Texas 2019 - 86th Regular

Texas House Bill HB3388 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	By: Sheffield, et al. H.B. No. 3388
2		-	(Senate Sponsor - Kolkhorst, Miles)
3		-	(In the Senate - Received from the House May 6, 2019;
4		-	May 10, 2019, read first time and referred to Committee on Health &
5		-	Human Services; May 17, 2019, reported adversely, with favorable
6		-	Committee Substitute by the following vote: Yeas 9, Nays 0;
7		-	May 17, 2019, sent to printer.)
8		-	Click here to see the committee vote
9		-	COMMITTEE SUBSTITUTE FOR H.B. No. 3388 By: Kolkhorst
	1	+	86R22633 KFF-F
	2	+	By: Sheffield, Bonnen of Galveston, Price, H.B. No. 3388
	3	+	Hefner, Raymond, et al.
10	4
11	5
12	6		A BILL TO BE ENTITLED
13	7		AN ACT
14	8		relating to the reimbursement of prescription drugs under Medicaid
15	9		and the child health plan program.
16	10		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
17	11		SECTION 1. Section 533.005(a), Government Code, is amended
18	12		to read as follows:
19	13		(a) A contract between a managed care organization and the
20	14		commission for the organization to provide health care services to
21	15		recipients must contain:
22	16		(1) procedures to ensure accountability to the state
23	17		for the provision of health care services, including procedures for
24	18		financial reporting, quality assurance, utilization review, and
25	19		assurance of contract and subcontract compliance;
26	20		(2) capitation rates that ensure the cost-effective
27	21		provision of quality health care;
28	22		(3) a requirement that the managed care organization
29	23		provide ready access to a person who assists recipients in
30	24		resolving issues relating to enrollment, plan administration,
31	25		education and training, access to services, and grievance
32	26		procedures;
33	27		(4) a requirement that the managed care organization
34	28		provide ready access to a person who assists providers in resolving
35	29		issues relating to payment, plan administration, education and
36	30		training, and grievance procedures;
37	31		(5) a requirement that the managed care organization
38	32		provide information and referral about the availability of
39	33		educational, social, and other community services that could
40	34		benefit a recipient;
41	35		(6) procedures for recipient outreach and education;
42	36		(7) a requirement that the managed care organization
43	37		make payment to a physician or provider for health care services
44	38		rendered to a recipient under a managed care plan on any claim for
45	39		payment that is received with documentation reasonably necessary
46	40		for the managed care organization to process the claim:
47	41		(A) not later than:
48	42		(i) the 10th day after the date the claim is
49	43		received if the claim relates to services provided by a nursing
50	44		facility, intermediate care facility, or group home;
51	45		(ii) the 30th day after the date the claim
52	46		is received if the claim relates to the provision of long-term
53	47		services and supports not subject to Subparagraph (i); and
54	48		(iii) the 45th day after the date the claim
55	49		is received if the claim is not subject to Subparagraph (i) or (ii);
56	50		or
57	51		(B) within a period, not to exceed 60 days,
58	52		specified by a written agreement between the physician or provider
59	53		and the managed care organization;
60	54		(7-a) a requirement that the managed care organization
61	55		demonstrate to the commission that the organization pays claims
62	56		described by Subdivision (7)(A)(ii) on average not later than the
63	57		21st day after the date the claim is received by the organization;
64	58		(8) a requirement that the commission, on the date of a
65	59		recipient's enrollment in a managed care plan issued by the managed
66	60		care organization, inform the organization of the recipient's
67	61		Medicaid certification date;
68	62		(9) a requirement that the managed care organization
69	63		comply with Section 533.006 as a condition of contract retention
70	64		and renewal;
71	65		(10) a requirement that the managed care organization
72	66		provide the information required by Section 533.012 and otherwise
73	67		comply and cooperate with the commission's office of inspector
74	68		general and the office of the attorney general;
75	69		(11) a requirement that the managed care
76	70		organization's usages of out-of-network providers or groups of
77	71		out-of-network providers may not exceed limits for those usages
78	72		relating to total inpatient admissions, total outpatient services,
79	73		and emergency room admissions determined by the commission;
80	74		(12) if the commission finds that a managed care
81	75		organization has violated Subdivision (11), a requirement that the
82	76		managed care organization reimburse an out-of-network provider for
83	77		health care services at a rate that is equal to the allowable rate
84	78		for those services, as determined under Sections 32.028 and
85	79		32.0281, Human Resources Code;
