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S.F. No. 934 - Prescription Drug Coverage (Delete-Everything Amendment)
 
Author: Senator Melisa Franzen
 
Prepared By: Katie Cavanor, Senate Counsel (651/296-3801)
 
Date: April 12, 2016



 

SF 934 modifies the utilization review and prior authorization process for prescription drugs and creates prescription drug benefit transparency and management coverage requirements.

Sections 1, 2, and 3, amend the electronic prescription drug program.

Section 1 (62J.497, subd. 1) adds a definition of utilization review organization.

Section 2 (62J.497, subd. 3) requires group purchasers and utilization review organizations to develop processes to ensure notifications to prescribers upon a denial of a claim for a prescribed drug that is not covered or is not included in the group purchaser’s formulary.  Requires the process to provide a list of covered drugs from the same class or classes as the drug originally prescribed.

Section 3 (62J.497, subd. 4) requires providers, group purchasers, prescribers, dispensers, and utilization review organizations that use paper forms for prescription drugs prior authorization, or for medical exception requests, to only use the uniform formulary exception form.

Sections 4 through 24 amend chapter 62M, utilization review.

Section 4 (62M.02, subd. 10a) adds a definition for “drug.”

Section 5 (62M.02, subd. 11a) adds a definition for “formulary.”

Section 6 (62M.02, subd. 12) modifies the definition of health benefit plan to include a health plan that provides coverage of prescription drugs.

Section 7 (62M.02, subd. 14) modifies the definition of “outpatient services” to include prescription drugs.

Section 8 (62M.02, subd. 14b) adds a definition for “prescription.”

Section 9 (62M.02, subd. 14c) adds a definition for “prescription drug order.”

Section 10 (62M.02, subd. 15) modifies the definition of  “prior authorization” to include preadmission review, pretreatment review, pharmaceutical utilization management procedures, utilization, and case management and any utilization review organization’s requirement that an enrollee or provider notify the utilization review organization prior to providing a service.

Section 11 (62M.01, subd. 17) modifies the definition of  “provider” to include a licensed pharmacist.

Section 12 (62M.01, subd. 18a) adds a definition for “quantity limit.”

Section 13 (62M.01, subd. 19a) adds a definition for “step therapy.”

Section 14 (62M.05, subd. 3a) modifies the time in which an initial determination on requests for utilization review must be communicated to the provider and enrollee from ten business days to five business days of the request.

Section 15 (62M.05, subd. 3b) modifies the time in which notification of an expedited initial determination to either certify or not to certify must be provided to the provider and enrollee from no later than 72 hours to no later than 36 hours from the initial request.

Section 16 (62M.05, subd. 4) requires a utilization review organization to have written procedures to address processes by which the utilization review organization must track and manage review requests and documentation submitted by providers and enrollees.  Specifies that if a utilization review organization fails to meet specified timelines, or fails to notify a provider that information needed to conduct the review is incomplete, or fails to properly maintain submitted records for which the provider or enrollee has documentation of submission, the service will be deemed approved.

Section 17 (62M.06, subd. 2) modifies the time in which a utilization review organization must notify the enrollee and attending health care professional of its determination on the expedited appeal from no later than 72 hours to no later than 36 hours after receiving the expedited appeal.

Section 18 (62M.06, subd. 3) modifies the time in which a utilization review organization must notify the enrollee, attending health care professional, and claims administrator of its determination on a standard appeal from 30 days to 15 days upon receipt of the notice to appeal.  If the utilization review organization cannot make a determination within 15 days due to circumstances outside the control of the review organization, the review organization may take up to ten additional days to notify the enrollee, attending health care professional, and claims administrator of its determination.  If it takes any additional days beyond the initial 15-day period to make its determination, it must inform the enrollee, attending health care professional, and claims administrator in advance of the extension and reasons for it.

Section 19 (62M.07), Paragraph (d), specifies that any authorization for a prescription drug must remain valid for the duration of an enrollee’s contract term so long as the drug continues to be prescribed to the patient, the drug remains safe, has not been withdrawn from use by the FDA or the manufacturer, and no drug warnings or recommended changes in drug usage has occurred.

Paragraph (e) prohibits a utilization review organization, health plan company, or claims administrator from imposing step therapy requirements for enrollees currently on a prescription drug for six specified classes.

