TX
Texas House Bill HB3670

Texas 2019 - 86th Regular

Texas House Bill HB3670 Compare Versions

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11 86R11655 JG-D
22 By: Frank H.B. No. 3670
33
44
55 A BILL TO BE ENTITLED
66 AN ACT
77 relating to the administration and operation of the Medicaid
88 program.
99 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1010 SECTION 1. Section 531.073, Government Code, is amended by
1111 amending Subsection (a) and adding Subsection (a-3) to read as
1212 follows:
1313 (a) The executive commissioner, in the rules and standards
1414 governing the Medicaid vendor drug program and the child health
1515 plan program, shall require prior authorization for the
1616 reimbursement of a drug that is not included in the appropriate
1717 preferred drug list adopted under Section 531.072, except for any
1818 drug exempted from prior authorization requirements by federal law
1919 and except as provided by Subsection (a-3). The executive
2020 commissioner may require prior authorization for the reimbursement
2121 of a drug provided through any other state program administered by
2222 the commission or a state health and human services agency,
2323 including a community mental health center and a state mental
2424 health hospital if the commission adopts preferred drug lists under
2525 Section 531.072 that apply to those facilities and the drug is not
2626 included in the appropriate list. The executive commissioner shall
2727 require that the prior authorization be obtained by the prescribing
2828 physician or prescribing practitioner.
2929 (a-3) The executive commissioner, in the rules and
3030 standards governing the Medicaid vendor drug program, may not
3131 require prior authorization, including clinical and non-preferred
3232 prior authorization, for a generic prescription drug included on
3333 the Medicaid vendor drug program prescription drug formulary.
3434 SECTION 2. Section 533.005(a), Government Code, is amended
3535 to read as follows:
3636 (a) A contract between a managed care organization and the
3737 commission for the organization to provide health care services to
3838 recipients must contain:
3939 (1) procedures to ensure accountability to the state
4040 for the provision of health care services, including procedures for
4141 financial reporting, quality assurance, utilization review, and
4242 assurance of contract and subcontract compliance;
4343 (2) capitation rates that ensure the cost-effective
4444 provision of quality health care;
4545 (3) a requirement that the managed care organization
4646 provide ready access to a person who assists recipients in
4747 resolving issues relating to enrollment, plan administration,
4848 education and training, access to services, and grievance
4949 procedures;
5050 (4) a requirement that the managed care organization
5151 provide ready access to a person who assists providers in resolving
5252 issues relating to payment, plan administration, education and
5353 training, and grievance procedures;
5454 (5) a requirement that the managed care organization
5555 provide information and referral about the availability of
5656 educational, social, and other community services that could
5757 benefit a recipient;
5858 (6) procedures for recipient outreach and education;
5959 (7) a requirement that the managed care organization
6060 make payment to a physician or provider for health care services
6161 rendered to a recipient under a managed care plan on any claim for
6262 payment that is received with documentation reasonably necessary
6363 for the managed care organization to process the claim:
6464 (A) not later than:
6565 (i) the 10th day after the date the claim is
6666 received if the claim relates to services provided by a nursing
6767 facility, intermediate care facility, or group home;
6868 (ii) the 30th day after the date the claim
6969 is received if the claim relates to the provision of long-term
7070 services and supports not subject to Subparagraph (i); and
7171 (iii) the 45th day after the date the claim
7272 is received if the claim is not subject to Subparagraph (i) or (ii);
7373 or
7474 (B) within a period, not to exceed 60 days,
7575 specified by a written agreement between the physician or provider
7676 and the managed care organization;
7777 (7-a) a requirement that the managed care organization
7878 demonstrate to the commission that the organization pays claims
7979 described by Subdivision (7)(A)(ii) on average not later than the
8080 21st day after the date the claim is received by the organization;
8181 (8) a requirement that the commission, on the date of a
8282 recipient's enrollment in a managed care plan issued by the managed
8383 care organization, inform the organization of the recipient's
8484 Medicaid certification date;
8585 (9) a requirement that the managed care organization
8686 comply with Section 533.006 as a condition of contract retention
8787 and renewal;
8888 (10) a requirement that the managed care organization
8989 provide the information required by Section 533.012 and otherwise
9090 comply and cooperate with the commission's office of inspector
9191 general and the office of the attorney general;
9292 (11) a requirement that the managed care
9393 organization's usages of out-of-network providers or groups of
9494 out-of-network providers may not exceed limits for those usages
9595 relating to total inpatient admissions, total outpatient services,
9696 and emergency room admissions determined by the commission;
9797 (12) if the commission finds that a managed care
9898 organization has violated Subdivision (11), a requirement that the
9999 managed care organization reimburse an out-of-network provider for
100100 health care services at a rate that is equal to the allowable rate
