KRS 304.17A-535: Drug utilization waiver program -- Limitations on generic

substitution -- Application to drug formulary.

(1) A managed care plan shall include a drug utilization review program, the primary

emphasis of which shall be to enhance quality of care for enrollees by assuring

appropriate drug therapy within the health care provider's legally authorized scope

of practice, that:

(a) Includes the following:

1. Retrospective review of prescription drugs furnished to enrollees;

2. Education of health care providers and enrollees regarding the

appropriate use of prescription drugs; and

3. Ongoing periodic examination of data on outpatient prescription drugs

to ensure quality therapeutic outcomes for enrollees; and

(b) Complies with KRS 304.17A-163 and 304.17A-1631.

(2) The drug utilization review program shall utilize the following to effectuate the

purposes of subsection (1) of this section:

(a) Relevant clinical criteria and standards for drug therapy;

(b) Nonproprietary criteria and standards developed and revised through input

from participating health care providers;

(c) Intervention that focuses on improving therapeutic outcomes; and

(d) Measures to ensure the confidentiality of the relationship between an enrollee

and a health care provider.

(3) When, in the professional opinion of a provider with prescriptive authority, the

provider determines that generic substitution of a pharmaceutical product is

medically inappropriate, the provider shall prescribe the pharmaceutical product the

provider determines medically appropriate with the indication "Do Not Substitute,"

and no substitution shall be made without the provider's approval.

(4) A managed care plan that restricts pharmacy benefits to a drug formular y shall have

an exceptions policy through which the managed care plan may cover a prescription

drug not included on the formulary.