Texas 2017 - 85th Regular

Texas House Bill HB1133 Compare Versions

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1		-	85R2236 EES-D
2	1		By: Sheffield, Zerwas, Price, Cook, Raymond, H.B. No. 1133
3	2		et al.
4	3
5	4
6	5		A BILL TO BE ENTITLED
7	6		AN ACT
8	7		relating to the reimbursement of prescription drugs under Medicaid
9	8		and the child health plan program.
10	9		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	10		SECTION 1. Section 533.005(a), Government Code, is amended
12	11		to read as follows:
13	12		(a) A contract between a managed care organization and the
14	13		commission for the organization to provide health care services to
15	14		recipients must contain:
16	15		(1) procedures to ensure accountability to the state
17	16		for the provision of health care services, including procedures for
18	17		financial reporting, quality assurance, utilization review, and
19	18		assurance of contract and subcontract compliance;
20	19		(2) capitation rates that ensure the cost-effective
21	20		provision of quality health care;
22	21		(3) a requirement that the managed care organization
23	22		provide ready access to a person who assists recipients in
24	23		resolving issues relating to enrollment, plan administration,
25	24		education and training, access to services, and grievance
26	25		procedures;
27	26		(4) a requirement that the managed care organization
28	27		provide ready access to a person who assists providers in resolving
29	28		issues relating to payment, plan administration, education and
30	29		training, and grievance procedures;
31	30		(5) a requirement that the managed care organization
32	31		provide information and referral about the availability of
33	32		educational, social, and other community services that could
34	33		benefit a recipient;
35	34		(6) procedures for recipient outreach and education;
36	35		(7) a requirement that the managed care organization
37	36		make payment to a physician or provider for health care services
38	37		rendered to a recipient under a managed care plan on any claim for
39	38		payment that is received with documentation reasonably necessary
40	39		for the managed care organization to process the claim:
41	40		(A) not later than:
42	41		(i) the 10th day after the date the claim is
43	42		received if the claim relates to services provided by a nursing
44	43		facility, intermediate care facility, or group home;
45	44		(ii) the 30th day after the date the claim
46	45		is received if the claim relates to the provision of long-term
47	46		services and supports not subject to Subparagraph (i); and
48	47		(iii) the 45th day after the date the claim
49	48		is received if the claim is not subject to Subparagraph (i) or (ii);
50	49		or
51	50		(B) within a period, not to exceed 60 days,
52	51		specified by a written agreement between the physician or provider
53	52		and the managed care organization;
54	53		(7-a) a requirement that the managed care organization
55	54		demonstrate to the commission that the organization pays claims
56	55		described by Subdivision (7)(A)(ii) on average not later than the
57	56		21st day after the date the claim is received by the organization;
58	57		(8) a requirement that the commission, on the date of a
59	58		recipient's enrollment in a managed care plan issued by the managed
60	59		care organization, inform the organization of the recipient's
61	60		Medicaid certification date;
62	61		(9) a requirement that the managed care organization
63	62		comply with Section 533.006 as a condition of contract retention
64	63		and renewal;
65	64		(10) a requirement that the managed care organization
66	65		provide the information required by Section 533.012 and otherwise
67	66		comply and cooperate with the commission's office of inspector
68	67		general and the office of the attorney general;
69	68		(11) a requirement that the managed care
70	69		organization's usages of out-of-network providers or groups of
71	70		out-of-network providers may not exceed limits for those usages
72	71		relating to total inpatient admissions, total outpatient services,
73	72		and emergency room admissions determined by the commission;
74	73		(12) if the commission finds that a managed care
75	74		organization has violated Subdivision (11), a requirement that the
76	75		managed care organization reimburse an out-of-network provider for
77	76		health care services at a rate that is equal to the allowable rate
78	77		for those services, as determined under Sections 32.028 and
79	78		32.0281, Human Resources Code;
80	79		(13) a requirement that, notwithstanding any other
81	80		law, including Sections 843.312 and 1301.052, Insurance Code, the
82	81		organization:
83	82		(A) use advanced practice registered nurses and
84	83		physician assistants in addition to physicians as primary care
85	84		providers to increase the availability of primary care providers in
86	85		the organization's provider network; and
87	86		(B) treat advanced practice registered nurses
88	87		and physician assistants in the same manner as primary care
