1.1                          A bill for an act 
  1.2             relating to human services; correcting inconsistencies 
  1.3             in mental health services coverage under provided 
  1.4             health plans; restricting prior authorization 
  1.5             requirements for certain drugs; amending Minnesota 
  1.6             Statutes 2000, section 245.50, subdivisions 1, 2, 5; 
  1.7             Minnesota Statutes 2001 Supplement, section 256B.0625, 
  1.8             subdivision 13. 
  1.9   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.10     Section 1.  Minnesota Statutes 2000, section 245.50, 
  1.11  subdivision 1, is amended to read: 
  1.12     Subdivision 1.  [DEFINITIONS.] For purposes of this 
  1.13  section, the following terms have the meanings given them. 
  1.14     (a) "Bordering state" means Iowa, North Dakota, South 
  1.15  Dakota, or Wisconsin. 
  1.16     (b) "Receiving agency or facility" means a public or 
  1.17  private hospital, mental health center, or other person or 
  1.18  organization authorized by a state to provide which provides 
  1.19  mental health services under this section to individuals from a 
  1.20  state other than the state in which the agency is located. 
  1.21     (c) "Receiving state" means the state in which a receiving 
  1.22  agency is located. 
  1.23     (d) "Sending agency" means a state or county agency which 
  1.24  sends an individual to a bordering state for treatment under 
  1.25  this section. 
  1.26     (e) "Sending state" means the state in which the sending 
  1.27  agency is located. 
  2.1      Sec. 2.  Minnesota Statutes 2000, section 245.50, 
  2.2   subdivision 2, is amended to read: 
  2.3      Subd. 2.  [PURPOSE AND AUTHORITY.] (a) The purpose of this 
  2.4   section is to enable appropriate treatment to be provided to 
  2.5   individuals, across state lines from the individual's state of 
  2.6   residence, in qualified facilities that are closer to the homes 
  2.7   of individuals than are facilities available in the individual's 
  2.8   home state. 
  2.9      (b) Unless prohibited by another law and subject to the 
  2.10  exceptions listed in subdivision 3, a county board or the 
  2.11  commissioner of human services may contract with an agency or 
  2.12  facility in a bordering state for mental health services for 
  2.13  residents of Minnesota, and a Minnesota mental health agency or 
  2.14  facility may contract to provide services to residents of 
  2.15  bordering states.  Except as provided in subdivision 5, a person 
  2.16  who receives services in another state under this section is 
  2.17  subject to the laws of the state in which services are 
  2.18  provided.  A person who will receive services in another state 
  2.19  under this section must be informed of the consequences of 
  2.20  receiving services in another state, including the implications 
  2.21  of the differences in state laws, to the extent the individual 
  2.22  will be subject to the laws of the receiving state. 
  2.23     Sec. 3.  Minnesota Statutes 2000, section 245.50, 
  2.24  subdivision 5, is amended to read: 