86	80		(13) a requirement that, notwithstanding any other
87	81		law, including Sections 843.312 and 1301.052, Insurance Code, the
88	82		organization:
89	83		(A) use advanced practice registered nurses and
90	84		physician assistants in addition to physicians as primary care
91	85		providers to increase the availability of primary care providers in
92	86		the organization's provider network; and
93	87		(B) treat advanced practice registered nurses
94	88		and physician assistants in the same manner as primary care
95	89		physicians with regard to:
96	90		(i) selection and assignment as primary
97	91		care providers;
98	92		(ii) inclusion as primary care providers in
99	93		the organization's provider network; and
100	94		(iii) inclusion as primary care providers
101	95		in any provider network directory maintained by the organization;
102	96		(14) a requirement that the managed care organization
103	97		reimburse a federally qualified health center or rural health
104	98		clinic for health care services provided to a recipient outside of
105	99		regular business hours, including on a weekend day or holiday, at a
106	100		rate that is equal to the allowable rate for those services as
107	101		determined under Section 32.028, Human Resources Code, if the
108	102		recipient does not have a referral from the recipient's primary
109	103		care physician;
110	104		(15) a requirement that the managed care organization
111	105		develop, implement, and maintain a system for tracking and
112	106		resolving all provider appeals related to claims payment, including
113	107		a process that will require:
114	108		(A) a tracking mechanism to document the status
115	109		and final disposition of each provider's claims payment appeal;
116	110		(B) the contracting with physicians who are not
117	111		network providers and who are of the same or related specialty as
118	112		the appealing physician to resolve claims disputes related to
119	113		denial on the basis of medical necessity that remain unresolved
120	114		subsequent to a provider appeal;
121	115		(C) the determination of the physician resolving
122	116		the dispute to be binding on the managed care organization and
123	117		provider; and
124	118		(D) the managed care organization to allow a
125	119		provider with a claim that has not been paid before the time
126	120		prescribed by Subdivision (7)(A)(ii) to initiate an appeal of that
127	121		claim;
128	122		(16) a requirement that a medical director who is
129	123		authorized to make medical necessity determinations is available to
130	124		the region where the managed care organization provides health care
131	125		services;
132	126		(17) a requirement that the managed care organization
133	127		ensure that a medical director and patient care coordinators and
134	128		provider and recipient support services personnel are located in
135	129		the South Texas service region, if the managed care organization
136	130		provides a managed care plan in that region;
137	131		(18) a requirement that the managed care organization
138	132		provide special programs and materials for recipients with limited
139	133		English proficiency or low literacy skills;
140	134		(19) a requirement that the managed care organization
141	135		develop and establish a process for responding to provider appeals
142	136		in the region where the organization provides health care services;
143	137		(20) a requirement that the managed care organization:
144	138		(A) develop and submit to the commission, before
145	139		the organization begins to provide health care services to
146	140		recipients, a comprehensive plan that describes how the
147	141		organization's provider network complies with the provider access
148	142		standards established under Section 533.0061;
149	143		(B) as a condition of contract retention and
150	144		renewal:
151	145		(i) continue to comply with the provider
152	146		access standards established under Section 533.0061; and
153	147		(ii) make substantial efforts, as
154	148		determined by the commission, to mitigate or remedy any
155	149		noncompliance with the provider access standards established under
156	150		Section 533.0061;
157	151		(C) pay liquidated damages for each failure, as
158	152		determined by the commission, to comply with the provider access
159	153		standards established under Section 533.0061 in amounts that are
160	154		reasonably related to the noncompliance; and
161	155		(D) regularly, as determined by the commission,
162	156		submit to the commission and make available to the public a report
163	157		containing data on the sufficiency of the organization's provider
164	158		network with regard to providing the care and services described
165	159		under Section 533.0061(a) and specific data with respect to access
166	160		to primary care, specialty care, long-term services and supports,
167	161		nursing services, and therapy services on the average length of
168	162		time between:
169	163		(i) the date a provider requests prior
170	164		authorization for the care or service and the date the organization