89	88		physicians with regard to:
90	89		(i) selection and assignment as primary
91	90		care providers;
92	91		(ii) inclusion as primary care providers in
93	92		the organization's provider network; and
94	93		(iii) inclusion as primary care providers
95	94		in any provider network directory maintained by the organization;
96	95		(14) a requirement that the managed care organization
97	96		reimburse a federally qualified health center or rural health
98	97		clinic for health care services provided to a recipient outside of
99	98		regular business hours, including on a weekend day or holiday, at a
100	99		rate that is equal to the allowable rate for those services as
101	100		determined under Section 32.028, Human Resources Code, if the
102	101		recipient does not have a referral from the recipient's primary
103	102		care physician;
104	103		(15) a requirement that the managed care organization
105	104		develop, implement, and maintain a system for tracking and
106	105		resolving all provider appeals related to claims payment, including
107	106		a process that will require:
108	107		(A) a tracking mechanism to document the status
109	108		and final disposition of each provider's claims payment appeal;
110	109		(B) the contracting with physicians who are not
111	110		network providers and who are of the same or related specialty as
112	111		the appealing physician to resolve claims disputes related to
113	112		denial on the basis of medical necessity that remain unresolved
114	113		subsequent to a provider appeal;
115	114		(C) the determination of the physician resolving
116	115		the dispute to be binding on the managed care organization and
117	116		provider; and
118	117		(D) the managed care organization to allow a
119	118		provider with a claim that has not been paid before the time
120	119		prescribed by Subdivision (7)(A)(ii) to initiate an appeal of that
121	120		claim;
122	121		(16) a requirement that a medical director who is
123	122		authorized to make medical necessity determinations is available to
124	123		the region where the managed care organization provides health care
125	124		services;
126	125		(17) a requirement that the managed care organization
127	126		ensure that a medical director and patient care coordinators and
128	127		provider and recipient support services personnel are located in
129	128		the South Texas service region, if the managed care organization
130	129		provides a managed care plan in that region;
131	130		(18) a requirement that the managed care organization
132	131		provide special programs and materials for recipients with limited
133	132		English proficiency or low literacy skills;
134	133		(19) a requirement that the managed care organization
135	134		develop and establish a process for responding to provider appeals
136	135		in the region where the organization provides health care services;
137	136		(20) a requirement that the managed care organization:
138	137		(A) develop and submit to the commission, before
139	138		the organization begins to provide health care services to
140	139		recipients, a comprehensive plan that describes how the
141	140		organization's provider network complies with the provider access
142	141		standards established under Section 533.0061;
143	142		(B) as a condition of contract retention and
144	143		renewal:
145	144		(i) continue to comply with the provider
146	145		access standards established under Section 533.0061; and
147	146		(ii) make substantial efforts, as
148	147		determined by the commission, to mitigate or remedy any
149	148		noncompliance with the provider access standards established under
150	149		Section 533.0061;
151	150		(C) pay liquidated damages for each failure, as
152	151		determined by the commission, to comply with the provider access
153	152		standards established under Section 533.0061 in amounts that are
154	153		reasonably related to the noncompliance; and
155	154		(D) regularly, as determined by the commission,
156	155		submit to the commission and make available to the public a report
157	156		containing data on the sufficiency of the organization's provider
158	157		network with regard to providing the care and services described
159	158		under Section 533.0061(a) and specific data with respect to access
160	159		to primary care, specialty care, long-term services and supports,
161	160		nursing services, and therapy services on the average length of
162	161		time between:
163	162		(i) the date a provider requests prior
164	163		authorization for the care or service and the date the organization
165	164		approves or denies the request; and
166	165		(ii) the date the organization approves a
167	166		request for prior authorization for the care or service and the date
168	167		the care or service is initiated;
169	168		(21) a requirement that the managed care organization
170	169		demonstrate to the commission, before the organization begins to
171	170		provide health care services to recipients, that, subject to the
