The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us)



STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL


Opinion No. 6779

December 3, 1993

DEPARTMENT OF SOCIAL SERVICES:

Drug monitoring program affecting single-source ulcer medications.

In section 919 of 1993 PA 186, the Legislature has prohibited any preauthorization requirement for single-source pharmaceutical products. Therefore, the Department of Social Services, Medical Services Administration may not rerquire prior authorization in order to continue a patient on high dosage levels of single-source ulcer medications.

Honorable Joe Conroy

Honorable R. Robert Geake

State Senators

The Capitol

Lansing, Michigan 48909

You have asked a question which may be phrased as follows:

May the Department of Social Services, Medical Services Administration require prior authorization to continue a patient on high dosage levels of single-source ucler medications, in light of section 919 of 1993 PA 186, which prohibits preauthorizing single-source pharmaceutical products?

The Social Welfare Act, 1939 PA 280, section 105, MCL 400.105; MSA 16.490(15), authorizes the Michigan Department of Social Services to administer the medical assistance (Medicaid) program established by Title XIX of the federal Social Security Act, 42 USC 1396, et seq. Within the Department of Social Services, the Medical Services Administration operates the Medicaid program.

1993 PA 186 is the appropriations statute for the Department of Social Services for fiscal year 1993-1994. Section 101 of that statute contains, among other things, an appropriation for the Medicaid program. Section 919 of the same statute provides:

(1) The department shall not preauthorize or in any way restrict single-source pharmaceutical products except those single-source pharmaceuticals that have been subject to prior authorization by the department prior to January 1, 1992 and those single-source pharmaceuticals within the categories specified in section 1927(d)(2) of the social security act, 42 U.S.C. 1396s(d), or for the reasons delineated in section 1927(d)(3) of the social security act.

(2) The department shall not implement drug utilization review or monitoring programs in such a manner as to circumvent the intent expressed in subsection (1). (1)

The term "single-source pharmaceutical" is derived from Title XIX of the federal Social Security Act which provides, in pertinent part:

(7) Multiple source drug; innovator multiple source drug; noninnovator multiple source drug; single source drug

(A) Defined

iv) Single source drug

The term "single source drug" means a covered out-patient drug which is produced or distributed under an original new drug application approved by the Food and Drug Administration, including a drug product marketed by any cross-licensed producers or distributors operating under the new drug application.

42 USC 1396r-8(k)(7)(A)(iv)

Single-source pharmaceutical or drug products are products most often produced by only one manufacturer and for which there is no generic substitute or equivalent available.

On June 1, 1993, the Medical Services Administration issued Medical Services Bulletin 93-02. That bulletin, effective July 1, 1993, provides at page 1:

Effective for dates of service on and after July 1, 1993, for individual products listed on Attachment I (Axid, Carafate, Pepcid, Prilosec, Tagamet, or Zantec):

A recipient served in your pharmacy may receive up to three consecutive months at the acute dosage levels specified on Attachment I.

Extensions for Acute Dosing Beyond Three Months:

Only prescribers may obtain extensions for acute therapy beyond three months. These extensions will be granted based on the patient's diagnosis and guidelines of the American Medical Association Drug Evaluations and the American Hospital Formulary Service (AHFS) Drug Information. [ Emphasis supplied.]

Medicaid is intended to cover the costs of necessary medical care, including pharmaceuticals or drugs, for those individuals who are deemed medically indigent as unable to pay for their own medical care. In bulletin 93-02, the Medical Services Administration has instituted a drug monitoring program for single-source ulcer medications, otherwise known as H2 antagonists. In cases where patients have already been on high dosages of the ulcer medication for a period of three months, this drug monitoring program requires that a medical practitioner obtain prior authorization in order to continue the patient on the high dosages with Medicaid payments for the drugs.

The single-source ulcer medications here in question do not fit within any of the exceptions contained in section 919(1) of 1993 PA 186. Also, the language of section 919 of 1993 PA 186 is not inconsistent with any federal or state substantive statutory provisions. Thus, we must determine whether this drug monitoring program is violative of section 919.

The language used in section 919(1) is mandatory. The Department of Social Services "shall not preauthorize or in any way restrict single-source pharmaceutical products." Pursuant to the bulletin language quoted above, prescribers must obtain an extension from the Medical Services Administration to continue a patient on high dosages of these products paid for by Medicaid. The need to obtain the extension is plainly a preauthorization requirement that restricts the use of the drugs in question. Moreover, the language in section 919(2) makes it clear that, while the Department of Social Services may implement drug monitoring programs, it may not do so in a manner that restricts access to single-source pharmaceutical products by requiring preauthorization.

In section 919 of 1993 PA 186, the Legislature has prohibited any preauthorization requirement for single-source pharmaceutical products. It is my opinion, therefore, that the Department of Social Services, Medical Services Administration may not require prior authorization in order to continue a patient on high dosage levels of single-source ulcer medications.

Frank J. Kelley

Attorney General

(1 Section 925 of 1992 PA 168, the appropriations statute for the Department of Social Services for fiscal year 1992-1993, contained language identical to section 919(1) of 1993 PA 186) The language of section 919(2) first appeared in 1993 PA 186.