Amendment
Bill No. CS/SB 8A

Amendment No. 220329

CHAMBER ACTION
Senate		House
.
.
.

---

---

1	Representative Ambler offered the following:
2
3	Amendment (with title amendment)
4	Remove everything after the enacting clause and insert:
5
6	Section 1.  Subsection (14) of section 409.908, Florida
7	Statutes, is amended to read:
8	409.908  Reimbursement of Medicaid providers.--Subject to
9	specific appropriations, the agency shall reimburse Medicaid
10	providers, in accordance with state and federal law, according
11	to methodologies set forth in the rules of the agency and in
12	policy manuals and handbooks incorporated by reference therein.
13	These methodologies may include fee schedules, reimbursement
14	methods based on cost reporting, negotiated fees, competitive
15	bidding pursuant to s. 287.057, and other mechanisms the agency
16	considers efficient and effective for purchasing services or
17	goods on behalf of recipients. If a provider is reimbursed based
18	on cost reporting and submits a cost report late and that cost
19	report would have been used to set a lower reimbursement rate
20	for a rate semester, then the provider's rate for that semester
21	shall be retroactively calculated using the new cost report, and
22	full payment at the recalculated rate shall be effected
23	retroactively. Medicare-granted extensions for filing cost
24	reports, if applicable, shall also apply to Medicaid cost
25	reports. Payment for Medicaid compensable services made on
26	behalf of Medicaid eligible persons is subject to the
27	availability of moneys and any limitations or directions
28	provided for in the General Appropriations Act or chapter 216.
29	Further, nothing in this section shall be construed to prevent
30	or limit the agency from adjusting fees, reimbursement rates,
31	lengths of stay, number of visits, or number of services, or
32	making any other adjustments necessary to comply with the
33	availability of moneys and any limitations or directions
34	provided for in the General Appropriations Act, provided the
35	adjustment is consistent with legislative intent.
36	(14)  A provider of prescribed drugs shall be reimbursed
37	the least of the amount billed by the provider, the provider's
38	usual and customary charge, or the Medicaid maximum allowable
39	fee established by the agency, plus a dispensing fee. The
40	Medicaid maximum allowable fee for ingredient cost will be based
41	on the lower of: average wholesale price (AWP) minus 18.4 16.4
42	percent, wholesaler acquisition cost (WAC) plus 2.75 4.75
43	percent, the federal upper limit (FUL), the state maximum
44	allowable cost (SMAC), or the usual and customary (UAC) charge
45	billed by the provider. Medicaid providers are required to
46	dispense generic drugs if available at lower cost and the agency
47	has not determined that the branded product is more cost-
48	effective, unless the prescriber has requested and received
49	approval to require the branded product. The agency is directed
50	to implement a variable dispensing fee for payments for
51	prescribed medicines while ensuring continued access for
52	Medicaid recipients. The variable dispensing fee may be based
53	upon, but not limited to, either or both the volume of
54	prescriptions dispensed by a specific pharmacy provider, the
55	volume of prescriptions dispensed to an individual recipient,
56	and dispensing of preferred-drug-list products. The agency may
57	increase the pharmacy dispensing fee authorized by statute and
58	in the annual General Appropriations Act by $0.50 for the
59	dispensing of a Medicaid preferred-drug-list product and reduce
60	the pharmacy dispensing fee by $0.50 for the dispensing of a
61	Medicaid product that is not included on the preferred drug
62	list. The agency may establish a supplemental pharmaceutical
63	dispensing fee to be paid to providers returning unused unit-
64	dose packaged medications to stock and crediting the Medicaid
65	program for the ingredient cost of those medications if the
66	ingredient costs to be credited exceed the value of the
67	supplemental dispensing fee. The agency is authorized to limit
68	reimbursement for prescribed medicine in order to comply with
69	any limitations or directions provided for in the General
70	Appropriations Act, which may include implementing a prospective
71	or concurrent utilization review program.
