Texas Administrative Code
Title 1 - ADMINISTRATION
Part 15 - TEXAS HEALTH AND HUMAN SERVICES COMMISSION
Chapter 353 - MEDICAID MANAGED CARE
Subchapter J - OUTPATIENT PHARMACY SERVICES
Section 353.903 - Definitions

(1) Clinical prior authorization (clinical PA)--A review process authorized by HHSC that is conducted by a healthcare managed care organization (health care MCO) prior to dispensing a drug. All clinical PAs must be identified on the Medicaid Vendor Drug Program website at http://www.txvendordrug.com.

(2) Covered outpatient drug--A drug or biological product included on the formulary and provided in an outpatient setting.

(3) Formulary--The list of covered outpatient drugs for the Texas Medicaid program.

(4) Maximum allowable cost--The highest unit price set by a health care MCO, or its subcontractor, for reimbursement of therapeutically equivalent multi-source drugs.

(5) Network provider--A pharmacy provider who has entered into a contract with the health care MCO to provide outpatient drug benefits to Medicaid enrollees.

(6) Non-preferred drug--A covered outpatient drug on the preferred drug list (PDL) that has been designated as non-preferred.

(7) Pharmacy benefits manager (PBM)--An entity that administers the Medicaid outpatient drug benefit on behalf of a health care MCO.

(8) Preferred drug--A covered outpatient drug on the PDL that has been designated as preferred because it has been evaluated to be safe, clinically effective, and cost-effective compared to other drugs in the same therapeutic drug class on the market.

(9) Preferred drug list (PDL)--The list of covered outpatient drugs reviewed by the Drug Utilization Review Board (DUR Board) . Reviewed drugs are recommended by the DUR Board as either preferred or non-preferred and HHSC establishes the final designation.

(10) Preferred drug list prior authorization (PDL PA)--A review conducted by a health care MCO prior to dispensing a non-preferred drug.