By: Raymond	H.B. No. 3732

	A BILL TO BE ENTITLED
	AN ACT
	relating to prescription drug benefits under the Medicaid program.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 531.073(a), Government Code, is amended
	to read as follows:
	(a)  The executive commissioner, in the rules and standards
	governing the Medicaid vendor drug program and the child health
	plan program, shall require prior authorization for the
	reimbursement of a drug that is not included in the appropriate
	preferred drug list adopted under Section 531.072, except as
	provided by Section 531.0731 and for any drug exempted from prior
	authorization requirements by federal law. Except as provided by
	Section 531.0731, the [The] executive commissioner may require
	prior authorization for the reimbursement of a drug provided
	through any other state program administered by the commission or a
	state health and human services agency, including a community
	mental health center and a state mental health hospital if the
	commission adopts preferred drug lists under Section 531.072 that
	apply to those facilities and the drug is not included in the
	appropriate list. The executive commissioner shall require that the
	prior authorization be obtained by the prescribing physician or
	prescribing practitioner.
	SECTION 2.  Subchapter B, Chapter 531, Government Code, is
	amended by adding Section 531.0731 to read as follows:
	Sec. 531.0731.  CONTINUITY OF CARE IN RELATION TO
	PRESCRIPTION DRUGS.  The commission shall ensure that a
	prescription drug prescribed to a person who is newly enrolled in
	the child health plan program, Medicaid, or another state program
	administered by the commission or a health and human services
	agency, or who is newly enrolled in a Medicaid managed care health
	plan, is not subject to a prior authorization requirement for up to
	one year after the date of the person's enrollment, if:
	(1)  the patient had previously been prescribed the
	drug to treat a medical condition; and
	(2)  the person's physician prescribes the drug to
	treat the person's medical condition based on the physician's
	determination that the prescription is the most appropriate course
	of treatment for the medical condition.
	SECTION 3.  Section 531.0736, Government Code, is amended by
	amending Subsection (b) to read as follows:
	(b)  In addition to performing any other duties required by
	federal law, the board shall:
	(1)  develop and submit to the commission
	recommendations for preferred drug lists adopted by the commission
	under Section 531.072;
	(2)  suggest to the commission restrictions or clinical
	edits on prescription drugs in accordance with Section 531.0738;
	(3)  review existing restrictions or clinical edits on
	prescription drugs for appropriateness in accordance with Section
	531.0738;
	(4)  recommend to the commission educational
	interventions for Medicaid providers;
	(5) [(4)]  review drug utilization across Medicaid;
	and
	(6) [(5)]  perform other duties that may be specified
	by law and otherwise make recommendations to the commission.
	SECTION 4.  Subchapter B, Chapter 531, is amended by adding
	Sections 531.0738, 531.07381, 531.07382, and 531.07383 to read as
	follows:
	Sec. 531.0738.  DRUG UTILIZATION REVIEW BOARD: SUGGESTION
	AND REVIEW OF RESTRICTIONS AND CLINICAL EDITS.  (a)  In performing
	the requirements under Sections 531.0736(b)(2) and (3), the board
	shall evaluate the appropriateness of and make a recommendation
	regarding a restriction or clinical edit or protocol on a
	prescription drug. The committee's evaluation and recommendation
	must:
	(1)  be based on only a determination of the safety and
	efficacy of the restriction or clinical edit or protocol;
	(2)  ensure the restriction or clinical edit is written
	for the needs of all applicable populations, including pediatric
	and obstetric populations; and
	(3)  include an explanation of the basis for the
	committee's recommendation that is written in such a way that would
	allow a person without medical training to understand.
	(b)  To perform the requirements under Section
	531.0736(b)(3), the board shall establish a periodic review
	schedule for existing restrictions or clinical edits or protocols.
	The schedule must require review of a restriction or clinical edit
	on a prescription drug no less frequently than once every two years.
