In the Texas workers’ compensation system, pharmacy benefits are based on a series of rules that are 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, open and closed formularies, rules pertaining to the transition to a closed formulary from an open formulary, and other pharmaceutical provisions. Understanding the rules for pharmacy services and related resources, including the requirements for pharmacy informal and voluntary network online registration, are crucial to the clinically appropriate prescribing of prescriptions and successful reimbursement for both claims subject to certified networks, and claims not subject to certified networks.
- Reminder on Direction of Care Prohibitions for Pharmacy Services 12/9/13
- Addition of Zohydro as an “N” Status Drug to Appendix A, ODG Workers’ Compensation Drug Formulary from the Official Disability Guidelines – Treatment in Workers’ Comp 12/5/13
- Insurance Carrier Pharmacy Closed Formulary Data Call Results on Legacy N-Drug Claims (PDF)
- REMINDER-Pharmacy Closed Formulary Status and Legacy Claim Implementation 8/28/13
- Notice of Pharmacy Closed Formulary Data Call on Legacy Claims 7/1/13 (Instructions, Spreadsheet)
- Pharmacy Closed Formulary Status and Legacy Claim Implementation Reminders 1/8/13
Memo: Texas Workers’ Compensation System Adopts Pharmacy Closed Formulary (PDF) 8/1/11
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.”
Pharmacy Formulary Rules:
- §134.500 – Definitions
- §134.506 – Outpatient Open Formulary for Claims with Dates of Injury Prior to September 1, 2011
- §134.510 – Transition to the Use of the Closed Formulary for Claims with Dates of Injury Prior to September 1, 2011
- §134.520 – Outpatient Closed Formulary for Dates of Injury On or After September 1, 2011
- §134.530 – Requirements for Use of the Closed Formulary for Claims Not Subject to Certified Networks
- §134.540 – Requirements for Use of the Closed Formulary for Claims Subject to Certified Networks
- §134.550 – Medical Interlocutory Order
“N” Drugs in Official Disability Guidelines – Treatment in Workers’ Comp (ODG) / Appendix A, ODG Workers’ Compensation Drug Formulary
The Texas Department of Insurance, Division of Workers’ Compensation (TDI-DWC) has posted Appendix A, ODG Workers' Compensation Drug Formulary, from the Official Disability Guidelines – Treatment in Workers’ Comp (ODG). The TDI-DWC will update the listing monthly upon receipt from ODG. The online edition of the ODG is updated as new evidence becomes available and is the official source for TDI-DWC actions.
Pharmacy Closed Formulary Timeline
Pharmacy closed formulary critical milestone dates are based on the adopted rules. Using a single track line, the first milestone is the start date of 1/17/11, which is the effective date of the open formulary. The next milestone is 9/1/11, and shows the rules taking two tracks. One track is the continuation of the open formulary for dates of injury prior to 9/1/11, also termed “legacy” claims. The second track is the effective date of the closed formulary and medical interlocutory orders for dates of injury on or after 9/1/11. The third and final milestone is 9/1/13, which brings the closed formulary back to a single track line, showing the closed formulary to be applicable for all claims as of 9/1/13 and beyond, regardless of dates of injury.
Medical Interlocutory Order (MIO) - §134.550
The MIO provides a means for an injured employee to continue use of the previously prescribed and dispensed drug(s) throughout the duration of the appeals/dispute process after a preauthorization denial. A pharmacy or prescribing doctor can submit a request for an MIO using DWC Form-064, Medical Interlocutory Order Request.
- Check the Events and Training calendar for a seminar in your area
- Pharmacy Formulary Rules Presentation (PDF)
TDI-DWC has prepared sample notification letters for insurance carriers to consider when fulfilling the notification requirement of 28 TAC §134.510. This insurance carrier notification activity applies to the claims with dates of injury prior to September 1, 2011, referred to as legacy claims.
- Memo 7/24/12
- Notification Letter to the Prescribing Doctor
- Overview of the Pharmacy Closed Formulary
- Letter informing the Injured Employee English | Spanish
- Letter Informing the Pharmacy (if known)
Guidelines concerning the reimbursement of pharmaceutical services are found in 28 TAC §134.503. Reimbursement for brand name and generic drugs are based on the average wholesale price times a multiplier. Details of reimbursement methodologies for compounds and over-the-counter medications are described in this rule.
Implements Texas Labor Code §413.0141, Initial Pharmaceutical Coverage, which gives authority to the Commissioner of Workers’ Compensation to adopt rules to provide for payment of pharmaceutical services sufficient for the first seven days following the date of injury.
Requires doctors to prescribe generics and over-the-counter alternatives when appropriate. Texas Labor Code §408.028, Pharmaceutical Services, provides that the Commissioner of Workers’ Compensation must require the use of generic medications and clinically appropriate over-the-counter alternatives to prescription drugs.
Provides a process for the claimant to obtain reimbursement for medications that have been purchased out-of-pocket.
If you have questions, contact Comp Connection for Health Care Providers at 800-372-7713, option 3.
For more information contact:
Last updated: 12/09/2013