SB 62 – Prescription Drug Rebates and Pricing
Authored by Sen. Vaneta Becker (R-Evansville)

Provides that the defined cost sharing for a prescription drug under a policy of accident and sickness insurance or a health maintenance organization contract must be calculated at the point of sale and based on a price that is reduced by an amount equal to at least 85% of all rebates received by the insurer or health maintenance organization in connection with the dispensing or administration of the prescription drug.

Chamber position: Oppose

The latest: The bill passed the Senate Health and Provider Services Committee 10-2.

Indiana Chamber action/commentary: Eli Lilly and Company testified in support of the bill. Anthem, CVS Health, Care Source and CIGNA all joined us in opposition. In testimony, the Chamber mentioned that Lilly and Anthem are two of its largest members. We opposed the bill because the fiscal impact statement shows that premiums will increase for local government non-ERISA (Employee Retirement Income Security Act) plans. If the bill impacts those plans in that manner, the same will apply to small group fully insured plans. The Chamber has a standing policy to oppose mandates that drive up premiums for fully insured plans. The Senate refuses to listen on this issue and will pass this bill. Every attempt will be made to kill SB 62 when it reaches the House.

SB 143 – Pharmacy Benefit Managers
Authored by Sen. Andy Zay (R-Huntington)

Requires the auditor of state to conduct an audit of prescription drug cost sharing for the Medicaid program every three state fiscal years. Adds requirements of pharmacy benefit managers (PBMs) when denying an appeal of the maximum allowable cost pricing of a prescription drug. Requires the Department of Insurance to develop a process for complaints regarding PBMs, including: (1) denied appeals of maximum allowable cost pricing; and (2) unfair, unjust or unlawful contract provisions. Allows a pharmacy or pharmacist to decline to provide pharmacist services to a covered individual if the acquisition cost to the pharmacy or pharmacist would exceed the amount received for the pharmacist services.

Chamber position: Oppose (pending review of late amendment)

The latest: The bill was amended in Senate Appropriations Committee and some on the fly. Senator Liz Brown (R-Fort Wayne) expressed major concerns about the portion of the bill that allows pharmacies to deny a prescription because they would have to accept payment for less than they actually paid for the drug. She noted that there are other drugs on which pharmacies are making a profit. While this may help pharmacies, it doesn’t help overall costs and access. Senator Brown also maintained that the Department of Insurance currently has authority to audit between a PBM and the pharmacy. The committee chairman, Ryan Mishler (R-Bremen), amended the auditing language because it created a fiscal component. The bill passed the committee after much discussion.

Indiana Chamber action/commentary: With the amendments, we believe the bill is in much better shape than previously, but the bill may still drive up costs to employers. No written advance copy was provided for one amendment, so we will have to wait until the new draft version is made public to see what is in the bill. It’s clear that there is momentum to pass this legislation in 2021 regardless of the Chamber’s final position.

Resource: Mike Ripley at (317) 264-6883 or email: mripley@indianachamber.com