Texas 2017 - 85th Regular

Texas Senate Bill SB1567 Compare Versions

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1	1	2017S0396-1 03/06/17
2	2	By: Kolkhorst S.B. No. 1567
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the reimbursement of prescription drugs under Medicaid
8	8	and the child health plan program.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Sections 533.005(a) and (a-2), Government Code,
11	11	are amended to read as follows:
12	12	(a) A contract between a managed care organization and the
13	13	commission for the organization to provide health care services to
14	14	recipients must contain:
15	15	(1) procedures to ensure accountability to the state
16	16	for the provision of health care services, including procedures for
17	17	financial reporting, quality assurance, utilization review, and
18	18	assurance of contract and subcontract compliance;
19	19	(2) capitation rates that ensure the cost-effective
20	20	provision of quality health care;
21	21	(3) a requirement that the managed care organization
22	22	provide ready access to a person who assists recipients in
23	23	resolving issues relating to enrollment, plan administration,
24	24	education and training, access to services, and grievance
25	25	procedures;
26	26	(4) a requirement that the managed care organization
27	27	provide ready access to a person who assists providers in resolving
28	28	issues relating to payment, plan administration, education and
29	29	training, and grievance procedures;
30	30	(5) a requirement that the managed care organization
31	31	provide information and referral about the availability of
32	32	educational, social, and other community services that could
33	33	benefit a recipient;
34	34	(6) procedures for recipient outreach and education;
35	35	(7) a requirement that the managed care organization
36	36	make payment to a physician or provider for health care services
37	37	rendered to a recipient under a managed care plan on any claim for
38	38	payment that is received with documentation reasonably necessary
39	39	for the managed care organization to process the claim:
40	40	(A) not later than:
41	41	(i) the 10th day after the date the claim is
42	42	received if the claim relates to services provided by a nursing
43	43	facility, intermediate care facility, or group home;
44	44	(ii) the 30th day after the date the claim
45	45	is received if the claim relates to the provision of long-term
46	46	services and supports not subject to Subparagraph (i); and
47	47	(iii) the 45th day after the date the claim
48	48	is received if the claim is not subject to Subparagraph (i) or (ii);
49	49	or
50	50	(B) within a period, not to exceed 60 days,
51	51	specified by a written agreement between the physician or provider
52	52	and the managed care organization;
53	53	(7-a) a requirement that the managed care organization
54	54	demonstrate to the commission that the organization pays claims
55	55	described by Subdivision (7)(A)(ii) on average not later than the
56	56	21st day after the date the claim is received by the organization;
57	57	(8) a requirement that the commission, on the date of a
58	58	recipient's enrollment in a managed care plan issued by the managed
59	59	care organization, inform the organization of the recipient's
60	60	Medicaid certification date;
61	61	(9) a requirement that the managed care organization
62	62	comply with Section 533.006 as a condition of contract retention
63	63	and renewal;
64	64	(10) a requirement that the managed care organization
65	65	provide the information required by Section 533.012 and otherwise
66	66	comply and cooperate with the commission's office of inspector
67	67	general and the office of the attorney general;
68	68	(11) a requirement that the managed care
69	69	organization's usages of out-of-network providers or groups of
70	70	out-of-network providers may not exceed limits for those usages
71	71	relating to total inpatient admissions, total outpatient services,
72	72	and emergency room admissions determined by the commission;
73	73	(12) if the commission finds that a managed care
74	74	organization has violated Subdivision (11), a requirement that the
75	75	managed care organization reimburse an out-of-network provider for
76	76	health care services at a rate that is equal to the allowable rate
77	77	for those services, as determined under Sections 32.028 and
78	78	32.0281, Human Resources Code;
79	79	(13) a requirement that, notwithstanding any other
80	80	law, including Sections 843.312 and 1301.052, Insurance Code, the
81	81	organization:
82	82	(A) use advanced practice registered nurses and
83	83	physician assistants in addition to physicians as primary care
84	84	providers to increase the availability of primary care providers in
85	85	the organization's provider network; and
86	86	(B) treat advanced practice registered nurses
87	87	and physician assistants in the same manner as primary care
88	88	physicians with regard to:
89	89	(i) selection and assignment as primary
90	90	care providers;
91	91	(ii) inclusion as primary care providers in
92	92	the organization's provider network; and
