (1) shall be the price offered by the manufacturer for that drug to

all pharmacies and dispensing physicians in the province.

Non-lowest price

(1) Notwithstanding

sections 21 and 22, a person may request that the prescribed drug dispensed be

an equivalent drug listed in the formulary, other than the lowest priced drug

listed in the formulary.

(2) Where a prescribed drug is dispensed by a

person under subsection (1), that person shall inform the person requesting a

specific equivalent drug of the difference in cost between the requested formulary

drug and the lowest priced equivalent formulary drug.

Non-formulary

25. Where

a prescribed drug not listed in the formulary is dispensed by a person

authorized by law to dispense prescriptions and

(

a) a drug with the same

active ingredients and strength; and

(

b) in the same or

similar dosage form

is listed in the formulary, that person

shall charge for that dispensed drug the price of the lowest priced drug as

referred to in paragraphs (

a) and (

b) that is listed in the formulary.

PART IV

TAMPER RESISTANT PRESCRIPTION DRUG PAD PROGRAM

Tamper resistant

prescription drug pads

(1) There

is established a program entitled the Tamper Resistant Prescription Drug Pad Program

which shall require the use by a prescriber of tamper resistant prescription

drug pads as provided by the minister.

(2) The minister shall, by regulation, establish a

list of drugs the prescription of which requires the use of tamper resistant

prescription drug pads.

(3) The list of drugs referred to in subsection

(2) shall be on file with the minister and may be available electronically on

the Internet.

(4) Tamper resistant prescription drug pads shall

be used in a manner determined by the minister.

(5) Drugs listed under subsection (2), the prescription

of which requires the use of tamper resistant prescription drug pads, shall not

be dispensed where the prescription is presented by telephone communication.

(6) A pharmacist or dispensing physician shall not

dispense a drug included in the list established under subsection (2) unless

the prescriber prescribing the drug has written or typed the prescription on a

tamper resistant prescription drug pad approved by and provided to the person

by the minister, or a person or body on behalf of the minister, and the written

or typed prescription is presented to the pharmacist or dispensing physician or

faxed in accordance with standards of practice for facsimile transmission set

by the Newfoundland and Labrador Pharmacy Board continued under the Pharmacy Act .

(7) The minister may prescribe, by regulation, the

information required to be included when using tamper resistant prescription

drug pads and where the required information has not been provided, or the

prescription has not been completed in the manner required by the minister

under subsection (4), a pharmacist may refuse to dispense that drug.

(8) Where a prescriber has had his or her licence

suspended or cancelled by his or her supervising professional body, or stops practicing

in the province, the prescriber shall return all

tamper resistant prescription drug pads to the minister within 3 days of that

suspension, cancellation or change of practice.

(9) A prescriber who fails to comply with

subsection (8) is guilty of an offence under this Act.

(10) Where a pharmacist receives a prescription for

a drug which is required to be prescribed according to this Part, and that

pharmacist reasonably believes that the prescription is suspect, the pharmacist

may

(

a) refuse to fill the prescription; or

(

b) report his or her reasonable suspicion to the

police for investigation.

PART V

UTILIZATION AND PRESCRIBING REVIEWS

Utilization

review

(1) The minister

may review the payment and utilization history of a beneficiary to determine

whether there may be inappropriate utilization by that beneficiary of his or

her benefits under the Newfoundland and Labrador Prescription Drug Program.

(2) Where the minister

(

a) suspects that there are overlapping claims for

the same or similar medication from 2 or more prescribers filled at 2 or more

pharmacies; or

(

b) finds from a review

of utilization under subsection (1) that a beneficiary's pattern of use is inappropriate,

in the minister's opinion,

the minister may restrict the use of a person's drug card to one pharmacy

of the person's choice and advise the person, his or her prescribers and the

pharmacy of choice of that action and the reasons for that action.

(3) Where a beneficiary fails to choose a pharmacy

under subsection (2) in the time allotted by the minister, the minister may suspend

that person's benefits under the Newfoundland and Labrador Prescription Drug Program until a pharmacy is chosen.

(4) Where measures taken under subsection (2) satisfied

the minister that utilization has been inappropriate, or the minister reasonably

believes that a beneficiary has violated the Controlled Drug and Substances Act ( Canada ), a

review of utilization may be conducted by the Medication Review Committee of

the department.