	A restriction or clinical edit on a prescription drug has no effect
	and may not be enforced beginning on the date of the second
	anniversary of the most recent review of the restriction or edit by
	the board unless the restriction or clinical edit has been
	evaluated and renewed by the board.
	(c)  In determining the safety and efficacy of a restriction
	or clinical edit, the board:
	(1)  may consider public comment or clinical
	information including scientific evidence, standards of practice,
	peer-reviewed medical literature, randomized clinical trials,
	pharmacoeconomic studies, and outcomes research data; and
	(2)  may not rely solely on manufacturer package
	inserts.
	Sec. 531.07381.  SUSPENSION OF RESTRICTION OR CLINICAL EDIT
	ON PRESCRIPTION DRUG.  The executive commissioner by rule shall
	adopt a process by which the commission amends or suspends a
	restriction or clinical edit on a prescription drug. The process
	must:
	(1)  allow providers or Medicaid managed care
	organization medical or pharmacy directors to submit to the
	commission evidence that the restriction or clinical edit:
	(A)  jeopardizes patient safety or care by
	imposing undue administrative burdens to patients or providers; or
	(B)  is clinically inaccurate or otherwise
	inappropriate;
	(2)  require the commission's Medicaid medical director
	to:
	(A)  review submitted clinical information to
	determine whether the restriction or clinical edit should be
	amended or suspended in the interest of patient safety or care; and
	(B)  submit a recommendation based on the medical
	director's determination regarding the restriction or clinical
	edit to the executive commissioner; and
	(3)  no later than 10 business days after the date the
	executive commissioner receives the medical director's
	recommendation), require the executive commissioner to amend or
	suspend the restriction or clinical edit in accordance with the
	medical director's determination, as applicable.
	Sec. 531.07382.  STEP THERAPY PROTOCOLS.  (a)  In this
	section and in Section 531.07383:
	(1)  "Clinical practice guideline" means a statement
	systematically developed by physicians and other health care
	providers to assist a patient or health care provider in making a
	decision about appropriate health care for a specific clinical
	circumstance or condition.
	(2)  "Clinical review criteria" means the written
	screening procedures, decision abstracts, clinical protocols, and
	practice guidelines used by a health benefit plan issuer,
	utilization review organization, or independent review
	organization to determine the medical necessity and
	appropriateness of a health care service or prescription drug.
	(3)  "Step therapy protocol" means a protocol that
	requires an enrollee to use a prescription drug or sequence of
	prescription drugs other than the drug that the enrollee's
	physician recommends for the enrollee's treatment before the health
	benefit plan provides coverage for the recommended drug.
	(b)  The commission may require a step therapy protocol
	before providing coverage for a prescription drug only if the
	commission establishes, implements, and administers the step
	therapy protocol in accordance with clinical review criteria
	readily available to the health care industry.  The clinical review
	criteria must be based on:
	(1)  generally accepted clinical practice guidelines
	that are:
	(A)  developed and endorsed by a
	multidisciplinary panel of experts described by Subsection (b); and
	(B)  based on high quality studies, research, and
	medical practice that are:
	(i)  created by an explicit and transparent
	process that:
	(a)  minimizes bias and conflicts of
	interest;
	(b)  explains the relationship between
	treatment options and outcomes;
	(c)  rates the quality of the evidence
	supporting the recommendations; and
	(d)  considers relevant patient
	subgroups and preferences; and
	(ii)  updated at appropriate intervals after
	a review of new evidence, research, and treatments; or
	(2)  if clinical practice guidelines described by
	Subdivision (1) are not reasonably available, peer-reviewed
	publications developed by independent experts, which must include
	physicians, with expertise applicable to the relevant health
	condition.
	(c)  A multidisciplinary panel of experts consisting of
	physicians and other health care providers that develops and
	endorses clinical practice guidelines under Subsection (a)(1) must
	manage conflicts of interest by:
	(1)  requiring each member of the panel's writing or
	review group to:
	(A)  disclose any potential conflict of interest,
	including a conflict of interest involving an insurer, managed care
	organization, or pharmaceutical manufacturer; and
	(B)  recuse himself or herself in any situation in
	which the member has a conflict of interest;
	(2)  using a methodologist to work with writing groups
	to provide objectivity in data analysis and the ranking of evidence
	by preparing evidence tables and facilitating consensus; and
	(3)  offering an opportunity for public review and
	comment.
