senate Bill S2711A

Regulates step therapy and first fail health insurance policies and contracts

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 23 / Jan / 2013
    • REFERRED TO INSURANCE
  • 08 / Jan / 2014
    • REFERRED TO INSURANCE
  • 14 / Feb / 2014
    • AMEND AND RECOMMIT TO INSURANCE
  • 14 / Feb / 2014
    • PRINT NUMBER 2711A

Summary

Regulates step therapy and first fail health insurance policies and contracts.

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Bill Details

See Assembly Version of this Bill:
A5214A
Versions:
S2711
S2711A
Legislative Cycle:
2013-2014
Current Committee:
Senate Insurance
Law Section:
Insurance Law
Laws Affected:
Add Art 33 ยงยง3301 & 3302, Ins L
Versions Introduced in 2011-2012 Legislative Cycle:
A9397, S6464, A9397

Sponsor Memo

BILL NUMBER:S2711A

TITLE OF BILL: An act to amend the insurance law, in relation to the
regulation of step therapy and first fail policies

PURPOSE: This bill would amend the insurance law by adding Article 33
which would regulate fail first accident/or health insurance policies
that require a patient to exhaust the least expensive drug options
before insurers will cover more expensive treatment options.

SUMMARY OF PROVISIONS: This bill would amend the insurance law by
adding a new Article 33 which would ensure prescribers have a clear
and convenient process to override step therapy under specific
conditions when medically in the best interest of the patient.

This bill does not prohibit step therapy, but rather establishes
guidelines to ensure providers have an expeditious process to override
step therapy in select instances where based on sound clinical and
medical evidence and professional medical judgment providers believe
it is medically in the best interest of the patient not to require
failure on an alternative and chemically different therapeutic agent.

In cases where step therapy is required, the bill would limit the time
period a patient could be subjected to step-therapy (or required to
fail on a treatment) to the period deemed necessary by the prescribing
physician to determine the treatment's clinical effectiveness or for a
period no longer than thirty days.

The amendments provided in this bill do not impact generic
substitution authorized by the New York State Medicaid Mandatory
Generic Drug Program.

JUSTIFICATION: Step Therapy or fail first policies is a practice
which requires the least expensive drug in any class to be proscribed
to a patient first, even if the required therapy is a different
therapeutic agent that the patient's physician believes is medically
in the best interest of the patient. If the treatment is ineffective,
insurers will then cover the more expensive treatment options.

There are currently no time limits or restrictions placed on fail
first policies. Patients, including those with serious medical
conditions, can be required to fail for an indefinite period of time
before the agent preferred by the physician can be prescribed. This
practice has the potential to result in serious negative consequences
for consumers and the public health system. By limiting the array of
medication options, both physicians and consumers are forced to
compromise their treatment decisions in a way that is dangerous, time
consuming and more expensive.

Under fail first, a consumer will often have to fail on one or more
medications before they are allowed access to the medication that his
or her physician would have tried as an initial treatment. It is poor
clinical care to delay the start of effective treatment and expose a
person to unnecessary risk. In this way, fail first denies patients
the drugs they need when they need them, and effectively allows
insurers to practice medicine without a license. There are significant
administrative costs' associated with these types of policies and most


importantly, consumers can relapse and require more expensive medical
interventions such as hospitalization.

The internal and external appeals process provisions in the insurance
law, Title II (sections 4900-08 and 4910-17), do not provide the
necessary protections for patients and physicians regarding access to
treatments restricted by fail first protocols. Title II outlines an
appeal process for an "adverse determination"; however a fail first or
step therapy requirement does not qualify as an "adverse
determination" under the definition. The existing appeal right
addresses a determination later in the process than a step therapy
override would. For example, the step therapy override process
addresses whether a patient should be required to try other
medications before the desired treatment is covered, rather than
whether the desired treatment is medically necessary and should be
covered at all. The proposed legislation would expedite the process
and allow for an override at an earlier point in the treatment process
than a final adverse determination.

When medically in the best interest of the patient, prescribers need a
clear process to override the step therapy or fail first requirement.
In cases where step therapy or fail first policies continue to be
applied, the time period a patient could be subjected to step-therapy
(or required to fail on a treatment) should be limited to the period
deemed necessary by the prescribing physician to determine the
treatment's clinical effectiveness or a period of no longer than
thirty days.

The following states have recently enacted legislation to prohibit or
limit fail first and step therapy practices when medically in the best
interest of the patient: Arkansas, Connecticut, Louisiana,
Mississippi, Texas, Utah, California, and Massachusetts. Patients in
New York currently subject to step therapy and fail first practices
require similar protections.

LEGISLATIVE HISTORY: 2012: S.6464/A.9397 Referred to Insurance

FISCAL IMPLICATIONS: Undetermined at this time.

