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SB-525 Medi-Cal: reimbursement: blood factors.(2019-2020)

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Date Published: 04/11/2019 09:00 PM
SB525:v97#DOCUMENT

Amended  IN  Senate  April 11, 2019
Amended  IN  Senate  March 27, 2019

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Senate Bill
No. 525


Introduced by Senator Stone

February 21, 2019


An act to amend Section 14105.86 of the Welfare and Institutions Code, relating to Medi-Cal.


LEGISLATIVE COUNSEL'S DIGEST


SB 525, as amended, Stone. Medi-Cal: reimbursement: blood factors.
Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law provides for a schedule of benefits covered by the Medi-Cal program, including the purchase of prescribed drugs subject to the Medi-Cal list of contract drugs and utilization controls. Existing law authorizes the department to enter into contracts with manufacturers of drugs, to maintain a list of contract drugs, including blood factors, and to require pharmaceutical manufacturers to provide various rebates to the state. Existing law requires the reimbursement for blood factors to be by national drug code number and to not exceed 120% of the average sales price of the last quarter reported.
This bill would instead require the reimbursement for blood factors to be either the lower of the wholesale acquisition cost, as defined, or 120% of the average sales price of the last quarter reported, whichever is less. or the actual acquisition cost for the drug plus a professional dispensing fee of $0.14 per unit. The bill would define those costs and fees for these purposes.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 14105.86 of the Welfare and Institutions Code is amended to read:

14105.86.
 (a) For the purposes of this section, the following definitions apply:
(1) (A) “Average sales price” means the price reported to the federal Centers for Medicare and Medicaid Services by the manufacturer pursuant to Section 1847A of the federal Social Security Act (42 U.S.C. Sec. 1395w-3a).
(B) “Average manufacturer price” means the price reported to the federal Centers for Medicare and Medicaid Services pursuant to Section 1927 of the federal Social Security Act (42 U.S.C. Sec. 1396r-8).
(C) “Wholesale acquisition cost” means the price for a drug product listed as the wholesale acquisition cost in the department’s primary price reference source. has the same meaning as provided for “wholesaler acquisition cost” in Section 14105.45.
(D) “Actual acquisition cost” has the same meaning as provided in Section 14105.45.
(E) “Professional dispensing fee” has the same meaning as provided in Section 14105.45.
(2) “Blood factors” means plasma protein therapies and their recombinant analogs. Blood factors include, but are not limited to, all of the following:
(A) Coagulation factors, including:
(i) Factor VIII, nonrecombinant.
(ii) Factor VIII, porcine.
(iii) Factor VIII, recombinant.
(iv) Factor IX, nonrecombinant.
(v) Factor IX, complex.
(vi) Factor IX, recombinant.
(vii) Antithrombin III.
(viii) Anti-inhibitor factor.
(ix) Von Willebrand factor.
(x) Factor VIIa, recombinant.
(B) Immune Globulin Intravenous.
(C) Alpha-1 Proteinase Inhibitor.
(b) The reimbursement for blood factors shall be by national drug code number, and reimbursement shall be either the lower of the wholesale acquisition cost or cost, 120 percent of the average sales price of the last quarter reported, whichever is less. or the actual acquisition cost for the drug plus a professional dispensing fee of 14 cents ($0.14) per unit.
(c) The average sales price for blood factors of manufacturers or distributors that do not report an average sales price pursuant to subdivision (a) shall be identical to the average manufacturer price. The average sales price for new products that do not have a calculable average sales price or average manufacturer price shall be equal to a projected sales price, as reported by the manufacturer to the department. Manufacturers reporting a projected sales price for a new product shall report the first monthly average manufacturer price reported to the federal Centers for Medicare and Medicaid Services. The reporting of an average sales price that does not meet the requirement of this subdivision shall result in that blood factor no longer being considered a covered benefit.
(d) The average sales price shall be reported at the national drug code level to the department on a quarterly basis.
(e) (1) Effective July 1, 2008, the department shall collect a state rebate, in addition to rebates pursuant to other provisions of state or federal law, for blood factors reimbursed pursuant to this section by programs that qualify for federal drug rebates pursuant to Section 1927 of the federal Social Security Act (42 U.S.C. Sec. 1396r-8) or otherwise qualify for federal funds under Title XIX of the federal Social Security Act (42 U.S.C. Sec. 1396 et seq.) pursuant to the Medicaid state plan or waivers and the programs authorized by Article 5 (commencing with Section 123800) of Chapter 3 of Part 2 of, and Article 1 (commencing with Section 125125) of Chapter 2 of Part 5 of, Division 106 of the Health and Safety Code.
(2) Upon implementation of paragraphs (4) and (5) of subdivision (b) of Section 14105.33 for blood factors pursuant to this section, “utilization data” used to determine the state rebate shall be described pursuant to subdivision (b) of Section 14105.33. The department shall post on its internet website a notice that it has implemented paragraphs (4) and (5) of subdivision (b) of Section 14105.33 for blood factors pursuant to this section.
(3) The state rebate shall be negotiated as necessary between the department and the manufacturer. Manufacturers who do not execute an agreement to pay additional rebates pursuant to this section shall have their blood factors available only through an approved treatment or service authorization request. All blood factors that meet the definition of a covered outpatient drug pursuant to Section 1927 of the federal Social Security Act (42 U.S.C. Sec. 1396r-8) shall remain a benefit, subject to the utilization controls provided for in this section.
(4) In reviewing authorization requests, the department shall approve the lowest net cost product that meets the beneficiary’s medical need. The review of medical need shall take into account a beneficiary’s clinical history or the use of the blood factor pursuant to payment by another third party, or both.
(f) A beneficiary may obtain blood factors that require a treatment or service authorization request pursuant to subdivision (e) if the beneficiary qualifies for continuing care status. To be eligible for continuing care status, a beneficiary must be taking the blood factor and the department has reimbursed a claim for the blood factor with a date of service that is within 100 days prior to the date the blood factor was placed on treatment authorization request status. A beneficiary may remain eligible for continuing care status, provided that a claim is submitted for the blood factor in question at least every 100 days and the date of service of the claim is within 100 days of the date of service of the last claim submitted for the same blood factor.
(g) Changes made to the list of covered blood factors under this or any other section shall be exempt from the requirements of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340), Chapter 4 (commencing with Section 11370), and Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code), and shall not be subject to the review and approval of the Office of Administrative Law.