	(d)  This section may not be construed to prohibit:
	(1)  the commission from requiring a patient to try an
	AB-rated generic equivalent drug before providing coverage for the
	equivalent branded prescription drug, unless the drug:
	(A)  has been demonstrated to be ineffective on
	the patient;
	(B)  has caused an adverse reaction in or physical
	or mental harm to the patient; or
	(C)  is likely to cause an adverse reaction in or
	physical or mental harm to the patient; or
	(2)  a prescribing provider from prescribing a
	prescription drug that is determined to be medically appropriate.
	Sec. 531.07383.  OVERRIDE OF RESTRICTIONS ON MEDICATION
	SEQUENCE IN STEP THERAPY PROTOCOL.  (a)  The commission shall
	establish a clear and convenient process for a prescribing health
	professional to request electronically, in writing, or by phone an
	override of a step therapy protocol.
	(b)  The commission shall grant a request for an override of
	a step therapy protocol to a prescribing health professional
	within, subject to Subsections (c) and (d), a reasonable time after
	the health professional completes the process for the request of
	the override, if:
	(1)  the prescribing health professional can
	demonstrate that the patient has previously failed the preferred
	treatment required under the step therapy protocol, or that the
	preferred treatment or another drug in the same pharmacologic class
	or with the same mechanism of action as the preferred treatment, has
	been ineffective or had a diminished effect for the treatment of a
	recipient's medical condition after two attempts of following the
	protocol; or
	(2)  based on sound clinical evidence or medical and
	scientific evidence, the prescribing health professional can
	demonstrate that the preferred treatment required under the step
	therapy protocol:
	(A)  is expected or likely to be ineffective based
	on the known relevant physical or mental characteristics of the
	recipient and known characteristics of the drug regimen; or
	(B)  will cause or will likely cause an adverse
	reaction in or physical or mental harm to the recipient.
	(c)  Except as provided by Subsection (e), if the commission
	does not deny an exception request described by Subsection (a)
	before 48 hours after the commission receives the request, the
	request is considered granted.
	(d)  If an exception request described by Subsection (c) also
	states that the prescribing provider reasonably believes that
	denial of the request makes the death of or serious harm to the
	patient probable, the request is considered granted if commission
	does not deny the request before 24 hours after the organization
	receives the request.
	(e)  The process established under this section must allow a
	prescribing health professional to appeal a denial of a request for
	an override of a step therapy protocol to the commission's medical
	director.
	SECTION 5.  Section 531.0741, Government Code, is amended to
	read as follows:
	Sec. 531.0741.  PUBLICATION OF INFORMATION REGARDING
	COMMISSION AND DRUG UTILIZATION REVIEW BOARD DECISIONS [ON
	PREFERRED DRUG LIST PLACEMENT].  (a)  The commission shall publish
	on the commission's Internet website any decisions on preferred
	drug list placement, including:
	(1)  a list of drugs reviewed and the commission's
	decision for or against placement on a preferred drug list of each
	drug reviewed;
	(2)  for each recommendation, whether a supplemental
	rebate agreement or a program benefit agreement was reached under
	Section 531.070; and
	(3)  the rationale for any departure from a
	recommendation of the Drug Utilization Review Board under Section
	531.0736.
	(b)  The commission shall publish on the commission's
	Internet website in a section of the website dedicated to
	prescription drug information:
	(1)  information on restrictions or clinical edits for
	a prescription drug, including a preferred drug, including the
	evaluation and recommendation required under Section 531.0738 that
	relates to the restriction or clinical edit; and
	(2)  the periodic review schedule established under
	Section 531.0738(b).
	(c)  The commission must publish the information required
	under this section in a manner that would allow a provider to search
	a preferred drug list to easily determine whether a prescription
	drug or drug class is subject to any restrictions or clinical edits.
