New State Law Regulates Health Insurers’ Prescription Drug Policies
Late last week Gov. Bruce Rauner signed legislation regulating health insurance protocols that require patients to start treatment with the least expensive version of a medication their doctor prescribed, even if it means the treatment could fail.
“One of the things insurance companies do sometimes is they’ll say that every single patient, no matter his or her circumstance, must first be started on the cheapest medicine on the insurance company’s formulary (or list of covered medications),” said Mark Heyrman, a clinical professor of law at the University of Chicago specializing in the rights of the mentally disabled.
“Every insurance company is required to have medications to treat all illnesses, so they’ll say, ‘We’ll allow the following medicines to be prescribed but you must start every patient on the absolute cheapest medication.’
“The only way a doctor is allowed to prescribe a more expensive medication is for you to fail on the cheapest, then you move to the next cheapest medication, and then if you fail on this, you’ll move to the next cheapest medication,” Heyrman said.
The practice is known as step therapy. The new law doesn't eliminate it, but adds some exceptions to it and makes the appeal process more transparent.
“Say I’m on a medication and it’s working for me and I’m stable, and my insurance changes and this medicine is covered under my new insurance. Because I’m stable on this drug, I don’t have to start the step process over again,” said Illinois Rep. Laura Fine (D-Glenview), who sponsored the legislation. “I can keep taking my medication. Prior to this legislation even if you were stable [on a prescribed medication] you’d have to start over if your insurance changed.”
Exceptions to step therapy are also allowed if doctors submit documentation on behalf of their patients showing that a specific medication was already tried and either failed to treat the patient or the patient experienced intolerable side effects.
Fine knows the practice well.
“I was very familiar with [step therapy] because my husband had gone through this six years ago. He was in a bad car accident and he lost his left arm as a result of it,” Fine said. “The doctor knew which medication would work best for him and it took months for our insurance company to cover that. He had to try and fail at two others before he could try this one.”
Step therapy can delay treatment as patients are required to try multiple medications and create more work for doctors who may have to call insurance companies to see if a prescribed medication will be covered or file an appeal when a patient is denied that medication, according to the Alliance for Patient Access, a national network of physicians advocating for patient access to approved therapies and appropriate clinical care.
If a cheaper medication can effectively treat a patient, Heyrman says “there’s nothing wrong with that,” but there are situations that warrant the use of more expensive medications.
“Failure can be catastrophic for the patient. It is often the case that the doctor and the patient will already know that the cheapest medication won’t work,” he said. “There are some medicines in my area of mental health that are not recommended for people who have hypertension or who are overweight or who have diabetes. No reasonable doctor would start you on that medication, and the doctor has a sound clinical reason for not choosing that medication and choosing something else.”
The legislation is the culmination of a yearslong process and compromise, Fine says.
“I worked with advocates and the insurance companies. We found a middle ground that’s really going to help a lot of people,” she added.
The law goes into effect Jan. 1, 2018.
Follow Kristen Thometz on Twitter: @kristenthometz
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