California Progresses with Formulary Journey

by Helios | Mar 03, 2016

The California Legislature held a joint hearing of the Senate Labor Industrial Relations Committee and the Assembly Insurance Committee for an update on the creation of a workers’ compensation drug formulary required by recent passage of AB1124.

The Joint Committee heard from a varied group of stakeholders, individuals and state agencies. Testimony by stakeholders ranged from an update on the current regulatory process by the California Division of Workers’ Compensation (DWC/DIR), to application of formulary requirements on physician prescribing practices as presented by the California Medical Association. Providing support for a drug formulary and offering insight into pros and cons of formulary adoption in California, Alex Swedlow from the California Workers’ Compensation Institute (CWCI) opined that a drug formulary could be a major reliever of friction costs and friction points in the system related to medication utilization, and could also help reduce a fairly large percentage of overall utilization reviews (UR) directly related to prescription medications. 

Christine Baker (DIR),  George Parisotto and Dr. Ray Meister (DWC) updated the committee on the progress of formulary development and their intent to meet the legislatively-mandated goal of July 1, 2017. The Division’s testimony focused on several key points, largely supported by other stakeholders:

  • The formulary must integrate with other existing Medical Treatment Utilization Schedule (MTUS) requirements
  • Itshould help reduce the friction points/costs of URs and Independent Medical Reviews (IMRs) for medications
  • The formulary must focus on the need for treatment with specific medications and be based on evidence-based medicine
  • Itmust include transparency to the medication list, as well as any updates
  • The formulary must establish a phase-in period for all dates of injury (DOI) to protect the needs of injured workers undergoing long-term therapies

Christine Baker from DIR/DWC clearly indicated to the Joint Committee that use of a drug formulary in California should have as its main goal, the ability to provide timely and appropriate care that is cost effective to the injured workers. During testimony, the DWC stated they hope to have a first draft of a formulary regulation out for public consumption by May, and they will issue follow up with the Legislature through an interim study in July.

Helios will remain engaged in the process and continue to support the efforts of the California DWC, RAND and the California Legislature as the formulary development moves forward.

For more information on California’s formulary journey, click here, or contact Brian Allen, Vice President of Government Affairs at 801-230-8379 or via email at for additional information or questions regarding this or other legislative or regulatory matters.