RESPONSE: The Commission agrees in part. The definition of the statement of medical necessity and requirements related to submitting the statement are found in §134.500, §§134.502-134.504, and §134.506. Any system participant that does not comply with the requirement relating to the statement of medical necessity is subject to administrative penalties. The above recommendation is not feasible; however, the pharmacist has the option of entering into medical dispute resolution.

COMMENT: Commenter noted that carriers obtain "letters of medical necessity" from physicians and still decline payment because information is not sufficient to justify payment. If a physician adheres to the required information in §134.502(f), that should be adequate to assure payment for services. Commenter suggested that this be worded more definitively so that the statement of medical necessity firmly establishes medical necessity (when filled out properly).

RESPONSE: The Commission disagrees. The statement of medical necessity is a communication tool designed to establish the medical necessity of the treatment for the injured employee's condition, and to facilitate payment. Insurance carriers are required to consider a prescribing doctor's statement of medical necessity before denying a bill for prescription or over-the-counter medications. If a doctor does not establish the medical necessity of the medication to the carrier's satisfaction then the carrier may deny payment.

Medical necessity is a fact-specific determination made on a case-by-case basis. The specification of information that should be included in a statement of medical necessity helps the doctor to provide adequate information; however, providing the specified information does not necessarily establish medical necessity for a particular service.

COMMENT: Commenter indicated that there is a need for accountability on the part of the insurance carrier if the carrier denied payment based on medical necessity but has not requested a statement of medical necessity. Commenter asked if a carrier could request a statement of medical necessity from the prescribing doctor and also deny payment for a prescription on the grounds of a lack of medical necessity. Carriers could simply request the physician to provide a statement of medical necessity on every brand name prescription. Commenter felt this would effectively hamper every physician when considering the most appropriate medication for the needs of the injured worker and asked if there would be repercussions for a carrier who routinely requests this information as a way to stall claims processing.

RESPONSE: The Commission agrees in part. Proposed subsection (e) has been modified to require the carrier to request a statement of medical necessity before denying payment for prescription or over the counter medications. The carrier has the right to deny payment if the statement does not establish the medical necessity of the treatment. Subsection (e) now references §133.301(d)-(g) which sets timeframes on requesting the statement of medical necessity and requires payments to be made in accordance with §133.304. Failure to comply with Commission rules may subject a carrier to administrative penalties and/or other sanctions.

COMMENT: Commenter suggested that the carrier should simultaneously notify all providers of the carrier's request for a statement of medical necessity so that the pharmacy provider may be given an opportunity to receive a copy of the doctor's response. This would alert providers that payment might be challenged.

RESPONSE: The Commission agrees. Subsection (e) has been modified to require the carrier to simultaneously notify the sender of the bill and the injured employee when a statement of medical necessity has been requested. In addition, subsection (e) has been changed to require the carrier to send a copy of the explanation of benefits (EOB) denying payment of a pharmacy bill to both the prescribing doctor and the injured employee. The Pharmacist already receives the EOB per §133.304(c). This provides much needed communication between the carrier, the prescribing doctor, the pharmacy, and the injured employee.

COMMENT: Commenter was of the opinion that the proposed rule improperly places the burden on the carrier to request and obtain statements of medical necessity of the prescription from the prescribing doctor. The commenter felt the burden should be on the doctor to indicate the medical necessity for the prescription and that §134.502(e) should be deleted and §134.502(f) be modified by removing language requiring the doctor to provide documents " no later than the 14th day after receipt of request." This is the current practice and nothing in HB-2600 indicates any legislative intent to vary this process. Commenter suggested that documentation automatically be provided to the carrier without a request being necessary to avoid disputes.

RESPONSE: The Commission disagrees. Currently there is no established practice of prescribing doctors routinely providing information to carriers regarding the medical necessity of prescriptions. It is not necessary to provide documentation of medical necessity for every prescription, only those prescriptions that are in question. A carrier's request for a statement of medical necessity is similar to the carrier's request for additional documentation to justify the treatment or service that was billed.

COMMENT: Commenter requested that the Commission clarify that there is no charge to the carrier for the statement of medical necessity required under §134.502.

RESPONSE: The Commission agrees and has added language to new §134.502(e) to state that a health care provider will not be reimbursed for preparation of, or sending of, a statement of medical necessity.

COMMENT: Commenter suggested that proposed §134.502(b)(2) should use the term "diagnosis" rather than " cause of injury" which is irrelevant to prescribing and dispensing pharmaceuticals.

RESPONSE: The Commission agrees. The list of information to be included in a statement of medical necessity has been deleted from §134.502 and an abbreviated description has been included in the definition of statement of medical necessity in §134.500. The term "cause of injury" is not listed.