171	165		approves or denies the request; and
172	166		(ii) the date the organization approves a
173	167		request for prior authorization for the care or service and the date
174	168		the care or service is initiated;
175	169		(21) a requirement that the managed care organization
176	170		demonstrate to the commission, before the organization begins to
177	171		provide health care services to recipients, that, subject to the
178	172		provider access standards established under Section 533.0061:
179	173		(A) the organization's provider network has the
180	174		capacity to serve the number of recipients expected to enroll in a
181	175		managed care plan offered by the organization;
182	176		(B) the organization's provider network
183	177		includes:
184	178		(i) a sufficient number of primary care
185	179		providers;
186	180		(ii) a sufficient variety of provider
187	181		types;
188	182		(iii) a sufficient number of providers of
189	183		long-term services and supports and specialty pediatric care
190	184		providers of home and community-based services; and
191	185		(iv) providers located throughout the
192	186		region where the organization will provide health care services;
193	187		and
194	188		(C) health care services will be accessible to
195	189		recipients through the organization's provider network to a
196	190		comparable extent that health care services would be available to
197	191		recipients under a fee-for-service or primary care case management
198	192		model of Medicaid managed care;
199	193		(22) a requirement that the managed care organization
200	194		develop a monitoring program for measuring the quality of the
201	195		health care services provided by the organization's provider
202	196		network that:
203	197		(A) incorporates the National Committee for
204	198		Quality Assurance's Healthcare Effectiveness Data and Information
205	199		Set (HEDIS) measures;
206	200		(B) focuses on measuring outcomes; and
207	201		(C) includes the collection and analysis of
208	202		clinical data relating to prenatal care, preventive care, mental
209	203		health care, and the treatment of acute and chronic health
210	204		conditions and substance abuse;
211	205		(23) subject to Subsection (a-1), a requirement that
212	206		the managed care organization develop, implement, and maintain an
213	207		outpatient pharmacy benefit plan for its enrolled recipients:
214	208		(A) that exclusively employs the vendor drug
215	209		program formulary and preserves the state's ability to reduce
216	210		waste, fraud, and abuse under Medicaid;
217	211		(B) that adheres to the applicable preferred drug
218	212		list adopted by the commission under Section 531.072;
219	213		(C) that includes the prior authorization
220	214		procedures and requirements prescribed by or implemented under
221	215		Sections 531.073(b), (c), and (g) for the vendor drug program;
222	216		(D) for purposes of which the managed care
223	217		organization:
224	218		(i) may not negotiate or collect rebates
225	219		associated with pharmacy products on the vendor drug program
226	220		formulary; and
227	221		(ii) may not receive drug rebate or pricing
228	222		information that is confidential under Section 531.071;
229	223		(E) that complies with the prohibition under
230	224		Section 531.089;
231	225		(F) under which the managed care organization may
232	226		not prohibit, limit, or interfere with a recipient's selection of a
233	227		pharmacy or pharmacist of the recipient's choice for the provision
234	228		of pharmaceutical services under the plan through the imposition of
235	229		different copayments;
236	230		(G) that allows the managed care organization or
237	231		any subcontracted pharmacy benefit manager to contract with a
238	232		pharmacist or pharmacy providers separately for specialty pharmacy
239	233		services, except that:
240	234		(i) the managed care organization and
241	235		pharmacy benefit manager are prohibited from allowing exclusive
242	236		contracts with a specialty pharmacy owned wholly or partly by the
243	237		pharmacy benefit manager responsible for the administration of the
244	238		pharmacy benefit program; and
245	239		(ii) the managed care organization and
246	240		pharmacy benefit manager must adopt policies and procedures for
247	241		reclassifying prescription drugs from retail to specialty drugs,
248	242		and those policies and procedures must be consistent with rules
249	243		adopted by the executive commissioner and include notice to network
250	244		pharmacy providers from the managed care organization;
251	245		(H) under which the managed care organization may
252	246		not prevent a pharmacy or pharmacist from participating as a
253	247		provider if the pharmacy or pharmacist agrees to comply with the
254	248		financial terms and conditions of the contract as well as other
255	249		reasonable administrative and professional terms and conditions of
256	250		the contract;
257	251		(I) under which the managed care organization may
258	252		include mail-order pharmacies in its networks, but may not require
