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PUBLIC LAW 103-66—AUG. 10, 1993 107 STAT. 617 tage in terms of safety, effectiveness, or clinical outcome of such treatment for such population over other drugs included in the formulary and there is a written expla- nation (available to the public) of the basis for the exclu- sion. "(D) The State plan permits coverage of a drug excluded from the formulary (other than any drug excluded from coverage or otherwise restricted under paragraph (2)) pursuant to a prior authorization program that is consistent with paragraph (5). (E) "Die formulary meets such other requirements as the Secretary may impose in order to achieve program savings consistent with protecting the health of program beneficiaries. A prior authorization program established by a State under parap;raph (5) is not a formulary subject to the requirements of this paragraph. "(5) REQUIREMENTS OF PRIOR AUTHORIZATION PROGRAMS.— A State plan under this title may require, as a condition of coverage or payment for a covered outpatient drug for which Federcu financial participation is available in accordance with this section, with respect to drugs dispensed on or after July 1, 1991, the approval of the drug before its dispensing for any medically accepted indication (as defined in subsection (kX6)) only if the system providing for such approval— "(A) provides response by telephone or other tele- communication device within 24 hours of a request for prior authorization; and ''(B) except with respect to the drugs on the list referred to in paragraph (2), provides for the dispensing of at least 72-hour supply of a covered outpatient pirescription drug in an emergenc^^ situation (as defined by the Secretary). "(6) OTHER PERMISSIBLE RESTRICTIONS.—A State may impose limitations, with respect to all such drugs in a thera- peutic class, on the minimum or maximum quantities per prescription or on the number of refills, if such Umitations are necessary to discourage waste, and may address instances of fraud or abuse by in£viduals in any manner authorized under this Act. "(e) TREATMENT OP PHARMACY REIMBURSEMENT LIMITS.— "(1) IN GENERAL.—During the period beginning on January 1,1991, and ending on December 31,1994— "(A) a State may not reduce the payment limits estab- lished by regulation under this title or any limitation described in paragraph (3) with respect to the ingredient cost of a covered outpatient drug or the dispensing fee for such a drug below the limits in effect as of January 1,1991, and "(B) except as provided in paragraph (2), the Secretary may not modify by regulation the formula established under sections 447.331 throu^ 447.334 of title 42, Code of Federal Regulations, in effect on November 5, 1990, to reduce the limits described in subp£u*agraph (A). "(2) SPECIAL RULE.—If a State is not in compliance with the regulations described in paragraph (IXB), paragraph (IXA) shall not apply to such State until such State is in compliance with such regulations.