101101 for those services, as determined under Sections 32.028 and
102102 32.0281, Human Resources Code;
103103 (13) a requirement that, notwithstanding any other
104104 law, including Sections 843.312 and 1301.052, Insurance Code, the
105105 organization:
106106 (A) use advanced practice registered nurses and
107107 physician assistants in addition to physicians as primary care
108108 providers to increase the availability of primary care providers in
109109 the organization's provider network; and
110110 (B) treat advanced practice registered nurses
111111 and physician assistants in the same manner as primary care
112112 physicians with regard to:
113113 (i) selection and assignment as primary
114114 care providers;
115115 (ii) inclusion as primary care providers in
116116 the organization's provider network; and
117117 (iii) inclusion as primary care providers
118118 in any provider network directory maintained by the organization;
119119 (14) a requirement that the managed care organization
120120 reimburse a federally qualified health center or rural health
121121 clinic for health care services provided to a recipient outside of
122122 regular business hours, including on a weekend day or holiday, at a
123123 rate that is equal to the allowable rate for those services as
124124 determined under Section 32.028, Human Resources Code, if the
125125 recipient does not have a referral from the recipient's primary
126126 care physician;
127127 (15) a requirement that the managed care organization
128128 develop, implement, and maintain a system for tracking and
129129 resolving all provider appeals related to claims payment, including
130130 a process that will require:
131131 (A) a tracking mechanism to document the status
132132 and final disposition of each provider's claims payment appeal;
133133 (B) the contracting with physicians who are not
134134 network providers and who are of the same or related specialty as
135135 the appealing physician to resolve claims disputes related to
136136 denial on the basis of medical necessity that remain unresolved
137137 subsequent to a provider appeal;
138138 (C) the determination of the physician resolving
139139 the dispute to be binding on the managed care organization and
140140 provider; and
141141 (D) the managed care organization to allow a
142142 provider with a claim that has not been paid before the time
143143 prescribed by Subdivision (7)(A)(ii) to initiate an appeal of that
144144 claim;
145145 (16) a requirement that a medical director who is
146146 authorized to make medical necessity determinations is available to
147147 the region where the managed care organization provides health care
148148 services;
149149 (17) a requirement that the managed care organization
150150 ensure that a medical director and patient care coordinators and
151151 provider and recipient support services personnel are located in
152152 the South Texas service region, if the managed care organization
153153 provides a managed care plan in that region;
154154 (18) a requirement that the managed care organization
155155 provide special programs and materials for recipients with limited
156156 English proficiency or low literacy skills;
157157 (19) a requirement that the managed care organization
158158 develop and establish a process for responding to provider appeals
159159 in the region where the organization provides health care services;
160160 (20) a requirement that the managed care organization:
161161 (A) develop and submit to the commission, before
162162 the organization begins to provide health care services to
163163 recipients, a comprehensive plan that describes how the
164164 organization's provider network complies with the provider access
165165 standards established under Section 533.0061;
166166 (B) as a condition of contract retention and
167167 renewal:
168168 (i) continue to comply with the provider
169169 access standards established under Section 533.0061; and
170170 (ii) make substantial efforts, as
171171 determined by the commission, to mitigate or remedy any
172172 noncompliance with the provider access standards established under
173173 Section 533.0061;
174174 (C) pay liquidated damages for each failure, as
175175 determined by the commission, to comply with the provider access
176176 standards established under Section 533.0061 in amounts that are
177177 reasonably related to the noncompliance; and
178178 (D) regularly, as determined by the commission,
179179 submit to the commission and make available to the public a report
180180 containing data on the sufficiency of the organization's provider
181181 network with regard to providing the care and services described
182182 under Section 533.0061(a) and specific data with respect to access
183183 to primary care, specialty care, long-term services and supports,
184184 nursing services, and therapy services on the average length of
185185 time between:
186186 (i) the date a provider requests prior
187187 authorization for the care or service and the date the organization
188188 approves or denies the request; and
189189 (ii) the date the organization approves a
190190 request for prior authorization for the care or service and the date
191191 the care or service is initiated;
192192 (21) a requirement that the managed care organization
193193 demonstrate to the commission, before the organization begins to
194194 provide health care services to recipients, that, subject to the
195195 provider access standards established under Section 533.0061:
196196 (A) the organization's provider network has the
197197 capacity to serve the number of recipients expected to enroll in a
198198 managed care plan offered by the organization;
199199 (B) the organization's provider network
