Governor Brown Signs Bill Creating Workers’ Compensation Drug Formulary

On October 6, 2015, Governor Jerry Brown signed Assemblymember Henry T. Perea’s (D-Fresno) Assembly Bill (AB) 1124 into law. AB 1124 will establish a prescription drug formulary in California’s workers’ compensation system. This bill will save the California workers’ compensation system up to $420 million while ensuring injured workers get the necessary level of care that would help them get back to work.

“A drug formulary in California will ensure our workers are provided with safe and effective care to get them back to work while reducing unnecessary costs and saving California hundreds of millions of dollars,” said Assemblymember Perea. “I applaud Governor Brown for signing this important measure into law.”

“We are pleased that this legislation will help ensure injured workers receive evidence based and appropriate pharmaceuticals at a reasonable cost,” said Christine Baker, Director Department of Industrial Relations.

“AB 1124 will reduce unnecessary costs within the workers’ compensation system while specifically protecting an injured worker’s right to any medically necessary prescription drugs,” said Mitch Seaman of the California Labor Federation. “In addition, the bill guarantees timely formulary updates as new drugs become available and a phased implementation for workers injured prior to the bill’s effective date. We applaud the work of the author, the Department of Industrial Relations, and the broad coalition of workers’ compensation stakeholders, and we look forward to remaining closely involved as the formulary works its way through the regulatory process.”

“On behalf of small businesses across California, we applaud both Assemblymember Henry Perea and Governor Jerry Brown in taking the concept of a work comp drug formulary and actually creating law. We believe this is a huge step forward in a multi-pronged strategy to address the misuse and abuse of prescription drugs,” said Scott Hauge, President, Small Business California.

“The California Chamber of Commerce commends Assemblymember Perea for his leadership in creating a safer and more efficient workers’ compensation system,” said Jeremy Merz of the California Chamber of Commerce. “By creating a prescription medication formulary, AB 1124 will provide effective and evidence-based treatment for injured workers while reducing delays and medical disputes.  This legislation furthers the goal of a balanced workers compensation system that provides timely benefits to injured workers and minimizes friction in the system.”

“The American Insurance Association (AIA) is pleased to support AB 1124 and the adoption of a workers’ compensation drug formulary.  An effective formulary will assist in injured workers’ medical outcomes, lesson system friction and provide for savings.  Formularies have been adopted in other states, and have proven to be effective in the managed care setting,” said Steve Suchil, Assistant Vice President/Counsel, State Affairs Western Region, (AIA). “Assembly Member Perea and his staff worked hard to convene meetings with affected parties and consider various points of view.  Passage of AB 1124 is another significant step in improving the workers’ compensation system.”

“Congratulations to Assemblymember Perea and Governor Brown in making AB 1124 law. California’s upcoming drug formulary should result in prescribing behavior changes away from dangerous prescription drugs and combinations of drugs to more clinically appropriate means of managing chronic pain. If the injured worker wins by getting better care faster, then all other stakeholders also win,” said Mark Pew, Senior Vice President, PRIUM.

Source: Assemblymember Perea’s Office   |  2015 © Copyright Payroll Masters

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