H. B. 2604

(By Mr. Speaker, Mr. Kiss, and Delegates

Martin, Leach, Douglas, Compton,

Trump and Capito)
[Introduced February 2, 1999; referred to the
Committee on Government Organization then Finance.]

A BILL to amend article five, chapter nine of the code of West Virginia, one thousand nine hundred thirty-one, as amended, by adding thereto a new section, designated section fifteen-a, relating to creating a medicaid drug prior authorization advisory board.

Be it enacted by the Legislature of West Virginia:
That article five, chapter nine of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended by adding thereto a new section, designated section fifteen-a, to read as follows:
ARTICLE 5. MISCELLANEOUS PROVISIONS.
§9-5-15a. Prior authorization of prescription drug products; creating a medicaid drug prior authorization advisory board; requiring rules providing a process for drugs that are or may made subject to prior authorization by the state medicaid agency; annual report; and termination date of board.
(a) The Legislature finds that it is in the best interests of the citizens of the State of West Virginia, as consumers of health care products and services, to provide a health care delivery system that is effective and efficient, recognizing that prescription drugs are a cost-effective component of total patient care, and that restriction of access to prescription drugs may have an adverse effect on patient health, increase rates of hospitalization, and increase the utilization of other health care services.
(b) There is hereby created a medicaid prior authorization advisory board, comprised of ten members to be appointed by the commissioner of the state medicaid agency. As used in this section, the term "board" means the medicaid prior authorization advisory board. Five members shall be physicians, at least three of whom shall care for a significant number of medicaid patients; three members shall be pharmacists, at least one of whom shall be a community pharmacist employed in a free-standing store not located in a mall or similar larger complex, who serve a significant number of medicaid patients, and at least one of whom shall be a hospital pharmacist; one member shall be a representative of the pharmaceutical manufacturers; and one member shall be a medicaid beneficiary. All members shall be residents of the State of West Virginia. When making appointments to the board, with the exception of the medicaid beneficiary, the commissioner shall consider recommendations made by the West Virginia Medical Association, WV Academy of Family Practice Physicians, the West Virginia Pharmacists Association, WV Osteopathic Medicine Society and the Pharmaceutical Research and Manufacturers of America. The commissioner of the state medicaid agency, or his or her designee, shall be an ex officio nonvoting member of the board and shall serve as secretary of the board without additional compensation. Each member of the committee shall receive reimbursement for reasonable and necessary travel expenses for each day or substantial portion thereof actually served in attendance at meetings of the board in accordance with the state's travel regulations. The board shall elect a chairman from its membership. The board shall meet at times and places designated by the commissioner of the state medicaid agency or upon the written request of two board members, but in no event shall the board meet less than four times per year.
(c) Not later than the first day of September, one thousand nine hundred ninety-nine, the board shall develop, by procedural rule pursuant to article three, chapter twenty-nine-a of this code, a procedure for obtaining public comment on prescription drugs or drug categories that are presently subject to prior authorization under the state's medicaid program, or are or may be in the future under consideration for prior authorization requirements, and formulating recommendations to the state medicaid agency related to prior authorization of these drugs. Review may be initiated by the board itself, or by written request of the state medicaid agency. The rule shall provide for:
(1) A public hearing process that allows for input and suggestions into policy development by all interested persons;
(2) Consideration of the rationale for prior authorization;
(3) Consideration of factors such as whether the drug is abused, misused or inappropriately used when less costly and equally effective drugs are available to patients;
(4) Consideration of alternatives to prior authorization, such as educational intervention directed at patients or providers, or limits on dosages or time periods during which a drug may be prescribed;
(5) Consideration of the adequacy of administrative systems and protocols available to providers seeking prior authorization, and the administrative cost and burden of complying with prior authorization requirements;
(6) Consideration of the availability of an administrative appeals process for denials of prior authorization which is transparent, open, and offers a timely response to providers denied any authorization for a drug that, in the provider's professional judgment, is what the patient needs or requires; and
(7) Notice to the manufacturer that a drug is under consideration for prior authorization.
(d) It is expressly recognized that no other entity may interfere with the discretion and judgment given to the single state agency that administers the state's medicaid program. Therefore, the state medicaid agency may accept or reject the recommendations of the board in whole or in part, and may amend or add to the recommendations.
(e) In formulating its recommendations to the state medicaid agency the board shall consider the potential impact on patient care and the potential fiscal impact of prior authorization on pharmacy, physician, hospitalization and outpatient costs. Any proposed regulation making a drug or category of drugs subject to prior authorization shall be accompanied by a statement of the estimated impact of prior authorization on pharmacy, physician, hospitalization and outpatient costs.
(f) The board shall report annually to the legislative oversight commission on health and human resources accountability regarding its recommendations related to prior authorization of drug products. The report shall include information related to the numbers of provider requests for prior authorization, the numbers of authorizations granted and denied, the numbers of blocked calls on phone lines available for prior authorization, the effect of the prior authorization requirement on utilization and program costs, the administrative costs of prior authorization, and the numbers of complaints from providers or patients.
(g) The board shall terminate on the first day of July, two thousand three, unless first continued by act of the Legislature enacted prior to the termination date.

NOTE: The purpose of this bill is to aid in creating medicare patient safeguards by establishing a prior authorization advisory board regarding drugs.

This section is new; therefore, underlining and strike-throughs have been omitted.