Mandated Benefits

Issue Description

It is estimated that in the past 30 years, lawmakers have passed more than 2,000 bills at the federal and state levels mandating specific coverage on every fully insured policy under control of that legislature. (NCSL 2015)  Many of these laws have a direct impact on the management of the pharmacy benefit. 

A summary of mandates implemented by the Affordable Care Act of 2010 are available from the National Conference of State Legislatures (NCSL).

Pharmacy mandates typically come in three forms:

  • Mandated Formulary – These mandates require pharmacy benefits to include coverage of medications to treat a certain population or condition. A good example of this is the requirement to cover medications that address the condition of infertility.
  • Mandates that call for coverage parity – These mandates typically require a plan to cover not just those agents it deems most appropriate, but all agents available to treat a condition, at parity cost. This may, for instance, require the coverage of medications that have a less desirable delivery method (i.e., intravenous) than the preferred medication(s).
  • Mandated coverage of medication for off-label use – These mandates undermine a plan’s ability to ensure the medications provided to its members are safe and efficacious.

AMCP Position Statements

Government-Mandated Pharmacy Benefits: The Academy of Managed Care Pharmacy (AMCP) believes managed care organizations (MCOs) and their clients (e.g., individuals, employers, government) must be able to independently make decisions regarding health benefits in order to meet the medical needs of their patient populations. Mandates imposed by government restrict a MCO’s ability to deliver a quality product and decrease the affordability and financial sustainability of the benefit. This statement discusses three types of government mandates that can affect a managed care pharmacist’s ability to design an appropriate pharmacy benefit: mandated formulary content, mandated coverage parity terms and mandated coverage of medications for specific indications. Read more

Therapeutic Interchange: The Academy of Managed Care Pharmacy (AMCP) supports the use of therapeutic interchange programs as a part of a comprehensive approach to quality, cost-effective patient care. Therapeutic interchange is the practice of replacing, with the prescribing physician’s approval, a prescription medication originally prescribed for a patient with a chemically different medication. Medications used in therapeutic interchange programs are expected to produce similar levels of clinical effectiveness and sound medical outcomes, based on available scientific evidence. Read more

Four Examples of Mandated Benefits:

  1. Mandating Coverage of Certain Services or Items 
  2. Mandates Impacting Provider Networks 
  3. Requirements on Establishing the Formulary Structure 
  4. Requirement or Restrictions on use of PAs, Step/Fail First protocols, Therapeutic Interchange, Mail-order 
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