COMMENT: The Commission received a number of comments regarding the quantity of a prescription that should be dispensed at one time. Commenters varied in their opinions of dispensing quantity limits. Some commenters supported the 30-day limit in the rule as proposed and advocated that a similar limit be placed on over-the-counter medications. Other commenters advocated that the limit be increased. Commenters suggested: 90-day supply when mail order is used to fill chronic medications; up to a 90-day supply if the prescribing doctor feels it will be more beneficial to the patient; and, no dispensing limit. Commenters advocating an increased dispensing limit indicated that the injured employees most directly affected by this 30-day supply limit were severely injured employees who rely on maintenance medication therapy and home delivery. For these employees, larger supplies provide a level of comfort, convenience, and care and are more beneficial to them. A commenter was of the opinion that a 30-day supply limit would diminish the quality of life and level of care for severely injured employees presently relying on maintenance medication therapy. Commenters felt that dispensing larger supplies provided a cost savings. Other commenters felt that Texas Labor Code §408.028 did not authorize the Commission to impose time limits on the duration of medications.

RESPONSE: The Commission agrees that a limit should be placed on the amount of prescription drugs dispensed at one time. Because some injured employees rely on the convenience of mail-order services for maintenance drugs, and because it appears that there may be some cost savings in dispensing larger quantities, subsection (c) has been changed to allow the dispensing of up to a 90-day supply of a prescription drug. Section 134.502(c) does not impose a limit on the duration of a doctor's prescription. It limits the amount of drugs that may be dispensed at one time to a 90-day supply. The Commission disagrees that a quantity limit for dispensing over-the-counter medications is necessary. Over-the-counter medications are generally less expensive than prescription medications and may be paid for initially by the injured employee. It is not necessary to place a limit on the quantity of over the counter medications. The Commission has revised §134.503(c) to set reimbursement for over-the-counter medications at the retail price of the lowest package quantity reasonably available that will fill the prescription.

COMMENT: Commenters supported language requiring prescribing health care providers to provide documentation that the prescription of a brand name drug is medically necessary. Commenters recommend that the Commission carefully monitor doctors' actual practice in writing prescriptions under the new rules to make sure that the brand name drug exception is not being misused and that the intended medical cost savings are actually achieved.

RESPONSE: The Commission agrees and will monitor all system participants.

COMMENT: Commenter suggested that the Commission should publish a list of reasons for prescribing brand name medications over generic alternatives. Without a list of acceptable reasons any reason becomes medically necessary. Commenter recommended reasons such as "the generic is not an Orange Book equivalent to the brand name medication" or "objective, clinical, peer-reviewed studies demonstrate that the generic alternative for treatment of this (ICD-9 diagnosis) is significantly less therapeutic."

RESPONSE: The Commission disagrees. The doctor's reason for prescribing brand name medications is a clinical decision based on the medical expertise of the doctor and the individual circumstances of the injured employee.

COMMENT: Commenter was of the opinion that §408.028 of the Texas Labor Code directs the commission to impose a requirement on pharmacists and pharmacies when the prescribing doctor does not specify a brand name. Commenter did not believe this section allows the commission to shift this requirement to the physician.

RESPONSE: The Commission disagrees. Section 408.028 requires doctors to prescribe all appropriate prescription and non-prescription medications and when a brand name prescription drug is necessary, to make the appropriate indication on the prescription. Unless it is indicated on the prescription that a brand name drug is necessary, the pharmacist is required to fill the prescription with a generic drug.

COMMENT: Commenter stated that applicable state law requires the physician, when writing a prescription for a brand name, to simply state "brand name necessary" - nothing more and nothing less. Commenter suggested that the rule should simply reflect the requirements of the statute and applicable state law and that additional requirements are overly broad, unduly burdensome, and exceed the authority granted under the statute. Commenter did not think that workers' compensation patients should be "labeled" as such.

RESPONSE: The Commission disagrees. Texas Labor Code §408.028 requires the Commission to adopt rules requiring the use of generic pharmaceutical medications and over-the-counter alternatives to prescription drugs. The requirement in §134.502(a)(1) is necessary to implement the provisions found in the Texas Labor Code §413.0141. Although rules implementing that statute cannot be adopted before September 1, 2002, the prescription requirements are included in the rule at this time and will also reduce the necessary system changes when additional rules are proposed. In addition, identifying that the prescriptions are related to a workers' compensation claim will prevent the pharmacy from inadvertently billing private insurance companies or injured employees for work related prescriptions.

COMMENT: Commenter stated that a patient often times having first utilized brand names finds the generics not as effective. Commenter suggested that brand name drugs should be considered with documented medical necessity.

RESPONSE: The Commission agrees. If need for a brand name drug exists and is documented, the doctor may prescribe the brand name drug in accordance with proposed §134.502(a)(3), and the pharmacist will fill the prescription with the brand name drug.