72	Section 2.  Subsection (39) of section 409.912, Florida
73	Statutes, is amended to read:
74	409.912  Cost-effective purchasing of health care.--The
75	agency shall purchase goods and services for Medicaid recipients
76	in the most cost-effective manner consistent with the delivery
77	of quality medical care. To ensure that medical services are
78	effectively utilized, the agency may, in any case, require a
79	confirmation or second physician's opinion of the correct
80	diagnosis for purposes of authorizing future services under the
81	Medicaid program. This section does not restrict access to
82	emergency services or poststabilization care services as defined
83	in 42 C.F.R. part 438.114. Such confirmation or second opinion
84	shall be rendered in a manner approved by the agency. The agency
85	shall maximize the use of prepaid per capita and prepaid
86	aggregate fixed-sum basis services when appropriate and other
87	alternative service delivery and reimbursement methodologies,
88	including competitive bidding pursuant to s. 287.057, designed
89	to facilitate the cost-effective purchase of a case-managed
90	continuum of care. The agency shall also require providers to
91	minimize the exposure of recipients to the need for acute
92	inpatient, custodial, and other institutional care and the
93	inappropriate or unnecessary use of high-cost services. The
94	agency shall contract with a vendor to monitor and evaluate the
95	clinical practice patterns of providers in order to identify
96	trends that are outside the normal practice patterns of a
97	provider's professional peers or the national guidelines of a
98	provider's professional association. The vendor must be able to
99	provide information and counseling to a provider whose practice
100	patterns are outside the norms, in consultation with the agency,
101	to improve patient care and reduce inappropriate utilization.
102	The agency may mandate prior authorization, drug therapy
103	management, or disease management participation for certain
104	populations of Medicaid beneficiaries, certain drug classes, or
105	particular drugs to prevent fraud, abuse, overuse, and possible
106	dangerous drug interactions. The Pharmaceutical and Therapeutics
107	Committee shall make recommendations to the agency on drugs for
108	which prior authorization is required. The agency shall inform
109	the Pharmaceutical and Therapeutics Committee of its decisions
110	regarding drugs subject to prior authorization. The agency is
111	authorized to limit the entities it contracts with or enrolls as
112	Medicaid providers by developing a provider network through
113	provider credentialing. The agency may competitively bid single-
114	source-provider contracts if procurement of goods or services
115	results in demonstrated cost savings to the state without
116	limiting access to care. The agency may limit its network based
117	on the assessment of beneficiary access to care, provider
118	availability, provider quality standards, time and distance
119	standards for access to care, the cultural competence of the
120	provider network, demographic characteristics of Medicaid
121	beneficiaries, practice and provider-to-beneficiary standards,
122	appointment wait times, beneficiary use of services, provider
123	turnover, provider profiling, provider licensure history,
124	previous program integrity investigations and findings, peer
125	review, provider Medicaid policy and billing compliance records,
126	clinical and medical record audits, and other factors. Providers
127	shall not be entitled to enrollment in the Medicaid provider
128	network. The agency shall determine instances in which allowing
129	Medicaid beneficiaries to purchase durable medical equipment and
130	other goods is less expensive to the Medicaid program than long-
131	term rental of the equipment or goods. The agency may establish
132	rules to facilitate purchases in lieu of long-term rentals in
133	order to protect against fraud and abuse in the Medicaid program
134	as defined in s. 409.913. The agency may seek federal waivers
135	necessary to administer these policies.
