BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1114


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          CONCURRENCE IN SENATE AMENDMENTS
          AB  
          1114 (Eggman)


          As Amended  August 24, 2016


          2/3 vote.  Urgency


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          |ASSEMBLY:  |79-0  |(June 1, 2015) |SENATE: |38-1  |(August 25,      |
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          |COMMITTEE VOTE: |16-0 |(August 30,     |RECOMMENDATION:   |concur     |
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          (Health)




          Original Committee Reference:  HEALTH


          SUMMARY:  Requires specified pharmacy services to be covered  
          under Medi-Cal, and specifies the rate of reimbursement for  








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          these services at 85% of the fee schedule for physician services  
          under Medi-Cal.  Contains an urgency clause to ensure that the  
          provisions of this bill go into immediate effect after  
          enactment.  Specifically, this bill:


          1)Specifies the following pharmacy services as a benefit under  
            the Medi-Cal program, subject to approval by the federal  
            Centers for Medicare and Medicaid Services:


             a)   Furnishing travel medications;


             b)   Furnishing naloxone hydrochloride;


             c)   Furnishing self-administered hormonal contraception;


             d)   Initiating and administering immunizations; and, 


             e)   Providing tobacco cessation counseling and furnishing  
               nicotine replacement therapy.


          2)Requires the Department of Health Care Services (DHCS) to do  
            the following:  a) establish a fee schedule for the list of  
            pharmacist services; and, b) specify the rate of reimbursement  
            to be at 85% of the fee schedule for physician services under  
            Medi-Cal.


          3)Requires a pharmacist to be enrolled as an ordering,  
            referring, and prescribing provider under the Medi-Cal program  
            prior to rendering a pharmacist service that is submitted by a  
            Medi-Cal pharmacy provider for reimbursement under this bill.


          4)Requires the Director of DHCS to seek any necessary federal  
            approvals for purposes of this bill, prohibits implementation  








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            until such approvals are obtained, and implemented only if  
            federal financial participation is available.


          5)Specifies that this bill does not restrict nor prohibit any  
            services currently provided by pharmacists as authorized by  
            law, as specified.


          6)Authorizes DHCS to implement, interpret, or make specific this  
            bill, without taking any regulatory action, as specified.   
            Requires DHCS to adopt regulations by July 1, 2021 and provide  
            a status report to the Legislature, as specified.


          The Senate amendments require specified pharmacist services to  
          be covered under Medi-Cal.


          FISCAL EFFECT:  According to the Senate Appropriations  
          Committee:


          1)One-time costs of $400,000 to $600,000 to make changes to the  
            system for processing Medi-Cal payments to allow pharmacist  
            services to be reimbursed at the rate level specified in this  
            bill (25% General Fund and 75% federal funds). 


          2)Unknown cost savings due to a shift from services being  
            provided by physicians to those services being provided by  
            pharmacists (General Fund and federal funds).  Under this  
            bill, Medi-Cal beneficiaries would be able to access certain  
            services from a pharmacist without the need to see a physician  
            to get a prescription.  This bill requires pharmacists to be  
            reimbursed at 85% of the rate paid to physicians.  The extent  
            of the cost savings from shifting from physician services to  
            pharmacist services is unknown. 


          3)Likely overall cost savings to the Medi-Cal program due to  
            increased utilization of certain drugs prescribed and  








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            dispensed by pharmacists (General Fund and federal funds).   
            Under this bill, it is likely that there will be increased  
            utilization of certain drugs, because it will be easier for  
            some Medi-Cal beneficiaries to access those drugs directly  
            from a pharmacist without the need for a physician visit.   
            Under current law, the drugs that can be provided by a  
            pharmacist in this manner include smoking cessation drugs,  
            contraceptives, naloxone (a drug that prevents opioid  
            overdoses), and immunizations.  These types of drugs have been  
            shown to result in overall health care cost savings, so it is  
            likely that any overall increase in their utilization by  
            Medi-Cal beneficiaries is likely to reduce long-term Medi-Cal  
            spending.


          COMMENTS:  According to the author, regulations were recently  
          finalized (2016) to allow California pharmacists to provide  
          hormonal contraceptives, the opioid overdose drug naloxone, and  
          nicotine replacing products for smoking cessation directly to  
          patients.  This bill will improve access to these vital health  
          services by authorizing the DHCS to establish a system for  
          pharmacists to provide services in the Medi-Cal program.  This  
          bill was not introduced earlier this year because the last  
          regulations to implement new pharmacist authorities were not  
          finalized until after the bill introduction deadline.   
          Discussions have since progressed with DHCS on the best  
          structure for this bill.  The author concluded this bill is  
          necessary to pass this bill this year so that Medi-Cal patients  
          can gain access to these health care services right away.

          The Pharmacy Act authorizes pharmacists to furnish compounded  
          drug products, transmit a valid prescription to another  
          pharmacist, and administer drugs and biologicals pursuant to a  
          prescriber's order.  SB 493 (Hernandez), Chapter 469, Statutes  
          of 2013, expanded the scope of pharmacists to authorize them to  
          furnish self-administered hormonal contraceptives, vaccines,  
          nicotine replacement products, and travel medications.   
          Additionally, SB 493 authorized the Board of Pharmacy (BOP) to  
          recognize Advance Practice Pharmacists who can perform patient  
          assessments, order and interpret drug therapy-related tests,  
          refer patients to other health care providers, participate in  
          the evaluation and management of diseases and health conditions  








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          in collaboration with other health care providers, and initiate,  
          adjust, or discontinue drug therapy.  AB 1535 (Bloom), Chapter  
          326, Statutes of 2014, additionally authorized pharmacists to  
          furnish naloxone hydrochloride.  Regulations were adopted by the  
          BOP on the furnishing of naloxone and nicotine replacement  
          products on January 2016 and the furnishing of self-administered  
          hormonal contraceptives were adopted in April 2016.  The  
          regulations for the furnishing of travel medications, and  
          administration of vaccinations are currently pending.  

          Analysis Prepared by:                                             
                          Rosielyn Pulmano / HEALTH / (916) 319-2097  FN:  
          0005002