Texas 2021 - 87th Regular

Texas Senate Bill SB674 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	87R1887 JG-F
2	2	By: Buckingham S.B. No. 674
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the availability of antipsychotic prescription drugs
8	8	under the vendor drug program and Medicaid managed care.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 531.073, Government Code, is amended by
11	11	amending Subsection (a) and adding Subsections (a-3) and (a-4) to
12	12	read as follows:
13	13	(a) The executive commissioner, in the rules and standards
14	14	governing the Medicaid vendor drug program and the child health
15	15	plan program, shall require prior authorization for the
16	16	reimbursement of a drug that is not included in the appropriate
17	17	preferred drug list adopted under Section 531.072, except for any
18	18	drug exempted from prior authorization requirements by federal law
19	19	and except as provided by Subsections (a-3) and [Subsection] (j).
20	20	The executive commissioner may require prior authorization for the
21	21	reimbursement of a drug provided through any other state program
22	22	administered by the commission or a state health and human services
23	23	agency, including a community mental health center and a state
24	24	mental health hospital if the commission adopts preferred drug
25	25	lists under Section 531.072 that apply to those facilities and the
26	26	drug is not included in the appropriate list. The executive
27	27	commissioner shall require that the prior authorization be obtained
28	28	by the prescribing physician or prescribing practitioner.
29	29	(a-3) The executive commissioner, in the rules and
30	30	standards governing the vendor drug program, may not require
31	31	clinical, nonpreferred, or other prior authorization for an
32	32	antipsychotic drug prescribed to an adult patient if:
33	33	(1) the patient has a diagnosed mental illness, as
34	34	defined by Section 571.003, Health and Safety Code, for which the
35	35	drug is prescribed;
36	36	(2) the prescribing physician or other health care
37	37	provider determines there is a medical necessity for prescribing
38	38	the drug based on:
39	39	(A) the treatment failure of a comparable drug on
40	40	an appropriate preferred drug list or within any subclass of a drug
41	41	on that list;
42	42	(B) medical contraindication of a drug on an
43	43	appropriate preferred drug list; or
44	44	(C) an allergic reaction to a drug on an
45	45	appropriate preferred drug list;
46	46	(3) the prescribing physician or other health care
47	47	provider determines, in consultation with the patient, that the
48	48	drug is the most appropriate course of treatment for the patient's
49	49	mental illness;
50	50	(4) the drug is approved for use by the United States
51	51	Food and Drug Administration;
52	52	(5) the prescribing physician or other health care
53	53	provider clearly indicates on the prescription that the drug must
54	54	be dispensed as written; and
55	55	(6) the prescribing physician or other health care
56	56	provider documents in the patient's health care record that each
57	57	requirement under this subsection has been satisfied.
58	58	(a-4) Subsection (a-3) does not affect:
59	59	(1) the authority of a pharmacist to dispense the
60	60	generic equivalent or interchangeable biological product of a
61	61	prescription drug in accordance with Subchapter A, Chapter 562,
62	62	Occupations Code; or
63	63	(2) any drug utilization review requirements
64	64	prescribed by state or federal law.
65	65	SECTION 2. Section 533.005(a), Government Code, is amended
66	66	to read as follows:
67	67	(a) A contract between a managed care organization and the
68	68	commission for the organization to provide health care services to
69	69	recipients must contain:
70	70	(1) procedures to ensure accountability to the state
71	71	for the provision of health care services, including procedures for
72	72	financial reporting, quality assurance, utilization review, and
73	73	assurance of contract and subcontract compliance;
74	74	(2) capitation rates that ensure the cost-effective
75	75	provision of quality health care;
76	76	(3) a requirement that the managed care organization
77	77	provide ready access to a person who assists recipients in
78	78	resolving issues relating to enrollment, plan administration,
79	79	education and training, access to services, and grievance
80	80	procedures;
81	81	(4) a requirement that the managed care organization
82	82	provide ready access to a person who assists providers in resolving
83	83	issues relating to payment, plan administration, education and
84	84	training, and grievance procedures;
85	85	(5) a requirement that the managed care organization
86	86	provide information and referral about the availability of
87	87	educational, social, and other community services that could
88	88	benefit a recipient;
89	89	(6) procedures for recipient outreach and education;
90	90	(7) a requirement that the managed care organization
91	91	make payment to a physician or provider for health care services
92	92	rendered to a recipient under a managed care plan on any claim for
93	93	payment that is received with documentation reasonably necessary
94	94	for the managed care organization to process the claim:
