2011 Louisiana Laws
Revised Statutes
TITLE 46 — Public welfare and assistance
RS 46:153.3 — Medical vendor reimbursements; allowable restrictions; peer-based prescribing and dispensing practice patterns; medicaid pharmaceutical and therapeutics committee

§153.3. Medical vendor reimbursements; allowable restrictions; peer-based prescribing and dispensing practice patterns; Medicaid Pharmaceutical and Therapeutics Committee

A. The Louisiana Legislature recognizes the need to ensure that the state delivers a medical assistance program which is cost effective and prudently administered. The legislature acknowledges that rising health care costs are creating an increased demand on the state's limited revenues. Further, the legislature finds that cost effective programs such as the medical assistance drug program optimize existing fiscal resources while improving the quality of patient care and reducing the need for more expensive health care services.

B.(1)(a) The department may limit ingredient reimbursement for multi-source prescription drugs in accordance with state and federal law.

(b)(i) The legislature finds the following:

(aa) Many pharmacies are in critical financial condition as a result of the implementation of Medicare Part D and from the uncompensated care that pharmacies provided to evacuees during the aftermath of Hurricanes Katrina and Rita.

(bb) Medicaid reimbursement rates for the dispensing fee component of prescription drugs have not been increased since 1994.

(cc) The enactment of the Deficit Reduction Act of 2005 will result in significantly reduced reimbursement rates for the ingredient cost of generic prescription drugs in the medical assistance program.

(dd) The Centers for Medicare and Medicaid Services (CMS) has issued guidance encouraging states to continue paying pharmacists more in dispensing fees to support state savings from greater use of generic prescription drugs.

(ee) Pharmacy is a vital link in the health care delivery system of the state and adequate access to prescription drugs, supplies, and pharmacist services for Louisiana citizens are in jeopardy.

(ii) The legislature further finds that the current Medicaid dispensing fee reimbursement rates are inadequate, that a reasonable dispensing fee is necessary to assure adequate access by Medicaid beneficiaries to prescription drugs, supplies, and pharmacist services, and that a rate of at least fifteen dollars per prescription on all prescription drugs for which a federal upper limit has been set or is set in the future, and at least ten dollars per prescription on all other prescription drugs would assure adequate access.

(iii) The legislature further finds that time is of the essence and that all steps necessary to implement the rate increase pursuant to Subparagraphs (c) and (d) of this Paragraph be taken timely so that an increase in the Medicaid dispensing fee begins on January 1, 2007.

(c) The legislature recognizes that any change in the rate of reimbursement by the medical assistance program must be submitted to and approved or deemed approved by CMS in order to receive federal matching funds. It is the intent of the legislature that the department shall submit to CMS for approval a state plan amendment reflective of the legislative findings in Items (B)(1)(b)(i) and (ii) of this Section and shall negotiate with CMS to obtain the reimbursement rates that assure adequate access to prescription drugs, supplies, and pharmacist services in accordance with Item (B)(1)(b)(ii) of this Section.

(d) The department shall submit a state plan for increased pharmacy dispensing fees as soon as practical. Provided, however, no increase in the dispensing fee rate shall be implemented until CMS shall approve or deem approved a specific rate for pharmacy services, and subject to the conditions of Subparagraph (e) of this Paragraph.

(e) Upon CMS approving or deeming approved the state plan amendment, the Department of Health and Hospitals shall submit for approval by the commissioner of administration and the Joint Legislative Committee on the Budget a funding plan to implement the approved dispensing fee as of January 1, 2007. The funding plan shall include any funds appropriated or allocated by the legislature specifically for this purpose and the cost savings that accrue from implementation of AMP reimbursement rates mandated by CMS, as provided in House Bill No. 1* of the 2006 Regular Session of the Legislature. Provided, however, in the event that available funds are insufficient to fund the pharmacy dispensing fee as approved by CMS, the Department of Health and Hospitals shall submit its funding plan with a pharmacy dispensing fee that does not exceed the available funding.