(5) The Medication Review Committee shall be

comprised of

(

a) persons with medical and pharmaceutical

expertise who shall have voting authority; and

(

b) persons with auditing expertise.

(6) The Medication Review Committee shall perform

the review referred to under subsection (4) and shall report to the minister

and make recommendations regarding action, including reporting to the police.

(7) The minister shall consider the report of the

committee under subsection (6) and, in his or her discretion, report the matter

to the police for investigation.

Prescribing

patterns

(1) The

minister may review the prescribing patterns of a prescriber utilizing the

program database and may inform that prescriber of the results of the review.

(2) A review of a prescriber's prescribing

patterns under this

section shall be carried out using statistical analysis and

comparative data, and the minister may request a review of prescribing patterns

by the Medication Review Committee of the department.

(3) The Medication Review Committee is composed of

the members referred to in subsection 27(5).

(4) The Medication Review Committee shall review

the request of the minister under subsection (2) and shall report to the minister

and make recommendations regarding action including

(

a) notification of the prescriber of the concerns

of the committee; and

(

b) requiring an

explanation of the prescriber's prescribing patterns which are of concern

within 10 days of the prescriber receiving that request.

(5) Where

(

a) the required information under subsection

(4) has not been provided by the prescriber in the time period required by that

subsection; or

(

b) the minister

considers it necessary, based on the analysis performed under this section,

the minister may report those prescribing patterns to the prescriber's

disciplinary body for investigation.

PART VI

AUDITING

Audit

29. In

order to determine compliance with the Newfoundland and

Labrador Prescription Drug Program, an audit may be performed under this Part

to determine compliance with this Act, the regulations, policies and the terms

and conditions of participation in the program.

Generally

accepted auditing standards

30. Audits

performed under this Act shall be performed according to generally accepted

auditing standards and audits may be performed using those techniques which may

be prescribed by regulation that are considered necessary to complete audits

according to the required standard.

Documentation and

other information

(1) An

auditor performing an audit may examine and copy those prescriptions,

documents, papers, and records that the auditor considers necessary to complete

the audit in the manner required by this Act.

(2) An examination of records referred to in

subsection (1) includes electronic records, and an auditor may make a copy of those

records, including electronic records in a manner that the auditor considers

necessary, including photocopying, scanning and electronic copying of data.

(3) Where reasonably necessary to determine

compliance under this Act, an auditor or other person appointed or designated

by the minister under this Act may, at reasonable times, without a warrant,

enter a pharmacy or pharmacy related business premises to inspect the documents referred to in subsection (1).

(4) A pharmacy shall provide the information required

by an auditor under this Act in order to determine compliance with this Act and

that information may be provided by mail, facsimile or by electronic transmission.

(5) An examination of records required under this

section may also include an examination of information, documentation or other

records held by a pharmacy regarding a beneficiary's insurer and any records of

payment to that insurer or other method of obtaining coverage for the drugs or related

products.

Deadlines

(1) The

minister may set deadlines for providing information to auditors acting under this

Part.

(2) The time period set by the minister under

subsection (1) may be varied with the agreement of the parties.

Further

information

33. The

minister may require that a pharmacy, prescriber, dispensing physician or

beneficiary supply further information where the minister requires the

information to substantiate a claim.

Review committee

(1) The minister may, in accordance with

the regulations, appoint a committee to review and advise upon matters referred

to it by the minister under this Part.

(2) The minister shall, by regulation, prescribe

(

a) the terms of

reference for the committee;

(

b) the composition of the committee; and

(

c) the duties of the

committee.

(3) The minister may consult with the Pharmacists'

Association of Newfoundland and Labrador and the Newfoundland and Labrador Pharmacy Board on the appointments to be made under

subsection (1).

(4) The committee shall review the matters

referred to it and advise the minister on its findings.

(5) The committee may make recommendations to the

minister regarding its findings, including recommendations that

(

a) recovery of funds; or

(

b) investigative action

be commenced.

Annual report

35. An

annual report of audits performed under this Act, including decisions made and

the outcomes of the audits shall be prepared by auditors appointed under this

Act and submitted to the minister.

PART VII

RECOVERY

Recovery from

beneficiaries

(1) If

the minister is satisfied that a beneficiary

(

a) has provided false or misleading information

to obtain benefits under this Act;

(

b) is entitled to reimbursement by a third party

for the costs of benefits which were provided under this Act; or

(

c) has otherwise incorrectly obtained benefits

under this Act,

the minister may assess the beneficiary

for those benefits and may recover those benefits as a debt due to the Crown in

right of the province.