95	95	(A) not later than:
96	96	(i) the 10th day after the date the claim is
97	97	received if the claim relates to services provided by a nursing
98	98	facility, intermediate care facility, or group home;
99	99	(ii) the 30th day after the date the claim
100	100	is received if the claim relates to the provision of long-term
101	101	services and supports not subject to Subparagraph (i); and
102	102	(iii) the 45th day after the date the claim
103	103	is received if the claim is not subject to Subparagraph (i) or (ii);
104	104	or
105	105	(B) within a period, not to exceed 60 days,
106	106	specified by a written agreement between the physician or provider
107	107	and the managed care organization;
108	108	(7-a) a requirement that the managed care organization
109	109	demonstrate to the commission that the organization pays claims
110	110	described by Subdivision (7)(A)(ii) on average not later than the
111	111	21st day after the date the claim is received by the organization;
112	112	(8) a requirement that the commission, on the date of a
113	113	recipient's enrollment in a managed care plan issued by the managed
114	114	care organization, inform the organization of the recipient's
115	115	Medicaid certification date;
116	116	(9) a requirement that the managed care organization
117	117	comply with Section 533.006 as a condition of contract retention
118	118	and renewal;
119	119	(10) a requirement that the managed care organization
120	120	provide the information required by Section 533.012 and otherwise
121	121	comply and cooperate with the commission's office of inspector
122	122	general and the office of the attorney general;
123	123	(11) a requirement that the managed care
124	124	organization's usages of out-of-network providers or groups of
125	125	out-of-network providers may not exceed limits for those usages
126	126	relating to total inpatient admissions, total outpatient services,
127	127	and emergency room admissions determined by the commission;
128	128	(12) if the commission finds that a managed care
129	129	organization has violated Subdivision (11), a requirement that the
130	130	managed care organization reimburse an out-of-network provider for
131	131	health care services at a rate that is equal to the allowable rate
132	132	for those services, as determined under Sections 32.028 and
133	133	32.0281, Human Resources Code;
134	134	(13) a requirement that, notwithstanding any other
135	135	law, including Sections 843.312 and 1301.052, Insurance Code, the
136	136	organization:
137	137	(A) use advanced practice registered nurses and
138	138	physician assistants in addition to physicians as primary care
139	139	providers to increase the availability of primary care providers in
140	140	the organization's provider network; and
141	141	(B) treat advanced practice registered nurses
142	142	and physician assistants in the same manner as primary care
143	143	physicians with regard to:
144	144	(i) selection and assignment as primary
145	145	care providers;
146	146	(ii) inclusion as primary care providers in
147	147	the organization's provider network; and
148	148	(iii) inclusion as primary care providers
149	149	in any provider network directory maintained by the organization;
150	150	(14) a requirement that the managed care organization
151	151	reimburse a federally qualified health center or rural health
152	152	clinic for health care services provided to a recipient outside of
153	153	regular business hours, including on a weekend day or holiday, at a
154	154	rate that is equal to the allowable rate for those services as
155	155	determined under Section 32.028, Human Resources Code, if the
156	156	recipient does not have a referral from the recipient's primary
157	157	care physician;
158	158	(15) a requirement that the managed care organization
159	159	develop, implement, and maintain a system for tracking and
160	160	resolving all provider appeals related to claims payment, including
161	161	a process that will require:
162	162	(A) a tracking mechanism to document the status
163	163	and final disposition of each provider's claims payment appeal;
164	164	(B) the contracting with physicians who are not
165	165	network providers and who are of the same or related specialty as
166	166	the appealing physician to resolve claims disputes related to
167	167	denial on the basis of medical necessity that remain unresolved
168	168	subsequent to a provider appeal;
169	169	(C) the determination of the physician resolving
170	170	the dispute to be binding on the managed care organization and
171	171	provider; and
172	172	(D) the managed care organization to allow a
173	173	provider with a claim that has not been paid before the time
174	174	prescribed by Subdivision (7)(A)(ii) to initiate an appeal of that
175	175	claim;
176	176	(16) a requirement that a medical director who is
177	177	authorized to make medical necessity determinations is available to
178	178	the region where the managed care organization provides health care
179	179	services;
180	180	(17) a requirement that the managed care organization
181	181	ensure that a medical director and patient care coordinators and
182	182	provider and recipient support services personnel are located in
183	183	the South Texas service region, if the managed care organization
