BILL NUMBER:S2711A

TITLE  OF BILL:  An act to amend the insurance law, in relation to the
regulation of step therapy and first fail policies

PURPOSE: This bill would amend the insurance law by adding Article  33
which  would regulate fail first accident/or health insurance policies
that require a patient to exhaust the  least  expensive  drug  options
before insurers will cover more expensive treatment options.

SUMMARY  OF  PROVISIONS:    This bill would amend the insurance law by
adding a new Article 33 which would ensure prescribers  have  a  clear
and  convenient  process  to  override  step  therapy  under  specific
conditions when medically in the best interest of the patient.

This bill does not  prohibit  step  therapy,  but  rather  establishes
guidelines to ensure providers have an expeditious process to override
step  therapy  in  select  instances where based on sound clinical and
medical evidence and professional medical judgment  providers  believe
it  is  medically  in  the best interest of the patient not to require
failure on an alternative and chemically different therapeutic agent.

In cases where step therapy is required, the bill would limit the time
period a patient could be subjected to step-therapy  (or  required  to
fail on a treatment) to the period deemed necessary by the prescribing
physician to determine the treatment's clinical effectiveness or for a
              

period no longer than thirty days.

The   amendments   provided   in  this  bill  do  not  impact  generic
substitution authorized by  the  New  York  State  Medicaid  Mandatory
Generic Drug Program.

JUSTIFICATION:    Step  Therapy  or  fail first policies is a practice
which requires the least expensive drug in any class to be  proscribed
to  a  patient  first,  even  if  the  required therapy is a different
therapeutic agent that the patient's physician believes  is  medically
in  the best interest of the patient. If the treatment is ineffective,
insurers will then cover the more expensive treatment options.

There are currently no time limits  or  restrictions  placed  on  fail
first   policies.  Patients,  including  those  with  serious  medical
conditions, can be required to fail for an indefinite period  of  time
before  the  agent  preferred by the physician can be prescribed. This
practice has the potential to result in serious negative  consequences
for  consumers  and the public health system. By limiting the array of
medication options,  both  physicians  and  consumers  are  forced  to
compromise  their treatment decisions in a way that is dangerous, time
consuming and more expensive.

Under fail first, a consumer will often have to fail on  one  or  more
medications  before they are allowed access to the medication that his
or her physician would have tried as an initial treatment. It is  poor
clinical  care  to delay the start of effective treatment and expose a
person to unnecessary risk. In this way, fail  first  denies  patients
the  drugs  they  need  when  they  need  them, and effectively allows
insurers to practice medicine without a license. There are significant
administrative costs' associated with these types of policies and most


importantly, consumers can relapse and require more expensive  medical
interventions such as hospitalization.

The  internal and external appeals process provisions in the insurance
law, Title II (sections 4900-08  and  4910-17),  do  not  provide  the
necessary  protections for patients and physicians regarding access to
treatments restricted by fail first protocols. Title  II  outlines  an
appeal process for an "adverse determination"; however a fail first or
step   therapy   requirement   does   not   qualify   as  an  "adverse
determination"  under  the  definition.  The  existing  appeal   right
addresses  a  determination  later  in the process than a step therapy
override  would.  For  example,  the  step  therapy  override  process
addresses   whether   a  patient  should  be  required  to  try  other
medications before the  desired  treatment  is  covered,  rather  than
whether  the  desired  treatment  is medically necessary and should be
covered at all. The proposed legislation would  expedite  the  process
and allow for an override at an earlier point in the treatment process
than a final adverse determination.

When medically in the best interest of the patient, prescribers need a
clear  process to override the step therapy or fail first requirement.
In cases where step therapy or fail  first  policies  continue  to  be
applied,  the time period a patient could be subjected to step-therapy
(or required to fail on a treatment) should be limited to  the  period
deemed  necessary  by  the  prescribing  physician  to  determine  the
treatment's clinical effectiveness or  a  period  of  no  longer  than
thirty days.

The  following states have recently enacted legislation to prohibit or
limit fail first and step therapy practices when medically in the best
interest   of   the   patient:   Arkansas,   Connecticut,   Louisiana,
Mississippi,  Texas,  Utah, California, and Massachusetts. Patients in
New York currently subject to step therapy and  fail  first  practices
require similar protections.

LEGISLATIVE HISTORY:  2012: S.6464/A.9397 Referred to Insurance

FISCAL IMPLICATIONS:  Undetermined at this time.

EFFECTIVE  DATE:  This act shall take effect on the 120th day after it
shall have become a law.