E. With regard to the dispensation of a substitute prescription drug for a prescribed drug to a covered individual the following provisions apply.

(1) The pharmacy benefits manager may substitute a lower-priced generic and therapeutically equivalent drug for a higher-priced prescribed drug.

(2) With regard to substitutions If a pharmacy benefits manager makes a substitution in which the substitute drug costs more than the prescribed drug, the substitution must be made for medical reasons that benefit the covered individual and must benefit the covered entity. If a substitution is being made under this subparagraph, the pharmacy benefits manager shall obtain the approval of the prescribing health professional or that person's authorized representative after disclosing disclose to the covered individual and the covered entity the cost of both drugs and any benefit or payment directly or indirectly accruing to the pharmacy benefits manager as a result of the substitution.

(3) The pharmacy benefits manager shall transfer in full to the covered entity any benefit or payment received in any form by the pharmacy benefits manager either as a result of a prescription drug substitution under subparagraph (1) or (2) or as a result of the pharmacy benefits manager's substituting a lower-priced generic and therapeutically equivalent drug for a higher-priced prescribed drug.

Sec. FFF-3. PL 2003, c. 513, Pt. W, §1 is amended to read:

Sec.* W-1. Implementation of incentive payments; rulemaking. Notwithstanding any other provision of law, the Department of Human Services shall adopt routine technical rules to implement incentive payments within existing resources to pharmacies, based on criteria, including, but not limited to, length of time participating in the Maine Rx Plus and drugs for the elderly programs, status as sole community or independent

providers and volume of publicly funded beneficiaries. Rules adopted pursuant to this section are routine technical rules as defined in the Maine Revised Statutes, Title 5, chapter 375, subchapter 2-A.