184	184	provides a managed care plan in that region;
185	185	(18) a requirement that the managed care organization
186	186	provide special programs and materials for recipients with limited
187	187	English proficiency or low literacy skills;
188	188	(19) a requirement that the managed care organization
189	189	develop and establish a process for responding to provider appeals
190	190	in the region where the organization provides health care services;
191	191	(20) a requirement that the managed care organization:
192	192	(A) develop and submit to the commission, before
193	193	the organization begins to provide health care services to
194	194	recipients, a comprehensive plan that describes how the
195	195	organization's provider network complies with the provider access
196	196	standards established under Section 533.0061;
197	197	(B) as a condition of contract retention and
198	198	renewal:
199	199	(i) continue to comply with the provider
200	200	access standards established under Section 533.0061; and
201	201	(ii) make substantial efforts, as
202	202	determined by the commission, to mitigate or remedy any
203	203	noncompliance with the provider access standards established under
204	204	Section 533.0061;
205	205	(C) pay liquidated damages for each failure, as
206	206	determined by the commission, to comply with the provider access
207	207	standards established under Section 533.0061 in amounts that are
208	208	reasonably related to the noncompliance; and
209	209	(D) regularly, as determined by the commission,
210	210	submit to the commission and make available to the public a report
211	211	containing data on the sufficiency of the organization's provider
212	212	network with regard to providing the care and services described
213	213	under Section 533.0061(a) and specific data with respect to access
214	214	to primary care, specialty care, long-term services and supports,
215	215	nursing services, and therapy services on the average length of
216	216	time between:
217	217	(i) the date a provider requests prior
218	218	authorization for the care or service and the date the organization
219	219	approves or denies the request; and
220	220	(ii) the date the organization approves a
221	221	request for prior authorization for the care or service and the date
222	222	the care or service is initiated;
223	223	(21) a requirement that the managed care organization
224	224	demonstrate to the commission, before the organization begins to
225	225	provide health care services to recipients, that, subject to the
226	226	provider access standards established under Section 533.0061:
227	227	(A) the organization's provider network has the
228	228	capacity to serve the number of recipients expected to enroll in a
229	229	managed care plan offered by the organization;
230	230	(B) the organization's provider network
231	231	includes:
232	232	(i) a sufficient number of primary care
233	233	providers;
234	234	(ii) a sufficient variety of provider
235	235	types;
236	236	(iii) a sufficient number of providers of
237	237	long-term services and supports and specialty pediatric care
238	238	providers of home and community-based services; and
239	239	(iv) providers located throughout the
240	240	region where the organization will provide health care services;
241	241	and
242	242	(C) health care services will be accessible to
243	243	recipients through the organization's provider network to a
244	244	comparable extent that health care services would be available to
245	245	recipients under a fee-for-service or primary care case management
246	246	model of Medicaid managed care;
247	247	(22) a requirement that the managed care organization
248	248	develop a monitoring program for measuring the quality of the
249	249	health care services provided by the organization's provider
250	250	network that:
251	251	(A) incorporates the National Committee for
252	252	Quality Assurance's Healthcare Effectiveness Data and Information
253	253	Set (HEDIS) measures or, as applicable, the national core
254	254	indicators adult consumer survey and the national core indicators
255	255	child family survey for individuals with an intellectual or
256	256	developmental disability;
257	257	(B) focuses on measuring outcomes; and
258	258	(C) includes the collection and analysis of
259	259	clinical data relating to prenatal care, preventive care, mental
260	260	health care, and the treatment of acute and chronic health
261	261	conditions and substance abuse;
262	262	(23) subject to Subsection (a-1), a requirement that
263	263	the managed care organization develop, implement, and maintain an
264	264	outpatient pharmacy benefit plan for its enrolled recipients:
265	265	(A) that, except as provided by Paragraph
266	266	(L)(ii), exclusively employs the vendor drug program formulary and
267	267	preserves the state's ability to reduce waste, fraud, and abuse
268	268	under Medicaid;
269	269	(B) that adheres to the applicable preferred drug
270	270	list adopted by the commission under Section 531.072;
271	271	(C) that, except as provided by Paragraph (L)(i),
272	272	includes the prior authorization procedures and requirements
273	273	prescribed by or implemented under Sections 531.073(b), (c), and
