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ARIZONA HOUSE OF REPRESENTATIVES57th Legislature, 2nd Regular Session |
Senate: HHS DP 5-1-1-0 | ATT DPA 9-1-0-0 | Third Read 25-2-3-0 |
SB 1672: AHCCCS; antipsychotic drugs; authorization
Sponsor: Senator Kavanagh, LD 3
Committee on Health & Human Services
Overview
Effective January 1, 2027, the Arizona Health Care Cost Containment System (AHCCCS) and its contractors may not require prior authorization for prescription antipsychotic medications and may impose step therapy protocols to a maximum of two distinct antipsychotic drugs.
History
AHCCCS administers Arizona's Medicaid program and provides health care services to eligible low-income individuals through a managed care delivery system. Under this system, AHCCCS contracts with health plans and other providers to furnish covered health and medical services to enrolled members. AHCCCS is responsible for establishing program requirements, determining eligibility, administering contracts and ensuring that services provided in accordance with state and federal law governing the Medicaid program (A.R.S. §§ 36-2901, 36-2903, 36-2904).
Seriously mentally ill means persons who, as a result of a mental disorder, exhibit emotional or behavioral functioning that is so impaired as to interfere substantially with their capacity to remain in the community without supportive treatment or services of a long-term or indefinite duration. In these persons, mental disability is severe and persistent, resulting in a long-term limitation of their functional capacities for primary activities of daily living such as interpersonal relationships, homemaking, self-care, employment and recreation (A.R.S. § 36-550)
Step therapy protocol is a protocol or program that establishes the specific sequence in which prescription drugs that are for a specified medical condition and that are medically necessary for a particular patient are covered by a health care insurer under a health care plan (A.R.S. § 20-3651).
Provisions
1. States that before providing coverage of a prescription antipsychotic drug approved by the U.S. Food and Drug Administration to a member who is at least 18 years old with a serious mental illness, AHCCCS and its contractors:
a. are prohibited from imposing a prior authorization requirement or other process that conditions, delays or denies the delivery of the drug to the member by applying predetermined criteria by AHCCCS or its contractor for covered prescription drugs, except as otherwise specified; and
b. may impose a process, including a step therapy protocol, requiring the member to show a failure to successfully respond to up to two distinct prescription antipsychotic drugs. (Sec. 1)
2. Requires AHCCCS and its contractors to grant a member, or the member’s health care provider, the ability to bypass a step therapy protocol by providing a history of the member’s failure to successfully respond to two distinct prescription antipsychotic drugs on the member’s current or previous health benefit plan. (Sec. 1)
3. Specifies that any step therapy protocol or other process must both:
a. be adjudicated electronically and in real time; and
b. consider a member to have tried two prescription antipsychotic drugs if the member has two paid claims for two distinct preferred antipsychotic drugs prescribed in a nonemergency or outpatient setting within the previous five years. (Sec. 1)
4. Applies the antipsychotic drug coverage requirements:
a. only to prescription antipsychotic drugs whose use is supported by peer-reviewed, evidence-based literature; and
b. prescription drug coverage that is paid either on a fee-for-service basis or through prepaid capitated health services contracts under AHCCCS. (Sec. 1)
5. Clarifies the antipsychotic drug coverage requirements do not prohibit AHCCCS from :
a. contracting with a managed care organization for pharmaceutical services offered under AHCCCS if the contract complies with the outlined requirements;
b. prohibiting or discouraging the use of a generic drug;
c. performing a drug utilization review that is necessary for patient safety or to ensure that the prescribed use is for a medically accepted indication;
d. collecting federal statutory rebates from participating drug manufacturers as part of the Medicaid Drug Rebate Program; or
e. entering into a supplemental rebate contract agreement with a drug manufacturer for preferred placement on the preferred drug list. (Sec. 1)
6. Defines terms. (Sec. 1)
7. Contains an effective date of January 1, 2027. (Sec. 2)
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Initials AG SB 1672
3/17/2026 Page 0 Health & Human Services
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