Health Benefit Mandates: Step Therapy

Effective beginning July 1, 2020, carriers (under certain circumstances) must approve step therapy override exception where coverage of a prescription drug for a medical condition is restricted through step therapy protocols, authorizing coverage if the drug is covered under the participant's plan.

As background, step therapy is a process used to help control costs and requires a participant to try a lower-priced medication before taking a “step up” to a more costly medication. With this new benefit mandate, a carrier must approve a step therapy override exception in certain circumstances, such as if the drug required under step therapy protocol is 1) not recommended; 2) likely to cause harm or be ineffective; 3) the participant has had a trial of a therapeutically equivalent dose of the drug that was discontinued as ineffective; and 4) the participant is currently receiving positive therapeutic outcome on a drug selected by the participant’s health care provider.

Employers who sponsor fully insured group health plans issued in South Dakota should be aware of this new mandate and confirm that their insurers are in compliance effective July 1, 2020.

Senate Bill 155 »