274	274	(g) for the vendor drug program;
275	275	(C-1) that does not require a clinical,
276	276	nonpreferred, or other prior authorization for any antiretroviral
277	277	drug, as defined by Section 531.073, or a step therapy or other
278	278	protocol, that could restrict or delay the dispensing of the drug
279	279	except to minimize fraud, waste, or abuse;
280	280	(C-2) that does not require a clinical,
281	281	nonpreferred, or other prior authorization for an antipsychotic
282	282	drug prescribed to an adult recipient if the requirements of
283	283	Section 531.073(a-3) are met;
284	284	(D) for purposes of which the managed care
285	285	organization:
286	286	(i) may not negotiate or collect rebates
287	287	associated with pharmacy products on the vendor drug program
288	288	formulary; and
289	289	(ii) may not receive drug rebate or pricing
290	290	information that is confidential under Section 531.071;
291	291	(E) that complies with the prohibition under
292	292	Section 531.089;
293	293	(F) under which the managed care organization may
294	294	not prohibit, limit, or interfere with a recipient's selection of a
295	295	pharmacy or pharmacist of the recipient's choice for the provision
296	296	of pharmaceutical services under the plan through the imposition of
297	297	different copayments;
298	298	(G) that allows the managed care organization or
299	299	any subcontracted pharmacy benefit manager to contract with a
300	300	pharmacist or pharmacy providers separately for specialty pharmacy
301	301	services, except that:
302	302	(i) the managed care organization and
303	303	pharmacy benefit manager are prohibited from allowing exclusive
304	304	contracts with a specialty pharmacy owned wholly or partly by the
305	305	pharmacy benefit manager responsible for the administration of the
306	306	pharmacy benefit program; and
307	307	(ii) the managed care organization and
308	308	pharmacy benefit manager must adopt policies and procedures for
309	309	reclassifying prescription drugs from retail to specialty drugs,
310	310	and those policies and procedures must be consistent with rules
311	311	adopted by the executive commissioner and include notice to network
312	312	pharmacy providers from the managed care organization;
313	313	(H) under which the managed care organization may
314	314	not prevent a pharmacy or pharmacist from participating as a
315	315	provider if the pharmacy or pharmacist agrees to comply with the
316	316	financial terms and conditions of the contract as well as other
317	317	reasonable administrative and professional terms and conditions of
318	318	the contract;
319	319	(I) under which the managed care organization may
320	320	include mail-order pharmacies in its networks, but may not require
321	321	enrolled recipients to use those pharmacies, and may not charge an
322	322	enrolled recipient who opts to use this service a fee, including
323	323	postage and handling fees;
324	324	(J) under which the managed care organization or
325	325	pharmacy benefit manager, as applicable, must pay claims in
326	326	accordance with Section 843.339, Insurance Code;
327	327	(K) under which the managed care organization or
328	328	pharmacy benefit manager, as applicable:
329	329	(i) to place a drug on a maximum allowable
330	330	cost list, must ensure that:
331	331	(a) the drug is listed as "A" or "B"
332	332	rated in the most recent version of the United States Food and Drug
333	333	Administration's Approved Drug Products with Therapeutic
334	334	Equivalence Evaluations, also known as the Orange Book, has an "NR"
335	335	or "NA" rating or a similar rating by a nationally recognized
336	336	reference; and
337	337	(b) the drug is generally available
338	338	for purchase by pharmacies in the state from national or regional
339	339	wholesalers and is not obsolete;
340	340	(ii) must provide to a network pharmacy
341	341	provider, at the time a contract is entered into or renewed with the
342	342	network pharmacy provider, the sources used to determine the
343	343	maximum allowable cost pricing for the maximum allowable cost list
344	344	specific to that provider;
345	345	(iii) must review and update maximum
346	346	allowable cost price information at least once every seven days to
347	347	reflect any modification of maximum allowable cost pricing;
348	348	(iv) must, in formulating the maximum
349	349	allowable cost price for a drug, use only the price of the drug and
350	350	drugs listed as therapeutically equivalent in the most recent
351	351	version of the United States Food and Drug Administration's
352	352	Approved Drug Products with Therapeutic Equivalence Evaluations,
353	353	also known as the Orange Book;
354	354	(v) must establish a process for
355	355	eliminating products from the maximum allowable cost list or
356	356	modifying maximum allowable cost prices in a timely manner to
357	357	remain consistent with pricing changes and product availability in
358	358	the marketplace;
359	359	(vi) must:
360	360	(a) provide a procedure under which a
361	361	network pharmacy provider may challenge a listed maximum allowable
362	362	cost price for a drug;
363	363	(b) respond to a challenge not later
364	364	than the 15th day after the date the challenge is made;
365	365	(c) if the challenge is successful,