(2) Benefits which have been paid to a beneficiary

under subsection (1) shall be recovered in the manner prescribed by the regulations.

(3) Notwithstanding subsection (2), the minister

may recover benefits paid under subsection (1) in a different manner where

there is an agreement with the beneficiary to do so.

(4) A beneficiary dissatisfied with the assessment

made by the minister may request an internal review of the matter under

section

Notice

37. Where

it has been determined under

section 36 that a beneficiary has received

benefits to which he or she is not entitled, the minister shall, in writing,

notify the beneficiary

(

a) that the assessment under

section 36 is a debt

due to the Crown;

(

b) of the amount of money paid in error and the manner

of calculating the amount;

(

c) that the amount of money may be recovered

according to this Part; and

(

d) of the beneficiary's right to internal review

or appeal under

Part VIII.

Recovery from

pharmacies and dispensing physicians

(1) Where,

following an audit performed under this Act it has been determined that a

payment has been made to a pharmacy or dispensing physician in excess of the

amount which was required to be paid under the Newfoundland and Labrador

Prescription Drug Program, that money is a debt due to the Crown in right of

the province.

(2) Payments which are determined to have been

paid in excess under subsection (1) shall be recovered in the manner prescribed

by the regulations.

(3) Notwithstanding subsection (2), the minister may

recover the amount of a payment made in excess in a different manner where

there is an agreement with the pharmacist or dispensing physician to do so.

(4) The minister may charge interest on payments

made in excess referred to in subsection (2) in the circumstances and at a rate

prescribed by the regulations.

Notice

39. Where

it has been determined under

section 38 that excess payments have been made to

a pharmacy or dispensing physician, the minister shall, in writing, notify the

pharmacy or dispensing physician

(

a) that the money is a

debt due to the Crown;

(

b) of the amount of the money paid in excess and

the manner of calculating the amount;

(

c) that the amount may be recovered according to

this Part; and

(

d) of the pharmacy's or dispensing physician's right

to alternate dispute resolution or appeal under

Part VIII.

PART VIII

INTERNAL REVIEW AND APPEAL

Internal review

(1) The

minister shall, according to the regulations, appoint an officer or officers to

perform an internal review of the matters referred to in subsection (2).

(2) A person

(

a) denied participation in the low income or

income support components of the Newfoundland and Labrador Prescription Drug

Program as set out in subsection 14(1) may request an internal review of a

decision respecting eligibility for or cancellation of benefits made under the

authority of this Act and the regulations;

(

b) denied coverage under

the program as set out in subsection 14(8) may request an internal review of

that denial of coverage under that section; or

(

c) who has been assessed

as owing a debt to the Crown under

section 36, may request an internal review

of that assessment.

(3) A request under subsection (2) shall be made

in writing by the person no later than 60 days after being notified of the

matters referred to in subsection (2).

(4) An officer or officers appointed under

subsection (1) shall perform an internal review in the manner prescribed by the

regulations.

(5) An internal review shall be performed within 20

business days of the receipt of the written request for it, and the results of

an internal review shall be provided to the person who requested the review, in

writing, within 5 business days of being decided, and the person is considered

to have received the outcome of the internal review 7 business days after it

has been decided.

Appeal from

section 40

(1) A

person may appeal, either personally or through another person acting on his or

her behalf with his or her written consent, the outcome of an internal review

under

section 40 to the appeal board appointed under

section 42 of the Income and Employment Support Act and

the powers of that board are that prescribed in that Act.

(2) An appeal under this

section shall be made in

writing no more than 60 days from the receipt of the outcome of an internal

review under

section 40.

(3) The appeal board shall

(

a) acknowledge the appeal;

(

b) arrange a date for hearing the appeal;

(

c) give at least 7 days notice of the date, time

and place fixed for hearing the appeal to the appellant and to the officers of

the department who are concerned;

(

d) notify an appellant of his or her right to

appear and to be represented under subsection (4); and

(

e) within 30 days of receiving the appeal, hear

the appeal.

(4) For the purpose of presenting his or her case

and producing evidence, an appellant may appear before the appeal board on his

or her own behalf or be represented by counsel or an agent of his or her choice

and may accompany and appear with his or her counsel or agent before the appeal

board, and this provision shall also apply where appeals are heard by

teleconference, video conference or other method approved by the minister.

