BILL NUMBER: SB 282 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Hernandez
FEBRUARY 19, 2015
An act to amend Section 1367.241 of the Health and Safety Code,
and to amend Section 10123.191 of the Insurance Code, relating to
health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
SB 282, as introduced, Hernandez. Health care coverage:
prescription drugs.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975,
provides for the regulation of health care service plans by the
Department of Managed Health Care and makes a willful violation of
the act a crime. Existing law provides for the regulation of health
insurers by the Department of Insurance. Commonly referred to as
utilization review, existing law governs the procedures that apply to
every health care service plan and health insurer that
prospectively, retrospectively, or concurrently reviews and approves,
modifies, delays, or denies, based on medical necessity, requests by
providers prior to, retrospectively, or concurrent with, the
provision of health care services to enrollees or insureds, as
specified. Existing law requires every prescribing provider, as
defined, when requesting prior authorization for prescription drug
benefits, to submit a prior authorization form developed jointly by
the Department of Managed Health Care and the Department of Insurance
to the health care service plan or health insurer, and requires
those plans and insurers to accept only those prior authorization
forms for prescription drug benefits. Existing law authorizes a
prescribing provider to submit the form electronically to the plan or
insurer.
This bill would authorize the prescribing provider to additionally
use an electronic process developed specifically for transmitting
prior authorization information that is consistent with the
standardized form described above and that meets the National Council
for Prescription Drug Programs' SCRIPT electronic prior
authorization standards. To the extent that the bill would thereby
require plans and insurers to accept that form of submission, the
bill would expand the scope of a crime and would impose a
state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1367.241 of the Health and Safety Code is
amended to read:
1367.241. (a) Notwithstanding any other provision of law, on and
after January 1, 2013, a health care service plan that provides
prescription drug benefits shall accept only the prior authorization
form developed pursuant to subdivision (c)
(c), or an electronic prior authorization process described in
subdivision (e), when requiring prior authorization for
prescription drug benefits. This section does not apply in the event
that a physician or physician group has been delegated the financial
risk for prescription drugs by a health care service plan and does
not use a prior authorization process. This section does not apply to
a health care service plan, or to its affiliated providers, if the
health care service plan owns and operates its pharmacies and does
not use a prior authorization process for prescription drugs.
(b) If a health care service plan fails to utilize or accept the
prior authorization form, or fails to respond within two business
days upon receipt of a completed prior authorization request from a
prescribing provider, pursuant to the submission of the prior
authorization form developed as described in subdivision (c), or
an electronic prior authorization process described in subdivision
(e), the prior authorization request shall be deemed to have
been granted. The requirements of this subdivision shall not apply to
contracts entered into pursuant to Article 2.7 (commencing with
Section 14087.3), Article 2.8 (commencing with Section 14087.5),
Article 2.81 (commencing with Section 14087.96), or Article 2.91
(commencing with Section 14089) of Chapter 7 of, or Chapter 8
(commencing with Section 14200) of, Part 3 of Division 9 of the
Welfare and Institutions Code.
(c) On or before July 1, 2012, the department and the Department
of Insurance shall jointly develop a uniform prior authorization
form. Notwithstanding any other provision of law, on and after
January 1, 2013, or six months after the form is developed, whichever
is later, every prescribing provider shall use that uniform prior
authorization form form, or an electronic
prior authorization process described in subdivision (e), to
request prior authorization for coverage of prescription drug
benefits and every health care service plan shall accept that form as
sufficient to request prior authorization for prescription drug
benefits.
(d) The prior authorization form developed pursuant to subdivision
(c) shall meet the following criteria:
(1) The form shall not exceed two pages.
(2) The form shall be made electronically available by the
department and the health care service plan.
(3) The completed form may also be electronically submitted from
the prescribing provider to the health care service plan.
(4) The department and the Department of Insurance shall develop
the form with input from interested parties from at least one public
meeting.
(5) The department and the Department of Insurance, in development
of the standardized form, shall take into consideration the
following:
(A) Existing prior authorization forms established by the federal
Centers for Medicare and Medicaid Services and the State Department
of Health Care Services.
(B) National standards pertaining to electronic prior
authorization.
(e) A prescribing provider may use an electronic prior
authorization system utilizing the standardized form described in
subdivision (c) or an electronic process developed specifically for
transmitting prior authorization information that is consistent with
the standardized form described in subdivision (c) and that meets
National Council for Prescription Drug Programs' SCRIPT electronic
prior authorization standards.
(e)
(f) For purposes of this section, a "prescribing
provider" shall include a provider authorized to write a
prescription, pursuant to subdivision (a) of Section 4040 of the
Business and Professions Code, to treat a medical condition of an
enrollee.
SEC. 2. Section 10123.191 of the Insurance Code is amended to
read:
10123.191. (a) Notwithstanding any other provision of law, on and
after January 1, 2013, a health insurer that provides prescription
drug benefits shall utilize and accept only the prior authorization
form developed pursuant to subdivision (c)
(c), or an electronic prior authorization process described in
subdivision (e), when requiring prior authorization for
prescription drug benefits.
(b) If a health insurer fails to utilize or accept the prior
authorization form, or fails to respond within two business days upon
receipt of a completed prior authorization request from a
prescribing provider, pursuant to the submission of the prior
authorization form developed as described in subdivision (c), or
an electronic prior authorization process described in subdivision
(e), the prior authorization request shall be deemed to have
been granted. The requirements of this subdivision shall not apply to
contracts entered into pursuant to Article 2.7 (commencing with
Section 14087.3), Article 2.8 (commencing with Section 14087.5),
Article 2.81 (commencing with Section 14087.96), or Article 2.91
(commencing with Section 14089) of Chapter 7 of, or Chapter 8
(commencing with Section 14200) of, Part 3 of Division 9 of the
Welfare and Institutions Code.
(c) On or before July 1, 2012, the department and the Department
of Managed Health Care shall jointly develop a uniform prior
authorization form. Notwithstanding any other provision of law, on
and after January 1, 2013, or six months after the form is developed,
whichever is later, every prescribing provider shall use that
uniform prior authorization form form, or an
electronic prior authorization process described in subdivision (e),
to request prior authorization for coverage of prescription
drug benefits and every health insurer shall accept that form as
sufficient to request prior authorization for prescription drug
benefits.
(d) The prior authorization form developed pursuant to subdivision
(c) shall meet the following criteria:
(1) The form shall not exceed two pages.
(2) The form shall be made electronically available by the
department and the health insurer.
(3) The completed form may also be electronically submitted from
the prescribing provider to the health insurer.
(4) The department and the Department of Managed Health Care shall
develop the form with input from interested parties from at least
one public meeting.
(5) The department and the Department of Managed Health Care, in
development of the standardized form, shall take into consideration
the following:
(A) Existing prior authorization forms established by the federal
Centers for Medicare and Medicaid Services and the State Department
of Health Care Services.
(B) National standards pertaining to electronic prior
authorization.
(e) A prescribing provider may use an electronic prior
authorization system utilizing the standardized form described in
subdivision (c) or an electronic process developed specifically for
transmitting prior authorization information that is consistent with
the standardized form described in subdivision (c) and that meets
National Council for Prescription Drug Programs' SCRIPT electronic
prior authorization standards.
(e)
(f) For purposes of this section, a "prescribing
provider" shall include a provider authorized to write a
prescription, pursuant to subdivision (a) of Section 4040 of the
Business and Professions Code, to treat a medical condition of an
insured.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.