COMMENT: Commenter stated that §134.502(a)(3) should be definitively worded so that a physician's specification for " brand name drugs" serves to help in the determination of medical necessity

RESPONSE: The Commission disagrees that §134.502(a)(3) should be changed. An indication of brand name necessary on the prescription is not enough to establish the medical necessity of the brand name prescription. The prescribing doctor must be able to establish medical necessity through documentation.

COMMENT: Commenter felt a doctor should justify his decisions regarding the prescribing of prescription and over-the-counter drugs.

RESPONSE: The Commission agrees. The prescribing doctor should maintain documentation within the employee's clinical file to justify the medical necessity of all prescriptions and must produce a statement of medical necessity when requested.

COMMENT: Commenter predicted that the new requirements for over-the-counter medication might deter physicians in writing prescription for over the counter medications.

RESPONSE: The Commission disagrees. The new requirements for over the counter medications are necessary to facilitate the delivery of required medications to the employee and to facilitate payment to the pharmacist and, when necessary, reimbursement to the injured employee.

COMMENT: Commenter suggested that the doctor's prescription should match the number of doses purchased by the claimant for which reimbursement is sought.

RESPONSE: The Commission disagrees. The number of doses for which the employee seeks reimbursement is not required to exactly match the prescription due to the packaging constraints of over-the-counter medications. The Commission has revised §134.503(c) to set reimbursement for over-the-counter medications at the retail price of the lowest package quantity reasonably available that will fill the prescription. For example, the prescription is for two tablets, four times a day, for eight days, for a total of 64 tablets. The medication is available in bottles of 50 and 100. The prescription calls for 64 to the injured employee must purchase the bottle of 100 in order to follow the doctor's prescription.

COMMENT: Some commenters felt an indication of workers' compensation on the prescription should apply to over-the-counter prescriptions only. This was intended for over-the-counter items in order to have some indication that the item was intended for workers' compensation reimbursement and use.

Another commenter felt that requiring an indication from a prescribing practitioner that the prescription is related to a worker's compensation claim may result in unfilled prescriptions. Because the prescribing practitioner has no responsibility to submit the prescription as a claim, the provider may neglect the proper indication. The pharmacist may be left with an invalid claim for their product and services. Commenter asked if an audit is done of the pharmacy and the pharmacy has filled prescriptions without such wording, if the carrier would be able to request a refund from the pharmacy.

RESPONSE: The Commission disagrees. Requiring a prescribing doctor to indicate on all prescriptions that they relate to a workers' compensation claim assists the pharmacy in knowing how to process the bill for payment. In addition, this notation is needed for the implementation of Texas Labor Code §413.0141. The failure of a prescribing doctor to indicate that the prescription is related to a workers' compensation claim does not mean that the prescription should not be filled, and does not render the pharmacist's bill invalid. The carrier is still responsible for making the appropriate payment.

COMMENT: Commenter notes that a bill was passed in the Texas Legislature this session that requires the " brand necessary" language on all prescriptions, effective in June. Commenters believed that if you create different standards for workers' compensation you would create more confusion among the prescribers and pharmacists. Additionally, commenters noted that not every prescription is written. Some may be called in.

RESPONSE: The Commission disagrees that the new rules create different standards for workers' compensation. Section 562.015, Occupations Code, was amended effective June 1, 2002 to require the use of the phrase "brand necessary" or "brand medically necessary" to prohibit the substitution of a generically equivalent drug. Unless the prescribing doctor uses the "brand necessary" language, the pharmacist shall fill with a generic equivalent. The only difference for prescribers in the workers' compensation system is the requirement that the prescribing doctor indicate that the prescription is related to workers' compensation.

COMMENT: Commenters suggested that §134.502(d)(3) be changed to read: "A pharmacy may contract with a separate person or entity to process bills and payments for a medical service. The pharmacy and the contracted entity are jointly and severally liable for the errors and omissions of the entity. The separate person or entity must bill the carrier at no more than the price defined in §134.502(d)(1). The provider may not increase its billed price or add any service fee or charge when using the separate person or entity."

Another commenter suggested deletion of the provisions imposing strict liability on pharmacists for the actions of their agents or amendment to reflect current industry practice and agency law. Commenter contended that a pharmacy should be responsible for the actions of the agent only where the agent is acting within the scope of its authority and subject to the discretion of the pharmacy. For those processors that are actually coming in and accepting complete responsibility for the prescription claim under contract, this may not be an appropriate place for regulation.

Commenters opposed permitting pharmacies to contract with a separate entity for billing and payment for medical services without having reasonable restrictions in place to avoid increased costs without benefit to the system participants. Commenters contended that the Commission should regulate billing and payment entities that contract with pharmacies.