(5) An appellant or the minister may request, in

writing, with reasons, a postponement of the hearing of an appeal for a reasonable

period as determined by the appeal board and the appeal board may, in its

discretion, grant the postponement.

(6) The minister may appear and be heard in a proceeding

under this section.

(7) Where

(

a) an appellant has not been granted a

postponement under subsection (5); or

(

b) the appellant, either in person or by his or

her counsel or agent, does not attend the hearing of the appeal after being

notified under this section,

the appeal board may proceed in his or her

absence to examine into the matter of the appeal and to hear the witnesses and

adjudicate on the matter.

(8) The appeal board may, where the appropriate

documents for consideration of the appeal have not been received, postpone the

hearing until the earliest possible date after those documents have been received.

(9) For the purpose of this Act, the appeal board

has the powers that are or may be conferred on a commissioner under the Public Inquiries Act.

Audit appeal

board

(1) The

Lieutenant-Governor in Council shall appoint 3 persons to act as an independent

external audit appeal board

(

a) one of whom shall be a pharmacist recommended

by the minister, and the minister may solicit the advice of the Pharmacists'

Association of Newfoundland and Labrador in the formulation of that recommendation;

(

b) one of whom shall

be a chartered accountant, certified management accountant or a certified

general accountant;

(

c) one of whom shall be a lawyer in good standing

with the Law Society of Newfoundland and Labrador who shall be the chairperson

of the board; and

(

d) none of whom shall be

officers of the department or employees of the government of the province or of

a board, commission, corporation or other body that is an agency of the Crown.

(2) Members appointed under subsection (1) or

alternates appointed under subsection (3) shall be appointed for 3 years, shall

be eligible for reappointment and shall hold office until re-appointed or until

a successor is appointed.

(3) The Lieutenant-Governor in Council may appoint

3 persons who are not employees of the government of the province or of a

board, commission, corporation or other body that is an agency of the Crown, as

alternate members of the appeal board to act as members of the appeal board as

a result of the absence, resignation, illness or death of a regular member

appointed under subsection (1) at a hearing to be held under this section.

(4) The persons appointed as alternates under subsection

(3) shall be

(

a) a pharmacist;

(

b) a chartered

accountant, certified management accountant or certified general accountant;

and

(

c) a lawyer,

and those persons shall act as alternates for the persons appointed

under subsection (1) in their respective professions and a lawyer who is an

alternate under paragraph (

c) shall act as chairperson of the board where the

chairperson is absent or unable to act.

(5) An alternate member appointed under subsection

(3) is considered for the purpose of this

section to be a member of the appeal

board.

(6) The minister shall appoint an officer to be

the secretary of the appeal board.

(7) The secretary appointed under subsection (6)

(

a) shall not have voting

privileges; and

(

b) shall keep full records of the proceedings of

the appeal board.

(8) All the members of the board, or their duly

appointed alternates, shall be present for the purpose of a quorum of the

board.

(9) Appeals heard by the board may be conducted in

person or by teleconference or video conference or other means as approved by

the minister provided that, in a meeting, all participants may participate

simultaneously and instantaneously.

(10) A board member participating in a meeting by

teleconference, videoconference or other method approved by the minister shall

be counted as a member present at the meeting for the purpose of establishing a

quorum under subsection (8).

(11) Where there is a tie vote on a motion or

resolution of the board, that motion or resolution shall be considered to be

defeated.

Appeal of audit

under

section 38

(1) A

person may appeal, either personally or through another person acting on his or

her behalf with his or her written consent, the outcome of an audit performed

under

Part VI to the appeal board.

(2) An appeal under this

section shall be made in

writing no more than 30 days from the receipt of the outcome of the audit.

(3) The appeal board shall

(

a) acknowledge the appeal;

(

b) arrange a date for hearing the appeal;

(

c) give at least 14 days notice of the date, time

and place fixed for hearing the appeal to the appellant and to the officers of

the department who are concerned;

(

d) notify an appellant of his or her right to

appear and to be represented under subsection (4); and

(

e) within 60 days of receiving the appeal, hear

the appeal.

(4) For the purpose of presenting his or her case

and producing evidence, an appellant may appear before the appeal board on his

or her own behalf or be represented by counsel or an agent of his or her choice

and may accompany and appear with his or her counsel or agent before the appeal

board, and this provision shall also apply where appeals are heard by

teleconference, video conference or other method approved by the minister.

