senate Bill S7894

Relates to prescription drugs in Medicaid managed care programs; repealers

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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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  • 17 / Jun / 2014
    • REFERRED TO RULES

Summary

Relates to prescription drugs in Medicaid managed care programs.

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Bill Details

See Assembly Version of this Bill:
A2335C
Versions:
S7894
Legislative Cycle:
2013-2014
Current Committee:
Senate Rules
Law Section:
Social Services Law
Laws Affected:
Add §365-i, rpld §364-j subs 25 & 25-a, §369-ee sub 2-b, amd §369-ee, Soc Serv L; amd §§2511, 270 & 272, Pub Health L

Sponsor Memo

BILL NUMBER:S7894

TITLE OF BILL: An act to amend the social services law and the public
health law, in relation to prescription drugs in Medicaid managed care
programs; and to repeal certain provisions of the social services law,
relating to payments for prescription drugs

PURPOSE:

To restore the "prescriber prevails" principle for all drugs, and other
basic consumer protections, to prescription drug coverage under Medicaid
managed care and add it to Family Health Plus and Child Health Plus.

SUMMARY OF PROVISIONS:

This bill requires Medicaid managed care, Family Health Plus, and Child
Health Plus plans to adopt the procedural protections of the Preferred
Drug Program, including "prescriber prevails," for all drugs. If a Medi-
caid managed care plan chooses not to do so, prescription drugs will be
carved out of that plan and covered on a fee-for-service basis. Plans
may also contract with the Department of Health to use the Department's
PDP to carry out these functions.

JUSTIFICATION:

In 2005, when Medicaid prescription drug coverage was administered
directly, by Medicaid, rather than being contracted out to managed care
plans, the Preferred Drug Program (PDP) was established to shift
prescribing to "preferred" drugs: (a) drugs that are significantly
better than others in their therapeutic class and (b) other drugs in the
class whose manufacturers pay the state higher rebates, The PDP included
a range of procedures to protect prescribers and patients, including the
rule that if, after consulting with the program, a prescriber still
insists on prescribing a "non-preferred" drug, the prescriber's judgment
prevails and the prescription is approved. The PDP was quite effective
at shifting prescribing to the preferred drugs, while also protecting
prescriber judgments on behalf of their patients. It is a model of how
to effectively organize health care. However, in 2011 the Legislature
went along with the Governor's budget proposal to have Medicaid managed
care plans take over the prescription drug benefit. "Prescriber
prevails" was included only for atypical anti psychotics and a small
list of other drug classes.

In the 2013-14 enacted budget, "prescriber prevails" was protected and
expanded for some categories of drugs. This bill restores the "prescri-
ber prevails" principle for all drugs and other basic consumer
protections for prescription drug coverage under Medicaid managed care,
and adds it to Family Health Plus and Child Health Plus.

LEGISLATIVE HISTORY:

New Bill.

FISCAL IMPLICATIONS:

Minimal.

EFFECTIVE DATE:

This act shall take effect on the one hundred eightieth day after it
shall become a law; provided, however, that section two of this act
shall take effect one year after this act shall become a law; and
provided further, that the amendments to section 369-ee of the social
services law made by section three of this act shall not affect the
repeal of such section and shall be deemed to expire therewith and
provided further, that the commissioner of health is immediately author-
ized and directed to take actions necessary to implement this act when
it takes effect.

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

                                  7894

                            I N  S E N A T E

                              June 17, 2014
                               ___________

Introduced  by Sen. CARLUCCI -- read twice and ordered printed, and when
  printed to be committed to the Committee on Rules

AN ACT to amend the social services law and the public  health  law,  in
  relation  to prescription drugs in Medicaid managed care programs; and
  to repeal certain provisions of the social services law,  relating  to
  payments for prescription drugs

