HOUSE BILL No. 1569
DIGEST OF INTRODUCED BILL
; IC 12-15-35.
Synopsis: Internet prescription drug information. Requires the drug
utilization review board to develop and implement an Internet site to
provide to the public comparative information concerning efficacy, use,
and cost of prescription drugs.
Effective: July 1, 2003.
January 16, 2003, read first time and referred to Committee on Technology, Research and
First Regular Session 113th General Assembly (2003)
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HOUSE BILL No. 1569
A BILL FOR AN ACT to amend the Indiana Code concerning
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 12-7-2-20.2; (03)IN1569.1.1. -->
IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2003]: Sec. 20.2. "Average retail price" has the meaning set forth
SOURCE: IC 12-7-2-190.6; (03)IN1569.1.2. -->
SECTION 2. IC
, AS ADDED BY P.L.107-2002,
SECTION 8, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 190.6. "Therapeutic classification" or "therapeutic
category", for purposes of IC
and IC 12-8-15, has the
meaning set forth in IC
SOURCE: IC 12-8-15; (03)IN1569.1.3. -->
SECTION 3. IC 12-8-15 IS ADDED TO THE INDIANA CODE AS
CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY
Chapter 15. Prescription Drug Information.
As used in this chapter, "average retail price" means the
price charged for a prescription drug by a pharmacy to a
consumer without a third party payment source.
Sec. 2. The drug utilization review board established by
IC 12-15-35-19 shall
develop and implement an Internet site where
(1) presented in language and a format that is understandable
to the general public; and
(2) comparing efficacy, use, and average retail price of
prescription drugs within a therapeutic classification;
is available to the public.
Sec. 3. The therapeutics committee established by
IC 12-15-35-20.5 shall develop a comparison of the prescription
drugs available to the public within a therapeutic classification,
(2) purposes of use; and
(3) average retail price;
of each prescription drug for publication on the Internet site
implemented under section 2 of this chapter.
SOURCE: IC 12-15-35-28; (03)IN1569.1.4. -->
SECTION 4. IC 12-15-35-28, AS AMENDED BY P.L.107-2002,
SECTION 17, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 28. (a) The board has the following duties:
(1) The adoption of rules to carry out this chapter, in accordance
with the provisions of IC 4-22-2 and subject to any office
approval that is required by the federal Omnibus Budget
Reconciliation Act of 1990 under Public Law 101-508 and its
(2) The implementation of a Medicaid retrospective and
prospective DUR program as outlined in this chapter, including
the approval of software programs to be used by the pharmacist
for prospective DUR and recommendations concerning the
provisions of the contractual agreement between the state and any
other entity that will be processing and reviewing Medicaid drug
claims and profiles for the DUR program under this chapter.
(3) The development and application of the predetermined criteria
and standards for appropriate prescribing to be used in
retrospective and prospective DUR to ensure that such criteria
and standards for appropriate prescribing are based on the
compendia and developed with professional input with provisions
for timely revisions and assessments as necessary.
(4) The development, selection, application, and assessment of
interventions for physicians, pharmacists, and patients that are
educational and not punitive in nature.
(5) The publication of an annual report that must be subject to
public comment before issuance to the federal Department of
Health and Human Services and to the Indiana legislative council
by December 1 of each year.
(6) The development of a working agreement for the board to
clarify the areas of responsibility with related boards or agencies,
including the following:
(A) The Indiana board of pharmacy.
(B) The medical licensing board of Indiana.
(C) The SURS staff.
(7) The establishment of a grievance and appeals process for
physicians or pharmacists under this chapter.
(8) The publication and dissemination of educational information
to physicians and pharmacists regarding the board and the DUR
program, including information on the following:
(A) Identifying and reducing the frequency of patterns of
fraud, abuse, gross overuse, or inappropriate or medically
unnecessary care among physicians, pharmacists, and
(B) Potential or actual severe or adverse reactions to drugs.
(C) Therapeutic appropriateness.
(D) Overutilization or underutilization.
(E) Appropriate use of generic drugs.
(F) Therapeutic duplication.
(G) Drug-disease contraindications.
(H) Drug-drug interactions.
(I) Incorrect drug dosage and duration of drug treatment.
(J) Drug allergy interactions.
(K) Clinical abuse and misuse.
(9) The adoption and implementation of procedures designed to
ensure the confidentiality of any information collected, stored,
retrieved, assessed, or analyzed by the board, staff to the board, or
contractors to the DUR program that identifies individual
physicians, pharmacists, or recipients.