  2.25     Subd. 5.  [SPECIAL CONTRACTS; WISCONSIN BORDERING 
  2.26  STATES.] The commissioner of the Minnesota department of human 
  2.27  services must enter into negotiations with appropriate personnel 
  2.28  at the Wisconsin department of health and social services and 
  2.29  must develop an agreement that conforms to the requirements of 
  2.30  subdivision 4, to enable the placement in Minnesota of patients 
  2.31  who are on emergency holds or who have been involuntarily 
  2.32  committed as mentally ill or chemically dependent in Wisconsin 
  2.33  and to enable the temporary placement in Wisconsin of patients 
  2.34  who are on emergency holds in Minnesota under section 253B.05, 
  2.35  provided that the Minnesota courts retain jurisdiction over 
  2.36  Minnesota patients, and the state of Wisconsin affords to 
  3.1   Minnesota patients the rights under Minnesota law.  Persons 
  3.2   committed by the Wisconsin courts and placed in Minnesota 
  3.3   facilities shall continue to be in the legal custody of 
  3.4   Wisconsin and Wisconsin's laws governing length of commitment, 
  3.5   reexaminations, and extension of commitment shall continue to 
  3.6   apply to these residents.  In all other respects, Wisconsin 
  3.7   residents placed in Minnesota facilities are subject to 
  3.8   Minnesota laws.  The agreement must specify that responsibility 
  3.9   for payment for the cost of care of Wisconsin residents shall 
  3.10  remain with the state of Wisconsin and the cost of care of 
  3.11  Minnesota residents shall remain with the state of Minnesota.  
  3.12  The commissioner shall be assisted by attorneys from the 
  3.13  Minnesota attorney general's office in negotiating and 
  3.14  finalizing this agreement.  The agreement shall be completed so 
  3.15  as to permit placement of Wisconsin residents in Minnesota 
  3.16  facilities and Minnesota residents in Wisconsin facilities 
  3.17  beginning July 1, 1994. (a) An individual who is detained, 
  3.18  committed, or placed on an involuntary basis under chapter 253B 
  3.19  may be confined or treated in a bordering state pursuant to a 
  3.20  contract under this section.  An individual who is detained, 
  3.21  committed, or placed on an involuntary basis under the civil law 
  3.22  of a bordering state may be confined or treated in Minnesota 
  3.23  pursuant to a contract under this section.  A peace or health 
  3.24  officer who is acting under the authority of the sending state 
  3.25  may transport an individual to a receiving agency that provides 
  3.26  services pursuant to a contract under this section, and may 
  3.27  transport the individual back to the sending state under the 
  3.28  laws of the sending state.  Court orders valid under the law of 
  3.29  the sending state are granted recognition and reciprocity in the 
  3.30  receiving state for individuals covered by a contract under this 
  3.31  section to the extent that the court orders relate to 
  3.32  confinement for treatment or care of mental illness.  Such 
  3.33  treatment or care may address other conditions that may be 
  3.34  co-occurring with the mental illness.  These court orders are 
  3.35  not subject to legal challenge in the courts of the receiving 
  3.36  state.  Individuals who are detained, committed, or placed under 
  4.1   the law of a sending state and who are transferred to a 
  4.2   receiving state under this section continue to be in the legal 
  4.3   custody of the authority responsible for them under the law of 
  4.4   the sending state.  Except in emergencies, those individuals may 
  4.5   not be transferred, removed, or furloughed from a receiving 
  4.6   agency without the specific approval of the authority 
  4.7   responsible for them under the law of the sending state. 
  4.8      (b) While in the receiving state pursuant to a contract 
  4.9   under this section, an individual shall be subject to the 
  4.10  sending state's laws and rules relating to length of 
  4.11  confinement, reexaminations, and extensions of confinement.  No 
  4.12  individual may be sent to another state pursuant to a contract 
  4.13  under this section until the receiving state has enacted a law 
  4.14  recognizing the validity and applicability of this section. 
  4.15     (c) If an individual receiving services pursuant to a 
  4.16  contract under this section leaves the receiving agency without 
  4.17  permission and the individual is subject to involuntary 
  4.18  confinement under the law of the sending state, the receiving 
  4.19  agency shall use all reasonable means to return the individual 
  4.20  to the receiving agency.  The receiving agency shall immediately 
  4.21  report the absence to the sending agency.  The receiving state 
  4.22  has the primary responsibility for, and the authority to direct, 
  4.23  the return of these individuals within its borders and is liable 
  4.24  for the cost of the action to the extent that it would be liable 
  4.25  for costs of its own resident. 
  4.26     (d) Responsibility for payment for the cost of care remains 
  4.27  with the sending agency. 
  4.28     (e) This subdivision also applies to county contracts under 
  4.29  subdivision 2 which include emergency care and treatment 
  4.30  provided to a county resident in a bordering state. 
  4.31     Sec. 4.  Minnesota Statutes 2001 Supplement, section 
  4.32  256B.0625, subdivision 13, is amended to read: 
  4.33     Subd. 13.  [DRUGS.] (a) Medical assistance covers drugs, 
  4.34  except for fertility drugs when specifically used to enhance 
  4.35  fertility, if prescribed by a licensed practitioner and 
  4.36  dispensed by a licensed pharmacist, by a physician enrolled in 
  5.1   the medical assistance program as a dispensing physician, or by 
  5.2   a physician or a nurse practitioner employed by or under 
  5.3   contract with a community health board as defined in section 
  5.4   145A.02, subdivision 5, for the purposes of communicable disease 
  5.5   control.  The commissioner, after receiving recommendations from 
  5.6   professional medical associations and professional pharmacist 
  5.7   associations, shall designate a formulary committee to advise 
  5.8   the commissioner on the names of drugs for which payment is 
  5.9   made, recommend a system for reimbursing providers on a set fee 
  5.10  or charge basis rather than the present system, and develop 
  5.11  methods encouraging use of generic drugs when they are less 
  5.12  expensive and equally effective as trademark drugs.  The 
  5.13  formulary committee shall consist of nine members, four of whom 
  5.14  shall be physicians who are not employed by the department of 
  5.15  human services, and a majority of whose practice is for persons 
  5.16  paying privately or through health insurance, three of whom 
  5.17  shall be pharmacists who are not employed by the department of 
  5.18  human services, and a majority of whose practice is for persons 
  5.19  paying privately or through health insurance, a consumer 
  5.20  representative, and a nursing home representative.  Committee 
  5.21  members shall serve three-year terms and shall serve without 
  5.22  compensation.  Members may be reappointed once.  