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

  Section 1. The social services law is amended by adding a new  section
365-i to read as follows:
  S  365-I.  PRESCRIPTION  DRUGS  IN MEDICAID MANAGED CARE PROGRAMS.  1.
DEFINITIONS. AS  USED  IN  THIS  SECTION,  UNLESS  THE  CONTEXT  CLEARLY
REQUIRES OTHERWISE:
  (A)  "ARTICLE" MEANS TITLE ELEVEN OF ARTICLE FIVE OF THIS CHAPTER WITH
RESPECT TO THE MEDICAL ASSISTANCE PROGRAM,  TITLE  ELEVEN-D  OF  ARTICLE
FIVE OF THIS CHAPTER WITH RESPECT TO THE FAMILY HEALTH PLUS PROGRAM, AND
TITLE ONE-A OF ARTICLE TWENTY-FIVE OF THE PUBLIC HEALTH LAW WITH RESPECT
TO THE CHILD HEALTH INSURANCE PROGRAM.
  (B)  "CLINICAL  DRUG  REVIEW  PROGRAM"  MEANS THE CLINICAL DRUG REVIEW
PROGRAM UNDER SECTION TWO HUNDRED SEVENTY-FOUR OF THE PUBLIC HEALTH LAW.
  (C) "EMERGENCY CONDITION" MEANS A MEDICAL OR BEHAVIORAL  CONDITION  AS
DETERMINED  BY  THE  PRESCRIBER  OR  PHARMACIST,  THE  ONSET OF WHICH IS
SUDDEN, THAT  MANIFESTS  ITSELF  BY  SYMPTOMS  OF  SUFFICIENT  SEVERITY,
INCLUDING  SEVERE  PAIN,  AND  FOR  WHICH  DELAY  IN BEGINNING TREATMENT
PRESCRIBED BY THE PATIENT'S HEALTH CARE PRACTITIONER WOULD RESULT IN:
  (I) PLACING THE HEALTH OR SAFETY OF THE  PERSON  AFFLICTED  WITH  SUCH
CONDITION OR OTHER PERSON OR PERSONS IN SERIOUS JEOPARDY;
  (II) SERIOUS IMPAIRMENT TO SUCH PERSON'S BODILY FUNCTIONS;
  (III) SERIOUS DYSFUNCTION OF ANY BODILY ORGAN OR PART OF SUCH PERSON;
  (IV) SERIOUS DISFIGUREMENT OF SUCH PERSON; OR
  (V) SEVERE DISCOMFORT.
  (D)  "MANAGED  CARE  PROVIDER"  MEANS  A  MANAGED  CARE PROVIDER UNDER
SECTION THREE HUNDRED SIXTY-FOUR-J OF THIS TITLE, A  MANAGED  LONG  TERM
CARE  PLAN  OR  OTHER  CARE  COORDINATION MODEL UNDER SECTION FORTY-FOUR

