Regulates step therapy and first fail health insurance policies and contracts

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.