  5.23     (b) The commissioner shall establish a drug formulary.  Its 
  5.24  establishment and publication shall not be subject to the 
  5.25  requirements of the Administrative Procedure Act, but the 
  5.26  formulary committee shall review and comment on the formulary 
  5.27  contents.  The formulary committee shall review and recommend 
  5.28  drugs which require prior authorization.  The formulary 
  5.29  committee may recommend drugs for prior authorization directly 
  5.30  to the commissioner, as long as opportunity for public input is 
  5.31  provided.  Prior authorization may be requested by the 
  5.32  commissioner based on medical and clinical criteria before 
  5.33  certain drugs are eligible for payment.  Before a drug may be 
  5.34  considered for prior authorization at the request of the 
  5.35  commissioner:  
  5.36     (1) the drug formulary committee must develop criteria to 
  6.1   be used for identifying drugs; the development of these criteria 
  6.2   is not subject to the requirements of chapter 14, but the 
  6.3   formulary committee shall provide opportunity for public input 
  6.4   in developing criteria; 
  6.5      (2) the drug formulary committee must hold a public forum 
  6.6   and receive public comment for an additional 15 days; and 
  6.7      (3) the commissioner must provide information to the 
  6.8   formulary committee on the impact that placing the drug on prior 
  6.9   authorization will have on the quality of patient care and 
  6.10  information regarding whether the drug is subject to clinical 
  6.11  abuse or misuse.  Prior authorization may be required by the 
  6.12  commissioner before certain formulary drugs are eligible for 
  6.13  payment.  The formulary shall not include:  
  6.14     (i) drugs or products for which there is no federal 
  6.15  funding; 
  6.16     (ii) over-the-counter drugs, except for antacids, 
  6.17  acetaminophen, family planning products, aspirin, insulin, 
  6.18  products for the treatment of lice, vitamins for adults with 
  6.19  documented vitamin deficiencies, vitamins for children under the 
  6.20  age of seven and pregnant or nursing women, and any other 
  6.21  over-the-counter drug identified by the commissioner, in 
  6.22  consultation with the drug formulary committee, as necessary, 
  6.23  appropriate, and cost-effective for the treatment of certain 
  6.24  specified chronic diseases, conditions or disorders, and this 
  6.25  determination shall not be subject to the requirements of 
  6.26  chapter 14; 
  6.27     (iii) anorectics, except that medically necessary 
  6.28  anorectics shall be covered for a recipient previously diagnosed 
  6.29  as having pickwickian syndrome and currently diagnosed as having 
  6.30  diabetes and being morbidly obese; 
  6.31     (iv) drugs for which medical value has not been 
  6.32  established; and 
  6.33     (v) drugs from manufacturers who have not signed a rebate 
  6.34  agreement with the Department of Health and Human Services 
  6.35  pursuant to section 1927 of title XIX of the Social Security Act.
  6.36     The commissioner shall publish conditions for prohibiting 
  7.1   payment for specific drugs after considering the formulary 
  7.2   committee's recommendations.  An honorarium of $100 per meeting 
  7.3   and reimbursement for mileage shall be paid to each committee 
  7.4   member in attendance.  