259	253		enrolled recipients to use those pharmacies, and may not charge an
260	254		enrolled recipient who opts to use this service a fee, including
261	255		postage and handling fees;
262	256		(J) under which the managed care organization or
263	257		pharmacy benefit manager, as applicable, must pay claims in
264	258		accordance with Section 843.339, Insurance Code; and
265	259		(K) under which the managed care organization or
266	260		pharmacy benefit manager, as applicable:
267	261		(i) must comply with Section 533.00514 as a
268	262		condition of contract retention and renewal [to place a drug on a
269	263		maximum allowable cost list, must ensure that:
270	264		[(a) the drug is listed as "A" or "B"
271	265		rated in the most recent version of the United States Food and Drug
272	266		Administration's Approved Drug Products with Therapeutic
273	267		Equivalence Evaluations, also known as the Orange Book, has an "NR"
274	268		or "NA" rating or a similar rating by a nationally recognized
275	269		reference; and
276	270		[(b) the drug is generally available
277	271		for purchase by pharmacies in the state from national or regional
278	272		wholesalers and is not obsolete];
279	273		(ii) must [provide to a network pharmacy
280	274		provider, at the time a contract is entered into or renewed with the
281	275		network pharmacy provider, the sources used to determine the
282	276		maximum allowable cost pricing for the maximum allowable cost list
283	277		specific to that provider;
284	278		[(iii) must] review and update drug
285	279		reimbursement [maximum allowable cost] price information at least
286	280		once every seven days to reflect any modification of [maximum
287	281		allowable cost] pricing under the vendor drug program;
288	282		(iii) [(iv) must, in formulating the
289	283		maximum allowable cost price for a drug, use only the price of the
290	284		drug and drugs listed as therapeutically equivalent in the most
291	285		recent version of the United States Food and Drug Administration's
292	286		Approved Drug Products with Therapeutic Equivalence Evaluations,
293	287		also known as the Orange Book;
294	288		[(v) must establish a process for
295	289		eliminating products from the maximum allowable cost list or
296	290		modifying maximum allowable cost prices in a timely manner to
297	291		remain consistent with pricing changes and product availability in
298	292		the marketplace;
299	293		[(vi)] must:
300	294		(a) provide a procedure under which a
301	295		network pharmacy provider may challenge the reimbursement [a listed
302	296		maximum allowable cost] price for a drug;
303	297		(b) respond to a challenge not later
304	298		than the 15th day after the date the challenge is made;
305	299		(c) if the challenge is successful,
306	300		make an adjustment in the drug price effective on the date the
307	301		challenge is resolved, and make the adjustment applicable to all
308	302		similarly situated network pharmacy providers, as determined by the
309	303		managed care organization or pharmacy benefit manager, as
310	304		appropriate;
311	305		(d) if the challenge is denied,
312	306		provide the reason for the denial; and
313	307		(e) report to the commission every 90
314	308		days the total number of challenges that were made and denied in the
315	309		preceding 90-day period for each [maximum allowable cost list] drug
316	310		for which a challenge was denied during the period; and
317	311		(iv) [(vii) must notify the commission not
318	312		later than the 21st day after implementing a practice of using a
319	313		maximum allowable cost list for drugs dispensed at retail but not by
320	314		mail; and
321	315		[(viii)] must provide a process for each of
322	316		its network pharmacy providers to readily access the drug
323	317		reimbursement price [maximum allowable cost] list specific to that
324	318		provider;
325	319		(24) a requirement that the managed care organization
326	320		and any entity with which the managed care organization contracts
327	321		for the performance of services under a managed care plan disclose,
328	322		at no cost, to the commission and, on request, the office of the
329	323		attorney general all discounts, incentives, rebates, fees, free
330	324		goods, bundling arrangements, and other agreements affecting the
331	325		net cost of goods or services provided under the plan;
332	326		(25) a requirement that the managed care organization
333	327		not implement significant, nonnegotiated, across-the-board
334	328		provider reimbursement rate reductions unless:
335	329		(A) subject to Subsection (a-3), the
336	330		organization has the prior approval of the commission to make the
337	331		reductions [reduction]; or
338	332		(B) the rate reductions are based on changes to
339	333		the Medicaid fee schedule or cost containment initiatives
340	334		implemented by the commission; and
341	335		(26) a requirement that the managed care organization
342	336		make initial and subsequent primary care provider assignments and
343	337		changes.
