BILL NUMBER: SB 866 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Hernandez
FEBRUARY 18, 2011
An act to add Section 1367.241 to the Health and Safety Code, and
to add Section 10123.191 to the Insurance Code, relating to health
care coverage.
LEGISLATIVE COUNSEL'S DIGEST
SB 866, as introduced, Hernandez. Health care coverage:
prescription drugs.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975,
provides for the regulation of health care service plans by the
Department of Managed Health Care and makes a willful violation of
the act a crime. Existing law provides for the regulation of health
insurers by the Department of Insurance. Commonly referred to as
utilization review, existing law governs the procedures that apply to
every health care service plan and health insurer that
prospectively, retrospectively, or concurrently reviews and approves,
modifies, delays, or denies, based on medical necessity, requests by
providers prior to, retrospectively, or concurrent with, the
provision of health care services to enrollees or insureds, as
specified.
Existing law also imposes various requirements and restrictions on
health care service plans and health insurers, including, among
other things, a prohibition on health care service plans and health
insurers that provide prescription drug benefits from excluding or
limiting coverage for a drug on the basis that the drug is prescribed
for a use that is different from the use for which the drug has been
approved for marketing by the federal Food and Drug Administration.
Existing law also requires a health care service plan that provides
prescription drug benefits to maintain an expeditious process by
which prescribing providers, as described, may obtain authorization
for a medically necessary nonformulary prescription drug, according
to certain procedures.
This bill would require the Department of Managed Health Care and
the Department of Insurance to, on or before July 1, 2012, develop a
prior authorization form for use by every health care service plan
and health insurer that provides prescription drug benefits. The bill
would require every physician, when requesting prior authorization
for prescription drug benefits, to submit the prior authorization
form to the health care service plan or health insurer, and would
require those plans and insurers to utilize and accept those prior
authorization forms for prescription drug benefits. Upon a failure to
accept the prior authorization form or to respond to a physician
within 48 hours, the bill would deem the prior authorization request
as granted, as specified.
Because a willful violation of the bill's provisions relative to
health care service plans would be a crime, the bill would impose a
state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1367.241 is added to the Health and Safety
Code, to read:
1367.241. (a) Notwithstanding any other provision of law, on and
after July 1, 2012, a health care service plan that provides
prescription drug benefits shall accept only the prior authorization
form developed pursuant to subdivision (c) when requiring prior
authorization for prescription drug benefits.
(b) If a health care service plan fails to utilize or accept the
prior authorization form or fails to respond within 48 hours to a
prior authorization request from a physician pursuant to the
submission of a prior authorization form, the prior authorization
request shall be deemed to have been granted.
(c) On or before July 1, 2012, the department and the Department
of Insurance shall jointly develop a uniform prior authorization form
that, notwithstanding any other provision of law, every physician
shall use to request prior authorization for coverage of prescription
drug benefits and that every health care service plan shall accept
as sufficient to request prior authorization for prescription drug
benefits.
(d) The prior authorization form developed pursuant to subdivision
(c) shall meet the following criteria:
(1) The form shall not exceed two pages.
(2) The form shall be electronically available and electronically
transmissible.
(3) The department and the Department of Insurance shall develop
the form with input from interested parties from at least one public
meeting.
SEC. 2. Section 10123.191 is added to the Insurance Code, to read:
10123.191. (a) Notwithstanding any other provision of law, on and
after July 1, 2012, a health insurer that provides prescription drug
benefits shall utilize and accept only the prior authorization form
developed pursuant to subdivision (c) when requiring prior
authorization for prescription drug benefits.
(b) If a health insurer fails to utilize or accept the prior
authorization form or fails to respond within 48 hours to a prior
authorization request from a physician pursuant to the submission of
a prior authorization form, the prior authorization request shall be
deemed to have been granted.
(c) On or before July 1, 2012, the department and the Department
of Managed Health Care shall jointly develop a uniform prior
authorization form that, notwithstanding any other provision of law,
every physician shall use to request prior authorization for coverage
of prescription drug benefits and that every health insurer shall
accept as sufficient to request prior authorization for prescription
drug benefits.
(d) The prior authorization form developed pursuant to subdivision
(c) shall meet the following criteria:
(1) The form shall not exceed two pages.
(2) The form shall be electronically available and electronically
transmissible.
(3) The department and the Department of Managed Health Care shall
develop the form with input from interested parties from at least
one public meeting.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.