  7.5      (c) The basis for determining the amount of payment shall 
  7.6   be the lower of the actual acquisition costs of the drugs plus a 
  7.7   fixed dispensing fee; the maximum allowable cost set by the 
  7.8   federal government or by the commissioner plus the fixed 
  7.9   dispensing fee; or the usual and customary price charged to the 
  7.10  public.  The pharmacy dispensing fee shall be $3.65, except that 
  7.11  the dispensing fee for intravenous solutions which must be 
  7.12  compounded by the pharmacist shall be $8 per bag, $14 per bag 
  7.13  for cancer chemotherapy products, and $30 per bag for total 
  7.14  parenteral nutritional products dispensed in one liter 
  7.15  quantities, or $44 per bag for total parenteral nutritional 
  7.16  products dispensed in quantities greater than one liter.  Actual 
  7.17  acquisition cost includes quantity and other special discounts 
  7.18  except time and cash discounts.  The actual acquisition cost of 
  7.19  a drug shall be estimated by the commissioner, at average 
  7.20  wholesale price minus nine percent, except that where a drug has 
  7.21  had its wholesale price reduced as a result of the actions of 
  7.22  the National Association of Medicaid Fraud Control Units, the 
  7.23  estimated actual acquisition cost shall be the reduced average 
  7.24  wholesale price, without the nine percent deduction.  The 
  7.25  maximum allowable cost of a multisource drug may be set by the 
  7.26  commissioner and it shall be comparable to, but no higher than, 
  7.27  the maximum amount paid by other third-party payors in this 
  7.28  state who have maximum allowable cost programs.  The 
  7.29  commissioner shall set maximum allowable costs for multisource 
  7.30  drugs that are not on the federal upper limit list as described 
  7.31  in United States Code, title 42, chapter 7, section 1396r-8(e), 
  7.32  the Social Security Act, and Code of Federal Regulations, title 
  7.33  42, part 447, section 447.332.  Establishment of the amount of 
  7.34  payment for drugs shall not be subject to the requirements of 
  7.35  the Administrative Procedure Act.  An additional dispensing fee 
  7.36  of $.30 may be added to the dispensing fee paid to pharmacists 
  8.1   for legend drug prescriptions dispensed to residents of 
  8.2   long-term care facilities when a unit dose blister card system, 
  8.3   approved by the department, is used.  Under this type of 
  8.4   dispensing system, the pharmacist must dispense a 30-day supply 
  8.5   of drug.  The National Drug Code (NDC) from the drug container 
  8.6   used to fill the blister card must be identified on the claim to 
  8.7   the department.  The unit dose blister card containing the drug 
  8.8   must meet the packaging standards set forth in Minnesota Rules, 
  8.9   part 6800.2700, that govern the return of unused drugs to the 
  8.10  pharmacy for reuse.  The pharmacy provider will be required to 
  8.11  credit the department for the actual acquisition cost of all 
  8.12  unused drugs that are eligible for reuse.  Over-the-counter 
  8.13  medications must be dispensed in the manufacturer's unopened 
  8.14  package.  The commissioner may permit the drug clozapine to be 
  8.15  dispensed in a quantity that is less than a 30-day supply.  
  8.16  Whenever a generically equivalent product is available, payment 
  8.17  shall be on the basis of the actual acquisition cost of the 
  8.18  generic drug, unless the prescriber specifically indicates 
  8.19  "dispense as written - brand necessary" on the prescription as 
  8.20  required by section 151.21, subdivision 2. 
  8.21     (d) For purposes of this subdivision, "multisource drugs" 
  8.22  means covered outpatient drugs, excluding innovator multisource 
  8.23  drugs for which there are two or more drug products, which: 
  8.24     (1) are related as therapeutically equivalent under the 
  8.25  Food and Drug Administration's most recent publication of 
  8.26  "Approved Drug Products with Therapeutic Equivalence 
  8.27  Evaluations"; 
  8.28     (2) are pharmaceutically equivalent and bioequivalent as 
  8.29  determined by the Food and Drug Administration; and 
  8.30     (3) are sold or marketed in Minnesota. 
  8.31  "Innovator multisource drug" means a multisource drug that was 
  8.32  originally marketed under an original new drug application 
  8.33  approved by the Food and Drug Administration. 
  8.34     (e) The basis for determining the amount of payment for 
  8.35  drugs administered in an outpatient setting shall be the lower 
  8.36  of the usual and customary cost submitted by the provider; the 
  9.1   average wholesale price minus five percent; or the maximum 
  9.2   allowable cost set by the federal government under United States 
  9.3   Code, title 42, chapter 7, section 1396r-8(e), and Code of 
  9.4   Federal Regulations, title 42, section 447.332, or by the 
  9.5   commissioner under paragraph (c). 
  9.6      (f) Prior authorization shall not be required or utilized 
  9.7   for any antipsychotic drug prescribed for the treatment of 
  9.8   mental illness where there is no generically equivalent drug 
  9.9   available.  This paragraph applies to any supplemental drug 
  9.10  rebate program established or administered by the commissioner.