172	171		provider access standards established under Section 533.0061:
173	172		(A) the organization's provider network has the
174	173		capacity to serve the number of recipients expected to enroll in a
175	174		managed care plan offered by the organization;
176	175		(B) the organization's provider network
177	176		includes:
178	177		(i) a sufficient number of primary care
179	178		providers;
180	179		(ii) a sufficient variety of provider
181	180		types;
182	181		(iii) a sufficient number of providers of
183	182		long-term services and supports and specialty pediatric care
184	183		providers of home and community-based services; and
185	184		(iv) providers located throughout the
186	185		region where the organization will provide health care services;
187	186		and
188	187		(C) health care services will be accessible to
189	188		recipients through the organization's provider network to a
190	189		comparable extent that health care services would be available to
191	190		recipients under a fee-for-service or primary care case management
192	191		model of Medicaid managed care;
193	192		(22) a requirement that the managed care organization
194	193		develop a monitoring program for measuring the quality of the
195	194		health care services provided by the organization's provider
196	195		network that:
197	196		(A) incorporates the National Committee for
198	197		Quality Assurance's Healthcare Effectiveness Data and Information
199	198		Set (HEDIS) measures;
200	199		(B) focuses on measuring outcomes; and
201	200		(C) includes the collection and analysis of
202	201		clinical data relating to prenatal care, preventive care, mental
203	202		health care, and the treatment of acute and chronic health
204	203		conditions and substance abuse;
205	204		(23) subject to Subsection (a-1), a requirement that
206	205		the managed care organization develop, implement, and maintain an
207	206		outpatient pharmacy benefit plan for its enrolled recipients:
208	207		(A) that exclusively employs the vendor drug
209	208		program formulary and preserves the state's ability to reduce
210	209		waste, fraud, and abuse under Medicaid;
211	210		(B) that adheres to the applicable preferred drug
212	211		list adopted by the commission under Section 531.072;
213	212		(C) that includes the prior authorization
214	213		procedures and requirements prescribed by or implemented under
215	214		Sections 531.073(b), (c), and (g) for the vendor drug program;
216	215		(D) for purposes of which the managed care
217	216		organization:
218	217		(i) may not negotiate or collect rebates
219	218		associated with pharmacy products on the vendor drug program
220	219		formulary; and
221	220		(ii) may not receive drug rebate or pricing
222	221		information that is confidential under Section 531.071;
223	222		(E) that complies with the prohibition under
224	223		Section 531.089;
225	224		(F) under which the managed care organization may
226	225		not prohibit, limit, or interfere with a recipient's selection of a
227	226		pharmacy or pharmacist of the recipient's choice for the provision
228	227		of pharmaceutical services under the plan through the imposition of
229	228		different copayments;
230	229		(G) that allows the managed care organization or
231	230		any subcontracted pharmacy benefit manager to contract with a
232	231		pharmacist or pharmacy providers separately for specialty pharmacy
233	232		services, except that:
234	233		(i) the managed care organization and
235	234		pharmacy benefit manager are prohibited from allowing exclusive
236	235		contracts with a specialty pharmacy owned wholly or partly by the
237	236		pharmacy benefit manager responsible for the administration of the
238	237		pharmacy benefit program; and
239	238		(ii) the managed care organization and
240	239		pharmacy benefit manager must adopt policies and procedures for
241	240		reclassifying prescription drugs from retail to specialty drugs,
242	241		and those policies and procedures must be consistent with rules
243	242		adopted by the executive commissioner and include notice to network
244	243		pharmacy providers from the managed care organization;
245	244		(H) under which the managed care organization may
246	245		not prevent a pharmacy or pharmacist from participating as a
247	246		provider if the pharmacy or pharmacist agrees to comply with the
248	247		financial terms and conditions of the contract as well as other
249	248		reasonable administrative and professional terms and conditions of
250	249		the contract;
251	250		(I) under which the managed care organization may
252	251		include mail-order pharmacies in its networks, but may not require
253	252		enrolled recipients to use those pharmacies, and may not charge an
254	253		enrolled recipient who opts to use this service a fee, including
255	254		postage and handling fees;
256	255		(J) under which the managed care organization or
257	256		pharmacy benefit manager, as applicable, must pay claims in
258	257		accordance with Section 843.339, Insurance Code; and
