EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0111*
SENATE BILL 111
J5, J4, J1 5lr1291
(PRE–FILED)
By: Senator Lam
Requested: October 21, 2024
Introduced and read first time: January 8, 2025
Assigned to: Finance
A BILL ENTITLED
AN ACT concerning 1
Maryland Medical Assistance Program and Health Insurance – Step Therapy, 2
Fail–First Protocols, and Prior Authorization – Prescription to Treat Serious 3
Mental Illness 4
FOR the purpose of prohibiting the Maryland Medical Assistance Program and certain 5
insurers, nonprofit health service plans, health maintenance organizations, and 6
managed care organizations from applying a prior authorization requirement, step 7
therapy protocol, or fail–first protocol for prescription drugs used to treat certain 8
mental illnesses of certain insureds and enrollees; and generally relating to coverage 9
of prescription drugs to treat serious mental illness. 10
BY adding to 11
Article – Health – General 12
Section 15–102.3(m) and 15–157 13
Annotated Code of Maryland 14
(2023 Replacement Volume and 2024 Supplement) 15
BY repealing and reenacting, with amendments, 16
Article – Insurance 17
Section 15–142 18
Annotated Code of Maryland 19
(2017 Replacement Volume and 2024 Supplement) 20
BY adding to 21
Article – Insurance 22
Section 15–851.1 23
Annotated Code of Maryland 24
(2017 Replacement Volume and 2024 Supplement) 25
2 SENATE BILL 111
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 1
That the Laws of Maryland read as follows: 2
Article – Health – General 3
15–102.3. 4
(M) THE PROVISIONS OF §§ 15–142(E)(2) AND 15–851.1 OF THE INSURANCE 5
ARTICLE APPLY TO MANA GED CARE ORGANIZATIO NS. 6
15–157. 7
(A) IN THIS SECTION, “STEP THERAPY OR FAIL–FIRST PROTOCOL” HAS THE 8
MEANING STATED IN § 15–142 OF THE INSURANCE ARTICLE. 9
(B) EXCEPT AS REQUIRED UN DER 42 U.S.C. § 1396A, BEGINNING JULY 1, 10
2025, THE PROGRAM MAY NOT APPLY A PRIOR AUTHORIZATIO N REQUIREMENT FOR 11
A PRESCRIPTION DRUG USED TO TREAT AN ADULT ENROLLEE’S DIAGNOSIS OF: 12
(1) BIPOLAR DISORDER ; 13
(2) SCHIZOPHRENIA ; 14
(3) MAJOR DEPRESSION ; 15
(4) POST–TRAUMATIC STRESS DIS ORDER; OR 16
(5) A MEDICATION–INDUCED MOVEMENT DIS ORDER ASSOCIATED 17
WITH THE TREATMENT O F A SERIOUS MENTAL I LLNESS. 18
(C) BEGINNING JULY 1, 2025, THE PROGRAM MAY NOT APPLY A STEP 19
THERAPY OR FAIL–FIRST PROTOCOL FOR A PRESCRIPTION D RUG USED TO TREAT AN 20
ENROLLEE’S DIAGNOSIS OF: 21
(1) BIPOLAR DISORDER ; 22
(2) SCHIZOPHRENIA ; 23
(3) MAJOR DEPRESSION ; 24
(4) POST–TRAUMATIC STRESS DIS ORDER; OR 25
(5) A MEDICATION–INDUCED MOVEMENT DIS ORDER ASSOCIATED 26
WITH THE TREATMENT OF A SERIOUS MENTAL ILLNESS. 27 SENATE BILL 111 3
SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland read 1
as follows: 2
Article – Insurance 3
15–142. 4
(a) (1) In this section the following words have the meanings indicated. 5
(2) “Step therapy drug” means a prescription drug or sequence of 6
prescription drugs required to be used under a step therapy or fail–first protocol. 7
(3) “Step therapy exception request” means a request to override a step 8
therapy or fail–first protocol. 9
(4) (i) “Step therapy or fail–first protocol” means a protocol established 10
by an insurer, a nonprofit health service plan, or a health maintenance organization that 11
requires a prescription drug or sequence of prescription drugs to be used by an insured or 12
an enrollee before a prescription drug ordered by a prescriber for the insured or the enrollee 13
is covered. 14
(ii) “Step therapy or fail–first protocol” includes a protocol that 15
meets the definition under subparagraph (i) of this paragraph regardless of the name, label, 16
or terminology used by the insurer, nonprofit health service plan, or health maintenance 17
organization to identify the protocol. 18
(5) “Supporting medical information” means: 19
(i) a paid claim from an entity subject to this section for an insured 20
or an enrollee; 21
(ii) a pharmacy record that documents that a prescription has been 22
filled and delivered to an insured or an enrollee, or a representative of an insured or an 23
enrollee; or 24
