September 22, 2015
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California Headed for Closed-Drug Formulary?

Legislation
, Pharmacy

Closed drug formularies are gaining traction as more states begin to adopt guidelines. California may be next if A.B. 1124 is passed.

A formulary is a list of brand name and generic drugs that are covered under a prescription drug benefit. A closed drug formulary means there is no coverage for non-formulary drugs. Closed drug formularies are often used for managing pharmacy budgets.

What You Need to Know About A.B. 1124

  • The bill would establish an evidence-based prescription drug formulary for California’s workers comp system by July 1, 2017.
  • California’s workers’ compensation system is the largest in the United States.
  • A closed-drug formulary would be designed to curb the abuse and overprescribing of certain medications (i.e. opioids).
  • According to a 2014 study by the California Workers’ Compensation Institute, a closed drug formulary could save California from $124 million to $420 million.
  • Under the bill, the administrative director of the Division of Workers’ Compensation would have to update the formulary quarterly at minimum.

A.B. 1124 Timeline

  • April 14-September 4 – Amendments made to bill
  • September 11 – Passed in Senate
  • September 12 – Passed in Assembly
  • September 14 – Enrolled, forwarded to Governor’s office.

What Does This Mean to You?

California could implement a closed drug formulary, which could require injured workers to be weaned off medications not included within the new formularies before the proposed July 1, 2017 start date.

According to a Buisness Insurance article, California plans to implement a closed drug formulary for its work comp system in an effort to reduce opioid use and overall costs. To read more about the proposed change, read the article titled "California Weighing Closed Workers Comp Drug Formulary."