Prior Authorization

The Texas Medicaid formulary includes some drugs subject to one or both types of prior authorization, clinical and non-preferred. Prior authorization must be approved before the drug is dispensed. Prior authorization is not a guarantee of payment. Even if a drug has been prior authorized, reimbursement can be affected for a variety of reasons (e.g., the client is ineligible on the date of service or the claim transaction is incomplete). The pharmacy should verify client eligibility status before submitting claims.

Clinical Prior Authorization

Clinical prior authorizations are based on evidence-based clinical criteria and nationally recognized peer-reviewed information. They may apply to an individual drug or a drug class on the formulary, including some preferred and non-preferred drugs. There are certain clinical prior authorizations all Medicaid managed care organizations (MCO) are required to perform. Usage of all other clinical prior authorizations will vary between MCOs at the discretion of each MCO.

Non-preferred Prior Authorization

The Texas Medicaid Preferred Drug List is arranged by drug class and contains a subset of many, but not all, drugs included on the Medicaid formulary. Drugs are identified as preferred or non-preferred on the list. Drugs listed as preferred, or those not listed at all, are available without prior authorization. Drugs identified as non-preferred require prior authorization. Managed care organizations are required to adhere to the preferred drug list. CHIP does not have a preferred drug list.

The PDL Prior Authorization Criteria Guide (PDF) explains the criteria used to evaluate the PDL prior authorization requests