S02086 Summary:

BILL NOS02086
 
SAME ASSAME AS A04285
 
SPONSORYOUNG
 
COSPNSRADDABBO
 
MLTSPNSR
 
Add Art 33 SS3301 - 3305, Ins L
 
Prohibits first fail accident and/or health insurance policies; enacts penalties and defines terms.
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S02086 Actions:

BILL NOS02086
 
01/10/2013REFERRED TO INSURANCE
01/08/2014REFERRED TO INSURANCE
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S02086 Floor Votes:

There are no votes for this bill in this legislative session.
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S02086 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          2086
 
                               2013-2014 Regular Sessions
 
                    IN SENATE
 
                                    January 10, 2013
                                       ___________
 
        Introduced  by  Sens.  YOUNG, ADDABBO -- 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  prohibition  on
          first fail policies
 
          The  People of the State of New York, represented in Senate and Assem-

        bly, do enact as follows:
 
     1    Section 1. The insurance law is amended by adding a new article 33  to
     2  read as follows:
     3                                  ARTICLE 33
     4                   PROHIBITION ON FIRST FAIL POLICIES AND
     5                    UNAUTHORIZED THERAPEUTIC SUBSTITUTION
     6  Section 3301. Definitions.
     7          3302. Prescription drug denials.
     8          3303. Switch communications/consumer right to know.
     9          3304. Penalties.
    10          3305. Prescription drug restriction overrides.
    11    § 3301. Definitions. As used in this article:
    12    (a)  "Insurer"  shall mean any person or entity who offers a policy of
    13  accident and/or health insurance pursuant to section three thousand  two

    14  hundred sixteen, three thousand two hundred twenty-one, or four thousand
    15  three  hundred three of this chapter or article forty-four of the public
    16  health law; except when such health care services are  provided,  deliv-
    17  ered,  arranged for, paid for, or reimbursed by any state, department or
    18  agency;
    19    (b) "Pharmacy benefits manager" or "PBM", means  a  person  or  entity
    20  other  than  a  pharmacy  or  pharmacist  acting  as an administrator in
    21  connection with pharmacy benefits;
    22    (c) "Switch communication", means a  written  communication  from  any
    23  insurer or PBM to a patient or the patient's physician that recommends a
    24  patient's medication be switched by the original prescribing health care
 

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD04369-01-3

        S. 2086                             2
 
     1  professional  to  a  different medication than the medication originally
     2  prescribed by the prescribing health care professional.
     3    (d)  "Generic  equivalent"  means  a  drug  that  is the same chemical
     4  compound as another drug and is the same dosage form, strength, route of
     5  administration, and intended use, and is listed as equivalent  in  FDA's
     6  approved  drug products with therapeutic equivalence evaluations (orange
     7  book).

     8    (e) "Therapeutic substitution" means the dispensing  of  a  chemically
     9  different  drug  in  the  place of the drug originally prescribed by the
    10  patient's physician  or  other  prescribing  health  care  professional,
    11  including  biologics  and  plasma-derived therapies. Therapeutic substi-
    12  tution does not include substitution of a generic equivalent.
    13    § 3302. Prescription drug denials. (a) A  policy  of  accident  and/or
    14  health insurance that covers prescription drugs shall not limit, reduce,
    15  or deny coverage for any drug if, prior to the limitation, reduction, or
    16  denial of coverage:
    17    (1) Any insured was using the drug;
    18    (2) Such insured or insureds were covered under the policy; and

    19    (3)  The drug was covered under the policy for such insured individual
    20  or individuals.
    21    (b) A limitation, reduction, or denial of coverage includes removing a
    22  drug from the formulary or other drug list, imposing new prior  authori-
    23  zation  or  other utilization management tools, or placing the drug on a
    24  formulary tier that increases the patient's cost-sharing obligations  or
    25  otherwise increases the patient's cost-sharing obligations.
    26    (c)  Nothing  in  this  section  shall prohibit an insurer from making
    27  uniform changes in its benefit design that apply to all  covered  drugs,
    28  uniformly  removing  a drug from the formulary list for all insureds, or
    29  increasing cost-sharing obligations merely due to a  percentage  coinsu-