(5) An appellant or the minister may request, in

writing, with reasons, a postponement of the hearing of an appeal for a

reasonable period as determined by the board and the board may, in its

discretion, grant the postponement.

(6) The minister may appear and be heard in a proceeding

under this section.

(7) Where

(

a) an appellant or the minister

has not been granted a postponement under subsection (5); or

(

b) the appellant or minister,

either in person or by counsel or agent, does not attend the hearing of the

appeal after being notified under this section,

the appeal board may proceed in the absence

of either party to examine into the matter of the appeal and to hear the

witnesses and adjudicate on the matter.

(8) The board may, where the appropriate documents

for consideration of the appeal have not been received, postpone the hearing

until the earliest possible date after those documents have been received.

(9) For the purpose of this Act, the appeal board

has the powers that are or may be conferred on a commissioner under the Public Inquiries Act .

Powers of board

(1) The

board may, within 30 days of hearing the appeal, confirm, vary or set aside the

finding or decision appealed from with power to give directions, consistent

with this Act and the regulations made under it, respecting the amount of money

owing by a pharmacy or dispensing physician under this Act and shall notify the

parties of that decision.

(2) Notwithstanding subsection (1), the board

shall not make an order inconsistent with the benefits lists established in the

regulations.

(3) A decision of the board shall, within 5 business

days of its being decided, be communicated in writing to the appellant and to

the officers of the department who are concerned.

Further appeal

(1) The

minister, a pharmacy or dispensing physician aggrieved by a decision of the

board under

section 44 may, within 60 days from the date of the order of the

board, appeal the decision to the Trial Division.

(2) The court may

(

a) uphold, amend or revoke the decision of the

appeal board; or

(

b) make another decision considered appropriate

in the circumstances

and the court may make an order as to

costs for or against the appellant or the Crown and fix the amount of those

costs.

(3) An appeal may be taken from an order or

decision of the Trial Division upon a point of law.

Alternate dispute

resolution

46. Notwithstanding

another provision of this Part, the minister may employ alternate dispute

resolution mechanisms in resolving the matters related to audit reviews and

appeals in the manner prescribed by regulation.

PART IX

OFFENCE AND PENALTY

Offence

(1) A person shall not, on behalf of himself or herself or on behalf of another

person, knowingly obtain or receive benefits to which that person or the other

person is not entitled to obtain or receive under this Act.

(2) A person shall not provide a false or

misleading statement in an application made under this Act or provide any false

or misleading information to the minister or a pharmacist, pharmacy, dispensing

physician or prescriber.

(3) A person shall not knowingly aid or abet

another person in applying for, obtaining or receiving any benefits under this

Act that the person is not eligible for under this Act.

(4) A person who violates this

section is guilty

of an offence.

Penalty

48. A

person guilty of an offence under this Act or the regulations is liable on

summary conviction to a fine of not more than $1,000.

Limitation period

49. A

prosecution under this Act or the regulations shall be started within 3 years

from the date the offence is alleged to have been committed.

PART X

GENERAL

Fees and forms

50. The

minister may set fees and prescribe forms for the purpose and administration of

this Act.

Regulations

51. The

Lieutenant-Governor in Council may prescribe regulations

(

a) respecting the rate

of co-pay for the components of the Newfoundland and

Labrador Prescription Drug Program, and that rate may vary according to the

component to which it relates;

(

b) respecting the

eligibility criteria for components of the Newfoundland and

Labrador Prescription Drug Program under subsection 14(2) and the criteria may

vary according to the component of the program to which they apply;

(

c) respecting the manner

of conducting a financial assessment to determine limited coverage under paragraph

14(8)(a);

(

d) respecting the

exceptional circumstances under which limited coverage may be provided under

subsection 14(8)(b);

(

e) respecting the

circumstances in which provider numbers may be suspended or cancelled under

subsection 16(2);

(

f) respecting the

auditing techniques considered necessary to conduct audits under

section 30;

(

g) respecting the manner

of recovering benefits under

section 36;

(

h) respecting the manner

of recovering benefits under

section 38;

(

i) respecting the

circumstances under which interest may be charged under subsection 38(4), and

the rate at which that interest may be charged;

(

j) respecting

alternative dispute resolution for the purpose of

Part VIII and the procedure

for that resolution; and

(

k) necessary for the

administration of this Act.