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05620-08-4

S. 7894                             2

HUNDRED THREE-F OF THE PUBLIC HEALTH LAW, A FAMILY HEALTH INSURANCE PLAN
UNDER SECTION THREE HUNDRED SIXTY-NINE-EE OF THIS ARTICLE (FAMILY HEALTH
PLUS PROGRAM), AN APPROVED ORGANIZATION UNDER  TITLE  ONE-A  OF  ARTICLE
TWENTY-FIVE  OF  THE PUBLIC HEALTH LAW (CHILD HEALTH INSURANCE PROGRAM),
OR ANY OTHER ENTITY THAT PROVIDES  OR  ARRANGES  FOR  THE  PROVISION  OF
MEDICAL  ASSISTANCE  SERVICES  AND  SUPPLIES TO PARTICIPANTS DIRECTLY OR
INDIRECTLY (INCLUDING BY REFERRAL), INCLUDING CASE MANAGEMENT, INCLUDING
THE MANAGED CARE PROVIDER'S AUTHORIZED AGENTS.
  (E) "NON-PREFERRED DRUG" MEANS A PRESCRIPTION DRUG THAT REQUIRES PRIOR
AUTHORIZATION UNDER THE PARTICIPANT'S MANAGED CARE PROVIDER.
  (F) "PARTICIPANT" MEANS A MEDICAL ASSISTANCE RECIPIENT  WHO  RECEIVES,
IS  REQUIRED  TO RECEIVE OR ELECTS TO RECEIVE HIS OR HER MEDICAL ASSIST-
ANCE SERVICES FROM A MANAGED CARE PROVIDER.
  (G) "PREFERRED DRUG" MEANS A PRESCRIPTION DRUG THAT IS NOT A  NON-PRE-
FERRED  DRUG  UNDER THE PATIENT'S MANAGED CARE PROVIDER. "PREFERRED DRUG
LIST" MEANS A LIST OF A MANAGED CARE PROVIDER'S PREFERRED DRUGS.
  (H) "PREFERRED DRUG PROGRAM" MEANS THE PREFERRED DRUG  PROGRAM  ESTAB-
LISHED UNDER SECTION TWO HUNDRED SEVENTY-TWO OF THE PUBLIC HEALTH LAW.
  (I)  "PRESCRIBER"  MEANS  A  HEALTH  CARE  PROFESSIONAL  AUTHORIZED TO
PRESCRIBE PRESCRIPTION DRUGS FOR  A  PARTICIPANT  OF  THE  MANAGED  CARE
PROVIDER, ACTING WITHIN HIS OR HER LAWFUL SCOPE OF PRACTICE.
  (J)  "PRESCRIPTION DRUG" OR "DRUG" MEANS A DRUG DEFINED IN SUBDIVISION
SEVEN OF SECTION SIXTY-EIGHT HUNDRED TWO OF THE EDUCATION LAW, FOR WHICH
A PRESCRIPTION IS REQUIRED UNDER THE FEDERAL  FOOD,  DRUG  AND  COSMETIC
ACT.  ANY  DRUG THAT DOES NOT REQUIRE A PRESCRIPTION UNDER SUCH ACT, BUT
WHICH WOULD OTHERWISE BE ELIGIBLE FOR REIMBURSEMENT UNDER  THIS  ARTICLE
WHEN  ORDERED  BY  A  PRESCRIBER  AND THE PRESCRIPTION IS SUBJECT TO THE
