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California HMOs facing drug access rule

The proposed regulations would ensure availability of needed medications, even those that are not in a plan's formulary.

By Robert Kazel — Posted Jan. 24, 2005

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HMO patients in California would be guaranteed access to medically necessary drugs under new regulations issued by the state's Dept. of Managed Health Care.

The proposed regulations, which were published for public comment Jan. 4, mandate that all health plans offering outpatient prescription drug coverage must cover all medically necessary prescription drugs. The drugs must be made available even if they are excluded from a plan's formulary. Price limits also are established.

Under the rules, medical and pharmacy professionals would have input into the content of HMOs' drug formularies, with both medical need and price taken into account as criteria.

Certain drugs, such as those used for cosmetic purposes and sexual performance, may be withheld from coverage under the proposed rules, if the director of the Dept. of Managed Heath Care approves the exclusion. Drugs for weight loss also could be excluded if the patient is not severely obese. Any limits on, or exclusions of, drug coverage would have to be outlined on an HMO's Web site and in its printed evidence-of-coverage literature.

HMOs would not have to pay for a prescription medication if a comparable over-the-counter drug could be purchased, but would have to reimburse for the prescription drug if the over-the-counter drug isn't effective. Patient co-payments would be capped at 50% of the health plan's cost for a drug.

The proposed policies are still being reviewed by the California Medical Assn., but at first glance they appear to be worthy of support, said spokeswoman Karen Nikos.

The California Assn. of Health Plans is still studying the details of the proposed rules, said Bobby Peña, a spokesman for the trade group.

Public comment period ends Jan. 31, and final regulations are expected to go into effect later this year.

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