Ministerial regulations

52. The

minister may prescribe regulations

(

a) establishing benefits lists setting out the

drugs and related products covered under the Newfoundland and

Labrador Prescription Drug Program and the limitations of that coverage;

(

b) respecting the manner

of calculating costs to be paid for drugs and related products under paragraph

(a);

(

c) establishing the drug formulary under

paragraph 19(1);

(

d) respecting the list of drugs which are

required to be prescribed using a tamper resistant prescription drug pad under

section 26;

(

e) respecting the information which may be

required to be included on tamper resistant prescription drug pads and the

manner of their use;

(

f) respecting the appointment of officers under

section 40; and

(

g) respecting the

appointment of the committee under

section 34, and prescribing

(

i) the terms of

reference,

(ii) the composition, and

(iii) the duties

of that committee.

SNL2002 cI-0.1 Amdt.

(1) Paragraph 2(

c) of the Income and Employment Support Act is

repealed and the following substituted:

(c) "appellant" means an applicant or

recipient who appeals the outcome of an internal review to the appeal board and

includes a person

(

i) who appeals the outcome of an internal review

performed under

section 4.2 of the Health

and Community Services Act, or

(ii) who appeals the outcome of an internal review

performed under

section 40 of the Pharmaceutical

Services Act;

(2) Subsection 43(1) of the Act is amended by

adding immediately after the reference " Health and Community Services Act " a comma and the phrase

"or under

section 40 of the Pharmaceutical

Services Act ".

(3) Subsection 43(2) of the Act is amended by

adding immediately after the reference " Health and Community Services Act " a comma and the phrase

"or under

section 40 of the Pharmaceutical

Services Act ".

(4) Subsection 44(1) of the Act is amended by

adding immediately after the reference " Health and Community Services Act " where it first occurs the

phrase "or the Pharmaceutical Services

Act " and by deleting the word "or" at the end of paragraph

(

c) and the period at the end of paragraph (

d) and substituting a semi-colon

and the word "and" and by adding immediately after that paragraph the

following:

(

e) respecting a matter referred to in

section 40

of the Pharmaceutical Services Act.

(5) Section 44 of the Act is amended by adding

immediately after subsection (2) the following:

(2.1) Notwithstanding subsection (1), the board

shall not make an order inconsistent with the benefits lists established by the

minister under the Pharmaceutical

Services Act.

(6) Paragraph 44(3)(

b) of the Act is amended by

adding immediately after the reference and comma " Health and Community Services Act , " the phrase and comma

"or the Pharmaceutical Services Act ,

SNL2005 cM-4.01 Amdt.

Section 66 of the Medical Act, 2005 is repealed and the following substituted:

Use of tamper

resistant prescription drug pads

66. A

medical practitioner who prescribes a drug included in the list of drugs and

drug products under paragraph 53(1 )(

d) of the Pharmaceutical Services Act shall write

or type the prescription on a tamper resistant prescription drug pad approved

by and provided to the medical practitioner by the minister.

SNL1994 cP-12.1 Amdt .

(1) The Pharmacy Act is amended by repealing sections 58 to 64.

(2) The Act is amended by repealing sections 65

and 66 and substituting the following:

Contravention

65. A

pharmacist who contravenes

Part III of the Pharmaceutical

Services Act is considered to have committed professional misconduct for

the purposes of

Part IV of this Act.

Actions

66. An

action does not lie against a person by reason only of the prescribing or

dispensing of a substitute drug in accordance with

Part III of the Pharmaceutical Services Act.

NLR 80/98 Amdt .

Section 44.1 of the Pharmacy Regulations is repealed.

Transitional

(1) Where a policy of the minister is replaced

in whole or in part by the coming into force of this Act and the regulations

and the provisions of this Act and the regulations are substituted, in an audit

to determine compliance begun before the Act and the regulations came into

force, the procedure established by the substituted provisions shall be followed

so far as it can be adapted.

(2) A benefit or a payment improperly conferred or

improperly paid before the coming into force of this Act, whether discovered

before or after the coming into force of this Act shall be recovered on the

same basis and in the same manner as provided for in this Act and the regulations.

(3) An audit conducted under a policy of the

minister prior to the coming into force of this Act and the regulations is

considered to have been validly undertaken as if it had been conducted under

this Act and the regulations.

Commencement

58. This Act shall come into force on a day to be

proclaimed by the Lieutenant-Governor in Council.

Earl G. Tucker,

Queen's Printer