(10) The implementation of additional drug utilization review
with respect to drugs dispensed to residents of nursing facilities
shall not be required if the nursing facility is in compliance with
the drug regimen procedures under 410 IAC 16.2-3-8 and 42 CFR
(11) The research, development, and approval of a preferred drug
(A) Medicaid's fee for service program;
(B) Medicaid's primary care case management program; and
(C) the primary care case management component of the
children's health insurance program under IC 12-17.6;
in consultation with the therapeutics committee.
(12) The approval of the review and maintenance of the preferred
drug list at least two (2) times per year.
(13) The preparation and submission of a report concerning the
preferred drug list at least two (2) times per year to the select joint
commission on Medicaid oversight established by IC 2-5-26-3.
(14) The collection of data reflecting prescribing patterns related
to treatment of children diagnosed with attention deficit disorder
or attention deficit hyperactivity disorder.
(15) The duties specified in IC 12-8-15.
(b) The board shall use the clinical expertise of the therapeutics
committee in developing a preferred drug list. The board shall also
consider expert testimony in the development of a preferred drug list.
(c) In researching and developing a preferred drug list under
subsection (a)(11), the board shall do the following:
(1) Use literature abstracting technology.
(2) Use commonly accepted guidance principles of disease
(3) Develop therapeutic classifications for the preferred drug list.
(4) Give primary consideration to the clinical efficacy or
appropriateness of a particular drug in treating a specific medical
(5) Include in any cost effectiveness considerations the cost
implications of other components of the state's Medicaid program
and other state funded programs.
(d) Prior authorization is required for coverage under a program
described in subsection (a)(11) of a drug that is not included on the
preferred drug list.
(e) The board shall determine whether to include a single source
covered outpatient drug that is newly approved by the federal Food and
Drug Administration on the preferred drug list not later than sixty (60)
days after the date of the drug's approval. However, if the board
determines that there is inadequate information about the drug
available to the board to make a determination, the board may have an
additional sixty (60) days to make a determination from the date that
the board receives adequate information to perform the board's review.
Prior authorization may not be automatically required for a single
source drug that is newly approved by the federal Food and Drug
Administration and that is:
(1) in a therapeutic classification:
(A) that has not been reviewed by the board; and
(B) for which prior authorization is not required; or
(2) the sole drug in a new therapeutic classification that has not
been reviewed by the board.
(f) The board may not exclude a drug from the preferred drug list
based solely on price.
(g) The following requirements apply to a preferred drug list
developed under subsection (a)(11):
(1) The office or the board may require prior authorization for a
drug that is included on the preferred drug list under the following
(A) To override a prospective drug utilization review alert.
(B) To permit reimbursement for a medically necessary brand
name drug that is subject to generic substitution under
(C) To prevent fraud, abuse, waste, overutilization, or
(D) To permit implementation of a disease management
(E) To implement other initiatives permitted by state or federal
(2) All drugs described in IC 12-15-35.5-3(b) must be included on
the preferred drug list.
(3) The office may add a new single source drug that has been
approved by the federal Food and Drug Administration to the
preferred drug list without prior approval from the board.
(4) The board may add a new single source drug that has been
approved by the federal Food and Drug Administration to the
preferred drug list.
(h) At least two (2) times each year, the board shall provide a report
to the select joint commission on Medicaid oversight established by
IC 2-5-26-3. The report must contain the following information:
(1) The cost of administering the preferred drug list.
(2) Any increase in Medicaid physician, laboratory, or hospital
costs or in other state funded programs as a result of the preferred
(3) The impact of the preferred drug list on the ability of a
Medicaid recipient to obtain prescription drugs.
(4) The number of times prior authorization was requested, and
the number of times prior authorization was:
(A) approved; and
(i) The board shall provide the first report required under subsection
(h) not later than six (6) months after the board submits an initial
preferred drug list to the office.
SOURCE: IC 12-15-35-28.5; (03)IN1569.1.5. -->
SECTION 5. IC 12-15-35-28.5, AS ADDED BY P.L.107-2002,
SECTION 18, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 28.5. The therapeutics committee established
under section 20.5 of this chapter shall do the following:
(1) Advise and make recommendations to the board in the board's
development and maintenance of a preferred drug list under
section 28 of this chapter.
(2) Submit to the board a proposed preferred drug list that has
been approved by a majority of a quorum of the therapeutics
(3) Advise and make recommendations to the board in the board's
review and maintenance of a preferred drug list.
(4) Perform the duties required under IC 12-8-15.