(2)(a) The department may establish a drug list that utilizes a prior approval process or any other process or combination of processes that prove to be cost-effective in the medical assistance program. At a minimum any prior approval process shall meet all of the following criteria:

(i) Provide for a response by telephone or other form of telecommunication device within a maximum of twenty-four hours of a request for prior authorization.

(ii) Provide for the dispensing of a minimum of a seventy-two hour supply of a covered outpatient prescription drug in an emergency situation as provided by federal rule or regulation.

(iii) Comply with federal laws, rules, and regulations.

(iv) Involve medical personnel, including but not limited to pharmacists, pharmacy technicians, nurses, and physicians.

(v) Assure that a qualified, licensed physician is available for consultation during the prior approval process.

(b) The department may enter into contractual arrangements to perform the prior approval function and the development of the preferred drug list with a Louisiana school of medicine, a Louisiana school of pharmacy, the fiscal intermediary for the Medicaid program, or such other qualified contractor that it deems appropriate. The department may, at the expiration of any current contractual obligation, enter into contractual arrangements through a public request for proposal process to perform the development of the preferred drug list.

(c) The department is authorized to promulgate rules and regulations in accordance with the Administrative Procedure Act to implement the provisions of this Paragraph.

(d) In order to maximize savings as provided by any formulary and to maintain continuity of care, the department shall not restrict or require prior approval of maintenance medications for Medicaid recipients who have been prescribed such medications prior to June 13, 2001, for a period of six months after June 13, 2001.

(e) Each year the department shall provide a written and public report to the legislature and the governor thirty days prior to the regular legislative session. The report shall cover:

(i) The cost of administering the preferred drug list, including the cost of administering the prior authorization function, the costs of development and maintenance of the preferred drug list and aggregate funds, returned to the federal government related to pharmaceutical rebates.

(ii) An analysis of the utilization trends for medical services provided by the state and any correlation to the preferred drug list.

(3)(a) The department, in consultation with and upon the recommendation of the Louisiana Medicaid Pharmacy Advisory Committee and the department's interdisciplinary medicine and pharmacy committee, shall develop peer-based prescribing and dispensing practice patterns for health care providers who participate in the Louisiana Medicaid Program and shall develop a process to promote such practice patterns through the Drug Utilization Review Board. This process shall include the authority for the department to educate health care providers and the authority to exclude from participating in the Louisiana Medicaid Program a health care provider who repeatedly fails to comply with the prescribing and dispensing practice patterns. This process shall only be in accordance with peer-based practice patterns and shall not establish a community standard for drug prescribing and dispensing practices applicable to medical malpractice actions. The intent of this Paragraph is to limit aberrant practice patterns based upon peer-based practice patterns. Nothing contained herein shall be interpreted or construed as to interfere with the provisions of Paragraph (2) of this Subsection.

(b) The department is authorized to promulgate rules and regulations in accordance with the Administrative Procedure Act to implement the provisions of this Paragraph.

(4)(a) The department is authorized to apply for the appropriate federal waiver from the Centers for Medicare and Medicaid Services for the state Medicaid program to conduct a pilot project to determine the effectiveness of, and projected cost savings which may result from, providing reimbursement for weight control therapies, including anorexic drugs, and nutritional, diet, and exercise counseling, in the state Medicaid Drug Program. Any such waiver which is obtained by the department shall provide for the pilot project to be conducted by the Louisiana State University Health Sciences Center in Shreveport in conjunction with Pennington Biomedical Research Center, involving twenty participants, and implementing diet, exercise, and nutritional therapies and counseling in conjunction with an anorexic drug regimen as indicated.

(b) The department, along with the Louisiana State University Health Sciences Center in Shreveport in conjunction with Pennington Biomedical Research Center, may apply for any available public or private grants and donations to offset costs of the pilot project, and such pilot project shall only be conducted if grants and donations are received in an amount sufficient to fund over fifty percent of the estimated cost of the pilot project. The department, in conjunction with the Louisiana State University Health Sciences Center in Shreveport and Pennington Biomedical Research Center, shall report the results of such pilot project to the House and Senate Health and Welfare Committees and the legislature prior to the 2002 Regular Session.

