National Alliance on Mental Illness
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NAMI POLICY RESEARCH INSTITUTE
STATE ACTION ALERT
February 21, 2003
MEDICATION CARVE OUTS FOR MENTAL ILLNESS:
A GUIDE FOR ADVOCATES
NAMI supports a carve-out or exemption of psychotropic medications from any other cost containment measures in the Medicaid program. NAMI promotes carve-outs for anti-psychotic, anti-depressant, anti-anxiety and anti-convulsant medications as a starting point in discussions with state officials. A narrower carve-out like "anti-psychotic medications only", should be considered only as a last resort, when a broader approach is not politically or economically achievable.
Proposed carve-out language would read as follows:
"No requirement for prior authorization or other restrictions on medications to treat mental illnesses, such as schizophrenia, bipolar disorder, major depression, may be imposed.
Medications that will be available without restriction for persons with mental illness include:
Several states passed or considered medication carve outs for mental illness in 2002. Please see the attached Kansas carve-out provisions. We believe this provision is the most politically feasible language at this time, and coincides with NAMI suggested language.
If you are facing potential restrictions on access to psychotropic medications in your state, you and your members must decide what advocacy strategies will work best for you. As a general rule, it is always best to start with an approach that will benefit the largest numbers of people with mental illnesses, and a smaller carve-out when the broader approach is not possible.
Kansas Carve-out Provisions
New Section 1. (a) The secretary of social and rehabilitation services may establish an advisory committee pursuant to K.S.A. 75-5313, and amendments thereto, to advise the secretary in the development of a preferred formulary listing of covered drugs by the state Medicaid program.
(b) The secretary of social and rehabilitation services shall evaluate drugs and drug classes for inclusion in the state Medicaid preferred drug formulary based on safety, effectiveness and clinical outcomes of such treatments. In addition, the secretary shall evaluate drugs and drug classes to determine whether inclusion of such drugs or drug classes in a starter dose program would be clinically efficacious and cost effective. If the factors of safety, effectiveness and clinical outcomes among drugs being considered in the same class indicate no therapeutic advantage, then the secretary shall consider the cost effectiveness and the net economic impact of such drugs in making recommendations for inclusion in the state Medicaid preferred drug formulary. Drugs which do not have a significant, clinically meaningful therapeutic advantage in terms of safety, effectiveness or clinical outcomes over to other drugs in the same class which have been selected for the preferred drug formulary may be excluded from the preferred drug formulary and may be subject to prior authorization in accordance with state and federal law, except, prior to July 1, 2003, where a prescriber has personally written "dispense as written" or " D.A.W.", or has signed the prescriber’s name of the "dispense as written" signature line in accordance with K.S.A. 65-1637, and amendments thereto.
(c) The secretary of social and rehabilitation services shall consider the net economic impact of drugs selected or excluded from the preferred formulary and may gather information on the costs of specific drugs, rebates or discounts pursuant to 42 U.S.C. 1396r-8, dispensing costs, dosing requirements and utilization of other drugs or other Medicaid health care services.
(d) The secretary of social and rehabilitation services may accept all services including, but not limited to, disease state management, associated with the delivery of pharmacy benefits under the state Medicaid program having a determinable cost effect in addition to the Medicaid prescription drug rebates required pursuant to 42 U.S.C. section 1396r-8.
(e) The state Medicaid preferred drug formulary shall be submitted to the Medicaid drug utilization review board for review and policy recommendations.
New Sec. 2. No requirements for prior authorization or other restrictions on medications used to treat mental illnesses such as schizophrenia, depression or bipolar disorder may be imposed on Medicaid recipients. Medications that will be available under the state Medicaid plan without restriction for persons with mental illnesses shall include atypical antipsychotic medications, conventional antipsychotic medications and other medications used for the treatment of mental illnesses.
New Sec. 3. A prescription medication prescribed for a Medicaid recipient or a person who becomes eligible for Medicaid assistance shall not be subject to any requirement for prior authorization under the state Medicaid plan unless (a) such prescription, including all authorized refills, has expired, or (b) the practitioner who prescribed the medication for such recipient prescribes a different medication.
New Sec. 4. (a) The state Medicaid plan shall include provisions for a program of differential dispensing fees for pharmacies that provide prescriptions for adult care homes under a unit dose system in accordance with rules and regulations of the state board of pharmacy and that participate in the return of unused medications program under the state Medicaid plan.
(b) The state Medicaid plan shall include provisions for differential ingredient cost reimbursement of generic and brand name pharmaceuticals. The secretary of social and rehabilitation services shall set the rates for differential cost reimbursement of generic and brand name pharmaceuticals by rules and regulations.
New Sec. 5. (a) Except where a prescriber has personally written "dispense as written: or "S.A.W.," or has signed the prescriber’s name on the "dispense as written" signature line in accordance with K.S.A. 65-1637 and amendments thereto, the secretary of social and rehabilitation services may limit reimbursement for a prescription under the Medicaid program to the multisource generic equivalent drug.
(b) No pharmacist participating in the medical assistance program shall be required to dispense a prescription-only drug that will not be reimbursed by the medical assistance program.