The Honorable Neely Cassady State Senator P.O. Box 1810 Nashville, AR 71852
Dear Senator Cassady:
This is in response to your request for an opinion on whether Arkansas has a "Freedom of Choice" law applicable to pharmacies that allows any provider to participate in any third party program, as long as they are willing to accept the reimbursement rate of that plan.
Arkansas does have a "Freedom of Choice" law such as you describe. See A.C.A. 23-79-143 (1992 Repl.). It provides, in pertinent part:
(c) A health insurance plan, policy, or health maintenance organization may not:
(1) Prohibit or limit in the State of Arkansas any person who is a participant or beneficiary of the policy or plan from selecting a pharmacy or pharmacist of his choice who has agreed to participate in the plan according to the terms offered by the insurer; or
(2) Deny a pharmacy or pharmacist the right to participate as a contract provider under the policy or plan if the pharmacy or pharmacist agrees to provide pharmacy services, including but not limited to prescription drugs, that meet the terms and requirements set forth by the insurer under the policy or plan and agrees to the terms of reimbursement set forth by the insurer.
This provision would appear to allow any provider to participate in a third party program, if the provider is willing to meet the terms of the insurer as set forth in the plan. It must be noted, however, that health maintenance organizations that are both state-certified and federally qualified and self-insured plans under the Employee Retirement Income Security Act of 1974 (ERISA) are specifically exempted from the provisions of 23-79-143. See A.C.A. 23-79-143(f) (1992 Repl.). I am enclosing for your review a copy of Opinion No. 91-047, which addresses the various effects of this provision on the marketplace.
The foregoing opinion, which I hereby approve, was prepared by Assistant Attorney General Catherine Templeton.
Sincerely,
WINSTON BRYANT Attorney General
WB:cyh Enclosure