C.(1) The department shall not restrict by prior authorization any anti-retroviral prescription drug prescribed and determined by a prescribing practitioner licensed by the state to be medically necessary for the treatment and prevention of HIV/AIDS. Such anti-retroviral prescription drugs include but are not limited to protease inhibitors, non-nucleoside reverse transcriptase inhibitors, nucleoside reverse transcriptase inhibitors, anti-virals, and fusion inhibitors prescribed for the treatment of HIV/AIDS.

(2) The department shall not restrict by prior authorization an atypical antipsychotic medication prescribed for the treatment of schizophrenia or mental illness with psychotic symptoms for a Medicaid recipient that has had a prescription for such atypical antipsychotic paid for by Medicaid during the six months prior to the effective date of the class being placed on the Medicaid preferred drug list.

(3) The department shall not restrict by prior authorization an immunomodulator or hepatitis C-specific antiviral drug prescribed for the treatment of hepatitis C for a Medicaid recipient that has had a prescription for such immunomodulator or hepatitis C - specific antiviral drug paid for by Medicaid during the six months prior to the effective date of the class being placed on the Medicaid preferred drug list.

(4) The department shall include data from the atypical antipsychotic drug class and the immunomodulator and hepatitis C - specific antiviral drug class with the data collected on all drug classes reviewed on the Medicaid preferred drug list for the annual report to the legislature and governor as required by Subparagraph (e) of Paragraph (2) of Subsection (B) of this Section.

D.(1) The Medicaid Pharmaceutical and Therapeutics Committee, hereinafter referred to as "the committee", is hereby created within the Department of Health and Hospitals. The committee shall be composed of twenty-one members appointed by the governor and submitted to the Senate for confirmation. The committee shall be representative of the state's geographic and demographic composition, including women and minorities.

(2) Each nominating organization shall certify by affidavit that the practice of each nominee involves either the care of or the supervision of the care of no less than one hundred fifty Medicaid recipients. The committee shall be comprised of the following persons:

(a) One physician with expertise in the area of pharmacology representing the Louisiana State University Health Sciences Center.

(b) One physician with expertise in the area of pharmacology representing Tulane University School of Medicine.

(c) One practicing physician who is participating in the Title XIX program as a family practitioner recommended from a list of three names submitted by the Louisiana State Medical Society.

(d) One practicing physician who is participating in the Title XIX program as an internal medicine specialist recommended from a list of three names submitted by the Louisiana State Medical Society.

(e) One practicing physician who is participating in the Title XIX program as a pediatrician recommended from a list of three names submitted by the Louisiana State Medical Society.

(f) One practicing physician who is participating in the Title XIX program as a surgeon recommended from a list of three names submitted by the Louisiana State Medical Society.

(g) One practicing physician who is participating in the Title XIX program as an obstetrics/gynecologist recommended from a list of three names submitted by the Louisiana State Medical Society.

(h) Two practicing physicians who are participating in the Title XIX program recommended from a list of six names submitted by the Louisiana Medical Association.

(i) One pharmacist representing University of Louisiana at Monroe School of Pharmacy.

(j) One pharmacist representing Xavier University of Louisiana School of Pharmacy.

(k) Two practicing pharmacists who are participating in the Title XIX drug program recommended from a list of six names submitted by the Louisiana Pharmacists Association. One pharmacist shall be an independent pharmacist and one pharmacist shall be a pharmacist representing a chain pharmacy.

(l) The secretary of the Department of Health and Hospitals or his designee.

(m) The director of the Medicaid program in the Department of Health and Hospitals or his designee.

(n) The president of the Senate or the president's designee.

(o) The speaker of the House of Representatives or the speaker's designee.

(p) One practicing physician who is participating in the Title XIX program as a psychiatrist recommended from a list of three names submitted by the Louisiana Psychiatric Medical Association.

