Bill Text: CA AB2779 | 2009-2010 | Regular Session | Amended

California Assembly Bill 2779 (Prior Session Legislation)

Bill Title: Workers' compensation: compounded drugs.

Spectrum: Partisan Bill (Democrat 7-0)

Status: (Engrossed - Dead) 2010-08-24 - To inactive file on motion of Senator DeSaulnier. [AB2779 Detail]

Download: California-2009-AB2779-Amended.html

BILL NUMBER: AB 2779	AMENDED
	BILL TEXT

	AMENDED IN SENATE  AUGUST 20, 2010
	AMENDED IN SENATE  AUGUST 11, 2010
	AMENDED IN SENATE  JULY 15, 2010
	AMENDED IN SENATE  JUNE 22, 2010
	AMENDED IN ASSEMBLY  APRIL 8, 2010

INTRODUCED BY   Assembly Member Solorio

                        MARCH 3, 2010

   An act to add Section 5307.13 to the Labor Code, relating to
workers' compensation, and declaring the urgency thereof, to take
effect immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2779, as amended, Solorio. Workers' compensation: 
compound medication.  compounded drugs. 
   Existing law establishes a workers' compensation system,
administered by the Administrative Director of the Division of
Workers' Compensation, to compensate an employee for injuries
sustained in the course of his or her employment.  Existing
law requires the administrative director, after public hearings, to
adopt and revise periodically an official medical fee schedule that
shall establish reasonable maximum fees paid for medical services,
drugs and pharmacy services, health care facility fees, home health
care, and all other treatment, care, services, and goods, other than
physician services.  
   This bill would provide that, until the administrative director
adopts a fee schedule governing compound medication, a compound
medication shall be reimbursable only if there is prior authorization
for it as medically necessary, as specified. The bill would
authorize the administrative director to adopt regulations as
necessary or convenient to implement the above-described provisions.
 
   This bill would provide that under workers' compensation law, a
compounded drug, as defined, dispensed on or after November 1, 2010,
shall be reimbursable only if certain conditions, including the
condition that all active ingredients in the compounded drug are
ingredients in drug products that have been approved by the federal
Food and Drug Administration and all other ingredients are listed by
the United States Pharmacopeia, are satisfied. 
   This bill would declare that it is to take effect immediately as
an urgency statute.
   Vote: 2/3. Appropriation: no. Fiscal committee:  yes
  no  . State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 5307.13 is added to the Labor Code, to read:

   5307.13.  (a) Until the administrative director adopts a fee
schedule consistent with the requirements of this section governing
compound medication, a compound medication shall be reimbursable only
if there is prior authorization for it as medically necessary
pursuant to Section 4610 and the compound medication meets all of the
following requirements:
   (1) All active ingredients in the compound medication are
ingredients in drug products that have been approved by the federal
Food and Drug Administration (FDA) or listed by the United States
Pharmacopeia. 
    5307.13.   (a) A compounded drug shall be
reimbursable only if all of the following conditions are satisfied:
 
   (1) Before the compounded drug is dispensed, both of the following
conditions are satisfied:  
   (A) The physician's request for authorization for the compounded
drug has been submitted to the insurer or, if there is no insurer, to
the employer, for prospective utilization review.  
   (B) The physician's request for authorization expressly identifies
the recommended drug as a compounded drug.  
   (2)  All active ingredients in the compounded drug are ingredients
in drug products that have been approved by the federal Food and
Drug Administration (FDA) and all other ingredients are listed by the
United States Pharmacopeia.  
   (2) 
    (3)  The  compound medication  
compounded drug  is not a copy  or substitute for
  of  an available FDA-approved product. 
   (3) 
    (4)  FDA-approved alternatives to the  compound
medication   compounded drug  have been tried with
 documented  therapeutic failure or patient intolerance.

   (b) If the insurer or employer has denied a request for
authorization for a compounded drug for the same employee for the
same injury pursuant to Section 4610, and if the denial has not been
overturned and there has not been a documented material change in the
employee's medical condition, subdivision (e) of Section 4610 shall
not apply to utilization review of a subsequent request for
authorization for the same or substantially identical compounded
drug.  
   (b) 
    (c)  The maximum allowance for the  compound
medication   compounded drug  shall not exceed the
sum of the amounts that would be allowed for the ingredient costs and
dispensing  fee   and compounding fees allowed
 under regulations adopted pursuant to Section 5307.1.  No
reimbursement shall be allowed for any ingredient that does not have
a valid National Drug Code (NDC) and a corresponding unit price in
the Medi-Cal database.  
   (c) 
    (d)  No fee shall be allowed for any  compound
medication   compounded drug  unless the billing
for that  compound medication   compounded drug
 includes all information necessary for calculation of the fee
pursuant to  this section   subdivision (c)
 . 
   (d) 
    (e)  Nothing in this section shall be interpreted to
authorize a nonphysician to reject, as medically unnecessary, an
otherwise valid  unsolicited  prescription for a compounded
 medication. To the extent applicable, Section 4610 shall
apply to requests for authorization required under this section.
  drug.  
   (e) 
    (f)  The administrative director may adopt regulations
 as necessary or convenient  to implement this
section. 
   (g) This section shall apply to any compounded drug dispensed on
or after November 1, 2010.  
   (h) For purposes of this section, "compounded drug" shall have the
meaning specified in regulations adopted by the California State
Board of Pharmacy. 
  SEC. 2.  This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
   Abusive billing practices for compounded drugs unreasonably
inflate the cost of workers' compensation coverage for employers and
insurers, and leave fewer dollars available for injured workers to
receive in benefits. In order to stop these abusive practices at the
earliest possible time, it is necessary for this act to take effect
immediately.