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By:  Janek                                                        S.B. No. 1173


A BILL TO BE ENTITLED

AN ACT

relating to prescription drug benefits under the group health 
benefit programs for certain governmental employees and retired 
employees.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter E, Chapter 1551, Insurance Code, as 
effective June 1, 2003, is amended by adding Section 1551.218 to 
read as follows:  
	Sec. 1551.218.  PRIOR AUTHORIZATION FOR CERTAIN DRUGS.  
(a)  In this section, "drug formulary" means a list of drugs 
preferred for use and eligible for coverage under a health benefit 
plan.
	(b)  A health benefit plan provided under this chapter that 
uses a drug formulary in providing a prescription drug benefit must 
require prior authorization for coverage of the following 
categories of prescribed drugs if the specific drug prescribed is 
not included in the formulary:
		(1)  a gastrointestinal drug;                                          
		(2)  a cholesterol-lowering drug;                                      
		(3)  an anti-inflammatory drug;                                        
		(4)  an antihistamine drug; and                                        
		(5)  an antidepressant drug.                                           
	(c)  Every six months the board of trustees shall submit to 
the comptroller and Legislative Budget Board a report regarding any 
cost savings achieved in the group benefits program through 
implementation of the prior authorization requirement of this 
section.  A report must cover the previous six-month period.
	SECTION 2.  Subchapter D, Chapter 1575, Insurance Code, as 
effective June 1, 2003, is amended by adding Section 1575.161 to 
read as follows:
	Sec. 1575.161.  PRIOR AUTHORIZATION FOR CERTAIN DRUGS.  
(a)  In this section, "drug formulary" means a list of drugs 
preferred for use and eligible for coverage under a health benefit 
plan.
	(b)  A health benefit plan provided under this chapter that 
uses a drug formulary in providing a prescription drug benefit must 
require prior authorization for coverage of the following 
categories of prescribed drugs if the specific drug prescribed is 
not included in the formulary:
		(1)  a gastrointestinal drug;                                          
		(2)  a cholesterol-lowering drug;                                      
		(3)  an anti-inflammatory drug;                                        
		(4)  an antihistamine; and                                             
		(5)  an antidepressant drug.                                           
	(c)  Every six months the board of trustees shall submit to 
the comptroller and Legislative Budget Board a report regarding any 
cost savings achieved in the group program through implementation 
of the prior authorization requirement of this section.  A report 
must cover the previous six-month period.
	SECTION 3.  Subchapter E, Chapter 3, Insurance Code, is 
amended by adding Article 3.50-7A to read as follows:
	Art. 3.50-7A.  PRIOR AUTHORIZATION FOR CERTAIN DRUGS 
PROVIDED UNDER TEXAS SCHOOL EMPLOYEES UNIFORM GROUP COVERAGE 
PROGRAM.  (a)  In this article, "drug formulary" means a list of 
drugs preferred for use and eligible for coverage by a health 
coverage plan.
	(b)  A health coverage plan provided under the uniform group 
coverage program established under Article 3.50-7 of this code that 
uses a drug formulary in providing a prescription drug benefit must 
require prior authorization for coverage of the following 
categories of prescribed drugs if the specific drug prescribed is 
not included in the formulary:
		(1)  a gastrointestinal drug;                                          
		(2)  a cholesterol-lowering drug;                                      
		(3)  an anti-inflammatory drug;                                        
		(4)  an antihistamine drug; and                                        
		(5)  an antidepressant drug.                                           
	(c)  Every six months the Teacher Retirement System of Texas 
shall submit to the comptroller and Legislative Budget Board a 
report regarding any cost savings achieved in the uniform group 
coverage program through implementation of the prior authorization 
requirement of this article.  A report must cover the previous 
six-month period.
	SECTION 4.  The initial reports required by Subsection (c), 
Section 1551.218, and Subsection (c), Section 1575.161, Insurance 
Code, and Subsection (c), Article 3.50-7A, Insurance Code, as added 
by this Act, are due September 1, 2005.
	SECTION 5.  This Act takes effect September 1, 2003, and 
applies to health benefit plans provided under Chapters 1551 and 
1575, Insurance Code, as effective June 1, 2003, and health 
coverage plans subject to Article 3.50-7A, Insurance Code, as added 
by this Act, beginning with the 2004-2005 plan year.