(q) A Medicaid recipient.

(r) One physician representing the Department of Neurology at Louisiana State University Health Sciences Center.

(s) One physician who is a pediatric oncologist representing the Louisiana State University Health Sciences Center.

(3) Other physicians who participate in various subspecialties may act as consultants to the committee as needed.

(4) Members of the committee shall be governed by either the Code of Governmental Ethics, R.S. 42:1101 et seq. or the code of ethics governing their respective profession.

(5)(a) The committee shall meet only in public and shall permit public comment prior to voting on any changes in the preferred drug list. Minutes of the meeting shall be made available to the public within five days after the minutes are approved. All documents that are distributed to the committee and not subject to state or federal confidentiality laws shall be made available to the public within five days after the committee meets.

(b) The committee shall be responsible for developing and maintaining a pharmacopoeia established in conjunction with a prior approval process as provided in Subparagraph (B)(2)(a) of this Section. The pharmacopoeia shall comply with all applicable state and federal laws, rules, and regulations. The committee may recommend additions and deletions to the pharmacopoeia and the pharmacopoeia may change in accordance with those recommendations. The committee shall also advise the secretary of the department on policy recommendations related to the prudent administration of the Medicaid drug program. The secretary shall assure that all actions of the committee comply with applicable state and federal laws, rules, and regulations prior to implementation or modification of the pharmacopoeia. The clinical decisions regarding the preferred drug list shall be made transparent through a written report that is publicly available. If the decision of the Medicaid Pharmaceutical and Therapeutics Committee is contrary to the clinical evidence found in labeling, drug compendia, or peer review literature, such decisions shall be justified in writing.

(c) Any drug approved by the United States Food and Drug Administration shall be added to the formulary as soon as it becomes commercially available. The Medicaid Pharmaceutical and Therapeutics Committee shall conduct an evidence-based analysis of the drug to determine if the drug shall be maintained on the formulary. The analysis shall include but not be limited to the medical evidence of the clinical effectiveness of the drug as well as evidence of the cost-effectiveness of the drug in treating illness and disease. The determination by the committee on any new drug approval by the United States Food and Drug Administration shall be made no later than ninety days after the drug becomes commercially available. Prior to a drug being prior authorized, it must have been reviewed by the Medicaid Pharmaceutical and Therapeutics Committee.

(d) The department shall not implement the pharmacopoeia authorized by this Subsection until the initial pharmacopoeia is submitted to and approved by the House and Senate committees on health and welfare. The committees may only approve or reject the pharmacopoeia and may not add specific drugs to or delete specific drugs from the pharmacopoeia.

(e) The department shall not require prior approval of any drug listed on the pharmacopoeia or formulary authorized by this Subsection. Any pharmacopoeia developed by the committee shall include but not be limited to drugs in the following therapeutic categories:

(i) Anti-cholesterol.

(ii) Arthritis.

(iii) Asthma.

(iv) Cancer.

(v) Carbonic anhydrase inhibitors.

(vi) Cardiovascular disease.

(vii) Diabetes.

(viii) HIV/AIDS.

(ix) Mental illness.

(x) Osteoporosis.

(xi) Lipase inhibitors.

(xii) Hemophilia.

Acts 1989, No. 403, §1, eff. June 30, 1989; Acts 1995, No. 991, §1; Acts 1999, No. 795, §1; Acts 1999, No. 802, §7, eff. July 2, 1999; Acts 1999, No. 1245, §1; Acts 2001, No. 395, §1, eff. June 13, 2001; Acts 2001, No. 1137, §1; Acts 2003, No. 1264, §1; Acts 2004, No. 653, §1; Acts 2004, No. 677, §1; Acts 2004, No. 705, §1; Acts 2005, No. 177, §1, eff. June 28, 2005, and §2, eff. June 30, 2007; Acts 2006, No. 801, §1, eff. Jan. 1, 2007.

*Acts 2006, No. 17.