366	366	make an adjustment in the drug price effective on the date the
367	367	challenge is resolved and make the adjustment applicable to all
368	368	similarly situated network pharmacy providers, as determined by the
369	369	managed care organization or pharmacy benefit manager, as
370	370	appropriate;
371	371	(d) if the challenge is denied,
372	372	provide the reason for the denial; and
373	373	(e) report to the commission every 90
374	374	days the total number of challenges that were made and denied in the
375	375	preceding 90-day period for each maximum allowable cost list drug
376	376	for which a challenge was denied during the period;
377	377	(vii) must notify the commission not later
378	378	than the 21st day after implementing a practice of using a maximum
379	379	allowable cost list for drugs dispensed at retail but not by mail;
380	380	and
381	381	(viii) must provide a process for each of
382	382	its network pharmacy providers to readily access the maximum
383	383	allowable cost list specific to that provider; and
384	384	(L) under which the managed care organization or
385	385	pharmacy benefit manager, as applicable:
386	386	(i) may not require a prior authorization,
387	387	other than a clinical prior authorization or a prior authorization
388	388	imposed by the commission to minimize the opportunity for waste,
389	389	fraud, or abuse, for or impose any other barriers to a drug that is
390	390	prescribed to a child enrolled in the STAR Kids managed care program
391	391	for a particular disease or treatment and that is on the vendor drug
392	392	program formulary or require additional prior authorization for a
393	393	drug included in the preferred drug list adopted under Section
394	394	531.072;
395	395	(ii) must provide for continued access to a
396	396	drug prescribed to a child enrolled in the STAR Kids managed care
397	397	program, regardless of whether the drug is on the vendor drug
398	398	program formulary or, if applicable on or after August 31, 2023, the
399	399	managed care organization's formulary;
400	400	(iii) may not use a protocol that requires a
401	401	child enrolled in the STAR Kids managed care program to use a
402	402	prescription drug or sequence of prescription drugs other than the
403	403	drug that the child's physician recommends for the child's
404	404	treatment before the managed care organization provides coverage
405	405	for the recommended drug; and
406	406	(iv) must pay liquidated damages to the
407	407	commission for each failure, as determined by the commission, to
408	408	comply with this paragraph in an amount that is a reasonable
409	409	forecast of the damages caused by the noncompliance;
410	410	(24) a requirement that the managed care organization
411	411	and any entity with which the managed care organization contracts
412	412	for the performance of services under a managed care plan disclose,
413	413	at no cost, to the commission and, on request, the office of the
414	414	attorney general all discounts, incentives, rebates, fees, free
415	415	goods, bundling arrangements, and other agreements affecting the
416	416	net cost of goods or services provided under the plan;
417	417	(25) a requirement that the managed care organization
418	418	not implement significant, nonnegotiated, across-the-board
419	419	provider reimbursement rate reductions unless:
420	420	(A) subject to Subsection (a-3), the
421	421	organization has the prior approval of the commission to make the
422	422	reductions; or
423	423	(B) the rate reductions are based on changes to
424	424	the Medicaid fee schedule or cost containment initiatives
425	425	implemented by the commission; and
426	426	(26) a requirement that the managed care organization
427	427	make initial and subsequent primary care provider assignments and
428	428	changes.
429	429	SECTION 3. (a) The Health and Human Services Commission
430	430	shall, in a contract between the commission and a managed care
431	431	organization under Chapter 533, Government Code, that is entered
432	432	into or renewed on or after the effective date of this Act, require
433	433	that the managed care organization comply with Section
434	434	533.005(a)(23)(C-2), Government Code, as added by this Act.
435	435	(b) The Health and Human Services Commission shall seek to
436	436	amend contracts entered into with managed care organizations under
437	437	Chapter 533, Government Code, before the effective date of this Act
438	438	to require those managed care organizations to comply with Section
439	439	533.005(a)(23)(C-2), Government Code, as added by this Act. To the
440	440	extent of a conflict between that section and a provision of a
441	441	contract with a managed care organization entered into before the
442	442	effective date of this Act, the contract provision prevails.
443	443	SECTION 4. If before implementing any provision of this Act
444	444	a state agency determines that a waiver or authorization from a
445	445	federal agency is necessary for implementation of that provision,
446	446	the agency affected by the provision shall request the waiver or
447	447	authorization and may delay implementing that provision until the
448	448	waiver or authorization is granted.
449	449	SECTION 5. This Act takes effect September 1, 2021.