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SPONSOR: |
SPAC |
DATE TYPED: |
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HB |
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SHORT TITLE: |
Medical Insurance Pool Prescription Drugs |
SB |
CS/754/aSCORC |
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ANALYST: |
Geisler |
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APPROPRIATION
Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY03 |
FY04 |
FY03 |
FY04 |
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NFI |
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(Parenthesis
( ) Indicate Expenditure Decreases)
Conflicts with:
HB 832 and SB 778
Relates to: SB 160, HB 402, HB 103
Public
Regulation Commission (PRC)
Department
of Health (DOH)
Health
Policy Commission (HPC)
SUMMARY
Synopsis of SCORC
Amendment
The Senate Corporation and Transportation Committee
amendment makes a few small language changes and clarifications. In addition, a new subsection F. is included
that reads:
“F. If the board establishes a prescription drug program, the board shall cooperate with other state and
federal prescription drug initiatives.”
Synopsis
of Original Bill
The Senate Public
Affairs Committee Substitute for HB 754 adds a new section to the Medical
Insurance Pool Act (59A-54 NMSA 1978) to empower the Medical Insurance Pool
Board to establish a prescription drug program for Pool beneficiaries, and to
determine eligibility, cost sharing, and dispensing criteria.
Significant
Issues
The changes to the act
are as follows:
· Authorizes
the Board to establish a prescription drug program, in whole or in part, including
a pilot or phase-in program.
· The
Board may determine levels of eligibility and cost sharing criteria.
· The
Board may establish how much an eligible individual will pay through a premium,
deductible, coinsurance, co-payment and other out-of-pocket expenses.
· If
the Board establishes a prescription drug program, they shall also establish
the assessments pursuant to Section 50A-54-10 NMSA 1978.
The changes to Section 50A-54-10 indicates that, if
the drug program is established, the assessment for a pool member shall be
determined in the same manner as other assessments, with the provision that
pool members shall be allowed a 50% credit on their premium tax for that member.
The changes to Section 59A-54-12 indicates that the
Board may issue a prescription drug benefit policy for a person who is:
· Over
65 years old and unable to purchase, or is ineligible for, a similar
prescription drug program,
· Eligible
for a State-funded or operated low-income pharmacy benefit program.
RELATIONSHIP
Relates to:
SB 160, Prescription Drug Programs
HB 402, Prescription Drug Waiver Program for Seniors
HB 103, Prescription Drug Co-payment Standard
OTHER SUBSTANTIVE ISSUES
·
Between 2001 and 2002,
·
In 2002, the Health Policy Commission performed
a wide-ranging and extensive study on prescription drug access in
· The average annual out-of-pocket expense per household for prescription drugs was $634.66.
· 12% had less than full access to the medications they needed.
· Of these, the populations that had the most difficulties with access were low-income persons, the uninsured, low/fixed income seniors, disabled persons and immigrants.
· Medicaid beneficiaries and the uninsured
face similar access difficulties to prescription drugs – 26% of Medicaid beneficiaries
and 29% of the uninsured population report significant difficulty accessing
needed drugs.
· 12.5% of Medicare beneficiaries have no
form of supplemental insurance at all.
Their incomes are too high for Medicaid, but too low to bring a
supplemental policy within reach. Among
this group, those who have greater health care needs clearly face the greatest
barriers to access.
·
Approximately 32 states have programs in
place or authorized that provide some sort of prescription drug coverage,
mostly for low-income seniors and/or disabled persons.
·
26 states have subsidy programs that
provide assistance with prescription expenses for seniors and other categories
of residents.
·
An additional 6 states have discount only
programs, with no state subsidy, that provide prescription drugs at a reduced
cost to eligible seniors.
Other
Issues
· The Medical Insurance Pool program was created to provide access to health coverage for all New Mexicans who are denied adequate insurance and considered uninsurable. All insurers who wish to do business in the state must be members of the Pool.
o By authorizing the Board to establish a prescription drug benefit, SB754 expands the promise of access created by the original statute.
· Many people who have health insurance have limited prescription drug coverage – or no drug coverage at all. SB754 allows the Pool Board to extend its prescription coverage to Medicare and Medicaid eligible individuals, when they lack access to prescription drugs.
o Medicare does not provide outpatient prescription drug coverage. To pay for the often-substantial costs not covered by Medicare, and to seek prescription drug coverage, beneficiaries must rely on other sources – or go without: recent estimates are that at any given time, over 30% of Medicare beneficiaries lack prescription drug coverage.
o A new study from the Center for Studying Health System Change (HSC) shows that “the prescription drug access problems experienced by Medicaid beneficiaries are virtually the same as the uninsured” – 26% of Medicaid beneficiaries and 29% of the uninsured population report significant difficulty accessing needed drugs (HSC News Release, April 9, 2002).
· Despite their growing cost, prescription drugs are a ever-more important component of modern medicine: “evidence suggests that more appropriate utilization of prescription drugs has the potential to lower total expenditures and improve the quality of care” (Employee Benefit Research Institute).
· The Medicaid Reform Committee recommended that cost-saving studies and initiatives be undertaken to provide access to prescription drugs for all New Mexicans.
GG/prr:sb:yr:ls