wa-26-18-005: Health Care Authority — WSR 26-18-005

WSR 26-18-005 (26-18)WSR 26-18-005PROPOSED RULESHEALTH CARE AUTHORITY[Filed August 20, 2026, 4:11 p.m.]Original Notice.Preproposal statement of inquiry was filed as WSR 26-05-049.Title of Rule and Other Identifying Information: WAC 182-52-0010 Prescription drug affordability board—Definitions, and new 182-52-0100 Prescription drug affordability board—Upper payment limits.Hearing Location(s): On October 6, 2026, at 10:00 a.m. The health care authority (HCA) holds public hearings virtually without a physical meeting place. Virtual public hearings are held via Microsoft Teams webinar. To attend, you must register in advance at https://events.gcc.teams.microsoft.com/event/9e03b114-69d9-465d-aacf-4bc10fba88d8@11d0e217-264e-400a-8ba0-57dcc127d72d.After registering, you will receive a confirmation email containing information about joining the public hearing. You will be able to join the public hearing through most standard internet browsers; you do not need to install Microsoft Teams.Date of Intended Adoption: Not sooner than October 7, 2026.Submit Written Comments to: HCA Rules Coordinator, P.O. Box 42716, Olympia, WA 98504-2716, email arc@hca.wa.gov, fax 360-586-9727, beginning August 20, 2026, 8:00 a.m., by October 6, 2026, 11:59 p.m.Assistance for Persons with Disabilities: Contact Jessica Nguyen, phone 360-725-1174, fax 360-586-9727, telecommunication relay service 711, email arc@hca.wa.gov, by September 18, 2026.Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: HCA is adding new rules to implement the prescription drug affordability board (board) methodology for setting upper payment limits as required in RCW 70.405.050 for prescription drugs the board has determined have led or will lead to excess costs based on its affordability review. Additionally, HCA is amending WAC 182-52-0010 to add a definition for upper payment limit. Reasons Supporting Proposal: See purpose.Statutory Authority for Adoption: RCW 70.405.050, 41.05.021, and 41.05.160.Statute Being Implemented: RCW 70.405.050, 41.05.021, and 41.05.160.Rule is not necessitated by federal law, federal or state court decision.Name of Proponent: HCA, governmental.Name of Agency Personnel Responsible for Drafting: Valerie Freudenstein, P.O. Box 42716, Olympia, WA 98504-2716, 360-725-5128; Implementation and Enforcement: Mike Neuenschwander, P.O. Box 45506, Olympia, WA 98504-5506, 360-725-0944.A school district fiscal impact statement is not required under RCW 28A.305.135.A cost-benefit analysis is not required under RCW 34.05.328. RCW 34.05.328 does not apply to HCA rules unless requested by the joint administrative rules review committee or applied voluntarily.This rule proposal, or portions of the proposal, is exempt from requirements of the Regulatory Fairness Act because the proposal: Is exempt under RCW 19.85.025(3) as the rule content is explicitly and specifically dictated by statute.Scope of exemption for rule proposal:Is fully exempt. August 20, 2026Wendy BarcusRules CoordinatorRDS-7198.2AMENDATORY SECTION(Amending WSR 24-02-078, filed 1/2/24, effective 6/10/24)WAC 182-52-0010Prescription drug affordability board—Definitions.The definitions in this section apply throughout this chapter unless the context clearly requires otherwise."Authority" means the health care authority, as defined in WAC 182-02-045."Biological product" has the same meaning as in 42 U.S.C. Sec. 262 (i)(1)."Biologics" means biological products and biosimilars."Biosimilar" has the same meaning as in 42 U.S.C. Sec. 262 (i)(2)."Board" means the prescription drug affordability board."Brand name drug" means specific legend drug products that are sold by a manufacturer under certain trademarks or patents."Confidential information" means:(a) Specific information collected by the authority that is not publicly available for the purposes of this chapter; or(b) Proprietary data provided by any entity in accordance with this chapter that is not subject to public disclosure."Conflict of interest" means an association, including a financial or personal association, that has the potential to bias or appear to bias an individual's decisions in board matters or activities."Data recipient" means an individual or entity authorized to receive data under chapter 70.405 RCW."Drug" means a substance:(a) Recognized as drugs in the official United States Pharmacopeia, official Homeopathic Pharmacopoeia of the United States, or official national formulary, or any supplement to any of them;(b) Intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in human beings;(c) Other than food, minerals, or vitamins intended to affect the structure of any function of the body of human beings; and(d) Intended for use as a component of any article specified in (a), (b), or (c) of this definition."Excess costs" means costs of appropriate utilization of a prescription drug that exceed the therapeutic benefit relative to other alternative treatments; or, costs of appropriate utilization of a prescription drug that are not sustainable to public and private health care systems over a 10-year time frame."Generic drug" has the same meaning as in RCW 69.48.020."Health carrier" or "carrier" has the same meaning as in RCW 48.43.005."Legend drug" means brand drug, generic drug, or biological product which is required by state law or regulation of the pharmacy quality assurance commission to be dispensed on prescription only or are restricted to use by practitioners only."Manufacturer" means a person, corporation, or other entity engaged in the manufacture of prescription drugs sold in or into Washington state. "Manufacturer" does not include a private label distributor or retail pharmacy that sells a drug under the retail pharmacy's store, or a prescription drug repackager."Out-of-pocket costs" means the amount of money the patient, another person on behalf of the patient, or entity on behalf of the patient paid to the pharmacy each time a prescription is filled, excluding the amount paid by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered drugs plus all costs for drugs that are not covered."Prescription drug" means a drug regulated under chapter 69.41 or 69.50 RCW, including generic drugs, brand name drugs, specialty drugs, and biological products."Publicly available" means information that is available to the general public, whether through internet search, Freedom of Information Act request or similar request, or through purchase or subscription, and includes information submitted to or reviewed by the Food and Drug Administration, information contained in financial statements, and information published or otherwise made available through drug information resources. "Publicly available" does not include trade secrets as defined by RCW 19.108.010 and information protected by copyright law. Publicly available information includes:(a) Drug name;(b) Drug class;(c) Price and pricing;(d) Course of treatment;(e) Manufacturer name;(f) Price increase over time;(g) Competitors; and(h) Competitor price and pricing."Rebate" means negotiated price concessions, discounts, however characterized, that accrue directly or indirectly to an entity in connection with utilization of prescription drugs including, but not limited to, rebates, administrative fees, market share rebates, price protection rebates, performance-based price concessions, volume-related rebates, other credits, and any other negotiated price concessions or discounts that are reasonably anticipated to be passed through to an entity during a coverage year, and any other form of price concession prearranged with a manufacturer, dispensing pharmacy, pharmacy benefit manager, rebate aggregator, group purchasing organization, or other party which are paid to an entity and are directly attributable to the utilization of certain drugs."Therapeutic alternative" means a drug product that may contain a different chemical or biological structure than the drug prescribed and can be expected to have a similar therapeutic effect and adverse reaction profile when administered to individuals in a therapeutically equivalent dose."Therapeutic equivalent" means a drug product of the identical base or salt as the specific drug product prescribed with essentially the same efficacy and toxicity when administered to an individual in the same dosage regimen. "Upper payment limit" means the amount established by the board that is the maximum amount that may be paid, by any entity, for an impacted prescription drug product.NEW SECTIONWAC 182-52-0100Prescription drug affordability board—Upper payment limits.(1) When a board affordability review determines that a prescription drug product has led to or will lead to excess costs, the board may place an upper payment limit on that prescription drug product.(2) The upper payment limit represents the total combined payment for a prescription drug product, inclusive of all components of the transaction price paid at the point of dispensing or administration. The upper payment limit:(a) Applies to all purchases of the prescription drug product by an entity and to all reimbursements for a claim for the prescription drug product by a health carrier or a health plan offered under chapter 41.05 RCW, when the prescription drug product is dispensed or administered to an individual in the state in person, by mail, or by other means as provided in RCW 70.405.050(6);(b) Does not include any reasonable dispensing fees or delivery charges separately charged by a pharmacy licensed under chapter 18.64 RCW; and(c) When applied to the reimbursement of a claim by a health carrier, or health plan under chapter 41.05 RCW, is the cumulative amount paid by the patient out-of-pocket and the amount reimbursed by a payer on behalf of the patient, for the prescription drug product in the unit of measure, package size, and dosage form.