259	258		(K) under which the managed care organization or
260	259		pharmacy benefit manager, as applicable:
261	260		(i) must comply with Section 533.00512 as a
262	261		condition of contract retention and renewal [to place a drug on a
263	262		maximum allowable cost list, must ensure that:
264	263		[(a) the drug is listed as "A" or "B"
265	264		rated in the most recent version of the United States Food and Drug
266	265		Administration's Approved Drug Products with Therapeutic
267	266		Equivalence Evaluations, also known as the Orange Book, has an "NR"
268	267		or "NA" rating or a similar rating by a nationally recognized
269	268		reference; and
270	269		[(b) the drug is generally available
271	270		for purchase by pharmacies in the state from national or regional
272	271		wholesalers and is not obsolete];
273	272		(ii) must provide to a network pharmacy
274	273		provider, at the time a contract is entered into or renewed with the
275	274		network pharmacy provider, the sources used to determine the actual
276		-	acquisition [maximum allowable] cost (AAC) pricing [for the maximum
277		-	allowable cost list specific to that provider];
	275	+	acquisition [maximum allowable] cost (AAC) pricing, other than the
	276	+	sources used to determine the actual acquisition cost (AAC) pricing
	277	+	of drugs obtained under Section 340B, Public Health Service Act (42
	278	+	U.S.C. Section 256b) [for the maximum allowable cost list specific
	279	+	to that provider];
278	280		(iii) must review and update drug
279	281		reimbursement [maximum allowable cost] price information at least
280	282		once every seven days to reflect any modification of the actual
281	283		acquisition [maximum allowable] cost (AAC) pricing or the factors
282	284		used to determine that pricing;
283	285		(iv) [must, in formulating the maximum
284	286		allowable cost price for a drug, use only the price of the drug and
285	287		drugs listed as therapeutically equivalent in the most recent
286	288		version of the United States Food and Drug Administration's
287	289		Approved Drug Products with Therapeutic Equivalence Evaluations,
288	290		also known as the Orange Book;
289	291		[(v) must establish a process for
290	292		eliminating products from the maximum allowable cost list or
291	293		modifying maximum allowable cost prices in a timely manner to
292	294		remain consistent with pricing changes and product availability in
293	295		the marketplace;
294	296		[(vi)] must:
295	297		(a) provide a procedure under which a
296	298		network pharmacy provider may challenge a listed actual acquisition
297	299		[maximum allowable] cost (AAC) price for a drug;
298	300		(b) respond to a challenge not later
299	301		than the 15th day after the date the challenge is made;
300	302		(c) if the challenge is successful,
301	303		make an adjustment in the drug price effective on the date the
302	304		challenge is resolved, and make the adjustment applicable to all
303	305		similarly situated network pharmacy providers, as determined by the
304	306		managed care organization or pharmacy benefit manager, as
305	307		appropriate;
306	308		(d) if the challenge is denied,
307	309		provide the reason for the denial; and
308	310		(e) report to the commission every 90
309	311		days the total number of challenges that were made and denied in the
310	312		preceding 90-day period for each [maximum allowable cost list] drug
311	313		for which a challenge was denied during the period; and
312	314		(v) [(vii) must notify the commission not
313	315		later than the 21st day after implementing a practice of using a
314	316		maximum allowable cost list for drugs dispensed at retail but not by
315	317		mail; and
316	318		[(viii)] must provide a process for each of
317	319		its network pharmacy providers to readily access the drug
318	320		reimbursement price [maximum allowable cost] list specific to that
319	321		provider;
320	322		(24) a requirement that the managed care organization
321	323		and any entity with which the managed care organization contracts
322	324		for the performance of services under a managed care plan disclose,
323	325		at no cost, to the commission and, on request, the office of the
324	326		attorney general all discounts, incentives, rebates, fees, free
325	327		goods, bundling arrangements, and other agreements affecting the
326	328		net cost of goods or services provided under the plan;
327	329		(25) a requirement that the managed care organization
328	330		not implement significant, nonnegotiated, across-the-board
329	331		provider reimbursement rate reductions unless:
330	332		(A) subject to Subsection (a-3), the
331	333		organization has the prior approval of the commission to make the
332	334		reduction; or
333	335		(B) the rate reductions are based on changes to
334	336		the Medicaid fee schedule or cost containment initiatives
335	337		implemented by the commission; and
336	338		(26) a requirement that the managed care organization
337	339		make initial and subsequent primary care provider assignments and
338	340		changes.