(iii) other information mutually agreed on by an entity subject to this 25
section and the prescriber of an insured or an enrollee. 26
(b) (1) This section applies to: 27
(i) insurers and nonprofit health service plans that provide hospital, 28
medical, or surgical benefits to individuals or groups on an expense–incurred basis under 29
health insurance policies or contracts that are issued or delivered in the State; and 30
4 SENATE BILL 111
(ii) health maintenance organizations that provide hospital, 1
medical, or surgical benefits to individuals or groups under contracts that are issued or 2
delivered in the State. 3
(2) An insurer, a nonprofit health service plan, or a health maintenance 4
organization that provides coverage for prescription drugs through a pharmacy benefits 5
manager is subject to the requirements of this section. 6
(c) An entity subject to this section may not impose a step therapy or fail–first 7
protocol on an insured or an enrollee if: 8
(1) the step therapy drug has not been approved by the U.S. Food and Drug 9
Administration for the medical condition being treated; or 10
(2) a prescriber provides supporting medical information to the entity that 11
a prescription drug covered by the entity: 12
(i) was ordered by a prescriber for the insured or enrollee within the 13
past 180 days; and 14
(ii) based on the professional judgment of the prescriber, was 15
effective in treating the insured’s or enrollee’s disease or medical condition. 16
(d) Subsection (c) of this section may not be construed to require coverage for a 17
prescription drug that is not: 18
(1) covered by the policy or contract of an entity subject to this section; or 19
(2) otherwise required by law to be covered. 20
(e) An entity subject to this section may not impose a step therapy or fail–first 21
protocol on an insured or an enrollee for a prescription drug approved by the U.S. Food and 22
Drug Administration if: 23
(1) (I) the prescription drug is used to treat the insured’s or enrollee’s 24
stage four advanced metastatic cancer; and 25
[(2)] (II) use of the prescription drug is: 26
[(i)] 1. consistent with the U.S. Food and Drug 27
Administration–approved indication or the National Comprehensive Cancer Network 28
Drugs & Biologics Compendium indication for the treatment of stage four advanced 29
metastatic cancer; and 30
[(ii)] 2. supported by peer–reviewed medical literature; OR 31
SENATE BILL 111 5
(2) THE PRESCRIPTION DRU G IS USED TO TREAT THE IN SURED’S OR 1
ENROLLEE’S DIAGNOSIS OF: 2
(I) BIPOLAR DISORDER ; 3
(II) SCHIZOPHRENIA ; 4
(III) MAJOR DEPRESSION ; 5
(IV) POST–TRAUMATIC STRESS DIS ORDER; OR 6
(V) A MEDICATION –INDUCED MOVEMENT DIS ORDER 7
ASSOCIATED WITH THE TREATMENT OF A SERIOUS MENTAL ILLNESS. 8
(f) (1) An entity subject to this section shall establish a process for requesting 9
an exception to a step therapy or fail–first protocol that is: 10
(i) clearly described, including the specific information and 11
documentation, if needed, that must be submitted by the prescriber to be considered a 12
complete step therapy exception request; 13
(ii) easily accessible to the prescriber; and 14
(iii) posted on the entity’s website. 15
(2) A step therapy exception request shall be granted if, based on the 16
professional judgment of the prescriber and any information and documentation required 17
under paragraph (1)(i) of this subsection: 18
(i) the step therapy drug is contraindicated or will likely cause an 19
adverse reaction to the insured or enrollee; 20
(ii) the step therapy drug is expected to be ineffective based on the 21
known clinical characteristics of the insured or enrollee and the known characteristics of 22
the prescription drug regimen; 23
(iii) the insured or enrollee is stable on a prescription drug prescribed 24
for the medical condition under consideration while covered under the policy or contract of 25
the entity or under a previous source of coverage; or 26
(iv) while covered under the policy or contract of the entity or a 27
previous source of coverage, the insured or enrollee has tried a prescription drug that: 28
1. is in the same pharmacologic class or has the same 29