APPLICABLE PROVISIONS OF THIS ARTICLE AND PARAGRAPH (A)  OF  SUBDIVISION
FOUR OF SECTION THREE HUNDRED SIXTY-FIVE-A OF THIS TITLE.
  (K)  "PRIOR AUTHORIZATION" MEANS A PROCESS REQUIRING THE PRESCRIBER OR
THE DISPENSER TO VERIFY WITH THE  PARTICIPANT'S  MANAGED  CARE  PROVIDER
THAT THE DRUG IS APPROPRIATE FOR THE NEEDS OF THE SPECIFIC PATIENT.
  (L)  "QUALIFIED  PRESCRIPTION DRUG SYSTEM" OR "SYSTEM" MEANS A PROCESS
UNDER THIS SECTION,  APPROVED  BY  THE  COMMISSIONER,  THROUGH  WHICH  A
MANAGED  CARE  PROVIDER  APPROVES PAYMENT FOR A NON-PREFERRED DRUG FOR A
PARTICIPANT BASED ON PRIOR AUTHORIZATION.
  2. PAYMENT FOR PRESCRIPTION DRUGS UNDER CAPITATION.  (A)  PAYMENT  FOR
PRESCRIPTION  DRUGS  SHALL  BE  INCLUDED  IN THE CAPITATION PAYMENTS FOR
SERVICES OR SUPPLIES PROVIDED TO A MANAGED CARE PROVIDER'S PARTICIPANTS,
PROVIDED THAT THE MANAGED CARE  PROVIDER  PAYS  FOR  PRESCRIPTION  DRUGS
UNDER  A  QUALIFIED  PRESCRIPTION  DRUG  SYSTEM. EVERY PRESCRIPTION DRUG
ELIGIBLE FOR REIMBURSEMENT UNDER THIS ARTICLE PRESCRIBED IN RELATION  TO
A  SERVICE  PROVIDED  BY  THE  MANAGED  CARE  PROVIDER SHALL BE EITHER A
PREFERRED OR NON-PREFERRED DRUG UNDER THE  QUALIFIED  PRESCRIPTION  DRUG
SYSTEM.  THE COMMISSIONER SHALL APPROVE A MANAGED CARE PROVIDER'S QUALI-
FIED  PRESCRIPTION  DRUG SYSTEM IF IT CONFORMS TO THE PROVISIONS OF THIS
SECTION.
  (B) IF THE MANAGED CARE PROVIDER DOES NOT PAY FOR  PRESCRIPTION  DRUGS
UNDER   A   QUALIFIED   PRESCRIPTION   DRUG  SYSTEM,  THEN  PAYMENT  FOR
PRESCRIPTION DRUGS FOR THE MANAGED CARE PROVIDER'S PATIENTS SHALL NOT BE
INCLUDED IN SUCH CAPITATION PAYMENTS AND  PRESCRIPTION  DRUGS  SHALL  BE
PROVIDED   FOR  THE  MANAGED  CARE  PROVIDER'S  PARTICIPANTS  UNDER  THE
PREFERRED DRUG PROGRAM.
  3. QUALIFIED PRESCRIPTION  DRUG  SYSTEM;  CRITERIA.  (A)  A  QUALIFIED
PRESCRIPTION  DRUG  SYSTEM  SHALL  PROMOTE  ACCESS TO THE MOST EFFECTIVE
PRESCRIPTION DRUGS WHILE REDUCING THE COST OF PRESCRIPTION  DRUGS  UNDER