200200 includes:
201201 (i) a sufficient number of primary care
202202 providers;
203203 (ii) a sufficient variety of provider
204204 types;
205205 (iii) a sufficient number of providers of
206206 long-term services and supports and specialty pediatric care
207207 providers of home and community-based services; and
208208 (iv) providers located throughout the
209209 region where the organization will provide health care services;
210210 and
211211 (C) health care services will be accessible to
212212 recipients through the organization's provider network to a
213213 comparable extent that health care services would be available to
214214 recipients under a fee-for-service or primary care case management
215215 model of Medicaid managed care;
216216 (22) a requirement that the managed care organization
217217 develop a monitoring program for measuring the quality of the
218218 health care services provided by the organization's provider
219219 network that:
220220 (A) incorporates the National Committee for
221221 Quality Assurance's Healthcare Effectiveness Data and Information
222222 Set (HEDIS) measures;
223223 (B) focuses on measuring outcomes; and
224224 (C) includes the collection and analysis of
225225 clinical data relating to prenatal care, preventive care, mental
226226 health care, and the treatment of acute and chronic health
227227 conditions and substance abuse;
228228 (23) subject to Subsection (a-1), a requirement that
229229 the managed care organization develop, implement, and maintain an
230230 outpatient pharmacy benefit plan for its enrolled recipients:
231231 (A) that exclusively employs the vendor drug
232232 program formulary and preserves the state's ability to reduce
233233 waste, fraud, and abuse under Medicaid;
234234 (B) that adheres to the applicable preferred drug
235235 list adopted by the commission under Section 531.072;
236236 (C) that includes the prior authorization
237237 procedures and requirements prescribed by or implemented under
238238 Sections 531.073(b), (c), and (g) for the vendor drug program;
239239 (D) for purposes of which the managed care
240240 organization:
241241 (i) may not negotiate or collect rebates
242242 associated with pharmacy products on the vendor drug program
243243 formulary; and
244244 (ii) may not receive drug rebate or pricing
245245 information that is confidential under Section 531.071;
246246 (E) that complies with the prohibition under
247247 Section 531.089;
248248 (F) under which the managed care organization may
249249 not prohibit, limit, or interfere with a recipient's selection of a
250250 pharmacy or pharmacist of the recipient's choice for the provision
251251 of pharmaceutical services under the plan through the imposition of
252252 different copayments;
253253 (G) that allows the managed care organization or
254254 any subcontracted pharmacy benefit manager to contract with a
255255 pharmacist or pharmacy providers separately for specialty pharmacy
256256 services, except that:
257257 (i) the managed care organization and
258258 pharmacy benefit manager are prohibited from allowing exclusive
259259 contracts with a specialty pharmacy owned wholly or partly by the
260260 pharmacy benefit manager responsible for the administration of the
261261 pharmacy benefit program; and
262262 (ii) the managed care organization and
263263 pharmacy benefit manager must adopt policies and procedures for
264264 reclassifying prescription drugs from retail to specialty drugs,
265265 and those policies and procedures must be consistent with rules
266266 adopted by the executive commissioner and include notice to network
267267 pharmacy providers from the managed care organization;
268268 (H) under which the managed care organization may
269269 not prevent a pharmacy or pharmacist from participating as a
270270 provider if the pharmacy or pharmacist agrees to comply with the
271271 financial terms and conditions of the contract as well as other
272272 reasonable administrative and professional terms and conditions of
273273 the contract;
274274 (I) under which the managed care organization may
275275 include mail-order pharmacies in its networks, but may not require
276276 enrolled recipients to use those pharmacies, and may not charge an
277277 enrolled recipient who opts to use this service a fee, including
278278 postage and handling fees;
279279 (J) under which the managed care organization or
280280 pharmacy benefit manager, as applicable, must pay claims in
281281 accordance with Section 843.339, Insurance Code; [and]
282282 (K) under which the managed care organization or
283283 pharmacy benefit manager, as applicable:
284284 (i) to place a drug on a maximum allowable
285285 cost list, must ensure that:
286286 (a) the drug is listed as "A" or "B"
287287 rated in the most recent version of the United States Food and Drug
288288 Administration's Approved Drug Products with Therapeutic
289289 Equivalence Evaluations, also known as the Orange Book, has an "NR"
290290 or "NA" rating or a similar rating by a nationally recognized
291291 reference; and
292292 (b) the drug is generally available
293293 for purchase by pharmacies in the state from national or regional
294294 wholesalers and is not obsolete;
295295 (ii) must provide to a network pharmacy
296296 provider, at the time a contract is entered into or renewed with the
297297 network pharmacy provider, the sources used to determine the
298298 maximum allowable cost pricing for the maximum allowable cost list
299299 specific to that provider;
300300 (iii) must review and update maximum
301301 allowable cost price information at least once every seven days to
302302 reflect any modification of maximum allowable cost pricing;
