Health plans may impose cost-sharing as part of the prescription drug benefit of a health plan. This cost-sharing can vary depending on the health plan and the type of drug. Generally, enrollee cost-sharing for prescription drugs counts against the enrollee's out-of-pocket maximum, which is the enrollee's maximum financial responsibility for the plan year. However, federal law permits health carriers to restrict whether third-party payments count toward the out-of-pocket maximum.
For non-grandfathered health plans (including health plans offered to state and school employees) issued or renewed on or after January 1, 2023, a health carrier or a health care benefit manager must include cost-sharing amounts paid on behalf of the enrollee for certain prescription drugs when calculating the enrollee's contribution to any applicable cost-sharing or out-of-pocket maximum. The amounts must be applied toward the enrollee's applicable cost-sharing or out-of-pocket maximum in full at the time it is rendered.
This requirement is applicable to drugs that either do not have a generic equivalent or drugs for which the enrollee obtained access via prior authorization, step therapy, or an exception process. The requirement does not apply, however, to drugs not subject to a deductible.
The requirement does not apply to a qualifying health plan for a health savings account to the extent necessary to preserve the enrollee's ability to claim tax exempt contributions and withdrawals from a health savings account under Internal Revenue Service laws, regulations, and guidance.
The Insurance Commissioner may adopt any rules necessary to implement these requirements.
(In support) Many people have expensive health conditions, such as HIV or bleeding disorders, that require specialty medications with no generic equivalents. Many of these drugs are classified as specialty drugs, which means patients have to meet the deductible before the insurer pays anything. People often have to get prior authorization or participate in step therapy before they are put on these drugs. People have relied on coupons for many years to survive the financial burden. Insurers are telling patients they can no longer count the coupons toward their cost-sharing, which negates the financial benefit of the coupon and allows the insurers to suck up the benefit of the coupons for themselves. The financial impact of this practice is devastating on these patients, causing families to choose between medications and paying for other expenses like rent. This can cause a catch-22 for patients where they are unable to work, but are unable to afford their medications without working. This issue is an example of the gamesmanship people face in the current health care system. By not allowing coupons to count, the pharmacy benefit manager doubles its own benefit while reducing the amount they pay for the medications, which constitutes manipulation. Most solutions to this problem require federal action, but this bill will help for the time being. This bill maintains the status quo. This bill reflects the need for larger health care reform. Families will be unable to absorb the additional costs without this bill. Eleven other states have done this.
(Opposed) Drug copay coupons have become ubiquitous for brand name drugs. The coupons make the drugs cheaper for patients, but drastically increase costs for employers and insurers. The coupons inflate profits for pharmaceutical companies. According to a federal advisory bulletin, coupons steer patients toward more expensive drugs when there are cheaper alternatives like generics. Coupons do not consider patient need. Drugs with coupons increase in price faster than drugs that do not have coupons. This is inconsistent with the goal of decreasing the costs of care. It is unfair to use a coupon to get a drug for free and then demand the insurer to count what was received for free against the deductible. Coupons are considered illegal kickbacks under federal law and are prohibited for federal health care programs, which is a criminal offense. California has also banned coupons. This bill may be a good short-term solution, but will increase overall health care costs in the long-term. This bill does not strike the right balance.