(3) Each year, the board may set an upper payment limit for up to 12 prescription drugs.(4) The board establishes a methodology for setting upper payment limits for prescription drugs that the board has determined have led to or will lead to excess costs based on the affordability review.(5) Before setting an upper payment limit for a drug, the board posts a notice of the proposed upper payment limit on the authority's website, including an explanation of the factors considered when setting the proposed limit and instructions to submit written comment. The board provides 30 days for public comment. See WAC 182-52-0095.(6) Depending on the board's ability to obtain the necessary data for determining an upper payment limit, the methodology must take into consideration:(a) The cost of administering the drug;(b) The cost of delivering the drug to patients;(c) The status of the drug on the drug shortage list published by the United States Food and Drug Administration (FDA); and(d) Other relevant administrative costs related to the production and delivery of the drug.(7) The board may recommend potential values for an upper payment limit derived from a blend of methodologies or variations in implementing the methodologies.(8) Once the board has performed the affordability review and determined the drug under review leads to or will lead to excess costs, the following blend of methodologies may be used to determine the upper payment limit:(a) Reference pricing;(b) Net pricing;(c) Budgetary pricing; or(d) Other methods as appropriate.(9) The board's established methodology must not use quality-adjusted life years that take into account a patient's age or severity of illness or disability to identify subpopulations for which a prescription drug would be less cost-effective. For any prescription drug that extends life, the board's analysis of cost-effectiveness may not employ a measure or metric which assigns a reduced value to the life extension provided by a treatment based on a preexisting disability or chronic health condition of the individuals whom the treatment would benefit.(10) For any upper payment limit set by the board, the board notifies the manufacturer of the drug and the manufacturer must inform the board if it is able to make the drug available for sale in the state and include a rationale for its decision. The board reports annually to the relevant committees of the legislature the manufacturers' responses.(11) The board monitors the supply of drugs for which it sets an upper payment limit and may suspend that limit if there is a shortage of the drug in the state.(a) Upon discovery of a drug shortage, the board may review information relevant to the availability of the impacted drug in Washington state.(b) After review of information, the board may vote to determine if there is a shortage in the state.(c) If the board has voted that there is a shortage, then the board may also vote to suspend the upper payment limit until the shortage is resolved.(d) If the board has voted that there is a shortage caused by the manufacturer, then it will be considered a manufacturer withdrawal from the market under RCW 70.405.070.(12) The board may annually reassess any upper payment limit based on current economic factors.(13) An employee-sponsored self-funded plan may elect to be subject to the upper payment limits as established by the board.(14) Once the board has determined an upper payment limit, the board establishes an effective date for the upper payment limit. The effective date must be at least six months after the board determines the upper payment limit. The upper payment limit applies only to purchases, contracts, and plans that are issued on or renewed after the effective date.(15) Any entity affected by a decision of the board may request an appeal within 30 calendar days of the board's decision, and the board rules on the appeal within 60 calendar days of receiving the appeal. Board rulings are subject to judicial review according to chapter 34.05 RCW.(16) Any individual denied coverage by a health carrier for a prescription drug because the drug was unavailable due to an upper payment limit established by the board may seek review of the denial according to RCW 48.43.530 and 48.43.535.(17) If it is determined by the health carrier or health plan offered under chapter 41.05 RCW that the prescription drug should be covered based on medical necessity, the carrier may disregard the upper payment limit and must provide coverage for the drug.