S. 7894                             3

THIS  ARTICLE.  THIS  SUBDIVISION  AND  SUBDIVISION FOUR OF THIS SECTION
APPLY TO QUALIFIED PRESCRIPTION DRUG SYSTEMS.
  (B)  WHEN  A  PRESCRIBER PRESCRIBES A NON-PREFERRED DRUG FOR A PARTIC-
IPANT,  REIMBURSEMENT  MAY  BE  DENIED  UNLESS  PRIOR  AUTHORIZATION  IS
OBTAINED,  UNLESS NO PRIOR AUTHORIZATION IS REQUIRED UNDER THIS SECTION.
WHEN A PRESCRIBER PRESCRIBES A PREFERRED  DRUG  FOR  A  PARTICIPANT,  NO
PRIOR  AUTHORIZATION  SHALL  BE REQUIRED FOR REIMBURSEMENT, UNLESS PRIOR
AUTHORIZATION IS REQUIRED UNDER THE CLINICAL DRUG REVIEW PROGRAM.
  (C) THE COMMISSIONER SHALL ESTABLISH PERFORMANCE STANDARDS FOR SYSTEMS
THAT, AT A MINIMUM, ENSURE THAT  SYSTEMS  PROVIDE  SUFFICIENT  TECHNICAL
SUPPORT AND TIMELY RESPONSES TO CONSUMERS, PRESCRIBERS AND PHARMACISTS.
  (D)  THE  COMMISSIONER SHALL ADOPT CRITERIA FOR QUALIFIED PRESCRIPTION
DRUG SYSTEMS AFTER CONSIDERING  RECOMMENDATIONS  AND  COMMENTS  RECEIVED
FROM  PRESCRIBERS,  PHARMACISTS, PARTICIPANTS, AND ORGANIZATIONS REPRES-
ENTING THEM.
  (E) THE MANAGED CARE PROVIDER SHALL DEVELOP ITS  PREFERRED  DRUG  LIST
BASED  INITIALLY ON AN EVALUATION OF THE CLINICAL EFFECTIVENESS, SAFETY,
AND PATIENT OUTCOMES, FOLLOWED BY CONSIDERATION OF  THE  COST-EFFECTIVE-
NESS  OF THE DRUGS. IN EACH THERAPEUTIC CLASS, THE MANAGED CARE PROVIDER
SHALL DETERMINE WHETHER THERE IS ONE DRUG  THAT  IS  SIGNIFICANTLY  MORE
CLINICALLY  EFFECTIVE  AND  SAFE, AND THAT DRUG SHALL BE INCLUDED ON THE
PREFERRED DRUG LIST WITHOUT CONSIDERATION OF COST. IF, AMONG TWO OR MORE
DRUGS IN A THERAPEUTIC CLASS, THE DIFFERENCE IN  CLINICAL  EFFECTIVENESS
AND  SAFETY  IS  NOT CLINICALLY SIGNIFICANT, THEN COST-EFFECTIVENESS MAY
ALSO BE CONSIDERED IN DETERMINING WHICH DRUG OR DRUGS SHALL BE  INCLUDED
ON THE PREFERRED DRUG LIST.
  4. PRIOR AUTHORIZATION. (A) A QUALIFIED PRESCRIPTION DRUG SYSTEM SHALL
MAKE AVAILABLE A TWENTY-FOUR HOUR PER DAY, SEVEN DAYS PER WEEK TELEPHONE
CALL  CENTER  THAT  INCLUDES  A  TOLLFREE  TELEPHONE  LINE AND DEDICATED
FACSIMILE LINE TO RESPOND TO REQUESTS FOR PRIOR AUTHORIZATION. THE  CALL
CENTER  SHALL  INCLUDE  QUALIFIED HEALTH CARE PROFESSIONALS WHO SHALL BE
AVAILABLE TO CONSULT WITH PRESCRIBERS CONCERNING PRESCRIPTION DRUGS THAT
ARE NON-PREFERRED DRUGS. A PRESCRIBER SEEKING PRIOR AUTHORIZATION  SHALL
CONSULT  WITH  THE  PROGRAM  CALL  LINE TO REASONABLY PRESENT HIS OR HER
JUSTIFICATION FOR THE PRESCRIPTION  AND  GIVE  THE  PROGRAM'S  QUALIFIED
HEALTH CARE PROFESSIONAL A REASONABLE OPPORTUNITY TO RESPOND.
  (B)  WHEN  A PATIENT'S HEALTH CARE PROVIDER PRESCRIBES A NON-PREFERRED
DRUG, THE PRESCRIBER SHALL CONSULT WITH THE SYSTEM TO  CONFIRM  THAT  IN
HIS  OR  HER  REASONABLE  PROFESSIONAL  JUDGMENT, THE PATIENT'S CLINICAL
CONDITION IS CONSISTENT WITH THE CRITERIA FOR APPROVAL OF  THE  NON-PRE-
FERRED DRUG. SUCH CRITERIA SHALL INCLUDE:
  (I) THE PREFERRED DRUG HAS BEEN TRIED BY THE PATIENT AND HAS FAILED TO
PRODUCE THE DESIRED HEALTH OUTCOMES;
  (II)  THE  PATIENT  HAS  TRIED  THE PREFERRED DRUG AND HAS EXPERIENCED
UNACCEPTABLE SIDE EFFECTS;
  (III) THE PATIENT HAS BEEN STABILIZED  ON  A  NON-PREFERRED  DRUG  AND
TRANSITION TO THE PREFERRED DRUG WOULD BE MEDICALLY CONTRAINDICATED; OR
  (IV)  OTHER CLINICAL INDICATIONS IDENTIFIED BY THE COMMISSIONER OR THE
MANAGED CARE PROVIDER FOR THE PATIENT'S USE OF THE  NON-PREFERRED  DRUG,
WHICH  SHALL INCLUDE CONSIDERATION OF THE MEDICAL NEEDS OF SPECIAL POPU-
LATIONS, INCLUDING CHILDREN,  ELDERLY,  CHRONICALLY  ILL,  PERSONS  WITH
MENTAL  HEALTH CONDITIONS, AND PERSONS AFFECTED BY HIV/AIDS OR HEPATITIS
C.
  (C) IN THE EVENT THAT THE PATIENT DOES NOT MEET THE CRITERIA IN  PARA-
GRAPH  (B)  OF  THIS  SUBDIVISION, THE PRESCRIBER MAY PROVIDE ADDITIONAL
INFORMATION TO THE MANAGED  CARE  PROVIDER  TO  JUSTIFY  THE  USE  OF  A