344	338		SECTION 2. Subchapter A, Chapter 533, Government Code, is
345	339		amended by adding Section 533.00514 to read as follows:
346	340		Sec. 533.00514. REIMBURSEMENT METHODOLOGY FOR PRESCRIPTION
347	341		DRUGS. (a) In accordance with rules adopted by the executive
348	342		commissioner, a managed care organization that contracts with the
349	343		commission under this chapter or a pharmacy benefit manager
350	344		administering a pharmacy benefit program on behalf of the managed
351	345		care organization shall reimburse a pharmacy or pharmacist,
352	346		including a Texas retail pharmacy or a Texas specialty pharmacy,
353	347		that:
354	348		(1) dispenses a prescribed prescription drug, other
355	349		than a drug obtained under Section 340B, Public Health Service Act
356	350		(42 U.S.C. Section 256b), to a recipient for not less than the
357	351		lesser of:
358	352		(A) the reimbursement amount for the drug under
359	353		the vendor drug program, including a dispensing fee that is not less
360	354		than the dispensing fee for the drug under the vendor drug program;
361	355		or
362	356		(B) the amount claimed by the pharmacy or
363	357		pharmacist, including the gross amount due or the usual and
364	358		customary charge to the public for the drug; or
365	359		(2) dispenses a prescribed prescription drug obtained
366	360		at a discounted price under Section 340B, Public Health Service Act
367	361		(42 U.S.C. Section 256b) to a recipient for not less than the
368	362		reimbursement amount for the drug under the vendor drug program,
369	363		including a dispensing fee that is not less than the dispensing fee
370	364		for the drug under the vendor drug program.
371	365		(b) The methodology adopted by rule by the executive
372	366		commissioner to determine Texas pharmacies' actual acquisition
373	367		cost (AAC) for purposes of the vendor drug program must be
374	368		consistent with the actual prices Texas pharmacies pay to acquire
375	369		prescription drugs marketed or sold by a specific manufacturer and
376	370		must be based on the National Average Drug Acquisition Cost
377	371		published by the Centers for Medicare and Medicaid Services or
378	372		another publication approved by the executive commissioner.
379	373		(c) The executive commissioner shall develop a process for
380	374		the periodic study of Texas retail pharmacies' actual acquisition
381	375		cost (AAC) for prescription drugs, Texas specialty pharmacies'
382	376		actual acquisition cost (AAC) for prescription drugs, retail
383	377		professional dispensing costs, and specialty pharmacy professional
384	378		dispensing costs and publish the results of each study on the
385	379		commission's Internet website.
386	380		(d) The dispensing fees adopted by the executive
387	381		commissioner for purposes of:
388	382		(1) Subsection (a)(1) must be based on, as
389	383		appropriate:
390	384		(A) Texas retail pharmacies' professional
391	385		dispensing costs for retail prescription drugs; or
392	386		(B) Texas specialty pharmacies' professional
393	387		dispensing costs for specialty prescription drugs; or
394	388		(2) Subsection (a)(2) must be based on Texas
395	389		pharmacies' professional dispensing costs for those drugs.
396	390		(e) Not less frequently than once every two years, the
397	391		commission shall conduct a study of Texas pharmacies' dispensing
398	392		costs for retail prescription drugs, specialty prescription drugs,
399	393		and drugs obtained under Section 340B, Public Health Service Act
400	394		(42 U.S.C. Section 256b). Based on the results of the study, the
401	395		executive commissioner shall adjust the minimum amount of the
402	396		retail professional dispensing fee and specialty pharmacy
403	397		professional dispensing fee under Subsection (a)(1) and the
404	398		dispensing fee for drugs obtained under Section 340B, Public Health
405	399		Service Act (42 U.S.C. Section 256b).
406	400		SECTION 3. Subchapter D, Chapter 62, Health and Safety
407	401		Code, is amended by adding Section 62.160 to read as follows:
408	402		Sec. 62.160. REIMBURSEMENT METHODOLOGY FOR PRESCRIPTION
409	403		DRUGS. A managed care organization providing pharmacy benefits
410	404		under the child health plan program or a pharmacy benefit manager
411	405		administering a pharmacy benefit program on behalf of the managed
412	406		care organization shall comply with Section 533.00514, Government
413	407		Code.
414	408		SECTION 4. Section 533.005(a-2), Government Code, is
415	409		repealed.
416	410		SECTION 5. If before implementing any provision of this Act
417	411		a state agency determines that a waiver or authorization from a
418	412		federal agency is necessary for implementation of that provision,
419	413		the agency affected by the provision shall request the waiver or
420	414		authorization and may delay implementing that provision until the
421	415		waiver or authorization is granted.
422		-	SECTION 6. The Health and Human Services Commission is
423		-	required to implement a provision of this Act only if the
424		-	legislature appropriates money specifically for that purpose. If
425		-	the legislature does not appropriate money specifically for that
426		-	purpose, the Health and Human Services Commission may, but is not
427		-	required to, implement a provision of this Act using other
428		-	appropriations available for that purpose.
429		-	SECTION 7. This Act takes effect March 1, 2020.
430		-	* * * * *
	416	+	SECTION 6. This Act takes effect March 1, 2020.