SB-0178, As Passed Senate, March 20, 2013

SUBSTITUTE FOR

SENATE BILL NO. 178

(As amended March 20, 2013)

     A bill to amend 1956 PA 218, entitled

"The insurance code of 1956,"

(MCL 500.100 to 500.8302) by adding section 2212c.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 2212c. (1) On or before January 1, <<2015>>, the <<workgroup>>

shall develop a standard prior authorization methodology for use by

prescribers to request and receive prior authorization from an

insurer when a policy, certificate, or contract requires prior

authorization for prescription drug benefits. The <<workgroup>>

shall include in the standard prior authorization methodology the

ability for the prescriber to designate the prior authorization

request for expedited review. In order to designate a prior

authorization request for expedited review, the prescriber shall

certify that applying the 15-day standard review period may

Senate Bill No. 178 as amended March 20, 2013

seriously jeopardize the life or health of the patient or the

patient's ability to regain maximum function.

(2) a prescription DRUG PRIOR AUTHORIZATION WORKGROUP is

created. within 30 days after the effective date of this section,

the department of community health and the department of insurance

and financial services shall work together and appoint members to

the workgroup. The workgroup must consist of a member who represents

the department of community health, A MEMBER WHO REPRESENTS THE

department of insurance and financial services, and members who

represent insurers, prescribers, pharmacists, hospitals, and other

stakeholders as determined necessary by the DEPARTMENT OF COMMUNITY

HEALTH AND THE DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES. The

workgroup shall appoint a chairperson from among its members. The

chairperson of the workgroup shall schedule workgroup meetings. The

department of community health and the department of insurance and

financial services shall organize the INITIAL meeting of the workgroup

and shall provide administrative support for the workgroup.

     (3)<<

>> In developing the

standard prior authorization methodology under subsection (1), the

<<              >> workgroup shall consider all of the following:

     (a) Existing and potential technologies that could be used to

transmit a standard prior authorization request.

     (b) The national standards pertaining to electronic prior

authorization developed by the national council for prescription

drug programs.

     (c) Any prior authorization forms and methodologies used in

pilot programs in this state.

     (d) Any prior authorization forms and methodologies developed

by the federal centers for medicare and medicaid services.

     (4) Beginning on the effective date of this section, an

insurer may specify in writing the materials and information

necessary to constitute a properly completed standard prior

authorization request when a policy, certificate, or contract

Senate Bill No. 178 as amended March 20, 2013

requires prior authorization for prescription drug benefits.

     (5) If the <<workgroup>> develops a paper form as the standard

prior authorization methodology under subsection (1), the paper

form shall meet all of the following requirements:

     (a) Consist of not more than 2 pages. However, an insurer may

request and require additional information beyond the 2-page

limitation of this subdivision, if that information is specified in

writing by the insurer under subsection (4). As used in this

subdivision, "additional information" includes, but is not limited

to, any of the following:

     (i) Patient clinical information including, but not limited to,

diagnosis, chart notes, lab information, and genetic tests.

     (ii) Information necessary for approval of the prior

authorization request under plan criteria.

     (iii) Drug specific information including, but not limited to,

medication history, duration of therapy, and treatment use.

     (b) Be electronically available.

     (c) Be electronically transmissible, including, but not

limited to, transmission by facsimile or similar device.

     (6) Beginning July 1, <<2016>>, if an insurer uses a prior

authorization methodology that utilizes an internet webpage,

internet webpage portal, or similar electronic, internet, and web-

based system, the prior authorization methodology described in

subsection (5) does not apply. Subsections (4), (8), and (9) apply

to a prior authorization methodology that utilizes an internet

webpage, internet webpage portal, or similar electronic, internet,

and web-based system.

Senate Bill No. 178 as amended March 20, 2013

     (7) Beginning July 1, <<2016>>, except as otherwise provided in

subsection (6), an insurer shall use the standard prior

authorization methodology developed under subsection (1) when a

policy, certificate, or contract requires prior authorization for

prescription drug benefits.

     (8) Beginning January 1, <<2016>>, a prior authorization request

that has not been certified for expedited review by the prescriber

is considered to have been granted by the insurer if the insurer

fails to grant the request, deny the request, or require additional

information of the prescriber within 15 days after the date and

time of submission of a standard prior authorization request under

this section. If additional information is requested by an insurer,

a prior authorization request under this subsection is not

considered granted if the prescriber fails to submit the additional

information within 15 days after the date and time of the original

submission of a properly completed standard prior authorization

request under this section. If additional information is requested

by an insurer, a prior authorization request is considered to have

been granted by the insurer if the insurer fails to grant the

request, deny the request, or otherwise respond to the request of

the prescriber within 15 days after the date and time of submission

of the additional information. If additional information is

requested by an insurer, a prior authorization request under this

subsection is considered void if the prescriber fails to submit the

additional information within 21 days after the date and time of

the original submission of a properly completed standard prior

authorization request under this section.

Senate Bill No. 178 as amended March 20, 2013

     (9) Beginning January 1, <<2016>>, a prior authorization request

that has been certified for expedited review by the prescriber is

considered to have been granted by the insurer if the insurer fails

to grant the request, deny the request, or require additional

information of the prescriber within 72 hours after the date and

time of submission of a standard prior authorization request under

this section. If additional information is requested by an insurer,

a prior authorization request under this subsection is not

considered granted if the prescriber fails to submit the additional

information within 72 hours after the date and time of the original

submission of a properly completed standard prior authorization

request under this section. If additional information is requested

by an insurer, a prior authorization request is considered to have

been granted by the insurer if the insurer fails to grant the

request, deny the request, or otherwise respond to the request of

the prescriber within 72 hours after the date and time of

submission of the additional information. If additional information

is requested by an insurer, a prior authorization request under

this subsection is considered void if the prescriber fails to

submit the additional information within 5 days after the date and

time of the original submission of a properly completed standard

prior authorization request under this section.

     (10) As used in this section:

     (a) "Insurer" means any of the following:

     (i) An insurer issuing an expense-incurred hospital, medical,

or surgical policy or certificate.

     (ii) A health maintenance organization.

Senate Bill No. 178 as amended March 20, 2013

     (iii) A health care corporation operating pursuant to the

nonprofit health care corporation reform act, 1980 PA 350, MCL

550.1101 to 550.1704.

     (iv) A third party administrator of prescription drug benefits.

     (b) "Prescriber" means that term as defined in section 17708

of the public health code, 1978 PA 368, MCL 333.17708.

     (c) "Prescription drug" means that term as defined in section

17708 of the public health code, 1978 PA 368, MCL 333.17708.

     (d) "Prescription drug benefit" means the right to have a

payment made by an insurer pursuant to prescription drug coverage

contained within a policy, certificate, or contract delivered,

issued for delivery, or renewed in this state.

<<(e) "Workgroup" means the prescription drug prior authorization workgroup created under subsection (2).>>