339	341		SECTION 2. Subchapter A, Chapter 533, Government Code, is
340	342		amended by adding Section 533.00512 to read as follows:
341	343		Sec. 533.00512. REIMBURSEMENT METHODOLOGY FOR PRESCRIPTION
342	344		DRUGS. (a) A managed care organization that contracts with the
343	345		commission under this chapter or a pharmacy benefit manager
344	346		administering a pharmacy benefit program on behalf of the managed
345	347		care organization shall reimburse a pharmacy or pharmacist that
346		-	dispenses a prescribed prescription drug to a recipient for not
347		-	less than the lesser of:
348		-	(1) the average of Texas pharmacies' actual
349		-	acquisition cost (AAC) for the drug, plus a dispensing fee that is
350		-	not less than a minimum amount adopted by rule by the executive
351		-	commissioner; or
	348	+	dispenses a prescribed prescription drug, other than a drug
	349	+	obtained under Section 340B, Public Health Service Act (42 U.S.C.
	350	+	Section 256b), to a recipient for not less than the lesser of:
	351	+	(1) for a drug dispensed by:
	352	+	(A) a retail pharmacy or a pharmacist employed by
	353	+	a retail pharmacy, the average of Texas retail pharmacies' actual
	354	+	acquisition cost (AAC) for the drug, plus a retail professional
	355	+	dispensing fee that is not less than a minimum amount adopted by the
	356	+	executive commissioner under authority of 42 C.F.R. Sections
	357	+	438.6(c)(1)(iii)(A) through (C); or
	358	+	(B) a specialty pharmacy or a pharmacist employed
	359	+	by a specialty pharmacy, the average of Texas specialty pharmacies'
	360	+	actual acquisition cost (AAC) for the drug, plus a specialty
	361	+	pharmacy professional dispensing fee that is not less than a
	362	+	minimum amount adopted by the executive commissioner under
	363	+	authority of 42 C.F.R. Sections 438.6(c)(1)(iii)(A) through (C); or
352	364		(2) the amount claimed by the pharmacy or pharmacist,
353	365		including the gross amount due or the usual and customary charge to
354	366		the public for the drug.
	367	+	(a-1) A managed care organization that contracts with the
	368	+	commission under this chapter or a pharmacy benefit manager
	369	+	administering a pharmacy benefit program on behalf of the managed
	370	+	care organization shall reimburse a pharmacy or pharmacist that
	371	+	dispenses a prescribed prescription drug obtained at a discounted
	372	+	price under Section 340B, Public Health Service Act (42 U.S.C.
	373	+	Section 256b) to a recipient for not less than the reimbursement
	374	+	amount for the drug under the vendor drug program, including a
	375	+	dispensing fee that is not less than the dispensing fee for the drug
	376	+	under the vendor drug program.
355	377		(b) The methodology adopted by rule by the executive
356		-	commissioner to determine Texas pharmacies' actual acquisition
357		-	cost (AAC) for purposes of Subsection (a) must be consistent with
358		-	the actual prices Texas pharmacies pay to acquire prescription
359		-	drugs marketed or sold by a specific manufacturer and may be based
360		-	on the National Average Drug Acquisition Cost published by the
361		-	Centers for Medicare and Medicaid Services or another publication
362		-	approved by the executive commissioner.
