Bill Text: HI HB891 | 2014 | Regular Session | Amended
Bill Title: Workers' Compensation; Drugs
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2013-12-18 - Carried over to 2014 Regular Session. [HB891 Detail]
Download: Hawaii-2014-HB891-Amended.html
HOUSE OF REPRESENTATIVES |
H.B. NO. |
891 |
TWENTY-SEVENTH LEGISLATURE, 2013 |
H.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO WORKERS' COMPENSATION DRUGS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that regulating markups on repackaged prescription drugs and compound medications will help to contain unreasonable increases of prescription drug costs in Hawaii's workers' compensation insurance system as repackagers expand into states, including Hawaii, where repackaged drug and compound medication costs are not currently regulated.
The legislature further finds that Hawaii's current reimbursement rate for pharmaceuticals in workers' compensation claims is among the highest in the nation for brand and generic products.
The legislature notes that this measure is not intended to deter physicians from dispensing drugs to their patients. The legislature acknowledges that physician dispensing serves an important purpose and assists patients in receiving comprehensive health care from a single provider. The legislature finds that this measure promotes the practice of physician dispensing of prescription medication in an ethical and transparent manner by authorizing reimbursement of a dispensing fee for each prescription dispensed by a physician.
The purpose of this Act is to close a loophole in Hawaii's workers' compensation insurance law to restrict markups of repackaged prescription drugs and compound medications to an amount that will help deter inflation of health care costs by preventing prescription medications from becoming an unreasonable cost driver.
SECTION 2. Section 386-21, Hawaii Revised Statutes, is amended to read as follows:
"§386‑21
Medical care, services, drugs, and supplies. (a) Immediately after
a work injury is sustained by an employee and so long as reasonably
needed, the employer shall furnish to the employee all medical care,
services, drugs, and supplies [as] that the nature of the
injury requires. [The liability] Liability pursuant to this section
for [the] medical care, services, drugs, and supplies shall be
subject to [the] a deductible [under] pursuant to
section 386-100.
(b) Whenever
medical care is needed, the injured employee may select any physician or
surgeon who [is practicing] practices on the island where the
injury was incurred to render medical care. If the services of a specialist
are indicated, the employee may select any physician or surgeon practicing in
the State. The director may authorize the selection of a specialist practicing
outside of the State [where] when no comparable medical
attendance within the State is available. Upon procuring the services of a
physician or surgeon, the injured employee shall give proper notice of the
employee's selection to the employer within a reasonable time after [the]
beginning [of the] treatment. If for any reason during the period when
medical care is needed, the employee wishes to change to another physician or
surgeon, the employee may do so in accordance with rules prescribed by the
director. If the employee is unable to select a physician or surgeon and the
emergency nature of the injury requires immediate medical attendance, or if the
employee does not desire to select a physician or surgeon and so advises the
employer, the employer shall select the physician or surgeon. The selection,
however, shall not deprive the employee of the employee's right [of] to
subsequently [selecting] select a physician or surgeon for
continuance of needed medical care.
(c) The
liability of the employer for medical care, services, drugs, and
supplies shall be limited to the charges computed [as set forth in] pursuant
to this section. The director shall make determinations of the charges and
shall adopt fee schedules based upon those determinations. Effective
January 1, 1997, and for each succeeding calendar year thereafter, the charges
shall not exceed one hundred ten per cent of fees prescribed in the Medicare
Resource Based Relative Value Scale applicable to Hawaii as prepared by the
United States Department of Health and Human Services, except as provided in
this [subsection.] section. The rates or fees provided for in
this section shall be adequate to ensure at all times the standard of services
and care intended by this chapter [to] for injured employees.
If the director determines that an allowance under the medicare program is not reasonable or if a medical treatment, accommodation, product, or service existing as of June 29, 1995, is not covered under the medicare program, the director, at any time, may establish an additional fee schedule or schedules not exceeding the prevalent charge for fees for services actually received by providers of health care services, to cover charges for that treatment, accommodation, product, or service. If no prevalent charge for a fee for service has been established for a given service or procedure, the director shall adopt a reasonable rate which shall be the same for all providers of health care services to be paid for that service or procedure.
The director
shall update the schedules required by this section every three years or
annually, as required[. The updates shall be], based upon:
(1) Future charges or additions prescribed in the Medicare Resource Based Relative Value Scale applicable to Hawaii as prepared by the United States Department of Health and Human Services; or
(2) A statistically
valid survey by the director of prevalent charges for fees for services
actually received by providers of health care services or based upon the
information provided to the director by the appropriate state agency [having]
with access to prevalent charges for medical fee information.
When a dispute exists between an insurer or self-insured employer and a medical services provider regarding the amount of a fee for medical services, the director may resolve the dispute in a summary manner as the director may prescribe; provided that a provider shall not charge more than the provider's private patient charge for the service rendered.