S. 7894                             4

NON-PREFERRED  DRUG.  THE  SYSTEM SHALL PROVIDE A REASONABLE OPPORTUNITY
FOR A PRESCRIBER TO REASONABLY PRESENT HIS OR HER JUSTIFICATION OF PRIOR
AUTHORIZATION. IF, AFTER CONSULTATION WITH THE  MANAGED  CARE  PROVIDER,
THE  PRESCRIBER,  IN HIS OR HER REASONABLE PROFESSIONAL JUDGMENT, DETER-
MINES  THAT  THE  USE  OF  A  NON-PREFERRED  DRUG  IS   WARRANTED,   THE
PRESCRIBER'S DETERMINATION SHALL BE FINAL.
  (D)  IF A PRESCRIBER MEETS THE REQUIREMENTS OF PARAGRAPH (B) OR (C) OF
THIS SUBDIVISION, THE PRESCRIBER SHALL BE  GRANTED  PRIOR  AUTHORIZATION
UNDER THIS SECTION.
  (E)  IN  THE INSTANCE WHERE A PRIOR AUTHORIZATION DETERMINATION IS NOT
COMPLETED WITHIN TWENTY-FOUR HOURS OF THE ORIGINAL  REQUEST,  SOLELY  AS
THE  RESULT  OF A FAILURE OF THE SYSTEM (WHETHER BY ACTION OR INACTION),
PRIOR AUTHORIZATION SHALL BE IMMEDIATELY AND AUTOMATICALLY GRANTED  WITH
NO FURTHER ACTION BY THE PRESCRIBER AND THE PRESCRIBER SHALL BE NOTIFIED
OF  THIS  DETERMINATION.  IN  THE  INSTANCE  WHERE A PRIOR AUTHORIZATION
DETERMINATION IS NOT COMPLETED WITHIN TWENTY-FOUR HOURS OF THE  ORIGINAL
REQUEST  FOR  ANY OTHER REASON, A SEVENTY-TWO HOUR SUPPLY OF THE MEDICA-
TION SHALL BE APPROVED BY THE SYSTEM AND THE PRESCRIBER SHALL  BE  NOTI-
FIED OF THIS DETERMINATION.
  (F)  WHEN,  IN  THE  JUDGMENT  OF THE PRESCRIBER OR THE PHARMACIST, AN
EMERGENCY CONDITION EXISTS, AND THE PRESCRIBER  OR  PHARMACIST  NOTIFIES
THE  MANAGED  CARE PROVIDER THAT AN EMERGENCY CONDITION EXISTS, A SEVEN-
TY-TWO HOUR EMERGENCY SUPPLY OF THE DRUG PRESCRIBED SHALL BE IMMEDIATELY
AUTHORIZED BY THE MANAGED CARE PROVIDER.
  (G) IN THE EVENT THAT A PATIENT PRESENTS A PRESCRIPTION TO  A  PHARMA-
CIST  FOR A PRESCRIPTION DRUG THAT IS A NON-PREFERRED DRUG AND FOR WHICH
THE PRESCRIBER HAS NOT OBTAINED A PRIOR  AUTHORIZATION,  THE  PHARMACIST
SHALL, WITHIN A PROMPT PERIOD BASED ON PROFESSIONAL JUDGMENT, NOTIFY THE
PRESCRIBER.  THE  PRESCRIBER  SHALL,  WITHIN  A  PROMPT  PERIOD BASED ON
PROFESSIONAL JUDGMENT, EITHER SEEK PRIOR AUTHORIZATION OR SHALL  CONTACT
THE  PHARMACIST  AND  AMEND  OR  CANCEL THE PRESCRIPTION. THE PHARMACIST
SHALL, WITHIN A PROMPT PERIOD BASED ON PROFESSIONAL JUDGMENT, NOTIFY THE
PATIENT WHEN PRIOR AUTHORIZATION HAS BEEN OBTAINED OR DENIED OR WHEN THE
PRESCRIPTION HAS BEEN AMENDED OR CANCELLED.
  (H) ONCE PRIOR AUTHORIZATION OF A PRESCRIPTION FOR A DRUG THAT IS  NOT
ON THE PREFERRED DRUG LIST IS OBTAINED, PRIOR AUTHORIZATION SHALL NOT BE
REQUIRED FOR ANY REFILL OF THE PRESCRIPTION.
  (I)  NO PRIOR AUTHORIZATION UNDER A QUALIFIED PRESCRIPTION DRUG SYSTEM
SHALL BE REQUIRED FOR: (I) ATYPICAL ANTI-PSYCHOTICS;  (II)  ANTI-DEPRES-
SANTS; (III) ANTI-RETROVIRALS USED IN THE TREATMENT OF HIV/AIDS OR HEPA-
TITIS  C;  (IV)  ANTI-REJECTION DRUGS USED IN THE TREATMENT OF ORGAN AND
TISSUE TRANSPLANTS; AND (V) ANY OTHER THERAPEUTIC CLASS FOR  THE  TREAT-
MENT OF MENTAL ILLNESS, HIV/AIDS OR HEPATITIS C, APPROVED BY THE COMMIS-
SIONER.
  5. CLINICAL DRUG REVIEW PROGRAM. IN THE CASE OF A DRUG FOR WHICH PRIOR
AUTHORIZATION  IS REQUIRED UNDER THE CLINICAL DRUG REVIEW PROGRAM, PRIOR
AUTHORIZATION SHALL BE OBTAINED UNDER THE CLINICAL DRUG  REVIEW  PROGRAM
AND NOT UNDER THIS SECTION.
  6.  PRESCRIBER  CONDUCT.  THE MANAGED CARE PROVIDER AND THE DEPARTMENT
SHALL  MONITOR  THE  PRIOR  AUTHORIZATION  PROCESS  UNDER  A   QUALIFIED
PRESCRIPTION DRUG SYSTEM FOR PRESCRIBING PATTERNS WHICH ARE SUSPECTED OF
ENDANGERING  THE HEALTH AND SAFETY OF THE PATIENT OR WHICH DEMONSTRATE A
LIKELIHOOD OF FRAUD OR ABUSE. THE MANAGED CARE PROVIDER AND THE  DEPART-
MENT SHALL TAKE ANY AND ALL ACTIONS OTHERWISE PERMITTED BY LAW TO INVES-
TIGATE SUCH PRESCRIBING PATTERNS, TO TAKE REMEDIAL ACTION AND TO ENFORCE
APPLICABLE FEDERAL AND STATE LAWS.