303303 (iv) must, in formulating the maximum
304304 allowable cost price for a drug, use only the price of the drug and
305305 drugs listed as therapeutically equivalent in the most recent
306306 version of the United States Food and Drug Administration's
307307 Approved Drug Products with Therapeutic Equivalence Evaluations,
308308 also known as the Orange Book;
309309 (v) must establish a process for
310310 eliminating products from the maximum allowable cost list or
311311 modifying maximum allowable cost prices in a timely manner to
312312 remain consistent with pricing changes and product availability in
313313 the marketplace;
314314 (vi) must:
315315 (a) provide a procedure under which a
316316 network pharmacy provider may challenge a listed maximum allowable
317317 cost price for a drug;
318318 (b) respond to a challenge not later
319319 than the 15th day after the date the challenge is made;
320320 (c) if the challenge is successful,
321321 make an adjustment in the drug price effective on the date the
322322 challenge is resolved[,] and make the adjustment applicable to all
323323 similarly situated network pharmacy providers, as determined by the
324324 managed care organization or pharmacy benefit manager, as
325325 appropriate;
326326 (d) if the challenge is denied,
327327 provide the reason for the denial; and
328328 (e) report to the commission every 90
329329 days the total number of challenges that were made and denied in the
330330 preceding 90-day period for each maximum allowable cost list drug
331331 for which a challenge was denied during the period;
332332 (vii) must notify the commission not later
333333 than the 21st day after implementing a practice of using a maximum
334334 allowable cost list for drugs dispensed at retail but not by mail;
335335 and
336336 (viii) must provide a process for each of
337337 its network pharmacy providers to readily access the maximum
338338 allowable cost list specific to that provider; and
339339 (L) that does not require prior authorization,
340340 including clinical and non-preferred prior authorization, for a
341341 generic prescription drug included on the applicable prescription
342342 drug formulary;
343343 (24) a requirement that the managed care organization
344344 and any entity with which the managed care organization contracts
345345 for the performance of services under a managed care plan disclose,
346346 at no cost, to the commission and, on request, the office of the
347347 attorney general all discounts, incentives, rebates, fees, free
348348 goods, bundling arrangements, and other agreements affecting the
349349 net cost of goods or services provided under the plan;
350350 (25) a requirement that the managed care organization
351351 not implement significant, nonnegotiated, across-the-board
352352 provider reimbursement rate reductions unless:
353353 (A) subject to Subsection (a-3), the
354354 organization has the prior approval of the commission to make the
355355 reductions [reduction]; or
356356 (B) the rate reductions are based on changes to
357357 the Medicaid fee schedule or cost containment initiatives
358358 implemented by the commission; and
359359 (26) a requirement that the managed care organization
360360 make initial and subsequent primary care provider assignments and
361361 changes.
362362 SECTION 3. Not later than October 1, 2019, the executive
363363 commissioner of the Health and Human Services Commission shall seek
364364 an amendment to the state Medicaid plan or a waiver under Section
365365 1115 of the federal Social Security Act (42 U.S.C. Section 1315), as
366366 appropriate, to:
367367 (1) allow the commission to implement requirements for
368368 Medicaid recipients to share the cost of Medicaid services,
369369 including through a copayment or other cost-sharing payment:
370370 (A) in amounts that, to the greatest extent
371371 possible, correspond to the cost-sharing requirements under
372372 Section 62.153, Health and Safety Code; and
373373 (B) in a manner consistent with Sections 32.064
374374 and 32.0641, Human Resources Code; and
375375 (2) eliminate medical assistance under Chapter 32,
376376 Human Resources Code, for health care services delivered to a
377377 person before the date the person is determined eligible for that
378378 assistance.
379379 SECTION 4. (a) The Health and Human Services Commission
380380 shall, in a contract between the commission and a managed care
381381 organization under Chapter 533, Government Code, that is entered
382382 into or renewed on or after the effective date of this Act, require
383383 that the managed care organization comply with Section
384384 533.005(a)(23)(L), Government Code, as added by this Act.
385385 (b) The Health and Human Services Commission shall seek to
386386 amend contracts entered into with managed care organizations under
387387 Chapter 533, Government Code, before the effective date of this Act
388388 to require those managed care organizations to comply with Section
389389 533.005(a)(23)(L), Government Code, as added by this Act. To the
390390 extent of a conflict between that section and a provision of a
391391 contract with a managed care organization entered into before the
392392 effective date of this Act, the contract provision prevails.
393393 SECTION 5. If before implementing any provision of this Act
394394 other than Section 3 of this Act, a state agency determines that a
395395 waiver or authorization from a federal agency is necessary for
396396 implementation of that provision, the agency affected by the
397397 provision shall request the waiver or authorization and may delay
398398 implementing that provision until the waiver or authorization is
399399 granted.
400400 SECTION 6. This Act takes effect September 1, 2019.