When a dispute
exists between an employee and [the] an employer or the
employer's insurer regarding the proposed treatment plan or whether medical
services should be continued, the employee shall continue to receive essential
medical services prescribed by the treating physician necessary to prevent
deterioration of the employee's condition or further injury until the director
issues a decision on whether the employee's medical treatment should be
continued. The director shall make a decision within thirty days of the filing
of a dispute. If the director determines that medical services pursuant to the
treatment plan should be or should have been discontinued, the director shall
designate the date after which medical services for that treatment plan are
denied. The employer or the employer's insurer may recover from the employee's
personal health care provider qualified pursuant to section 386-27, or from any
other appropriate occupational or non-occupational insurer, all the sums paid
for medical services rendered after the date designated by the director. Under
no circumstances shall the employee be charged for the disallowed services,
unless the services were obtained in violation of section 386-98. The
attending physician, employee, employer, or insurance carrier may request in
writing that the director review the denial of the treatment plan or the
continuation of medical services.
(d) The reimbursement amounts for drugs shall be priced in accordance with the medical fee schedules adopted by the director pursuant to subsection (c) or a lower amount for which the insurance carrier contracts. Payment for prescription drugs shall be made at the average wholesale price as listed in the Red Book: Pharmacy's Fundamental Reference, plus no more than forty per cent of the average wholesale price for drugs sold by a physician, hospital, pharmacy, or provider of service other than a physician; provided that:
(1) A physician who directly dispenses prescription medication to a patient on an island with a population of five hundred thousand or more shall be reimbursed a dispensing fee of $ per prescription dispensed; and
(2) A physician who directly dispenses prescription medication to a patient on an island with a population of less than five hundred thousand shall be reimbursed a dispensing fee of $ per prescription dispensed.
Repackaged or relabeled drug prices shall not exceed the amount as calculated in subsection (e).
(e) The price for a repackaged or relabeled drug shall be calculated by multiplying the number of units dispensed by the average wholesale price set by the original manufacturer of the underlying drug, plus no more than forty per cent, except where the insurance carrier and the specific provider seeking reimbursement have directly contracted with one another for a lower reimbursement amount, and adding an additional per cent repackaging premium.
(f) The price for a generic drug shall be calculated by multiplying the number of units dispensed by the wholesale price of the generic drug, plus no more than sixty per cent, except where the insurance carrier and the specific provider seeking reimbursement have directly contracted with one another for a lower reimbursement amount, and adding an additional per cent repackaging premium.
(g) Compounded medications shall be reimbursed based on the sum of the fee due for each medication ingredient having an assigned national drug code that is used in the compounded medication. If the national drug code for any ingredient is a code for a repackaged drug, the reimbursement for that ingredient shall be as provided in subsection (e).
(h) If information pertaining to the original labeler or manufacturer of the underlying drug product used in repackaged or compounded medications is not provided or is unknown, then reimbursement shall be based on the most reasonable and closely related average wholesale price for the underlying drug product.
(i) Physician dispensing of repackaged prescription medications shall be allowed on the initial visit only and shall not exceed a thirty day supply. All subsequent prescription medications shall be obtained by the patient from a pharmacy.
[(d)] (j)
The director, with input from stakeholders in the workers' compensation system,
including but not limited to insurers, health care providers, employers, and
employees, shall establish standardized forms for health care providers to use
when reporting on and billing for injuries compensable under this chapter. The
forms may be in triplicate, or in any other configuration so as to minimize, to
the extent practicable, the need for a health care provider to fill out
multiple forms describing the same workers' compensation case to the
department, the injured employee's employer, and the employer's insurer.
[(e)] (k)
If it appears to the director that the injured employee has wilfully refused to
accept the services of a competent physician or surgeon selected as provided in
this section, or has wilfully obstructed the physician or surgeon, or medical,
surgical, or hospital services or supplies, the director may consider [such]
the refusal or obstruction on the part of the injured employee to be a
waiver in whole or in part of the right to medical care, services, drugs,
and supplies, and may suspend the weekly benefit payments, if any, to which the
employee is entitled so long as the refusal or obstruction continues.
[(f)] (l)
Any funds as are periodically necessary to the department to implement the [foregoing]
provisions of this section may be charged to and paid from the special
compensation fund provided by section 386-151.
[(g)] (m)
In cases where the compensability of [the] a claim is not
contested by the employer, the medical services provider shall notify or bill
the employer, insurer, or the special compensation fund for services rendered
relating to the compensable injury within two years of the date services were
rendered. Failure to bill the employer, insurer, or the special compensation
fund within the two-year period shall result in the forfeiture of the medical
services provider's right to payment. The medical [[]services[]]
provider shall not directly charge the injured employee for treatments relating
to the compensable injury."
SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 4. This Act, upon its approval, shall take effect on July 1, 2113, and shall be repealed on July 1, 2015; provided that section 386-21, Hawaii Revised Statutes, shall be reenacted in the form in which it read on the day prior to the effective date of this Act.
Report Title:
Workers' Compensation; Drugs
Description:
Establishes price caps within the Hawaii workers' compensation insurance system for drugs. Authorizes a dispensing fee to physicians. Limits physicians' authority to directly dispense prescription medications. Effective July 1, 2113. Repeals July 1, 2015. (HB891 HD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.