S. 7894                             5

  7. USE OF PREFERRED DRUG PROGRAM. THE COMMISSIONER MAY CONTRACT WITH A
MANAGED CARE PROVIDER FOR THE PROVIDER TO USE THE PREFERRED DRUG PROGRAM
TO  PROVIDE PRIOR AUTHORIZATION UNDER THE MANAGED CARE PROVIDER'S QUALI-
FIED PRESCRIPTION DRUG SYSTEM. THE CONTRACT SHALL INCLUDE TERMS REQUIRED
BY  THE  COMMISSIONER  TO  MAXIMIZE  SAVINGS TO THE MEDICAID PROGRAM AND
PROTECT THE HEALTH AND INTERESTS OF THE MANAGED CARE PROVIDER'S  PARTIC-
IPANTS.  THE  CONTRACT  SHALL PROVIDE WHETHER THE PREFERRED DRUG PROGRAM
SHALL USE THE MANAGED CARE PROVIDER'S LISTS OF  PREFERRED  AND  NON-PRE-
FERRED  DRUGS  OR  THE  PREFERRED  DRUG  LIST  UNDER  THE PREFERRED DRUG
PROGRAM, WITH RESPECT TO WHETHER PRIOR AUTHORIZATION IS REQUIRED.
  S 2. Subdivisions 25 and  25-a of section 364-j of the social services
law are REPEALED.
  S 3. Subdivision 2-b of section 369-ee of the social services  law  is
REPEALED and a new subdivision 2-b is added to read as follows:
  2-B.  PAYMENT  FOR  PRESCRIPTION DRUGS. PAYMENT FOR PRESCRIPTION DRUGS
SHALL BE INCLUDED IN THE CAPITATED PAYMENTS  FOR  SERVICES  OR  SUPPLIES
PROVIDED UNDER A FAMILY HEALTH INSURANCE PLAN OR PROVIDED BY AN EMPLOYER
PARTNERSHIP  FOR  FAMILY  HEALTH  PLUS  PLAN AUTHORIZED BY SECTION THREE
HUNDRED SIXTY-NINE-EE OF THIS TITLE, PROVIDED THAT  THE  PLAN  PAYS  FOR
PRESCRIPTION  DRUGS  UNDER  A  QUALIFIED  PRESCRIPTION DRUG SYSTEM UNDER
SECTION THREE HUNDRED SIXTY-FIVE-I OF THIS ARTICLE.  EVERY  PRESCRIPTION
DRUG  ELIGIBLE  FOR  REIMBURSEMENT  UNDER  THIS  ARTICLE  PRESCRIBED  IN
RELATION TO A SERVICE PROVIDED BY THE PLAN SHALL BE EITHER  A  PREFERRED
OR  NON-PREFERRED  DRUG UNDER THE QUALIFIED PRESCRIPTION DRUG SYSTEM. IF
THE  PLAN  DOES  NOT  PAY  FOR  PRESCRIPTION  DRUGS  UNDER  A  QUALIFIED
PRESCRIPTION  DRUG  SYSTEM,  THEN PAYMENT FOR PRESCRIPTION DRUGS FOR THE
PLAN'S PATIENTS SHALL NOT BE INCLUDED IN SUCH  CAPITATION  PAYMENTS  AND
PRESCRIPTION  DRUGS  SHALL  BE  PROVIDED FOR THE APPROVED ORGANIZATION'S
PARTICIPANTS UNDER THE PREFERRED DRUG PROGRAM.
  S 4. Section 2511 of the public health law is amended by adding a  new
subdivision 22 to read as follows:
  22.  PAYMENT  FOR  PRESCRIPTION  DRUGS. PAYMENT FOR PRESCRIPTION DRUGS
SHALL BE INCLUDED IN THE PAYMENTS FOR SERVICES OR SUPPLIES  PROVIDED  BY
THE  APPROVED ORGANIZATION, PROVIDED THAT THE PLAN PAYS FOR PRESCRIPTION
DRUGS UNDER A QUALIFIED PRESCRIPTION DRUG  SYSTEM  UNDER  SECTION  THREE
HUNDRED SIXTY-FIVE-I OF THE SOCIAL SERVICES LAW. EVERY PRESCRIPTION DRUG
ELIGIBLE  FOR REIMBURSEMENT UNDER THIS ARTICLE PRESCRIBED IN RELATION TO
A SERVICE PROVIDED BY  THE  APPROVED  ORGANIZATION  SHALL  BE  EITHER  A
PREFERRED  OR  NON-PREFERRED  DRUG UNDER THE QUALIFIED PRESCRIPTION DRUG
SYSTEM. IF THE APPROVED ORGANIZATION DOES NOT PAY FOR PRESCRIPTION DRUGS
UNDER  A  QUALIFIED  PRESCRIPTION  DRUG   SYSTEM,   THEN   PAYMENT   FOR
PRESCRIPTION DRUGS FOR THE APPROVED ORGANIZATION'S PATIENTS SHALL NOT BE
INCLUDED  IN  SUCH PAYMENTS AND PRESCRIPTION DRUGS SHALL BE PROVIDED FOR
THE  APPROVED  ORGANIZATION'S  PARTICIPANTS  UNDER  THE  PREFERRED  DRUG
PROGRAM.
  S  5.  Subdivision  11  of  section  270  of the public health law, as
amended by section 2-a of part C of chapter 58 of the laws of  2008,  is
amended to read as follows:
  11.  "State  public  health plan" means the medical assistance program
established by title eleven of article five of the social  services  law
(referred  to in this article as "Medicaid"), the elderly pharmaceutical
insurance coverage program established by title three of article two  of
the  elder law (referred to in this article as "EPIC"), [and] the family
health plus program established by section three  hundred  sixty-nine-ee
of the social services law [to the extent that section provides that the

