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Pharmacy

In the Texas workers' compensation system, pharmacy benefits are based on a series of rules entitled Pharmaceutical Benefits [28 Texas Administrative Code (TAC) §134.500 through §134.550]. These rules cover commonly used definitions, initial pharmaceutical coverage, prescribing of generics and over-the-counter drugs in addition to brand name drugs, a pharmacy fee guideline, a closed formulary, and other pharmaceutical provisions. Understanding the rules for pharmacy services and related resources are crucial to the clinically appropriate prescribing of prescriptions and successful reimbursement for both claims subject to certified workers' compensation health care networks (networks), and claims not subject to certified networks (non-network).

Appendix A | Pharmacy Rules | Pharmacy Closed Formulary Rule Development and Implementation | Related Links

Appendix A

"N" Drugs in Official Disability Guidelines - Treatment in Workers' Comp (ODG) / Appendix A, ODG Workers' Compensation Drug Formulary

The Division of Workers' Compensation (DWC) has posted Appendix A, ODG Workers' Compensation Drug Formulary, from the Official Disability Guidelines - Treatment in Workers' Comp (ODG). The DWC updates the Appendix A listing monthly upon receipt from ODG, just as the online edition of the ODG is updated as new evidence becomes available and is the official source for DWC actions.

 Closed pharmacy formulary diagram*  closed formulary includes ALL FDA approved drugs. It excludes the following, which require preauthorization:   Drugs with "N" stauts Investigational or experimental drugs All prescription drugs created through compounding  *After initial pharmaceutical coverage 28 TAC §134.501

As of September 1, 2013, the pharmacy closed formulary applies to all claims regardless of date of injury. The pharmacy closed formulary includes all FDA approved drugs. Preauthorization is required for drugs identified with a status of "N" in the current edition of the ODG; any compound that contains a drug identified with an “N status, and any investigational or experimental drug as defined in Texas Labor Code §413.014(a).

The definition of the closed formulary was amended in April of 2018 to exclude from the closed formulary any prescription drug created through compounding. Consequently, all new prescriptions for drugs created through compounding after July 1, 2018 will require preauthorization.  

Pharmacy Rules:

Training Tools

Pharmacy Closed Formulary Rule Development and Implementation

April 2018

The DWC posted a notice of adopted amendments to §134.500 which will exclude from the closed formulary all prescription drugs created through compounding prescribed and dispensed on or after July 1, 2018. The adopted amendments to §134.530 and §134.540 will require preauthorization of these drugs for claims subject to and not subject to certified networks. The rule changes do not prohibit the use of compounded drugs for injured employees when medically necessary; however, they do require that medical necessity be determined prior to prescribing and dispensing these drugs on or after July 1, 2018. Prescriptions for compounded drugs not requiring preauthorization that are written before July 1, 2108, and refills for those prescriptions, will not be impacted by these rule changes.

  • Memo
  • Adopted Rules (§134.500, 134.530, 134.540)
  • Rule proposal and public hearing
    • January 10, 2018, and February 15, 2018
  • Informal working drafts of the rules published on the agency’s website
    • June 16, 2017
November 2015

The DWC prepared sample notification letters that insurance carriers may use for notifications.  This insurance carrier notification activity applied to claims where injured employees were prescribed Fentanyl Transdermal Patches and/or MS-Contin.

September 2013

August 2013

REMINDER-Pharmacy Closed Formulary Status and Legacy Claim Implementation

July 2013

Notice of Pharmacy Closed Formulary Data Call on Legacy Claims ( Instructions, Spreadsheet)

January 2013

Pharmacy Closed Formulary Status and Legacy Claim Implementation Reminders

July 2012

The DWC prepared sample notification letters for insurance carriers to consider when fulfilling the notification requirement of 28 TAC §134.510. This insurance carrier notification activity applied to the claims with dates of injury prior to September 1, 2011, referred to as legacy claims.

September 2011

Closed formulary applicable to new claims

August 2011

Memo - Texas Workers' Compensation System Adopts Pharmacy Closed Formulary (PDF)

December 2010

Rule adoption

March 2008 - August 2010

  • Research and rule development
  • System participant meetings
    • August 25, 2008, March 5, 2009, and August 20, 2009
  • Informal working drafts of the rules published on the agency's website
    • December 16, 2008, June 12, 2009, and February 4, 2010
  • Rule proposal and public hearing
    • July 16, 2010, and August 16, 2010

2005

The 79th Texas Legislature passed House Bill 7, which amended Texas Labor Code §408.028 concerning Pharmaceutical Services. The pertinent provisions stated: "The commissioner by rule shall adopt a closed formulary under Section 413.011. Rules adopted by the commissioner shall allow an appeals process for claims in which a treating doctor determines and documents that a drug not included in the formulary is necessary to treat an injured employee's compensable injury."

Related Links

Informal/Voluntary Networks

Preauthorization

Workers' Compensation Research and Evaluation Group

If you have questions, contact Comp Connection for Health Care Providers at 800-252-7031, option 3.

For more information, contact:

Last updated: 6/1/2018