93	93	(iii) inclusion as primary care providers
94	94	in any provider network directory maintained by the organization;
95	95	(14) a requirement that the managed care organization
96	96	reimburse a federally qualified health center or rural health
97	97	clinic for health care services provided to a recipient outside of
98	98	regular business hours, including on a weekend day or holiday, at a
99	99	rate that is equal to the allowable rate for those services as
100	100	determined under Section 32.028, Human Resources Code, if the
101	101	recipient does not have a referral from the recipient's primary
102	102	care physician;
103	103	(15) a requirement that the managed care organization
104	104	develop, implement, and maintain a system for tracking and
105	105	resolving all provider appeals related to claims payment, including
106	106	a process that will require:
107	107	(A) a tracking mechanism to document the status
108	108	and final disposition of each provider's claims payment appeal;
109	109	(B) the contracting with physicians who are not
110	110	network providers and who are of the same or related specialty as
111	111	the appealing physician to resolve claims disputes related to
112	112	denial on the basis of medical necessity that remain unresolved
113	113	subsequent to a provider appeal;
114	114	(C) the determination of the physician resolving
115	115	the dispute to be binding on the managed care organization and
116	116	provider; and
117	117	(D) the managed care organization to allow a
118	118	provider with a claim that has not been paid before the time
119	119	prescribed by Subdivision (7)(A)(ii) to initiate an appeal of that
120	120	claim;
121	121	(16) a requirement that a medical director who is
122	122	authorized to make medical necessity determinations is available to
123	123	the region where the managed care organization provides health care
124	124	services;
125	125	(17) a requirement that the managed care organization
126	126	ensure that a medical director and patient care coordinators and
127	127	provider and recipient support services personnel are located in
128	128	the South Texas service region, if the managed care organization
129	129	provides a managed care plan in that region;
130	130	(18) a requirement that the managed care organization
131	131	provide special programs and materials for recipients with limited
132	132	English proficiency or low literacy skills;
133	133	(19) a requirement that the managed care organization
134	134	develop and establish a process for responding to provider appeals
135	135	in the region where the organization provides health care services;
136	136	(20) a requirement that the managed care organization:
137	137	(A) develop and submit to the commission, before
138	138	the organization begins to provide health care services to
139	139	recipients, a comprehensive plan that describes how the
140	140	organization's provider network complies with the provider access
141	141	standards established under Section 533.0061;
142	142	(B) as a condition of contract retention and
143	143	renewal:
144	144	(i) continue to comply with the provider
145	145	access standards established under Section 533.0061; and
146	146	(ii) make substantial efforts, as
147	147	determined by the commission, to mitigate or remedy any
148	148	noncompliance with the provider access standards established under
149	149	Section 533.0061;
150	150	(C) pay liquidated damages for each failure, as
151	151	determined by the commission, to comply with the provider access
152	152	standards established under Section 533.0061 in amounts that are
153	153	reasonably related to the noncompliance; and
154	154	(D) regularly, as determined by the commission,
155	155	submit to the commission and make available to the public a report
156	156	containing data on the sufficiency of the organization's provider
157	157	network with regard to providing the care and services described
158	158	under Section 533.0061(a) and specific data with respect to access
159	159	to primary care, specialty care, long-term services and supports,
160	160	nursing services, and therapy services on the average length of
161	161	time between:
162	162	(i) the date a provider requests prior
163	163	authorization for the care or service and the date the organization
164	164	approves or denies the request; and
165	165	(ii) the date the organization approves a
166	166	request for prior authorization for the care or service and the date
167	167	the care or service is initiated;
168	168	(21) a requirement that the managed care organization
169	169	demonstrate to the commission, before the organization begins to
170	170	provide health care services to recipients, that, subject to the
171	171	provider access standards established under Section 533.0061:
172	172	(A) the organization's provider network has the
173	173	capacity to serve the number of recipients expected to enroll in a
174	174	managed care plan offered by the organization;
175	175	(B) the organization's provider network
176	176	includes:
177	177	(i) a sufficient number of primary care
178	178	providers;
