Senate Study Bill 1072 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON HUMAN RESOURCES BILL BY CHAIRPERSON SEGEBART) A BILL FOR An Act relating to the use of step therapy protocols for 1 prescription drugs by health carriers, health benefit 2 plans, and utilization review organizations, and including 3 applicability provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 2354XC (1) 87 av/nh
S.F. _____ Section 1. LEGISLATIVE FINDINGS. The general assembly 1 finds and declares the following: 2 1. Health carriers, health benefit plans, and utilization 3 review organizations are increasingly making use of step 4 therapy protocols under which covered persons are required to 5 try one or more prescription drugs before coverage is provided 6 for another prescription drug selected by the covered person’s 7 health care professional. 8 2. Such step therapy protocols, where they are based on 9 well-developed scientific standards and administered in a 10 flexible manner that takes into account the individual needs 11 of covered persons, can play an important part in controlling 12 health care costs. 13 3. In some cases, requiring a covered person to follow 14 a step therapy protocol may have adverse and even dangerous 15 consequences for the covered person, who may either not realize 16 a benefit from taking a particular prescription drug or may 17 suffer harm from taking an inappropriate prescription drug. 18 4. Without uniform policies in the state for step therapy 19 protocols, all covered persons may not receive equivalent or 20 the most appropriate treatment. 21 5. It is imperative that step therapy protocols in the state 22 preserve the health care professional’s right to make treatment 23 decisions that are in the best interest of the covered person. 24 6. It is a matter of public interest that the general 25 assembly require health carriers, health benefit plans, and 26 utilization review organizations to base step therapy protocols 27 on appropriate clinical practice guidelines or published peer 28 review data developed by independent experts with knowledge 29 of the condition or conditions under consideration; that 30 covered persons be excepted from step therapy protocols when 31 inappropriate or otherwise not in the best interest of the 32 covered persons; and that covered persons have access to a 33 fair, transparent, and independent process for allowing a 34 covered person or a health care professional to request an 35 -1- LSB 2354XC (1) 87 av/nh 1/ 11
S.F. _____ exception to a step therapy protocol when the covered person’s 1 health care professional deems appropriate. 2 Sec. 2. NEW SECTION . 514F.7 Use of step therapy protocols. 3 1. Definitions. For the purposes of this section: 4 a. “Authorized representative” means the same as defined in 5 section 514J.102. 6 b. “Clinical practice guidelines” means a systematically 7 developed statement to assist health care professionals and 8 covered persons in making decisions about appropriate health 9 care for specific clinical circumstances and conditions. 10 c. “Clinical review criteria” means the same as defined in 11 section 514J.102. 12 d. “Covered person” means the same as defined in section 13 514J.102. 14 e. “Health benefit plan” means the same as defined in 15 section 514J.102. 16 f. “Health care professional” means the same as defined in 17 section 514J.102. 18 g. “Health care services” means the same as defined in 19 section 514J.102. 20 h. “Health carrier” means the same as defined in section 21 514J.102. 22 i. “Medical necessity” means health care services and 23 supplies that under the applicable standard of care are 24 appropriate for any of the following: 25 (1) To improve or preserve health, life, or function. 26 (2) To slow the deterioration of health, life, or function. 27 (3) For the early screening, prevention, evaluation, 28 diagnosis, or treatment of a disease, condition, illness, or 29 injury. 30 j. “Step therapy override exception” means a step therapy 31 protocol should be overridden in favor of immediate coverage of 32 the prescription drug selected by a health care professional. 33 This determination is based on a review of the covered person’s 34 or health care professional’s request for an override, along 35 -2- LSB 2354XC (1) 87 av/nh 2/ 11
S.F. _____ with supporting rationale and documentation. 1 k. “Step therapy protocol” means a protocol or program that 2 establishes a specific sequence in which prescription drugs for 3 a specified medical condition and medically appropriate for 4 a particular covered person are covered under a pharmacy or 5 medical benefit by a health carrier, a health benefit plan, or 6 a utilization review organization, including self-administered 7 drugs and drugs administered by a health care professional. 8 l. “Utilization review” means a program or process by which 9 an evaluation is made of the necessity, appropriateness, and 10 efficiency of the use of health care services, procedures, or 11 facilities given or proposed to be given to an individual. 12 Such evaluation does not apply to requests by an individual or 13 provider for a clarification, guarantee, or statement of an 14 individual’s health insurance coverage or benefits provided 15 under a health benefit plan, nor to claims adjudication. 16 Unless it is specifically stated, verification of benefits, 17 preauthorization, or a prospective or concurrent utilization 18 review program or process shall not be construed as a guarantee 19 or statement of insurance coverage or benefits for any 20 individual under a health benefit plan. 21 m. “Utilization review organization” means an entity that 22 performs utilization review, other than a health carrier 23 performing utilization review for its own health benefit plans. 24 2. Establishment of step therapy protocols. 25 a. A health carrier, health benefit plan, or utilization 26 review organization shall do all of the following when 27 establishing a step therapy protocol: 28 (1) Use clinical review criteria based on clinical practice 29 guidelines that meet all of the following requirements: 30 (a) Recommend that particular prescription drugs be taken 31 in the specific sequence required by the step therapy protocol. 32 (b) Are developed and endorsed by a multidisciplinary panel 33 of experts that manages conflicts of interest among members 34 of the panel’s writing and review groups by doing all of the 35 -3- LSB 2354XC (1) 87 av/nh 3/ 11