    30  rance  payment that necessarily increases with an increase in the under-
    31  lying drug prices.
    32    (d) No therapeutic substitution of a medication by  anyone  authorized
    33  to  dispense  medications  for self or home administration by a consumer
    34  shall be allowed without  the  express  authorization  of  the  original
    35  prescribing  physician  or  health  care  professional and notice to the
    36  patient and the policy sponsor as provided for in section three thousand
    37  three hundred three of this  article.  Prior  to  making  a  therapeutic
    38  substitution  in  a  patient's prescription including but not limited to
    39  changes in product selection and changes in dosage, the dispensing phar-
    40  macist shall:

    41    (1) Verbally  request  the  patient  to  agree  to  a  change  to  the
    42  prescription, and explain that the change cannot be made unless both the
    43  patient  and the prescribing physician (or other prescribing health care
    44  professional) expressly agree to the change;
    45    (2) Verbally describe the proposed change that would be  made  to  the
    46  prescription,  including  clearly  identifying the originally prescribed
    47  medication  and  the  medication  that  would  be  substituted  for  the
    48  originally prescribed medication; and
    49    (3)  Verbally  inform  the  patient  of  the  impact,  if  any, on the
    50  patient's out-of-pocket cost.
    51    § 3303. Switch communications/consumer right to know.  (a) Any time  a

    52  patient's prescribed medication is recommended to be switched to a medi-
    53  cation  other than that originally prescribed by the prescribing practi-
    54  tioner, a switch communication shall be sent to:

        S. 2086                             3
 
     1    (1) The patient and shall provide information about why the switch  is
     2  proposed and the patient's rights for refusing the recommended change in
     3  treatment; and
     4    (2) The policy sponsor and shall inform such sponsor of the pharmaceu-
     5  tical  wholesale acquisition cost, shown in currency form, of the recom-
     6  mended medication and the wholesale acquisition cost, shown in  currency
     7  form, of the originally prescribed medication.
     8    (b) Such switch communication shall:

     9    (1)  Clearly  identify  the  originally  prescribed medication and the
    10  medication to which it has been proposed  that  the  patient  should  be
    11  switched;
    12    (2)  Provide information which is truthful, accurate, and not mislead-
    13  ing, with appropriate fair balance, consistent with  the  United  States
    14  Food and Drug Administration for medications;
    15    (3)  Include  current  approved product labeling and information about
    16  risks associated with the recommended medication;
    17    (4) Clearly acknowledge that  no  therapeutic  substitution  shall  be
    18  allowed  without  the  express authorization of the original prescribing
    19  physician or other original prescribing health care professional;

    20    (5) Advise the patient of his or her rights to  discuss  the  proposed
    21  change  in  treatment  before  such  a  switch  takes place, including a
    22  discussion with the patient's prescribing practitioner, the filing of  a
    23  grievance  with  the  insurer  to prevent the switch if such a switch is
    24  based on a financial incentive and the filing of a  grievance  with  the
    25  department; and
    26    (6)  Explain any cost-sharing changes for which the patient is respon-
    27  sible.
    28    (c) A copy of any switch communication sent to a patient shall also be
    29  sent to the prescribing practitioner.
    30    (d) Health  insurance  payers,  including  employers  responsible  for
    31  paying the health care premium or portions thereof, shall be notified of

    32  therapeutic substitutions among policy participants and of any therapeu-
    33  tic  substitution  programs adopted by health plans and pharmacy benefit
    34  managers in any plan offered by such premium payer or employer.
    35    (e) The department shall create one form  for  insurers  and  pharmacy
    36  benefit  managers to use in switch communications to patients, prescrib-
    37  ing practitioners, and health insurance payers including employers.
    38    (f) The department shall promulgate rules  governing  switch  communi-
    39  cations. Such rules shall include, but not be limited to the following:
    40    (1) Procedures for verifying the accuracy of any switch communications
    41  from  policies  of accident and/or health insurance and pharmacy benefit