179	179	(ii) a sufficient variety of provider
180	180	types;
181	181	(iii) a sufficient number of providers of
182	182	long-term services and supports and specialty pediatric care
183	183	providers of home and community-based services; and
184	184	(iv) providers located throughout the
185	185	region where the organization will provide health care services;
186	186	and
187	187	(C) health care services will be accessible to
188	188	recipients through the organization's provider network to a
189	189	comparable extent that health care services would be available to
190	190	recipients under a fee-for-service or primary care case management
191	191	model of Medicaid managed care;
192	192	(22) a requirement that the managed care organization
193	193	develop a monitoring program for measuring the quality of the
194	194	health care services provided by the organization's provider
195	195	network that:
196	196	(A) incorporates the National Committee for
197	197	Quality Assurance's Healthcare Effectiveness Data and Information
198	198	Set (HEDIS) measures;
199	199	(B) focuses on measuring outcomes; and
200	200	(C) includes the collection and analysis of
201	201	clinical data relating to prenatal care, preventive care, mental
202	202	health care, and the treatment of acute and chronic health
203	203	conditions and substance abuse;
204	204	(23) subject to Subsection (a-1), a requirement that
205	205	the managed care organization develop, implement, and maintain an
206	206	outpatient pharmacy benefit plan for its enrolled recipients:
207	207	(A) that exclusively employs the vendor drug
208	208	program formulary and preserves the state's ability to reduce
209	209	waste, fraud, and abuse under Medicaid;
210	210	(B) that adheres to the applicable preferred drug
211	211	list adopted by the commission under Section 531.072;
212	212	(C) that includes the prior authorization
213	213	procedures and requirements prescribed by or implemented under
214	214	Sections 531.073(b), (c), and (g) for the vendor drug program;
215	215	(D) for purposes of which the managed care
216	216	organization:
217	217	(i) may not negotiate or collect rebates
218	218	associated with pharmacy products on the vendor drug program
219	219	formulary; and
220	220	(ii) may not receive drug rebate or pricing
221	221	information that is confidential under Section 531.071;
222	222	(E) that complies with the prohibition under
223	223	Section 531.089;
224	224	(F) under which the managed care organization may
225	225	not prohibit, limit, or interfere with a recipient's selection of a
226	226	pharmacy or pharmacist of the recipient's choice for the provision
227	227	of pharmaceutical services under the plan through the imposition of
228	228	different copayments;
229	229	(G) under which a contract between the managed
230	230	care organization or any subcontracted pharmacy benefit manager and
231	231	a pharmacist or pharmacy provider indicates the reimbursement
232	232	methodology to be used and, at a minimum, indicates:
233	233	(i) the amount to be paid for each claim for
234	234	ingredient cost as a percentage of the amount that would be paid
235	235	under Medicaid fee-for-service; and
236	236	(ii) the amount to be paid for each claim
237	237	for the professional dispensing fee as a percentage of the amount
238	238	that would be paid under Medicaid fee-for-service;
239	239	(H) that allows the managed care organization or
240	240	any subcontracted pharmacy benefit manager to contract with a
241	241	pharmacist or pharmacy providers separately for specialty pharmacy
242	242	services, except that:
243	243	(i) the managed care organization and
244	244	pharmacy benefit manager are prohibited from allowing exclusive
245	245	contracts with a specialty pharmacy owned wholly or partly by the
246	246	pharmacy benefit manager responsible for the administration of the
247	247	pharmacy benefit program; and
248	248	(ii) the managed care organization and
249	249	pharmacy benefit manager must adopt policies and procedures for
250	250	reclassifying prescription drugs from retail to specialty drugs,
251	251	and those policies and procedures must be consistent with rules
252	252	adopted by the executive commissioner and include notice to network
253	253	pharmacy providers from the managed care organization;
254	254	(I)[(H)] under which the managed care
255	255	organization may not prevent a pharmacy or pharmacist from
256	256	participating as a provider if the pharmacy or pharmacist agrees to
257	257	comply with the financial terms and conditions of the contract as
258	258	well as other reasonable administrative and professional terms and
259	259	conditions of the contract;
260	260	(J)[(I)] under which the managed care
261	261	organization may include mail-order pharmacies in its networks, but
262	262	may not require enrolled recipients to use those pharmacies, and
263	263	may not charge an enrolled recipient who opts to use this service a
264	264	fee, including postage and handling fees;
265	265	(K)[(J)] under which the managed care
266	266	organization or pharmacy benefit manager, as applicable, must pay