EFFECTIVE DATE: This act shall take effect on the 120th day after it
shall have become a law.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 2711--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 23, 2013
                               ___________

Introduced  by  Sens.  YOUNG,  BALL,  BRESLIN,  GOLDEN, GRISANTI, LANZA,
  MARCHIONE, PARKER, TKACZYK, VALESKY -- read twice and ordered printed,
  and when printed to be committed to  the  Committee  on  Insurance  --
  recommitted  to  the  Committee on Insurance in accordance with Senate
  Rule  6,  sec.  8  --  committee  discharged,  bill  amended,  ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the insurance law, in relation to the regulation of step
  therapy and first fail policies

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The insurance law is amended by adding a new article 33  to
read as follows:
                               ARTICLE 33
                     REGULATION OF STEP THERAPY AND
                           FIRST FAIL POLICIES
SECTION 3301. DEFINITIONS.
        3302. PRESCRIPTION DRUG RESTRICTION OVERRIDES.
  S 3301. DEFINITIONS. AS USED IN THIS ARTICLE:
  (A)  "INSURER"  SHALL MEAN ANY PERSON OR ENTITY WHO OFFERS A POLICY OF
ACCIDENT AND/OR HEALTH INSURANCE PURSUANT TO SECTION THREE THOUSAND  TWO
HUNDRED SIXTEEN, THREE THOUSAND TWO HUNDRED TWENTY-ONE, OR FOUR THOUSAND
THREE  HUNDRED THREE OF THIS CHAPTER OR ARTICLE FORTY-FOUR OF THE PUBLIC
HEALTH LAW.
  (B) "PHARMACY BENEFIT MANAGEMENT" OR  "PBM"  SHALL  MEAN  THE  SERVICE
PROVIDED  TO  AN  INSURER, DIRECTLY OR THROUGH ANOTHER ENTITY; INCLUDING
THE PROCUREMENT  OF  PRESCRIPTION  DRUGS  TO  BE  DISPENSED  TO  COVERED
PERSONS,  OR THE ADMINISTRATION OR MANAGEMENT OF PRESCRIPTION DRUG BENE-
FITS INCLUDING, BUT NOT LIMITED TO, ANY OF THE FOLLOWING:
  (1) A MAIL ORDER PHARMACY;
  (2) CLAIMS PROCESSING, RETAIL NETWORK MANAGEMENT AND PAYMENT OF CLAIMS
TO PHARMACIES FOR DISPENSING PRESCRIPTION DRUGS;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05355-03-4

S. 2711--A                          2

  (3) CLINICAL OR OTHER FORMULARY, OR PREFERRED DRUG LIST DEVELOPMENT OR
MANAGEMENT;
  (4)  NEGOTIATION  OR  ADMINISTRATION  OF  REBATES,  DISCOUNTS, PAYMENT
DIFFERENTIALS OR  OTHER  INCENTIVES  FOR  THE  INCLUSION  OF  PARTICULAR
PRESCRIPTION  DRUGS  IN A PARTICULAR CATEGORY OR TO PROMOTE THE PURCHASE
OF PARTICULAR PRESCRIPTION DRUGS;
  (5) PATIENT COMPLIANCE, THERAPEUTIC INTERVENTION AND  GENERIC  SUBSTI-
TUTION PROGRAMS; AND
  (6) DISEASE MANAGEMENT.
  S  3302. PRESCRIPTION DRUG RESTRICTION OVERRIDES. (A) WHEN MEDICATIONS
FOR THE TREATMENT OF ANY MEDICAL CONDITION ARE RESTRICTED FOR USE BY  AN
INSURER  OR  PBM  BY A STEP THERAPY OR FAIL FIRST PROTOCOL, A PRESCRIBER
SHALL HAVE ACCESS TO A CLEAR AND CONVENIENT PROCESS AT NO CHARGE TO SUCH
PRESCRIBER AND/OR PATIENT TO OVERRIDE SUCH RESTRICTIONS FROM THE INSURER
AND MAY EXPEDITIOUSLY OVERRIDE SUCH RESTRICTION IF:
  (1) SUCH PRESCRIBER, IN HIS OR  HER  PROFESSIONAL  JUDGMENT,  BELIEVES
THAT THE PREFERRED TREATMENT BY THE INSURER OR THE PBM HAS BEEN INEFFEC-
TIVE  IN THE TREATMENT OF THE COVERED PERSON'S DISEASE OR MEDICAL CONDI-
TION; OR
  (2) BASED ON  SOUND  CLINICAL  EVIDENCE  AND  MEDICAL  AND  SCIENTIFIC
EVIDENCE:
  (A)  SUCH  PRESCRIBER,  IN  HIS OR HER PROFESSIONAL JUDGMENT, BELIEVES
THAT THE PREFERRED TREATMENT IS EXPECTED TO BE INEFFECTIVE BASED ON  THE
KNOWN  RELEVANT PHYSICAL OR MENTAL CHARACTERISTICS OF THE COVERED PERSON
AND KNOWN CHARACTERISTICS OF THE DRUG REGIMEN, AND IS LIKELY TO BE INEF-
FECTIVE OR ADVERSELY AFFECT THE DRUG'S EFFECTIVENESS OR PATIENT  COMPLI-
ANCE; OR
  (B)  SUCH  PRESCRIBER,  IN  HIS OR HER PROFESSIONAL JUDGMENT, BELIEVES
THAT THE PREFERRED TREATMENT HAS CAUSED OR IS LIKELY TO CAUSE AN ADVERSE
REACTION OR OTHER HARM TO THE COVERED PERSON.
  (B) THE DURATION OF ANY STEP THERAPY OR FAIL FIRST PROTOCOL SHALL  NOT
BE LONGER THAN EITHER (1) THE PERIOD DEEMED NECESSARY BY THE PRESCRIBING
PHYSICIAN OR HEALTH CARE PROFESSIONAL TO DETERMINE THE TREATMENT'S CLIN-
ICAL EFFECTIVENESS, OR (2) A PERIOD OF THIRTY DAYS.
  (C)  NOTHING  IN THIS SECTION SHALL REQUIRE COVERAGE FOR AN ADDITIONAL
CONDITION NOT ALREADY COVERED BY THE POLICY OR CONTRACT, OR WHICH IS NOT
OTHERWISE COVERED BY LAW.
  S 2. This act shall take effect on the one hundred twentieth day after
it shall have become a law.

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