136	(39)(a)  The agency shall implement a Medicaid prescribed-
137	drug spending-control program that includes the following
138	components:
139	1.  A Medicaid preferred drug list, which shall be a
140	listing of cost-effective therapeutic options recommended by the
141	Medicaid Pharmacy and Therapeutics Committee established
142	pursuant to s. 409.91195 and adopted by the agency for each
143	therapeutic class on the preferred drug list. At the discretion
144	of the committee, and when feasible, the preferred drug list
145	should include at least two products in a therapeutic class. The
146	agency may post the preferred drug list and updates to the
147	preferred drug list on an Internet website without following the
148	rulemaking procedures of chapter 120. Antiretroviral agents are
149	excluded from the preferred drug list. The agency shall also
150	limit the amount of a prescribed drug dispensed to no more than
151	a 34-day supply unless the drug products' smallest marketed
152	package is greater than a 34-day supply, or the drug is
153	determined by the agency to be a maintenance drug in which case
154	a 100-day maximum supply may be authorized. The agency is
155	authorized to seek any federal waivers necessary to implement
156	these cost-control programs and to continue participation in the
157	federal Medicaid rebate program, or alternatively to negotiate
158	state-only manufacturer rebates. The agency may adopt rules to
159	implement this subparagraph. The agency shall continue to
160	provide unlimited contraceptive drugs and items. The agency must
161	establish procedures to ensure that:
162	a.  There is a response to a request for prior consultation
163	by telephone or other telecommunication device within 24 hours
164	after receipt of a request for prior consultation; and
165	b.  A 72-hour supply of the drug prescribed is provided in
166	an emergency or when the agency does not provide a response
167	within 24 hours as required by sub-subparagraph a.
168	2.  Reimbursement to pharmacies for Medicaid prescribed
169	drugs shall be set at the lesser of: the average wholesale price
170	(AWP) minus 18.4 16.4 percent, the wholesaler acquisition cost
171	(WAC) plus 2.75 4.75 percent, the federal upper limit (FUL), the
172	state maximum allowable cost (SMAC), or the usual and customary
173	(UAC) charge billed by the provider.
174	3.  The agency shall develop and implement a process for
175	managing the drug therapies of Medicaid recipients who are using
176	significant numbers of prescribed drugs each month. The
177	management process may include, but is not limited to,
178	comprehensive, physician-directed medical-record reviews, claims
179	analyses, and case evaluations to determine the medical
180	necessity and appropriateness of a patient's treatment plan and
181	drug therapies. The agency may contract with a private
182	organization to provide drug-program-management services. The
183	Medicaid drug benefit management program shall include
184	initiatives to manage drug therapies for HIV/AIDS patients,
185	patients using 20 or more unique prescriptions in a 180-day
186	period, and the top 1,000 patients in annual spending. The
187	agency shall enroll any Medicaid recipient in the drug benefit
188	management program if he or she meets the specifications of this
189	provision and is not enrolled in a Medicaid health maintenance
190	organization.
191	4.  The agency may limit the size of its pharmacy network
192	based on need, competitive bidding, price negotiations,
193	credentialing, or similar criteria. The agency shall give
194	special consideration to rural areas in determining the size and
195	location of pharmacies included in the Medicaid pharmacy
196	network. A pharmacy credentialing process may include criteria
197	such as a pharmacy's full-service status, location, size,
198	patient educational programs, patient consultation, disease
199	management services, and other characteristics. The agency may
200	impose a moratorium on Medicaid pharmacy enrollment when it is
201	determined that it has a sufficient number of Medicaid-
202	participating providers. The agency must allow dispensing
203	practitioners to participate as a part of the Medicaid pharmacy
204	network regardless of the practitioner's proximity to any other
205	entity that is dispensing prescription drugs under the Medicaid
206	program. A dispensing practitioner must meet all credentialing
207	requirements applicable to his or her practice, as determined by
208	the agency.
209	5.  The agency shall develop and implement a program that
210	requires Medicaid practitioners who prescribe drugs to use a
211	counterfeit-proof prescription pad for Medicaid prescriptions.
212	The agency shall require the use of standardized counterfeit-
213	proof prescription pads by Medicaid-participating prescribers or
214	prescribers who write prescriptions for Medicaid recipients. The
215	agency may implement the program in targeted geographic areas or
216	statewide.
217	6.  The agency may enter into arrangements that require
218	manufacturers of generic drugs prescribed to Medicaid recipients
219	to provide rebates of at least 15.1 percent of the average
220	manufacturer price for the manufacturer's generic products.
