California Assembly Bill AB2779 Amended / Bill

 BILL NUMBER: AB 2779AMENDED BILL TEXT AMENDED IN SENATE AUGUST 11, 2010 AMENDED IN SENATE JULY 15, 2010 AMENDED IN SENATE JUNE 22, 2010 AMENDED IN ASSEMBLY APRIL 8, 2010 INTRODUCED BY Assembly Member Solorio MARCH 3, 2010 An act to add Section 5307.13 to the Labor Code, relating to workers' compensation, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST AB 2779, as amended, Solorio. Workers' compensation: compound medication. Existing law establishes a workers' compensation system, administered by the Administrative Director of the Division of Workers' Compensation, to compensate an employee for injuries sustained in the course of his or her employment. Existing law requires the administrative director,  on or before December 1, 2004, to adopt, after public hearings, a medical treatment utilization schedule, as specified   after public hearings, to adopt and revise periodically an official medical fee schedule that shall establish reasonable maximum fees paid for medical services, drugs and pharmacy services, health care facility fees, home health care, and all other treatment, care, services, and goods, other than physician services  . This bill would provide that, until the administrative director adopts  medical treatment utilization guidelines   a fee schedule  governing compound medication, a compound medication shall be  covered   reimbursable  only if there is prior authorization for it as medically necessary, as specified.  The bill would authorize the administrative director to adopt regulations as necessary or convenient to implement the above-described provisions.  This bill would declare that it is to take effect immediately as an urgency statute. Vote: 2/3. Appropriation: no. Fiscal committee:  no   yes  . State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 5307.13 is added to the Labor Code, to read: 5307.13. (a) Until the administrative director adopts  medical treatment utilization guidelines   a fee schedule consistent with the requirements of this section  governing compound medication, a compound medication shall be  covered   reimbursable  only if there is prior authorization for it as medically necessary  based on a determination of all of the following:   pursuant to Section 4610 and the compound medication meets all of the following requirements:  (1) All active ingredients in the compound medication are  medications   ingredients in drug products  that have been approved by the federal Food and Drug Administration (FDA)  or listed by the United States Pharmacopeia  . (2) The compound medication is not a copy or substitute for an available FDA-approved product.  (3) The safety and effectiveness of use of the compound medication for the prescribed indication is supported by FDA-approval or adequate medical and scientific research.   (4)   (3)  FDA-approved alternatives to the compound medication have been tried with therapeutic failure or patient intolerance. (b) The maximum allowance for the compound medication shall not exceed the sum of the amounts that would be allowed for the ingredient costs and dispensing fee under regulations adopted pursuant to Section 5307.1. (c) No fee shall be allowed for any compound medication unless the  initial  billing for that compound medication includes all information necessary for calculation of the fee pursuant to this section  and regulations adopted by the administrative director  .  (d) Nothing in this section shall be interpreted to authorize a nonphysician to reject, as medically unnecessary, an otherwise valid prescription for a compounded medication. To the extent applicable, Section 4610 shall apply to requests for authorization required under this section.   (e) The administrative director may adopt regulations as necessary or convenient to implement this section.  SEC. 2. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: Abusive billing practices for compounded drugs unreasonably inflate the cost of workers' compensation coverage for employers and insurers, and leave fewer dollars available for injured workers to receive in benefits. In order to stop these abusive practices at the earliest possible time, it is necessary for this act to take effect immediately.