Relates to expedited utilization review of prescription drugs

Section 3 amends Section 4900 of the Insurance Law to define key terms such as "Step therapy protocol override determination" and "Step therapy protocol." Step therapy protocol means a policy, protocol or program that establishes the specific sequence in which prescription drugs for a specified medical condition are approved for a particular patient. Step therapy protocol override determination means a determination made by a utilization review agent to override a step therapy protocol.

Section 4 amends Section 4902 (a) of the Insurance Law by adding a two new subdivisions (10) and (11). Subdivision 10 requires a utilization review agent to utilize evidenced-based and peer reviewed clinical review criteria that is appropriate for a patient's medical condition when establishing a step therapy protocol. Subdivision 11 requires a utilization review agent to utilize evidence-based and peer reviewed clinical review criteria that is appropriate to a particular patient and such patient's medical condition when making a determination about whether to override a step therapy protocol.

Section 5 adds three new subsections (c-a), (c-b) and (c-c) to the Insurance Law to provide an expedited process for patients and health care providers to override a step therapy protocol. A determination must be made within 24 hours of the receipt of all information from the patient and/or health care provider in emergency cases. This section establishes standards for an override determination. Upon a determination that the step therapy protocol should be overridden, the health plan must authorize immediate coverage for the prescription drug prescribed by the patient's treating health care provider.

Section 6 amends Section 4902 (a) of the Insurance Law to provide that if an insurance company or utilization review agent fails to respond within the required timeframes, the appeal shall be deemed granted in favor of the patient.

Sections 7, 8, 9, 10 and 11 make identical amendments as those described above to the Public Health Law to regulate step therapy or fail first protocols imposed by HMOs.

An amendment is made to the Unconsolidated Laws to provide that the bill shall not be construed to prevent: a health care plan, utilization review agent, or pharmacy benefit manager from requiring a patient to try an AB-rated generic equivalent prior to providing coverage for the equivalent branded prescription drug; or a health care provider from prescribing a prescription drug that is determined to be medically appropriate.

Section 11 provides for an effective date of January 1, 2017 applicable to health insurance and health benefit plans delivered, issued for delivery, or renewed after such date.

Justification

The Legislature makes the following findings:

(1) Health insurance plans are increasingly making use of step therapy or "fail first" protocols under which patients are required to try one or more prescription drugs before coverage is provided for a drug selected by the patient's health care provider.

(2) Step therapy protocols, where they are based on well-developed scientific standards and administered in a flexible manner that takes into account the individual needs of patients, can play an important role in controlling health care costs.

(3) In some cases, requiring a patient to follow a step therapy protocol may have adverse and even dangerous consequences for the patient who may either not realize a benefit from taking a prescription drug or may suffer harm from taking an inappropriate drug.

(4) Without uniform policies in the State for step therapy protocols, all patients may not receive the equivalent or most appropriate treatment.

(5) It is imperative that step therapy protocols in the State preserve the health care provider's right to make treatment decisions in the best interests of the patient.

(6) Therefore, it is a matter of public interest to require health insurance companies and utilization review organizations to base step therapy protocols on appropriate clinical practice guidelines or published peer review data developed by independent experts with knowledge of the condition or conditions under consideration; that patients be exempt from step therapy protocols when inappropriate or otherwise not in the best interest of the patients; and that patients have access to a fair, transparent and independent process for requesting an excep- tion to a step therapy protocol when the patients' physician deems appropriate.

The following states have enacted strong laws to prohibit or limit step therapy or fail first practices: Connecticut, Kentucky, Louisiana, Maryland, Mississippi, Indiana and Washington. Patients in New York currently subject to step therapy or fail first practices require similar protections.

Prior legislative history

2015: S.3419-A Referred to Insurance 2013/2014: S. 2711A Referred to Insurance 2012: S.6464/A.9397 Referred to Insurance

Fiscal implications

Undetermined at this time.

Effective date

The act would take effect on January 1, 2017 and apply to health insurance and health benefit plans delivered, issued for delivery, or renewed after such date.