Regulates step therapy and first fail health insurance policies and contracts.
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 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 on the 120th day after it shall become law.
STATE OF NEW YORK ________________________________________________________________________ 2711 2013-2014 Regular Sessions IN SENATE January 23, 2013 ___________Introduced by Sen. YOUNG -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance 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, INCLUDING MANAGED CARE PROVIDERS AS DEFINED IN SECTION THREE HUNDRED SIXTY-FOUR-J OF THE SOCIAL SERVICES 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; (3) CLINICAL OR OTHER FORMULARY, OR PREFERRED DRUG LIST DEVELOPMENT OR MANAGEMENT;EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD05355-01-3 S. 2711 2
(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 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) FOR MEDICATIONS WITH NO GENERIC EQUIVALENT AND FOR WHICH THE PRES- CRIBER IN HIS OR HER CLINICAL JUDGMENT BELIEVES THAT NO APPROPRIATE THERAPEUTIC ALTERNATIVE IS AVAILABLE, AN INSURER OR PBM SHALL PROVIDE ACCESS TO UNITED STATES FOOD AND DRUG ADMINISTRATION (FDA) LABELED MEDI- CATIONS WITHOUT RESTRICTION TO TREAT SUCH MEDICAL CONDITIONS FOR WHICH AN FDA LABELED MEDICATION IS AVAILABLE. (D) 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.