221	These arrangements shall require that if a generic-drug
222	manufacturer pays federal rebates for Medicaid-reimbursed drugs
223	at a level below 15.1 percent, the manufacturer must provide a
224	supplemental rebate to the state in an amount necessary to
225	achieve a 15.1-percent rebate level.
226	7.  The agency may establish a preferred drug list as
227	described in this subsection, and, pursuant to the establishment
228	of such preferred drug list, it is authorized to negotiate
229	supplemental rebates from manufacturers that are in addition to
230	those required by Title XIX of the Social Security Act and at no
231	less than 14 percent of the average manufacturer price as
232	defined in 42 U.S.C. s. 1936 on the last day of a quarter unless
233	the federal or supplemental rebate, or both, equals or exceeds
234	29 percent. There is no upper limit on the supplemental rebates
235	the agency may negotiate. The agency may determine that specific
236	products, brand-name or generic, are competitive at lower rebate
237	percentages. Agreement to pay the minimum supplemental rebate
238	percentage will guarantee a manufacturer that the Medicaid
239	Pharmaceutical and Therapeutics Committee will consider a
240	product for inclusion on the preferred drug list. However, a
241	pharmaceutical manufacturer is not guaranteed placement on the
242	preferred drug list by simply paying the minimum supplemental
243	rebate. Agency decisions will be made on the clinical efficacy
244	of a drug and recommendations of the Medicaid Pharmaceutical and
245	Therapeutics Committee, as well as the price of competing
246	products minus federal and state rebates. The agency is
247	authorized to contract with an outside agency or contractor to
248	conduct negotiations for supplemental rebates. For the purposes
249	of this section, the term "supplemental rebates" means cash
250	rebates. Effective July 1, 2004, value-added programs as a
251	substitution for supplemental rebates are prohibited. The agency
252	is authorized to seek any federal waivers to implement this
253	initiative.
254	8.  The Agency for Health Care Administration shall expand
255	home delivery of pharmacy products. To assist Medicaid patients
256	in securing their prescriptions and reduce program costs, the
257	agency shall expand its current mail-order-pharmacy diabetes-
258	supply program to include all generic and brand-name drugs used
259	by Medicaid patients with diabetes. Medicaid recipients in the
260	current program may obtain nondiabetes drugs on a voluntary
261	basis. This initiative is limited to the geographic area covered
262	by the current contract. The agency may seek and implement any
263	federal waivers necessary to implement this subparagraph.
264	9.  The agency shall limit to one dose per month any drug
265	prescribed to treat erectile dysfunction.
266	10.a.  The agency may implement a Medicaid behavioral drug
267	management system. The agency may contract with a vendor that
268	has experience in operating behavioral drug management systems
269	to implement this program. The agency is authorized to seek
270	federal waivers to implement this program.
271	b.  The agency, in conjunction with the Department of
272	Children and Family Services, may implement the Medicaid
273	behavioral drug management system that is designed to improve
274	the quality of care and behavioral health prescribing practices
275	based on best practice guidelines, improve patient adherence to
276	medication plans, reduce clinical risk, and lower prescribed
277	drug costs and the rate of inappropriate spending on Medicaid
278	behavioral drugs. The program may include the following
279	elements:
280	(I)  Provide for the development and adoption of best
281	practice guidelines for behavioral health-related drugs such as
282	antipsychotics, antidepressants, and medications for treating
283	bipolar disorders and other behavioral conditions; translate
284	them into practice; review behavioral health prescribers and
285	compare their prescribing patterns to a number of indicators
286	that are based on national standards; and determine deviations
287	from best practice guidelines.
288	(II)  Implement processes for providing feedback to and
289	educating prescribers using best practice educational materials
290	and peer-to-peer consultation.
291	(III)  Assess Medicaid beneficiaries who are outliers in
292	their use of behavioral health drugs with regard to the numbers
293	and types of drugs taken, drug dosages, combination drug
294	therapies, and other indicators of improper use of behavioral
295	health drugs.
