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78R7064 JMM-F

By:  Van de Putte                                                 S.B. No. 1311



A BILL TO BE ENTITLED

AN ACT

relating to the provision of pharmaceutical benefits, the payment 
of claims for pharmaceutical services, and the resolution of 
certain disputes under the workers' compensation system.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 408.028, Labor Code, is amended by 
amending Subsection (b) and adding Subsection (e) to read as 
follows:
	(b)  The commission by rule shall develop a [an open] 
formulary under Section 413.011 that requires the use of generic 
pharmaceutical medications and clinically appropriate 
over-the-counter alternatives to prescription medications unless 
otherwise specified by the prescribing doctor, in accordance with 
applicable state law.
	(e)  An employee who wishes to use a brand name medication 
for which a generic product is available at a lower cost and the 
prescriber has authorized substitution of a generic product is 
responsible for payment of the price the pharmacy charges cash 
customers for the brand name medication.  The commission shall 
adopt rules under which an insurance carrier shall reimburse, on 
submission of appropriate receipts, an employee who pays for a 
brand name medication under this subsection for the difference in 
cost between the brand name medication and the generic product.  A 
payment described by this subsection by an employee to a pharmacy 
does not violate Section 413.042.
	SECTION 2.  Section 413.011, Labor Code, is amended by 
adding Subsections (h) and (i) to read as follows:
	(h)  An insurance carrier shall continue to pay a pharmacy 
for pharmaceutical services until the insurance carrier notifies 
the pharmacy of the carrier's intent to deny claims.  Any service 
rendered by a pharmacy before the receipt of the notice shall be 
considered compensable under the service fee guidelines.
	(i)  The commission shall establish pharmaceutical fee 
guidelines, taking into consideration the methodology used by other 
states, a pharmacy's usual and customary retail charge for a 
product, and the additional risks and administrative expenses 
incurred by a pharmacy for providing services to injured employees 
under this subtitle and commission rules.  Pharmacy services shall 
be reimbursed in accordance with the guidelines established under 
this subsection or in accordance with individually negotiated rates 
established between an insurance carrier and the health care 
provider, whichever amount is lower.  The guidelines for 
pharmaceutical service fees must be fair and reasonable and 
designed to ensure the quality of medical care and access to 
pharmacy services.  The commission shall establish an advisory 
committee of pharmacy providers, insurance carriers, and 
administrators to assist the commission in developing the 
guidelines under this subsection.
	SECTION 3.  Section 413.031, Labor Code, is amended by 
adding Subsection (m) to read as follows:
	(m)  For purposes of resolving disputes involving small 
amounts of money, including disputes regarding durable medical 
equipment or pharmaceutical services ordered and authorized by a 
health care provider, the commission shall establish an alternative 
dispute resolution process to be operated by the commission.
	SECTION 4.  Section 413.042, Labor Code, is amended by 
adding Subsection (c) to read as follows:
	(c)  This section does not prohibit a payment by an employee 
to a pharmacy for a brand name medication as provided by Section 
408.028(e).
	SECTION 5.  (a) This Act takes effect September 1, 2003.                       
	(b)  Not later than January 1, 2004, the Texas Workers' 
Compensation Commission shall:
		(1)  adopt rules under Section 408.028, Labor Code, as 
amended by this Act; 
		(2)  establish the pharmaceutical service fee 
guidelines required by Section 413.011(i), Labor Code, as added by 
this Act; and
		(3)  establish the alternative dispute resolution 
process required by Section 413.031(m), Labor Code, as added by 
this Act.