S.F. _____ following: 1 (i) Requiring members to disclose any potential conflicts 2 of interest with entities, including health carriers, 3 health benefit plans, utilization review organizations, and 4 pharmaceutical manufacturers, and requiring members to recuse 5 themselves from voting if there is a conflict of interest. 6 (ii) Using a methodologist to work with the panel’s writing 7 groups to provide objectivity in data analysis and ranking of 8 evidence through the preparation of evidence tables and by 9 facilitating consensus. 10 (iii) Offering opportunities for public review and 11 comments. 12 (c) Are based on high-quality studies, research, and 13 medical practice. 14 (d) Are created through an explicit and transparent process 15 that does all of the following: 16 (i) Minimizes biases and conflicts of interest. 17 (ii) Explains the relationship between treatment options 18 and outcomes. 19 (iii) Rates the quality of the evidence supporting the 20 recommendations. 21 (iv) Considers relevant patient subgroups and preferences. 22 (e) Are continually updated through a review of new 23 evidence, research, and newly developed treatments. 24 (2) Take into account the needs of atypical covered person 25 populations and diagnoses when establishing clinical review 26 criteria. 27 (3) Notwithstanding subparagraph (1), peer-reviewed 28 publications may be substituted for the use of clinical 29 practice guidelines in establishing a step therapy protocol. 30 b. This subsection shall not be construed to require 31 health carriers, health benefit plans, utilization review 32 organizations, or the state to establish a new entity to 33 develop clinical review criteria for step therapy protocols. 34 c. A health carrier, health benefit plan, or utilization 35 -4- LSB 2354XC (1) 87 av/nh 4/ 11
S.F. _____ review organization shall, upon written request of an insured 1 or prospective insured, provide specific written clinical 2 review criteria relating to a particular condition or disease, 3 including clinical review criteria relating to a request for a 4 step therapy override exception and, where appropriate, other 5 clinical information which the health carrier, health benefit 6 plan, or utilization review organization might consider in its 7 utilization review or in making a determination to approve 8 or deny a request for a step therapy override exception, 9 including a description of how the information will be used in 10 the utilization review process or in making a determination 11 to approve or deny a request for a step therapy override 12 exception. However, to the extent that such information is 13 proprietary to the health carrier, health benefit plan, or 14 utilization review organization, the insured or prospective 15 insured shall only use the information for the purposes of 16 assisting the insured or prospective insured in evaluating the 17 covered services provided by the health carrier, health benefit 18 plan, or utilization review organization. Such clinical review 19 criteria and other clinical information shall also be made 20 available to a health care professional, upon written request 21 made by the health care professional on behalf of an insured 22 or prospective insured. 23 3. Exceptions process transparency. 24 a. When coverage of a prescription drug for the 25 treatment of any medical condition is restricted for use 26 by a health carrier, health benefit plan, or utilization 27 review organization through the use of a step therapy 28 protocol, the covered person and the prescribing health 29 care professional shall have access to a clear, readily 30 accessible, and convenient process to request a step therapy 31 override exception. A health carrier, health benefit plan, or 32 utilization review organization may use its existing medical 33 exceptions process to satisfy this requirement. The process 34 used shall be easily accessible on the internet site of the 35 -5- LSB 2354XC (1) 87 av/nh 5/ 11
