# Tenn. Code Ann. § 56-7-3102: Part definitions > Tennessee · Statutes · In force URL: https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C7_S56-7-3102 ## Section - **Citation:** Tenn. Code Ann. § 56-7-3102 - **Heading:** Part definitions - **Jurisdiction:** Tennessee - **Kind:** Statutes - **Status:** In force - **Text as of:** August 14, 2026 - **Source:** Compiled text - **Location:** TN Code / Title 56 / Chapter 7 / Section 56-7-3102 ## Text As used in this part, unless the context otherwise requires: (1) "Covered entity": (A) Means an individual or entity that provides health coverage to covered individuals who are employed or reside in this state, and includes, but is not limited to: (i) A health insurance issuer; (ii) A managed health insurance issuer, as defined in § 56-32-128(a) ; (iii) A nonprofit hospital; (iv) A medication service organization; (v) An insurer; (vi) A health coverage plan; (vii) A health maintenance organization licensed to practice pursuant to this title; (viii) A health program administered by this state or its political subdivisions, including the TennCare programs administered pursuant to the waivers approved by the United States department of health and human services; (ix) A nonprofit insurance company; (x) A prepaid plan; (xi) A self-insured entity; (xii) Plans governed by the Employee Retirement Income Security Act of 1974 (ERISA) ( 29 U.S.C. § 1001 et seq.); and (xiii) An employer, labor union, or other group of persons organized in this state; and (B) Does not include: (i) A health plan that provides coverage only for accidental injury, specified disease, hospital indemnity, medicare supplement, disability income, or other long-term care; or (ii) A plan subject to regulation under medicare part D; (2) "Maximum allowable cost" means the maximum amount that a pharmacy benefits manager or covered entity will reimburse a pharmacy for the cost of a drug or a medical product or device; (3) "Maximum allowable cost list" means a list of drugs, medical products or devices, or both medical products and devices, for which a maximum allowable cost has been established by a pharmacy benefits manager or covered entity; (4) "Pharmacist" and "pharmacy" have the same meanings as those terms are defined in § 63-10-204 ; (5) "Pharmacy benefits manager" means a person, business or other entity and any wholly or partially owned subsidiary of the entity, that administers the medication and/or device portion of pharmacy benefits coverage provided by a covered entity. "Pharmacy benefits manager" includes, but is not limited to, a health insurance issuer, managed health insurance issuer as defined in § 56-32-128(a) , nonprofit hospital, medication service organization, insurer, health coverage plan, health maintenance organization licensed to practice pursuant to this title, a health program administered by the state or its political subdivisions, including the TennCare programs administered pursuant to the waivers approved by the United States department of health and human services, nonprofit insurance companies, prepaid plans, self-insured entities, plans governed by the Employee Retirement Income Security Act of 1974 (ERISA) ( 29 U.S.C. § 1001 et seq.), and all other corporations, entities or persons acting for a pharmacy benefits manager in a contractual or employment relationship in the performance of pharmacy benefits management for a covered entity and includes, but is not limited to, a mail order pharmacy; and (6) "Pharmacy services administrative organization" means an entity that provides contracting and other administrative services to pharmacies to assist them in their interaction with third-party payers, pharmacy benefits managers, drug wholesalers, and other entities. Amended by 2022 Tenn. Acts, ch. 1070, s 4, eff. 1/1/2023. Amended by 2022 Tenn. Acts, ch. 1070, s 3, eff. 1/1/2023. Amended by 2016 Tenn. Acts, ch. 631, s 1, eff. 3/23/2016. Amended by 2014 Tenn. Acts, ch. 857, s 1, eff. 1/1/2015. Acts 2007 , ch. 224, § 1. As used in this part, unless the context otherwise requires: rd-party payers, pharmacy benefits managers, drug wholesalers, and other entities. Amended by 2022 Tenn. Acts, ch. 1070, s 4, eff. 1/1/2023. Amended by 2022 Tenn. Acts, ch. 1070, s 3, eff. 1/1/2023. Amended by 2016 Tenn. Acts, ch. 631, s 1, eff. 3/23/2016. Amended by 2014 Tenn. Acts, ch. 857, s 1, eff. 1/1/2015. Acts 2007 , ch. 224, § 1. As used in this part, unless the context otherwise requires: (1) "Covered entity": (A) Means an individual or entity that provides health coverage to covered individuals who are employed or reside in this state, and includes, but is not limited to: (i) A health insurance issuer; (ii) A managed health insurance issuer, as defined in § 56-32-128(a) ; (iii) A nonprofit hospital; (iv) A medication service organization; (v) An insurer; (vi) A health coverage plan; (vii) A health maintenance organization licensed to practice pursuant to this title; (viii) A health program administered by this state or its political subdivisions, including the TennCare programs administered pursuant to the waivers approved by the United States department of health and human services; (ix) A nonprofit insurance company; (x) A prepaid plan; (xi) A self-insured entity; (xii) Plans governed by the Employee Retirement Income Security Act of 1974 (ERISA) ( 29 U.S.C. § 1001 et seq.); and (xiii) An employer, labor union, or other group of persons organized in this state; and (B) Does not include: (i) A health plan that provides coverage only for accidental injury, specified disease, hospital indemnity, medicare supplement, disability income, or other long-term care; or (ii) A plan subject to regulation under medicare part D; (A) Means an individual or entity that provides health coverage to covered individuals who are employed or reside in this state, and includes, but is not limited to: (i) A health insurance issuer; (ii) A managed health insurance issuer, as defined in § 56-32-128(a) ; (iii) A nonprofit hospital; (iv) A medication service organization; (v) An insurer; (vi) A health coverage plan; (vii) A health maintenance organization licensed to practice pursuant to this title; (viii) A health program administered by this state or its political subdivisions, including the TennCare programs administered pursuant to the waivers approved by the United States department of health and human services; (ix) A nonprofit insurance company; (x) A prepaid plan; (xi) A self-insured entity; (xii) Plans governed by the Employee Retirement Income Security Act of 1974 (ERISA) ( 29 U.S.C. § 1001 et seq.); and (xiii) An employer, labor union, or other group of persons organized in this state; and (i) A health insurance issuer; (ii) A managed health insurance issuer, as defined in § 56-32-128(a) ; (iii) A nonprofit hospital; (iv) A medication service organization; (v) An insurer; (vi) A health coverage plan; (vii) A health maintenance organization licensed to practice pursuant to this title; (viii) A health program administered by this state or its political subdivisions, including the TennCare programs administered pursuant to the waivers approved by the United States department of health and human services; (ix) A nonprofit insurance company; (x) A prepaid plan; (xi) A self-insured entity; (xii) Plans governed by the Employee Retirement Income Security Act of 1974 (ERISA) ( 29 U.S.C. § 1001 et seq.); and (xiii) An employer, labor union, or other group of persons organized in this state; and (B) Does not include: (i) A health plan that provides coverage only for accidental injury, specified disease, hospital indemnity, medicare supplement, disability income, or other long-term care; or (ii) A plan subject to regulation under medicare part D; rity Act of 1974 (ERISA) ( 29 U.S.C. § 1001 et seq.); and (xiii) An employer, labor union, or other group of persons organized in this state; and (B) Does not include: (i) A health plan that provides coverage only for accidental injury, specified disease, hospital indemnity, medicare supplement, disability income, or other long-term care; or (ii) A plan subject to regulation under medicare part D; (i) A health plan that provides coverage only for accidental injury, specified disease, hospital indemnity, medicare supplement, disability income, or other long-term care; or (ii) A plan subject to regulation under medicare part D; (2) "Maximum allowable cost" means the maximum amount that a pharmacy benefits manager or covered entity will reimburse a pharmacy for the cost of a drug or a medical product or device; (3) "Maximum allowable cost list" means a list of drugs, medical products or devices, or both medical products and devices, for which a maximum allowable cost has been established by a pharmacy benefits manager or covered entity; (4) "Pharmacist" and "pharmacy" have the same meanings as those terms are defined in § 63-10-204 ; (5) "Pharmacy benefits manager" means a person, business or other entity and any wholly or partially owned subsidiary of the entity, that administers the medication and/or device portion of pharmacy benefits coverage provided by a covered entity. "Pharmacy benefits manager" includes, but is not limited to, a health insurance issuer, managed health insurance issuer as defined in § 56-32-128(a) , nonprofit hospital, medication service organization, insurer, health coverage plan, health maintenance organization licensed to practice pursuant to this title, a health program administered by the state or its political subdivisions, including the TennCare programs administered pursuant to the waivers approved by the United States department of health and human services, nonprofit insurance companies, prepaid plans, self-insured entities, plans governed by the Employee Retirement Income Security Act of 1974 (ERISA) ( 29 U.S.C. § 1001 et seq.), and all other corporations, entities or persons acting for a pharmacy benefits manager in a contractual or employment relationship in the performance of pharmacy benefits management for a covered entity and includes, but is not limited to, a mail order pharmacy; and (6) "Pharmacy services administrative organization" means an entity that provides contracting and other administrative services to pharmacies to assist them in their interaction with third-party payers, pharmacy benefits managers, drug wholesalers, and other entities. Amended by 2022 Tenn. Acts, ch. 1070, s 4, eff. 1/1/2023. Amended by 2022 Tenn. Acts, ch. 1070, s 3, eff. 1/1/2023. Amended by 2016 Tenn. Acts, ch. 631, s 1, eff. 3/23/2016. Amended by 2014 Tenn. Acts, ch. 857, s 1, eff. 1/1/2015. Acts 2007 , ch. 224, § 1. ## Nearby sections - [Tenn. Code Ann. § 56-7-101 Contract of insurance - Definition - Restrictions and limitations - Exceptions](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C7_S56-7-101.md) - [Tenn. Code Ann. § 56-7-102 Policies to contain entire contract - Exceptions - Construed as Tennessee contracts - Rules of construction - Duty to defend - Determination of obligations - Assignment](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C7_S56-7-102.md) - [Tenn. Code Ann. § 56-7-103 Misrepresentation or warranty will not void policy - Exceptions](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C7_S56-7-103.md) - [Tenn. 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