296	(IV)  Alert prescribers to patients who fail to refill
297	prescriptions in a timely fashion, are prescribed multiple same-
298	class behavioral health drugs, and may have other potential
299	medication problems.
300	(V)  Track spending trends for behavioral health drugs and
301	deviation from best practice guidelines.
302	(VI)  Use educational and technological approaches to
303	promote best practices, educate consumers, and train prescribers
304	in the use of practice guidelines.
305	(VII)  Disseminate electronic and published materials.
306	(VIII)  Hold statewide and regional conferences.
307	(IX)  Implement a disease management program with a model
308	quality-based medication component for severely mentally ill
309	individuals and emotionally disturbed children who are high
310	users of care.
311	11.a.  The agency shall implement a Medicaid prescription
312	drug management system. The agency may contract with a vendor
313	that has experience in operating prescription drug management
314	systems in order to implement this system. Any management system
315	that is implemented in accordance with this subparagraph must
316	rely on cooperation between physicians and pharmacists to
317	determine appropriate practice patterns and clinical guidelines
318	to improve the prescribing, dispensing, and use of drugs in the
319	Medicaid program. The agency may seek federal waivers to
320	implement this program.
321	b.  The drug management system must be designed to improve
322	the quality of care and prescribing practices based on best
323	practice guidelines, improve patient adherence to medication
324	plans, reduce clinical risk, and lower prescribed drug costs and
325	the rate of inappropriate spending on Medicaid prescription
326	drugs. The program must:
327	(I)  Provide for the development and adoption of best
328	practice guidelines for the prescribing and use of drugs in the
329	Medicaid program, including translating best practice guidelines
330	into practice; reviewing prescriber patterns and comparing them
331	to indicators that are based on national standards and practice
332	patterns of clinical peers in their community, statewide, and
333	nationally; and determine deviations from best practice
334	guidelines.
335	(II)  Implement processes for providing feedback to and
336	educating prescribers using best practice educational materials
337	and peer-to-peer consultation.
338	(III)  Assess Medicaid recipients who are outliers in their
339	use of a single or multiple prescription drugs with regard to
340	the numbers and types of drugs taken, drug dosages, combination
341	drug therapies, and other indicators of improper use of
342	prescription drugs.
343	(IV)  Alert prescribers to patients who fail to refill
344	prescriptions in a timely fashion, are prescribed multiple drugs
345	that may be redundant or contraindicated, or may have other
346	potential medication problems.
347	(V)  Track spending trends for prescription drugs and
348	deviation from best practice guidelines.
349	(VI)  Use educational and technological approaches to
350	promote best practices, educate consumers, and train prescribers
351	in the use of practice guidelines.
352	(VII)  Disseminate electronic and published materials.
353	(VIII)  Hold statewide and regional conferences.
354	(IX)  Implement disease management programs in cooperation
355	with physicians and pharmacists, along with a model quality-
356	based medication component for individuals having chronic
357	medical conditions.
358	12.  The agency is authorized to contract for drug rebate
359	administration, including, but not limited to, calculating
360	rebate amounts, invoicing manufacturers, negotiating disputes
361	with manufacturers, and maintaining a database of rebate
362	collections.
363	13.  The agency may specify the preferred daily dosing form
364	or strength for the purpose of promoting best practices with
365	regard to the prescribing of certain drugs as specified in the
366	General Appropriations Act and ensuring cost-effective
367	prescribing practices.
368	14.  The agency may require prior authorization for
369	Medicaid-covered prescribed drugs. The agency may, but is not
370	required to, prior-authorize the use of a product:
371	a.  For an indication not approved in labeling;
372	b.  To comply with certain clinical guidelines; or
373	c.  If the product has the potential for overuse, misuse,
374	or abuse.