267	267	claims in accordance with Section 843.339, Insurance Code; and
268	268	(L)[(K)] under which the managed care
269	269	organization or pharmacy benefit manager, as applicable:
270	270	(i) to place a drug on a maximum allowable
271	271	cost list, must ensure that:
272	272	(a) the drug is listed as "A" or "B"
273	273	rated in the most recent version of the United States Food and Drug
274	274	Administration's Approved Drug Products with Therapeutic
275	275	Equivalence Evaluations, also known as the Orange Book, has an "NR"
276	276	or "NA" rating or a similar rating by a nationally recognized
277	277	reference; and
278	278	(b) the drug is generally available
279	279	for purchase by pharmacies in the state from national or regional
280	280	wholesalers and is not obsolete;
281	281	(ii) must provide to a network pharmacy
282	282	provider, at the time a contract is entered into or renewed with the
283	283	network pharmacy provider, the sources used to determine the
284	284	maximum allowable cost pricing for the maximum allowable cost list
285	285	specific to that provider;
286	286	(iii) must review and update maximum
287	287	allowable cost price information at least once every seven days to
288	288	reflect any modification of maximum allowable cost pricing;
289	289	(iv) must, in formulating the maximum
290	290	allowable cost price for a drug, use only the price of the drug and
291	291	drugs listed as therapeutically equivalent in the most recent
292	292	version of the United States Food and Drug Administration's
293	293	Approved Drug Products with Therapeutic Equivalence Evaluations,
294	294	also known as the Orange Book;
295	295	(v) must establish a process for
296	296	eliminating products from the maximum allowable cost list or
297	297	modifying maximum allowable cost prices in a timely manner to
298	298	remain consistent with pricing changes and product availability in
299	299	the marketplace;
300	300	(vi) must:
301	301	(a) provide a procedure under which a
302	302	network pharmacy provider may challenge a listed maximum allowable
303	303	cost price for a drug;
304	304	(b) respond to a challenge not later
305	305	than the 15th day after the date the challenge is made;
306	306	(c) if the challenge is successful,
307	307	make an adjustment in the drug price effective on the date the
308	308	challenge is resolved, and make the adjustment applicable to all
309	309	similarly situated network pharmacy providers, as determined by the
310	310	managed care organization or pharmacy benefit manager, as
311	311	appropriate;
312	312	(d) if the challenge is denied,
313	313	provide the reason for the denial; and
314	314	(e) report to the commission every 90
315	315	days the total number of challenges that were made and denied in the
316	316	preceding 90-day period for each maximum allowable cost list drug
317	317	for which a challenge was denied during the period;
318	318	(vii) must notify the commission not later
319	319	than the 21st day after implementing a practice of using a maximum
320	320	allowable cost list for drugs dispensed at retail but not by mail;
321	321	and
322	322	(viii) must provide a process for each of
323	323	its network pharmacy providers to readily access the maximum
324	324	allowable cost list specific to that provider;
325	325	(24) a requirement that the managed care organization
326	326	and any entity with which the managed care organization contracts
327	327	for the performance of services under a managed care plan disclose,
328	328	at no cost, to the commission and, on request, the office of the
329	329	attorney general all discounts, incentives, rebates, fees, free
330	330	goods, bundling arrangements, and other agreements affecting the
331	331	net cost of goods or services provided under the plan;
332	332	(25) a requirement that the managed care organization
333	333	not implement significant, nonnegotiated, across-the-board
334	334	provider reimbursement rate reductions unless:
335	335	(A) subject to Subsection (a-3), the
336	336	organization has the prior approval of the commission to make the
337	337	reduction; or
338	338	(B) the rate reductions are based on changes to
339	339	the Medicaid fee schedule or cost containment initiatives
340	340	implemented by the commission; and
341	341	(26) a requirement that the managed care organization
342	342	make initial and subsequent primary care provider assignments and
343	343	changes.
344	344	(a-2) Except as provided by Subsection (a)(23)(L)(viii)
345	345	[(a)(23)(K)(viii)], a maximum allowable cost list specific to a
346	346	provider and maintained by a managed care organization or pharmacy
347	347	benefit manager is confidential.
348	348	SECTION 2. If before implementing any provision of this Act
349	349	a state agency determines that a waiver or authorization from a
350	350	federal agency is necessary for implementation of that provision,
351	351	the agency affected by the provision shall request the waiver or
352	352	authorization and may delay implementing that provision until the
353	353	waiver or authorization is granted.
354	354	SECTION 3. This Act takes effect March 1, 2018.