	378	+	commissioner to determine Texas retail pharmacies' actual
	379	+	acquisition cost (AAC) and Texas specialty pharmacies' actual
	380	+	acquisition cost (AAC) for purposes of Subsection (a) must be
	381	+	consistent with the actual prices Texas pharmacies pay to acquire
	382	+	prescription drugs marketed or sold by a specific manufacturer and
	383	+	must be based on the National Average Drug Acquisition Cost
	384	+	published by the Centers for Medicare and Medicaid Services or
	385	+	another publication approved by the executive commissioner.
363	386		(c) The executive commissioner shall develop a process for
364		-	the periodic study of Texas pharmacies' actual acquisition cost
365		-	(AAC) for prescription drugs and publish the results of each study
366		-	on the commission's Internet website.
367		-	(d) The dispensing fee adopted by the executive
368		-	commissioner for purposes of Subsection (a) must be based on Texas
369		-	pharmacies' dispensing costs for prescription drugs.
370		-	(e) Not less frequently than once every five years, the
	387	+	the periodic study of Texas retail pharmacies' actual acquisition
	388	+	cost (AAC) for prescription drugs, Texas specialty pharmacies'
	389	+	actual acquisition cost (AAC) for prescription drugs, retail
	390	+	professional dispensing costs, and specialty pharmacy professional
	391	+	dispensing costs and publish the results of each study on the
	392	+	commission's Internet website.
	393	+	(d) The dispensing fees adopted by the executive
	394	+	commissioner for purposes of:
	395	+	(1) Subsection (a) must be based on, as appropriate:
	396	+	(A) Texas retail pharmacies' professional
	397	+	dispensing costs for retail prescription drugs; or
	398	+	(B) Texas specialty pharmacies' professional
	399	+	dispensing costs for specialty prescription drugs; or
	400	+	(2) Subsection (a-1) must be based on Texas
	401	+	pharmacies' professional dispensing costs for those drugs.
	402	+	(e) Not less frequently than once every two years, the
371	403		commission shall conduct a study of Texas pharmacies' dispensing
372		-	costs for prescription drugs. Based on the results of the study,
373		-	the executive commissioner shall consider amending the minimum
374		-	amount of the dispensing fee in Subsection (a).
	404	+	costs for retail prescription drugs, specialty prescription drugs,
	405	+	and drugs obtained under Section 340B, Public Health Service Act
	406	+	(42 U.S.C. Section 256b). Based on the results of the study, the
	407	+	executive commissioner shall adjust the minimum amount of the
	408	+	retail professional dispensing fee and specialty pharmacy
	409	+	professional dispensing fee under Subsection (a) and the dispensing
	410	+	fee for drugs obtained under Section 340B, Public Health Service
	411	+	Act (42 U.S.C. Section 256b).
375	412		SECTION 3. Subchapter D, Chapter 62, Health and Safety
376	413		Code, is amended by adding Section 62.160 to read as follows:
377	414		Sec. 62.160. REIMBURSEMENT METHODOLOGY FOR PRESCRIPTION
378	415		DRUGS. A managed care organization providing pharmacy benefits
379	416		under the child health plan program or a pharmacy benefit manager
380	417		administering a pharmacy benefit program on behalf of the managed
381	418		care organization shall comply with Section 533.00512, Government
382	419		Code.
383	420		SECTION 4. Section 32.0462(a), Human Resources Code, is
384	421		amended to read as follows:
385	422		(a) Notwithstanding any other provision of state law, the
386	423		commission shall:
387	424		(1) use the reimbursement methodology under Section
388	425		533.00512, Government Code, to determine [consider a nationally
389	426		recognized, unbiased pricing standard for prescription drugs in
390	427		determining] reimbursement amounts under the vendor drug program;
391	428		and
392	429		(2) update reimbursement amounts under the vendor drug
393	430		program at least weekly.
394	431		SECTION 5. Section 533.005(a-2), Government Code, is
395	432		repealed.
396	433		SECTION 6. If before implementing any provision of this Act
397	434		a state agency determines that a waiver or authorization from a
398	435		federal agency is necessary for implementation of that provision,
399	436		the agency affected by the provision shall request the waiver or
400	437		authorization and may delay implementing that provision until the
401	438		waiver or authorization is granted.
402	439		SECTION 7. This Act takes effect March 1, 2018.