The following words and terms, when used in this subchapter, have the following meaning unless the context clearly indicates otherwise.

1. (1) Clinical edit--A process for verifying that a member's medical condition matches the clinical criteria for a prescribed drug.
2. (2) Clinical edit prior authorization (clinical edit PA)--A prior authorization that is granted by a health care managed care organization (health care MCO) prior to dispensing a covered outpatient drug with a clinical edit.
3. (3) Covered outpatient drug--A drug or biological product included on the formulary and dispensed by a pharmacy in an outpatient setting.
4. (4) Formulary--The list of covered outpatient drugs for the Texas Medicaid program.
5. (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. (6) Non-preferred drug--A covered outpatient drug on the preferred drug list (PDL) that has been designated as non-preferred.
7. (7) Pharmacy benefits manager (PBM)--An entity that administers the Medicaid outpatient drug benefit on behalf of a health care MCO.
8. (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. (9) Preferred drug list (PDL)--The list of covered outpatient drugs reviewed by the Pharmaceutical and Therapeutics (P & T) Committee. Reviewed drugs are recommended by the P & T Committee as either preferred or non-preferred and HHSC establishes the final designation.
10. (10) Preferred drug list prior authorization (PDL PA)--A prior authorization that is granted by a health care MCO prior to dispensing a non-preferred drug.
11. (11) Prior authorization (PA)--A positive determination made by a health care MCO that a prescription for a covered outpatient drug meets the criteria to be reimbursed by the health care MCO.

Source Note:The provisions of this §353.903 adopted to be effective March 1, 2012, 37 TexReg 1292.