	SECTION 6.  Subchapter B, Chapter 531, Government Code is
	amended by adding Section 531.0761 to read as follows:
	Sec. 531.0761.  PRESCRIPTION OF GENERIC EQUIVALENTS.  (a)
	Notwithstanding any other section of law and in a manner that
	complies with applicable federal law, the commission shall ensure
	that a preferred drug list adopted by the commission for the
	Medicaid vendor drug program and for prescription drugs purchased
	through the child health plan program establishes a generic
	equivalent of a prescribed drug as a preferred drug.
	(b)  If a physician or other health care practitioner acting
	within the practitioner's scope of delegated authority writes a
	prescription for a generic equivalent of a prescribed drug, the
	commission may not require the physician or practitioner to specify
	the national drug code on the prescription.
	Sec. 531.0762.  UPDATING NATIONAL DRUG CODES.  (a)  No later
	than the 15th business day after the day the commission receives
	notice from the Centers for Medicaid and Medicare Services that a
	National Drug Code has been eliminated or changed, the commission
	shall update its electronic database and notify Medicaid managed
	care organizations.
	SECTION 7.  Subchapter A, Chapter 533, Government Code, is
	amended by adding Section 533.022 to read as follows:
	Sec. 533.022.  PHARMACY BENEFIT PLAN REQUIREMENTS.  (a)  The
	commission shall require that the pharmacy benefit plan of a
	managed care organization that contracts with the commission to
	provide health care services to recipients must:
	(1)  adopt the restrictions or clinical edits as
	recommended by the Drug Utilization Review Board under Section
	531.0738 and impose no other restrictions or clinical edits than
	those recommended by the board;
	(2)  adopt the process adopted under Section 531.07381
	for amending or suspending a restriction or clinical edit on a
	prescription drug;
	(3)  adhere to the step therapy guidelines and override
	procedures under Sections 531.07382 and 531.07383, including a
	procedure for an appeal under Section 531.07383(e) to the managed
	care organization's medical director.
	SECTION 8.  Section 533.005(a-1), Government Code, is
	amended to read as follows:
	(a-1)  The requirements imposed by Subsections (a)(23)(A),
	(B), and (C) do not apply, and may not be enforced, on and after
	August 31, 2030 [2018].
	SECTION 9.  If before implementing any provision of this Act
	a state agency determines that a waiver or authorization from a
	federal agency is necessary for implementation of that provision,
	the agency affected by the provision shall request the waiver or
	authorization and may delay implementing that provision until the
	waiver or authorization is granted.
	SECTION 10.  (a) The Drug Utilization Review Board shall
	establish a schedule for reviewing restrictions and clinical edits
	on prescription drugs provided as benefits under the Medicaid
	program as required by Section 531.0738, Government Code, as added
	by this Act, no later than March 1, 2018.
	(b)  The Drug Utilization Review Board shall complete a
	review of all restrictions and clinical edits on prescription drugs
	that are provided as benefits under the Medicaid program that are in
	effect on the effective date of this Act, as required by Section
	531.0738, Government Code, as added by this Act, no later than
	September 1, 2018.
	(c)  The Health and Human Services Commission may not allow a
	restriction or clinical edit on a prescription drug provided as a
	benefit under the Medicaid program to be enforced or to have any
	effect before the Drug Utilization Review Board reviews the
	restriction or clinical edit in accordance with Subsection (b) of
	this SECTION, unless the Health and Human Services Commission
	requires the enforcement or imposition of the restriction or
	clinical edit by administrative rule or by contract with a managed
	care organization that contracts with the commission to provide
	health care benefits to enrollees in the Medicaid program.
	SECTION 11.  This Act takes effect immediately if it
	receives a vote of two-thirds of all the members elected to each
	house, as provided by Section 39, Article III, Texas Constitution.
	If this Act does not receive the vote necessary for immediate
	effect, this Act takes effect September 1, 2017.