Section 20 (62M.09, subd. 3) requires all physicians conducting the review in connection with any policy issued by a health plan company, regardless of size to be licensed in Minnesota.

Section 21 (62M.09, subd. 6) requires that all physician consultants used in the appeal process be licensed in Minnesota.

Section 22 (62M.10, subd. 7) requires a utilization review organization to provide upon request to an enrollee, provider, and the commissioner of commerce, the written clinical criteria used to determine medical necessity, appropriateness, and efficacy of a procedure or service.

Section 23 (62M.11) permits a provider to file a complaint regarding compliance with the requirements of this chapter or regarding a determination not to certify directly to the commissioner responsible for regulating the utilization review organization.

Section 24 (62M.17) requires utilization review organizations to annually report to the Commissioner of Health specified information regarding medical exception requests and for other prescription drug prior authorization requests.

Section 25 (62Q.83) creates prescription drug benefit transparency and management requirements.

Subd. 1 defines the following terms:  drug; formulary; health plan company; and prescription.

Subd. 2 requires a health plan company that cover prescription drugs and uses a formulary to make its formulary and related benefit information available by electronic means and, upon request, in writing at least 30 days prior to annual renewal dates.

Subd. 3. Paragraph (a), specifies that once a formulary has been established a health plan company, may at any time during an enrollee’s contract year, expand its formulary by adding drugs to the formulary; reduce the copayments or coinsurance; or move a drug to a benefit category that reduces the enrollee’s cost.

Paragraph (b) states that a health plan company may remove a brand name drug from its formulary or place a brand name drug in a benefit category that increases an enrollee’s cost only if an A-rated generic or multisource brand name equivalent is added to the formulary at a lower cost to the enrollee and upon 60 notice to prescribers, pharmacists, and affected enrollees.

Paragraph (c) prohibits a health plan company from removing drugs from its formulary or moving drugs to a benefit category that increases an enrollee’s cost during the enrollee’s contract year.  This prohibition does not apply if the change is associated with the drug being deemed unsafe by the FDA or it has been withdrawn by the FDA or the manufacturer, or an independent source has issued drug specific warnings or recommended changes in drug usage.

Subd. 4. Paragraph (a) requires a health plan company to establish and maintain a transition process to prevent gaps in prescription drug coverage for enrollees with ongoing prescription drug needs who are affected by changes in formulary drug availability.

Paragraph (b) requires the process to provide coverage for at least 60 days.

Paragraph (c) requires that any cost-sharing applied be based on the defined prescription drug benefit terms and must be consistent with any cost-sharing that would be charged for nonformulary drugs approved under a medication exceptions process.

Paragraph (d) requires the health plan company to ensure that written notice is provided to each affected enrollee and prescriber within three business days after adjudication of the transition coverage.

Subd. 5. Paragraph (a) requires each health plan company to establish and maintain a medical exceptions process that allows enrollees, providers, and an authorized representative to request and obtain coverage approval in certain situations.

Paragraph (b) requires the exception to remain valid for the duration of an enrollee’s contract term provided that the medication continues to be prescribed of the same condition, and the medication has not been withdrawn by the manufacturer or the FDA.

Paragraph (c) requires the medical exceptions process to comply with the requirements under chapter 62M (utilization review).

Subd. 6 requires the Commissioner of Health to convene an advisory group to provide guidance in monitoring changes and trends in prescription drug coverage and formulary design.  Requires the commissioner to submit a report to the legislature  on a biennial basis beginning January 15, 2017, describing trends in prescription drug coverage, formulary design, medication exception requests, and benefit designs.  Requires health plan companies to cooperate in providing information necessary for the advisory group to carry out its responsibilities.

Section 26 (256B.0625, subd. 13f) prohibits the Commissioner of Human Services from updating the prior authorization requirements for a drug to no more than on an annual basis unless the drug has been deemed unsafe by the FDA, been withdrawn by the manufacturer or the FDA, or an independent source has issued drug specific warnings or recommended changes in drug usage.

Section 27 (256B.69, subd. 6) specifies that managed care plans and county-based purchasing plans must comply with chapters 62M and 62Q, for purposes of delivering services under the prepaid medical assistance program.

Section 28 sets deadlines for the first appointments and the first meeting of the Prescription Drug Advisory Council.

Section 29 is a Revisor’s instruction to comply with the changes in chapter 62M.

 

 
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