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Advisory 2002-06

Implementation of Pharmacy Rules

The Texas Workers' Compensation Commission (Commission) provides clarification for the implementation of adopted new rules 134.500, 134.502-134.504, and 134.506 that apply to all prescriptions that are prescribed or filled on or after March 1, 2002.

Form TWCC-66
The TWCC-66 (Statement of Pharmacy Services) has been revised to reflect the requirements of the new pharmacy rules. The revised form is available on the Commission web site at Pharmacists may use the revised TWCC-66a immediately. The revised TWCC-66a is required for all pharmacy bills submitted on or after April 1, 2002.

Generic Substitutions
The Commission is aware of the Texas Pharmacy Act §562.009 (Occupations Code) that requires a pharmacist to inform patients of their right to refuse generic equivalent substitution or to display a sign that informs patients of their right to refuse generic substitution. Because in many non-workers' compensation insurance plans the patient is required or permitted to pay a co-payment, the patient may refuse a generic substitution in those plans, but not in Texas Workers' Compensation.

The Commission emphasizes that workers' compensation patients are not allowed to refuse generic substitution and to pay the difference. As stated in Rule 134.503(b) "When the doctor has written a prescription for a generic prescription drug or a prescription that does not require the use of a brand-name drug, in accordance with Rule 134.502(a)(3), the pharmacist shall dispense and be reimbursed for the generic pharmaceutical medication." Additionally, if a pharmacy knowingly charges an injured employee for any or all of the cost of a prescription related to a compensable injury or to an injury in dispute that has not been finally adjudicated as non-compensable, the pharmacy is in violation of Texas Labor Code §413.042 and may be subject to administrative sanctions. The statute and Commission rules allow a brand-name prescription drug to be dispensed only when the prescribing doctor has prohibited the substitution of a generically equivalent drug by writing on the prescription "brand necessary" or "brand medically necessary." If an employee is having difficulty with the generic prescription drug, the employee should contact the prescribing doctor to discuss the situation.

Statement of Medical Necessity
An insurance carrier (carrier) shall request a Statement of Medical Necessity as required by Rule 134.502(e), only if the carrier is considering denying reimbursement in whole or in part for reasons related to medical necessity. A carrier is not required to request a Statement of Medical Necessity if the reason that reimbursement is being denied does not include any reasons relating to medical necessity.

Requirement to Provide the EOB
It is important for the employee and the prescribing doctor to know about a carrier's denial of a pharmacy bill because the denial of payment for the prescription could affect the employee's access to medically necessary medication. Although Rule 134.502(h) requires the insurance carrier to send the TWCC-62 (Explanation of Benefits or EOB) to the pharmacist, the employee, and the prescribing doctor when a bill is either reduced or denied, the Commission will not take enforcement action against an insurance carrier for failing to provide the TWCC-62 to the employee and the prescribing doctor when a bill is reduced in accordance with Rule 133.503 Reimbursement Methodology. The requirement for the insurance carrier to send the EOB to the pharmacist will be enforced with respect to reductions and denials, as will the requirement to send the EOB to the employee and prescribing doctor on denials in accordance with Rule 134.502(h). The "grace period" on enforcement regarding notice of a reduction is effective only until further notice from the Commission, which will be given prior to the end of the "grace period".

Signed this 7th day of March, 2002

Richard F. Reynolds, Executive Director

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