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California DWC Proposes Required Pharmacy Fee Schedule Changes

by
Optum for Workers' Compensation
| Oct 03, 2018

With the workers’ compensation pharmacy fee schedule in California being tied directly to Medi-Cal, the Division of Workers Compensation (DWC) published initial draft rule language in its rules “forum” to align the pharmacy fee schedule with pending changes to Medi-Cal. As part of the Affordable Care Act, the California Medi-Cal program is moving forward with final implementation of its Actual Acquisition Cost (AAC)-based reimbursement methodology, which is set to implement by the end of 2018. DWC will continue to work with Medi-Cal to ensure a smooth application to workers’ compensation pharmacy claims.

Once implemented, the ACC reimbursement methodology will impact all workers’ compensation pharmacy claims in California. Publication of a draft rule in the DWC forum not only initiates a rule-making process, but indicates that implementation of AAC reimbursement is close to being completed by Medi-Cal, as the DWC has a 60-day lag time for compliance with any changes made by Medi-Cal. The effective date for the new reimbursement methodology in the draft DWC rule language is January 1, 2019. It is important to note that DWC clearly indicates there will be no retrospective application of the new reimbursement methodology, as the draft language impacts only prescriptions dispensed on or after January 1, 2019.

Additionally, the draft language contains reimbursement language that will impact medications dispensed from a retail pharmacy, medications dispensed by a physician, and compounded medications. The draft language also clarifies the new fee schedule will apply to mail-order pharmacies that are providing pharmacy care or services to injured workers who reside within California. 

The current comment period on the draft language ends October 8, 2018. The next step for the DWC will be to move the proposal forward into a formal rule-making process 30 to 45 days following the comment period.

We strongly urge our clients to review the draft language and provide feedback. Our government affairs team will provide our own feedback during the forum phase and will also participate in the, later, formal rule-making process. Once the forum period is closed, the draft language should move forward to a formal rule-making process with a defined comment period timeframe. 

As with all public policy developments, until final adoption, all proposed language is subject to change.  Our government affairs team will continue to provide updates during the rule-making. The initial draft rule can be viewed here.