mechanism of action as the step therapy drug; and 30
6 SENATE BILL 111
2. was discontinued by the prescriber due to lack of efficacy 1
or effectiveness, diminished effect, or an adverse event. 2
(3) On granting a step therapy exception request, an entity subject to this 3
section shall authorize coverage for the prescription drug ordered by the prescriber for an 4
insured or enrollee. 5
(4) An enrollee or insured may appeal a step therapy exception request 6
denial in accordance with Subtitle 10A or Subtitle 10B of this title. 7
(5) This subsection may not be construed to: 8
(i) prevent: 9
1. an entity subject to this section from requiring an insured 10
or enrollee to try an AB–rated generic equivalent or interchangeable biological product 11
before providing coverage for the equivalent branded prescription drug; or 12
2. a health care provider from prescribing a prescription 13
drug that is determined to be medically appropriate; or 14
(ii) require an entity subject to this section to provide coverage for a 15
prescription drug that is not covered by a policy or contract of the entity. 16
(6) An entity subject to this section may use an existing step therapy 17
exception process that satisfies the requirements under this subsection. 18
15–851.1. 19
(A) (1) THIS SECTION APPLIES TO: 20
(I) INSURERS AND NONPROF IT HEALTH SERVICE PL ANS THAT 21
PROVIDE COVERAGE FOR PRESCRIPTION DRUGS U NDER INDIVIDUAL , GROUP, OR 22
BLANKET HEALTH INSUR ANCE POLICIES OR CON TRACTS THAT ARE ISSU ED OR 23
DELIVERED IN THE STATE; AND 24
(II) HEALTH MAINTENANCE O RGANIZATIONS THAT PR OVIDE 25
COVERAGE FOR PRESCRI PTION DRUGS UNDER IN DIVIDUAL OR GROUP CO NTRACTS 26
THAT ARE ISSUED OR D ELIVERED IN THE STATE. 27
(2) AN INSURER, A NONPROFIT HEALTH S ERVICE PLAN, OR A HEALTH 28
MAINTENANCE ORGANIZA TION THAT PROVIDES C OVERAGE FOR PRESCRIP TION 29
DRUGS THROUGH A PHAR MACY BENEFITS MANAGE R IS SUBJECT TO THE 30
REQUIREMENTS OF THIS SECTION. 31
SENATE BILL 111 7
(B) EXCEPT AS REQUIRE D UNDER 42 U.S.C. § 1396A, AN ENTITY SUBJECT 1
TO THIS SECTION MAY NOT APPLY A PRIOR AU THORIZATION REQUIREM ENT FOR A 2
PRESCRIPTION DRUG US ED TO TREAT AN ADULT INSURED’S OR ENROLLEE ’S 3
DIAGNOSIS OF: 4
(1) BIPOLAR DISORDER ; 5
(2) SCHIZOPHRENIA ; 6
(3) MAJOR DEPRESSION ; 7
(4) POST–TRAUMATIC STRESS DIS ORDER; OR 8
(5) A MEDICATION –INDUCED MOVEMENT DIS ORDER ASSOCIATED 9
WITH THE TREATMENT O F A SERIOUS MENTAL I LLNESS. 10
SECTION 3. AND BE IT FURTHER ENACTED, That: 11
(a) On or before January 31, 2027, and each January 1 thereafter through 2031, 12
the Maryland Department of Health shall report to the Department of Legislative Services 13
on any cost increase to the Maryland Medical Assistance Program from the immediately 14
preceding fiscal year that results from the implementation of Section 1 of this Act. 15
(b) On or before April 30 of the year in which a report is submitted under 16
subsection (a) of this section, the Department of Legislative Services shall determine, based 17
on the report, whether the implementation of Section 1 of this Act resulted in a cost increase 18
to the Maryland Medical Assistance Program of more than $2,000,000 from the 19
immediately preceding fiscal year. 20
(c) If the Department of Legislative Services determines that the implementation 21
of Section 1 of this Act resulted in a cost increase to the Maryland Medical Assistance 22
Program of more than $2,000,000 from the immediately preceding fiscal year, with no 23
further action required by the General Assembly, at the end of April 30 of the year the 24
determination is made, Section 1 of this Act shall be abrogated and of no further force and 25
effect. 26
SECTION 4. AND BE IT FURTHER ENACTED, That Section 2 of this Act shall 27
apply to all policies, contracts, and health benefit plans issued, delivered, or renewed in the 28
State on or after January 1, 2026. 29
SECTION 5. AND BE IT FURTHER ENACTED, That Section 2 of this Act shall take 30
effect January 1, 2026. 31
SECTION 6. AND BE IT FURTHER ENACTED, That, except as provided in Section 32
5 of this Act, this Act shall take effect July 1, 2025. 33