S.F. _____ health carrier, health benefit plan, or utilization review 1 organization. 2 b. A step therapy override exception shall be approved 3 expeditiously by a health carrier, health benefit plan, 4 or utilization review organization if any of the following 5 circumstances apply: 6 (1) The prescription drug required under the step therapy 7 protocol is contraindicated or is likely to cause an adverse 8 reaction or physical or mental harm to the covered person. 9 (2) The prescription drug required under the step therapy 10 protocol is expected to be ineffective based on the known 11 clinical characteristics of the covered person and the known 12 characteristics of the prescription drug regimen. 13 (3) The covered person has tried the prescription drug 14 required under the step therapy protocol while under the 15 covered person’s current or a previous health benefit plan, 16 or another prescription drug in the same pharmacologic class 17 or with the same mechanism of action, and such prescription 18 drug was discontinued due to lack of efficacy or effectiveness, 19 diminished effect, or an adverse event. 20 (4) The prescription drug required under the step therapy 21 protocol is not in the best interest of the covered person, 22 based on medical necessity. 23 (5) The covered person is stable on a prescription drug 24 selected by the covered person’s health care professional for 25 the medical condition under consideration while on the current 26 or a previous health benefit plan. 27 c. Upon approval of a step therapy override exception, the 28 health carrier, health benefit plan, or utilization review 29 organization shall expeditiously authorize coverage for the 30 prescription drug selected by the covered person’s prescribing 31 health care professional. 32 d. A health carrier, health benefit plan, or utilization 33 review organization shall make a determination to approve or 34 deny a request for a step therapy override exception within 35 -6- LSB 2354XC (1) 87 av/nh 6/ 11
S.F. _____ seventy-two hours of receipt of the request for an exception or 1 appeal of a denial of such a request. In cases where exigent 2 circumstances exist, a health carrier, health benefit plan, or 3 utilization review organization shall make a determination to 4 approve or deny the request for an exception or appeal of a 5 denial of such a request within twenty-four hours of receipt 6 of the request for an exception or appeal of a denial of such a 7 request. If a determination to approve or deny the request for 8 an exception or appeal of a denial of such a request is not made 9 within the applicable time period, the request for an exception 10 or appeal of a denial of such a request shall be deemed to be 11 approved. 12 e. If a determination is made to deny a request for 13 a step therapy override exception, the health carrier, 14 health benefit plan, or utilization review organization 15 shall provide the covered person or the covered person’s 16 authorized representative and the covered person’s prescribing 17 health care professional with the reason for the denial and 18 information regarding the procedure to appeal the denial. Any 19 determination to deny a request for a step therapy override 20 exception may be appealed by a covered person or the covered 21 person’s authorized representative. 22 f. A health carrier, health benefit plan, or utilization 23 review organization shall uphold or reverse a denial of 24 a request for a step therapy override exception within 25 seventy-two hours of receipt of an appeal of the denial. 26 In cases where exigent circumstances exist as provided in 27 paragraph “d” , a health carrier, health benefit plan, or 28 utilization review organization shall make a determination to 29 uphold or reverse a denial of such a request within twenty-four 30 hours of receipt of an appeal of the denial. If the denial of 31 a request for a step therapy override exception is not upheld 32 or reversed on appeal within the applicable time period, the 33 denial shall be deemed to be reversed and the request for an 34 override exception shall be deemed to be approved. 35 -7- LSB 2354XC (1) 87 av/nh 7/ 11
S.F. _____ g. If a denial of a request for a step therapy override 1 exception is upheld on appeal, the health carrier, health 2 benefit plan, or utilization review organization shall 3 provide the covered person or the covered person’s authorized 4 representative and the patient’s prescribing health care 5 professional with the reason for upholding the denial on appeal 6 and information regarding the procedure to request external 7 review of the denial pursuant to chapter 514J. Any denial of a 8 request for a step therapy override exception that is upheld 9 on appeal shall be considered a final adverse determination 10 for purposes of chapter 514J and is eligible for a request for 11 external review by a covered person or the covered person’s 12 authorized representative pursuant to chapter 514J. 13 4. Limitations. This section shall not be construed to do 14 either of the following: 15 a. Prevent a health carrier, health benefit plan, or 16 utilization review organization from requiring a covered person 17 to try an AB-rated generic equivalent prescription drug prior 18 to providing coverage for the equivalent branded prescription 19 drug. 20 b. Prevent a health care professional from prescribing 21 a prescription drug that is determined to be medically 22 appropriate. 23 Sec. 3. APPLICABILITY. This Act is applicable to a health 24 benefit plan that is delivered, issued for delivery, continued, 25 or renewed in this state on or after January 1, 2018. 26 EXPLANATION 27 The inclusion of this explanation does not constitute agreement with 28 the explanation’s substance by the members of the general assembly. 29 This bill relates to the use of step therapy protocols 30 for prescription drugs by health carriers, health benefit 31 plans, and utilization review organizations, and includes 32 applicability provisions. 33 The bill includes legislative findings that step therapy 34 protocols are increasingly being used by health carriers, 35 -8- LSB 2354XC (1) 87 av/nh 8/ 11
