BILL NUMBER: AB 1124 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 17, 2015
AMENDED IN SENATE JULY 14, 2015
AMENDED IN SENATE JULY 8, 2015
AMENDED IN ASSEMBLY JUNE 1, 2015
AMENDED IN ASSEMBLY APRIL 14, 2015
INTRODUCED BY Assembly Member Perea
FEBRUARY 27, 2015
An act to amend Sections 4600.1, 4600.2, and 5307.27 of, and
to add Sections 5307.28 and 5307.29 to
to, the Labor Code, relating to workers' compensation.
LEGISLATIVE COUNSEL'S DIGEST
AB 1124, as amended, Perea. Workers' compensation: prescription
medication formulary.
Existing law establishes a workers' compensation system,
administered by the Administrative Director of the Division of
Workers' Compensation, to compensate an employee for injuries
sustained in the course of employment. The administrative director is
authorized to adopt, amend, or repeal, after public hearings, any
rules and regulations that are reasonably necessary to enforce the
state workers' compensation provisions, except when that power is
specifically reserved to the Workers' Compensation Appeals Board.
Existing law requires the administrative director to adopt a
medical treatment utilization schedule that addresses the frequency,
duration, intensity, and appropriateness of all common treatments
performed in worker s ' compensation
cases.
This bill would require the administrative director to, on or
before January 1, 2017, establish a medical evidence-based workers'
compensation drug formulary for medications prescribed in the workers'
compensation system, to be effective commencing July 1, 2017. The
bill requires the administrative director to revise the formulary to
adopt appropriate changes, as specified, and to publish any revisions
on the Internet Web site of the Division of Workers' Compensation.
The bill would require the administrative director to convene a
Workers' Compensation Formulary Advisory Committee to assist in the
development of the formulary, and would require the committee to
study and make recommendations, as specified, on the development of a
workers' compensation formulary in California.
This bill would require the administrative director to establish
an outpatient prescription drug formulary, on or before July 1, 2017,
as part of the medical treatment utilization schedule, for
medications prescribed in the workers' compensation system. The bill
would require the administrative director to make certain
considerations, as specified, in establishing the formulary. The bill
would require the administrative director to meet and consult with
stakeholders, as specified, prior to the adoption of the formulary.
The bill would require the administrative director to publish at
least 2 interim reports on the Internet Web site of the Division of
Workers' Compensation describing the status of the establishment of
the formulary, beginning July 1, 2016, until the formulary is
effective. The bill would require the administrative director to
update the formulary at least on a quarterly basis to allow for the
availability of all appropriate medications, including medications
newly approved for use. The bill would also make conforming changes
to related code sections.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 5307.28 is added to the
Labor Code, to read:
5307.28. (a) On or before January 1, 2017, the administrative
director shall establish a medical evidence-based workers'
compensation drug formulary for medications prescribed in the workers'
compensation system, to be effective commencing July 1, 2017.
(b) The formulary shall be revised to adopt appropriate changes no
later than 60 days after the administrative director receives
recommendations from the Workers' Compensation Formulary Advisory
Committee and determines that evidence-based revisions are warranted.
The administrative director shall determine the effective date of
the changes, and shall issue an order, exempt from Sections 5307.3
and 5307.4 and the rulemaking provisions of the Administrative
Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code), informing the
public of the changes and their effective date. All orders issued
pursuant to this subdivision shall be published on the Internet Web
site of the Division of Workers' Compensation.
SEC. 2. Section 5307.29 is added to the Labor
Code, to read:
5307.29. (a) The administrative director shall convene a Workers'
Compensation Formulary Advisory Committee to assist in the
development of a formulary pursuant to Section 5307.28. The committee
shall be composed of members appointed by the director and shall
include, but not be limited to, health care providers, insurers,
employers, pharmacists, attorneys who represent applicants, an
appointee of the Speaker of the Assembly, and an appointee of the
Senate Rules Committee.
(b) The committee shall study and make recommendations on the
development of a workers' compensation formulary in California.
(c) The committee shall convene on a quarterly basis and provide
its recommendations to the administrative director on or before
December 31, 2016.
(d) The recommendations developed pursuant to subdivision (c)
shall ensure all of the following:
(1) Injured worker access to appropriate opioids, including those
with abuse-deterrent properties, other pain management prescriptions,
and off-label prescription drugs, when medically necessary.
(2) A gradual detoxification plan for a worker receiving
potentially addictive prescription drug treatment.
(3) Timely formulary updates that minimize delays involved in
adding new drugs to the formulary.
SECTION 1. It is the intent of the Legislature to
establish an outpatient prescription drug formulary for medications
prescribed in the workers' compensation system, to be effective July
1, 2017. In establishing the formulary, the Administrative Director
of the Division of Workers' Compensation shall consider, with the
maximum transparency possible, a medical evidence-based formulary,
and, in addition to the provisions of this act, at least all
of the following:
(a) Medical evidence-based guidelines for access to appropriate
medication pursuant to pain management prescription drug therapies.
(b) Medical evidence-based guidelines for access to off-label
prescription drugs when evidence-based and medically necessary.