S. 7894                             6

program  shall  be subject to this article], AND THE CHILD HEALTH INSUR-
ANCE PROGRAM UNDER TITLE ONE-A OF ARTICLE TWENTY-FIVE OF THIS CHAPTER.
  S  6.  Section 272 of the public health law is amended by adding a new
subdivision 12 to read as follows:
  12. NO PRIOR AUTHORIZATION SHALL BE REQUIRED UNDER THE PREFERRED  DRUG
PROGRAM FOR:
  (A)  ATYPICAL ANTI-PSYCHOTICS; (B) ANTI-DEPRESSANTS; (C) ANTI-RETROVI-
RALS USED IN THE TREATMENT OF HIV/AIDS OR HEPATITIS C;  (D)  ANTI-REJEC-
TION  DRUGS  USED  IN THE TREATMENT OF ORGAN AND TISSUE TRANSPLANTS; AND
(E) ANY OTHER THERAPEUTIC CLASS FOR THE  TREATMENT  OF  MENTAL  ILLNESS,
HIV/AIDS  OR  HEPATITIS  C, RECOMMENDED BY THE BOARD AND APPROVED BY THE
COMMISSIONER UNDER THIS SECTION.
  S 7. This act shall take effect on the one hundred eightieth day after
it shall become a law; provided, however, that section two of  this  act
shall  take  effect  one  year  after  this  act shall become a law; and
provided further, that the amendments to section 369-ee  of  the  social
services  law  made  by  section  three of this act shall not affect the
repeal of such section and shall  be  deemed  to  expire  therewith  and
provided further, that the commissioner of health is immediately author-
ized  and  directed to take actions necessary to implement this act when
it takes effect.

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