375
376	The agency may require the prescribing professional to provide
377	information about the rationale and supporting medical evidence
378	for the use of a drug. The agency may post prior authorization
379	criteria and protocol and updates to the list of drugs that are
380	subject to prior authorization on an Internet website without
381	amending its rule or engaging in additional rulemaking.
382	15.  The agency, in conjunction with the Pharmaceutical and
383	Therapeutics Committee, may require age-related prior
384	authorizations for certain prescribed drugs. The agency may
385	preauthorize the use of a drug for a recipient who may not meet
386	the age requirement or may exceed the length of therapy for use
387	of this product as recommended by the manufacturer and approved
388	by the Food and Drug Administration. Prior authorization may
389	require the prescribing professional to provide information
390	about the rationale and supporting medical evidence for the use
391	of a drug.
392	16.  The agency shall implement a step-therapy prior
393	authorization approval process for medications excluded from the
394	preferred drug list. Medications listed on the preferred drug
395	list must be used within the previous 12 months prior to the
396	alternative medications that are not listed. The step-therapy
397	prior authorization may require the prescriber to use the
398	medications of a similar drug class or for a similar medical
399	indication unless contraindicated in the Food and Drug
400	Administration labeling. The trial period between the specified
401	steps may vary according to the medical indication. The step-
402	therapy approval process shall be developed in accordance with
403	the committee as stated in s. 409.91195(7) and (8). A drug
404	product may be approved without meeting the step-therapy prior
405	authorization criteria if the prescribing physician provides the
406	agency with additional written medical or clinical documentation
407	that the product is medically necessary because:
408	a.  There is not a drug on the preferred drug list to treat
409	the disease or medical condition which is an acceptable clinical
410	alternative;
411	b.  The alternatives have been ineffective in the treatment
412	of the beneficiary's disease; or
413	c.  Based on historic evidence and known characteristics of
414	the patient and the drug, the drug is likely to be ineffective,
415	or the number of doses have been ineffective.
416
417	The agency shall work with the physician to determine the best
418	alternative for the patient. The agency may adopt rules waiving
419	the requirements for written clinical documentation for specific
420	drugs in limited clinical situations.
421	17.  The agency shall implement a return and reuse program
422	for drugs dispensed by pharmacies to institutional recipients,
423	which includes payment of a $5 restocking fee for the
424	implementation and operation of the program. The return and
425	reuse program shall be implemented electronically and in a
426	manner that promotes efficiency. The program must permit a
427	pharmacy to exclude drugs from the program if it is not
428	practical or cost-effective for the drug to be included and must
429	provide for the return to inventory of drugs that cannot be
430	credited or returned in a cost-effective manner. The agency
431	shall determine if the program has reduced the amount of
432	Medicaid prescription drugs which are destroyed on an annual
433	basis and if there are additional ways to ensure more
434	prescription drugs are not destroyed which could safely be
435	reused. The agency's conclusion and recommendations shall be
436	reported to the Legislature by December 1, 2005.
437	(b)  The agency shall implement this subsection to the
438	extent that funds are appropriated to administer the Medicaid
439	prescribed-drug spending-control program. The agency may
440	contract all or any part of this program to private
441	organizations.
442	(c)  The agency shall submit quarterly reports to the
443	Governor, the President of the Senate, and the Speaker of the
444	House of Representatives which must include, but need not be
445	limited to, the progress made in implementing this subsection
446	and its effect on Medicaid prescribed-drug expenditures.
447	Section 3.  This act shall take effect March 1, 2009.
448
449
450	-----------------------------------------------------
451	T I T L E  A M E N D M E N T
452	Remove the entire title and insert:
453	A bill to be entitled
454	An act relating to Medicaid; amending s. 409.908, F.S.;
455	revising reimbursement rates for providers of Medicaid
456	prescribed drugs; amending s. 409.912, F.S.; revising
457	reimbursement rates to pharmacies for Medicaid prescribed
458	drugs; providing an effective date.
459

CODING: Words stricken are deletions; words underlined are additions.