(c) Guidance of utilization review, pursuant to Section 4610 of
the Labor Code, as applicable to medications within the established
formulary and circumstances that may warrant use of medications
outside the established formulary.
SEC. 2. Section 4600.1 of the Labor
Code is amended to read:
4600.1. (a) Subject to subdivision (b), any person or entity that
dispenses medicines and medical supplies, as required by Section
4600, shall dispense the generic drug equivalent.
(b) A person or entity shall is not
be required to dispense a generic drug equivalent
under either of the following circumstances:
(1) When If
a generic drug equivalent is unavailable.
(2) When If
the prescribing physician specifically provides in writing that
a nongeneric drug must be dispensed.
(c) For purposes of this section, "dispense" has the same meaning
as the definition contained in Section 4024 of the Business and
Professions Code.
(d) Nothing in this This
section shall be construed to does not
preclude a prescribing physician, who is also the dispensing
physician, from dispensing a generic drug equivalent.
(e) This section applies only to medicines prescribed or dispensed
prior to the effective date of the outpatient prescription drug
formulary adopted pursuant to Section 5307.27.
SEC. 3. Section 4600.2 of the Labor
Code is amended to r ead:
4600.2. (a) Notwithstanding Section 4600, when
if a self-insured employer, group of self-insured
employers, insurer of an employer, or group of insurers contracts
with a pharmacy, group of pharmacies, or pharmacy benefit network to
provide medicines and medical supplies required by this article to be
provided to injured employees, those injured employees that are
subject to the contract shall be provided medicines and medical
supplies in the manner prescribed in the contract for as long as
medicines or medical supplies are reasonably required to cure or
relieve the injured employee from the effects of the injury.
Medicines provided pursuant to the contract are subject to the
outpatient prescription drug formulary adopted pursuant to Section
5307.27, and a contract shall not limit the availability of
medications otherwise indicated pursuant to the formulary.
(b) Nothing in this section shall affect the ability of
employee-selected physicians to continue to prescribe and have the
employer provide medicines and medical supplies that the physicians
deem reasonably required to cure or relieve the injured employee from
the effects of the injury.
(c)
(b) Each contract described in subdivision (a) shall
comply with standards adopted by the administrative director. In
adopting those standards, the administrative director shall seek to
reduce pharmaceutical costs and may consult any relevant studies or
practices in other states. The standards shall provide for access to
a pharmacy within a reasonable geographic distance from an injured
employee's residence.
(d)
(c) An employer or insurer that has established a medical provider
network pursuant to Section 4616 is in compliance with this section
if pharmacy network services are included within its medical provider
network plan filed with the administrative director pursuant to
paragraph (1) of subdivision (b) of Section 4616.
SEC. 4. Section 5307.27 of the Labor
Code is amended to read:
5307.27. On or before December 1, 2004, the
(a) The administrative director, in
consultation with the Commission on Health and Safety and Workers'
Compensation, shall adopt, after public hearings, a medical treatment
utilization schedule, that shall incorporate the evidence-based,
peer-reviewed, nationally recognized standards of care recommended by
the commission pursuant to Section 77.5, and that shall address, at
a minimum, the frequency, duration, intensity, and appropriateness of
all treatment procedures and modalities commonly performed in
workers' compensation cases.
(b) On or before July 1, 2017, the medical treatment utilization
schedule adopted by the administrative director shall include an
outpatient prescription drug formulary. This section does not
prohibit the authorization of medications that are not in the
formulary when the variance is demonstrated, in accordance with
subdivision (a) of Section 4604.5, to cure or relieve the injured
worker from the effects of his or her injury.
(c) The outpatient prescription drug formulary shall include a
phased implementation for workers injured prior to July 1, 2017, in
order to ensure injured workers safely transition to medications on
the formulary. This section does not prohibit medically necessary
tapering or weaning of medications to treat workers injured on or
after July 1, 2017.
(d) On or before July 1, 2017, the medical treatment utilization
schedule shall include guidelines for the development of a
detoxification plan for an injured worker receiving potentially
addictive prescription drug treatment or drug treatment if a
detoxification plan is necessary for patient safety.
SEC. 5. Section 5307.28 is added to t
he Labor Code , to read:
5307.28. (a) Prior to the adoption of an outpatient prescription
drug formulary as required by Section 5307.27, the administrative
director shall meet and consult regarding the establishment of a
formulary with stakeholders, including, but not limited to,
employers, insurers, private sector employee representatives, public
sector employee representatives, treating physicians actively
practicing medicine, pharmacists, pharmacy benefit managers,
attorneys who represent applicants, and injured workers.
(b) The administrative director may meet and consult with an ad
hoc group of physicians and pharmacists to address proposed updates
after the formulary is implemented.
(c) Beginning July 1, 2016, and concluding with the effective date
of the formulary, the administrative director shall publish at least
two interim reports on the Internet Web site of the Division of
Workers' Compensation describing the status of the establishment of
the formulary.
SEC. 6. Section 5307.29 is added to the
Labor Code , to read:
5307.29. The administrative director shall update the outpatient
prescription drug formulary at least on a quarterly basis to allow
for the availability of all appropriate medications, including
medications newly approved for use.