AB 374, as amended, Nazarian. Health care coverage: prescription drugs.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and makes a willful violation of that act a crime. Existing law also provides for the regulation of health insurers by the Department of Insurance. Existing law imposes various requirements and restrictions on health care service plans and health insurers, including, among other things, requiring 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 prohibit a health care service plan or health insurer that provides medication pursuant to a step therapy or fail-first requirement from applying that requirement to a patient who has made a step therapy override determination request if, in the professional judgment of the prescribing physician, the step therapy or fail-first requirement would be medically inappropriate for that patient for specified reasons.
Because a willful violation of these requirements with respect 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:
The Legislature finds and declares all of the
2following:
3(a) Health care service plans and health insurers are increasingly
4making use of step therapy or fail-first protocols, hereafter referred
5to as step therapy protocol, under which patients are required to
6try one or more prescription drugs before coverage is provided for
7a drug selected by the patient’s health care provider.
8(b) Step therapy protocols, when they are based on
9well-developed scientific standards and administered in a flexible
10manner that takes into account the individual needs of patients,
11can play an
important role in controlling health care costs.
12(c) In some cases, requiring a patient to follow a step therapy
13protocol may have adverse and even dangerous consequences for
14the patient who may either not realize a benefit from taking a
15prescription drug or may suffer harm from taking an inappropriate
16drug.
17(d) It is imperative that step therapy protocols preserve the health
18care provider’s right to make treatment decisions in the best interest
19of the patient.
20(e) Therefore, the Legislature declares it a matter of public
21interest that it require health care service plans and health insurers
22to base step therapy protocols on appropriate clinical practice
23guidelines developed by professional medical societies with
24expertise
in the condition or conditions under consideration, that
P3 1patients be exempt from step therapy protocols when inappropriate
2or otherwise not in the best interest of the patients, and that patients
3have access to a fair, transparent, and independent process for
4requesting an exception to a step therapy protocol when
5appropriate.
Section 1367.244 is added to the Health and Safety
7Code, to read:
(a) A health care service plan that provides coverage
9for medications pursuant to a step therapy or fail-first protocol
10shall not apply that requirement to a patient who has made a step
11therapy override determination request if, in the professional
12judgment of the prescribing physician, the step therapy or fail-first
13requirement would be medically inappropriate for that patient for
14any of the reasons specified in subdivision (b).
15(b) A step therapy override determination request by a patient
16with adequate supporting rationale and documentation from the
17prescribing physician shall be expeditiouslybegin delete grantedend deletebegin insert
reviewedend insert by
18the plan if any of the following apply:
19(1) The prescription drug required by the plan is contraindicated
20or will likely cause an adverse reaction by, or physical or mental
21harm to, the patient.
22(2) The prescription drug required by the plan is expected to be
23ineffective based on the known relevant physical or mental
24characteristics of the patient and the known characteristics of the
25prescription drug regimen.
26(3) The prescription drug required by the plan is not in the best
27interest of the patient, based on medical appropriateness.
28(4) The patient is stable on a prescription drug selected by their
29health
care provider for the medical condition under consideration.
30(5) The prescription drug required by the plan has not been
31approved by the federal Food and Drug Administration for the
32patient’s condition.
33(c) Upon the granting of a step therapy override determination,
34the health care service plan shall authorize coverage for the
35prescription drug prescribed by the patient’s treating health care
36provider, provided such prescription drug is a covered prescription
37drug under that policy or contract.
38(d) For purposes of this section, “step therapy override
39determination” means a determination as to whether a step therapy
40protocol should apply in a particular patient’s situation, or whether
P4 1the step therapy protocol should
be overridden in favor of
2immediate coverage of the health care provider’s selected
3prescription drug.
4(e) This section does not prevent a health care service plan from
5requiring a patient to try an AB-rated generic equivalent drug prior
6to providing coverage for the equivalent branded prescription drug.
7This section does not prevent a health care provider from
8prescribing a prescription drug that is determined to be medically
9appropriate.
Section 10123.197 is added to the Insurance Code, to
11read:
(a) A health insurer that provides coverage for
13medications pursuant to a step therapy or fail-first protocol shall
14not apply that requirement to a patient who has made a step therapy
15override determination request if, in the professional judgment of
16the prescribing physician, the step therapy or fail-first requirement
17would be medically inappropriate for that patient for any of the
18reasons specified in subdivision (b).
19(b) A step therapy override determination request by a patient
20with adequate supporting rationale and documentation from the
21prescribing physician shall be expeditiouslybegin delete grantedend deletebegin insert
reviewedend insert by
22the health insurer if any of the following apply:
23(1) The prescription drug required by the health insurer is
24contraindicated or will likely cause an adverse reaction by, or
25physical or mental harm to, the patient.
26(2) The prescription drug required by the health insurer is
27expected to be ineffective based on the known relevant physical
28or mental characteristics of the patient and the known
29characteristics of the prescription drug regimen.
30(3) The prescription drug required by the health insurer is not
31in the best interest of the patient, based on medical appropriateness.
32(4) The patient is stable on a
prescription drug selected by his
33or her health care provider for the medical condition under
34consideration.
35(5) The prescription drug required by the health insurer has not
36been approved by the federal Food and Drug Administration for
37the patient’s condition.
38(c) Upon the granting of a step therapy override determination,
39the health insurer shall authorize coverage for the prescription drug
40prescribed by the patient’s treating health care provider, provided
P5 1the prescription drug is a covered prescription drug under that
2policy.
3(d) For purposes of this section, “step therapy override
4determination” means a determination as to whether a step therapy
5protocol should apply in a particular patient’s situation, or
whether
6the step therapy protocol should be overridden in favor of
7immediate coverage of the health care provider’s selected
8prescription drug.
9(e) This section does not prevent a health insurer from requiring
10a patient to try an AB-rated generic equivalent drug prior to
11providing coverage for the equivalent branded prescription drug.
12This section does not prevent a health care provider from
13prescribing a prescription drug that is determined to be medically
14appropriate.
No reimbursement is required by this act pursuant to
16Section 6 of Article XIII B of the California Constitution because
17the only costs that may be incurred by a local agency or school
18district will be incurred because this act creates a new crime or
19infraction, eliminates a crime or infraction, or changes the penalty
20for a crime or infraction, within the meaning of Section 17556 of
21the Government Code, or changes the definition of a crime within
22the meaning of Section 6 of Article XIII B of the California
23Constitution.
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