S.F. _____ health benefit plans, and utilization review organizations to 1 control health care costs, that step therapy protocols that 2 are based on well-developed scientific standards and flexibly 3 administered can play an important role in controlling health 4 care costs, but that in some cases use of such protocols can 5 have adverse or dangerous consequences for the person for whom 6 the drugs are prescribed. The bill includes findings that 7 uniform policies for the use of such protocols that preserve a 8 health care professional’s right to make treatment decisions 9 and that provide for exceptions to the use of such protocols 10 are in the public interest. 11 The bill defines a “step therapy protocol” as a protocol 12 or program that establishes a specific sequence in which 13 prescription drugs for a specified medical condition and 14 medically appropriate for a particular covered person are 15 covered under a pharmacy or medical benefit by a health 16 carrier, a health benefit plan, or a utilization review 17 organization including self-administered drugs and drugs 18 administered by a health care professional. 19 The bill requires that a step therapy protocol be 20 established using clinical review criteria that are based 21 on specified clinical practice guidelines. A step therapy 22 protocol should take into account the needs of atypical 23 populations and diagnoses. The bill does not require a health 24 carrier, health benefit plan, utilization review organization, 25 or the state to establish a new entity to develop clinical 26 review criteria for such protocols. 27 Upon written request of an insured or prospective insured, 28 or upon written request of a health care professional on behalf 29 of such a person, a health carrier, health benefit plan, 30 or utilization review organization shall provide specific 31 written clinical review criteria relating to a particular 32 condition or disease, including criteria relating to a request 33 for a step therapy override exception which might be used in 34 utilization review or in making a determination to approve or 35 -9- LSB 2354XC (1) 87 av/nh 9/ 11
S.F. _____ deny a request for a step therapy override exception. If the 1 information provided is proprietary the insured or prospective 2 insured shall use it only for purposes of evaluating covered 3 services. 4 The bill also provides that when a step therapy protocol 5 is in use, the person participating in a health benefit plan 6 or the person’s prescribing health care professional must 7 have access to a clear, readily accessible, and convenient 8 process to request a step therapy override exception. A “step 9 therapy override exception” means a step therapy protocol 10 should be overridden in favor of immediate coverage of the 11 prescription drug selected by the prescribing health care 12 professional, based on a review of the request along with 13 supporting rationale and documentation. The bill provides that 14 the request for an exception shall be granted if specified 15 circumstances are determined to exist and coverage for the drug 16 selected by the prescribing health care professional shall be 17 authorized. 18 A request for a step therapy override exception must be 19 approved or denied by the health carrier, health benefit plan, 20 or utilization review organization utilizing the step therapy 21 protocol within 72 hours of receipt of the request or appeal of 22 a denial of such a request, or within 24 hours of receipt of the 23 request or appeal of a denial of such a request where exigent 24 circumstances exist. The health carrier, health benefit 25 plan, or utilization review organization can use its existing 26 medical exceptions procedure to satisfy this requirement. If 27 a determination to approve or deny the request or appeal of a 28 denial of such a request is not made within the applicable time 29 period, the request is deemed to be approved. 30 If a determination is made to deny the request for a step 31 therapy override exception, the health carrier, health benefit 32 plan, or utilization review organization shall provide the 33 person making the request with the reason for the denial and 34 information about the procedure to appeal the denial. Any 35 -10- LSB 2354XC (1) 87 av/nh 10/ 11
S.F. _____ denial of such a request is eligible for appeal. 1 Upon appeal, the health carrier, health benefit plan, or 2 utilization review organization shall make a determination to 3 uphold or reverse the denial within 72 hours, or within 24 4 hours in the case of exigent circumstances, of receiving the 5 appeal. If the denial is not upheld or reversed on appeal 6 within the applicable time period, the denial is deemed to 7 be reversed and the request for an exception is deemed to be 8 approved. 9 If a denial of a request for a step therapy override 10 exception is upheld on appeal, the person making the appeal 11 shall be provided with the reason for upholding the denial 12 on appeal and information regarding the procedure to request 13 external review of the denial pursuant to Code chapter 514J. 14 A denial of a request for such an exception that is upheld on 15 appeal shall be considered a final adverse determination for 16 purposes of Code chapter 514J and is eligible for a request for 17 external review pursuant to Code chapter 514J. 18 The bill shall not be construed to prevent a health carrier, 19 health benefit plan, or utilization review organization from 20 requiring a person to try an AB-rated generic equivalent 21 prescription drug prior to providing coverage for the 22 equivalent branded prescription drug, or to prevent a health 23 care professional from prescribing a prescription drug that is 24 determined to be medically appropriate. 25 The bill is applicable to a health benefit plan that is 26 delivered, issued for delivery, continued, or renewed in this 27 state on or after January 1, 2018. 28 -11- LSB 2354XC (1) 87 av/nh 11/ 11