    42  managers to ensure that such switch communications are  truthful,  accu-
    43  rate,  and  not misleading based on cost to the patient and policy spon-
    44  sor, the product package labeling, medical compendia recognized  by  the
    45  drug  utilization  review  board,  and peer-reviewed medical literature,
    46  with appropriate references provided;
    47    (2) Except for a substitution  due  to  the  Food  and  Drug  Adminis-
    48  tration's  withdrawal of a drug for prescription, a requirement that all
    49  switch communications bear a prominent legend on  the  first  page  that
    50  states:    "This  is  not a product safety notice. This is a promotional
    51  announcement from your health care insurer or pharmacy benefits  manager
    52  about one of your current prescribed medications.";

    53    (3)  A  requirement  that,  the notification of request for medication
    54  change (i) expressly states  that  the  change  involves  a  therapeutic
    55  substitution,  not  a  generic substitution; (ii) explain the difference
    56  between therapeutic substitution and  generic  substitution;  and  (iii)

        S. 2086                             4
 
     1  provide  a truthful, fair, and balanced explanation regarding the poten-
     2  tial, ramifications of the therapeutic substitution, including  but  not
     3  limited  to,  that medications in the same therapeutic class are associ-
     4  ated  with  different  risks  and  benefits  and may work differently in
     5  different patients.
     6    § 3304. Penalties. (a) Issuing or delivering or causing to  be  issued

     7  or  delivered  a  switch communication that has not been approved and is
     8  not in compliance with the requirements of section three thousand  three
     9  hundred  three  of  this  article  is punishable by a fine not to exceed
    10  twenty-five thousand dollars.
    11    (b) Providing a misrepresentation  or  false  statement  in  a  switch
    12  communication  under  section three thousand three hundred three of this
    13  article is punishable by a  fine  not  to  exceed  twenty-five  thousand
    14  dollars.
    15    (c)  Any  other  material  violation  of  section three thousand three
    16  hundred three of this article is punishable by  a  fine  not  to  exceed
    17  twenty-five thousand dollars.
    18    §  3305. Prescription drug restriction overrides. (a) When medications

    19  for the treatment of any medical condition are restricted for use by  an
    20  insurer  or  PBM  by a step therapy or fail first protocol, a prescriber
    21  shall have access to a clear and convenient  process  to  override  such
    22  restrictions  from  the  insurer  and  may  expeditiously  override such
    23  restriction if:
    24    (1) The preferred treatment by the insurer or the PBM has  been  inef-
    25  fective  in  the  treatment  of  the covered person's disease or medical
    26  condition; or
    27    (2) Based on  sound  clinical  evidence  and  medical  and  scientific
    28  evidence:
    29    (A) The preferred treatment is expected to be ineffective based on the
    30  known  relevant physical or mental characteristics of the covered person

    31  and known characteristics of the drug regimen, and is likely to be inef-
    32  fective or adversely affect the drug's effectiveness or patient  compli-
    33  ance; or
    34    (B)  The  preferred  treatment  has  caused  or  is likely to cause an
    35  adverse reaction or other harm to the covered person.
    36    (b) The duration of any step therapy or fail first protocol shall  not
    37  be  longer than the period deemed necessary by the prescribing physician
    38  or health care professional to determine the treatment's clinical effec-
    39  tiveness or a period of fourteen days.
    40    (c) For medications with no  generic  equivalent  and  for  which  the
    41  prescribing physician in their clinical judgment feels that no appropri-

    42  ate therapeutic alternative is available an insurer or PBM shall provide
    43  access to United States Food and Drug Administration (FDA) labeled medi-
    44  cations  without  restriction to treat such medical conditions for which
    45  an FDA labeled medication is available.
    46    (d) Nothing in this section shall require coverage for  an  additional
    47  condition  not  already  covered by the policy or which is not otherwise
    48  covered by law.
    49    § 2. This act shall take effect on the one hundred twentieth day after
    50  it shall have become a law.
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