2012 -- H 7573

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

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A N A C T

RELATING TO INSURANCE - PRESCRIPTION DRUG BENEFITS

     Introduced By: Representatives Keable, Naughton, Blazejewski, Morrison, and Tanzi

     Date Introduced: February 15, 2012

     Referred To: House Corporations

It is enacted by the General Assembly as follows:

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     SECTION 1. Legislative findings.-- (1) The cost-sharing, deductibles and co-insurance

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obligations for certain drugs are becoming more cost prohibitive for persons trying to overcome

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serious and often life-threatening diseases and conditions, such as cancer, multiple sclerosis,

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rheumatoid arthritis, hepatitis C, hemophilia and psoriasis.

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     (2) These drugs are typically new, produced in lesser quantities than other drugs, and not

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available as less expensive brand name or generic prescription drugs. Some health insurance

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plans and policies in other states as well as some self-insured plans have established unique

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categories or specialty tiers for these drugs, sometimes referred to as Tier IV or Tier V.

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     (3) Patients under these plans are required to pay a percentage of the costs of these high-

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priced drugs, rather than the traditional co-payment amounts for generic, preferred brand and

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non-preferred brand prescription drugs, often covered by Tier I, Tier II and Tier III plans and

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policies, respectively. As a result, patients covered under plans with specialty tiers must pay

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thousands of dollars in out-of-pocket costs for drugs critical to their treatment.

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     (4) It is in the public interest to help patients to afford necessary prescription drugs by

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prohibiting cost-sharing, deductibles and co-insurance obligations by patients that exceed

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payments for non-preferred brand prescription drugs or the equivalent thereof. It is not the intent

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of this legislation to preclude plans or policies from categorizing drugs used in the treatment of

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these common diseases as brand name prescription drugs or generic prescription drug

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equivalents. The extraordinary disparity in cost-sharing, deductible and co-insurance burdens

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imposed on patients whose life and health depend on these drugs constitutes serious and

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unjustified discrimination based on their disease or disability.

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     (5) This legislation is intended to provide patients more affordable access to prescription

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drugs essential for their treatment of cancer, multiple sclerosis, rheumatoid arthritis, hepatitis C,

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hemophilia, psoriasis and other diseases.

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     SECTION 2. Chapter 27-20.8 of the General Laws entitled "Prescription Drug Benefits"

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is hereby amended by adding thereto the following section:

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     27-20.8-3. Specialty tiers prohibited. -- (a) No health plan, which provides coverage for

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prescription drugs and for which cost-sharing, deductibles or co-insurance obligations are

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determined by category of prescription drugs, shall establish tiers of prescription drug co-pays in

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which the maximum prescription drug co-pay exceeds by more than five hundred percent (500%)

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the lowest prescription drug co-pay charged under the health plan. If the health plan provides a

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limit for out-of-pocket expenses for benefits other than prescription drugs, the insurer shall

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include one of the following provisions in the plan that would result in the lowest out-of- pocket

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prescription drug cost to the enrollee or subscriber:

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     (1) Out-of-pocket expenses for prescription drugs shall be included under the health

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plan’s total limit for out-of-pocket expenses for all benefits provided under the plan: or

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     (2) Out-of-pocket expenses for prescription drugs per contract year shall not exceed one

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thousand dollars ($1,000) per enrollee or subscriber, or two thousand dollars ($2,000) per insured

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family, adjusted for inflation.

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     (b) This section shall not apply to insurance coverage providing benefits for:

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     (1) Hospital confinement indemnity;

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     (2) Disability income;

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     (3) Accident only;

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     (4) Long-term care;

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     (5) Medicare supplement;

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     (6) Limited benefit health;

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     (7) Specified disease indemnity;

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     (8) Sickness or bodily injury or death by accident or both; and

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     (9) Other limited benefit policies.

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     (c) It shall be an unlawful discriminatory practice for any employer, labor organization,

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insurer, health maintenance organization or other entity to limit health care coverage such that

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cost-sharing, deductibles or co-insurance obligations for any prescription drug exceeds by more

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than five hundred percent (500%) the lowest prescription drug co-pay charged under the health

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plan; provided however, this subdivision shall not apply to any self-insured employee welfare

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benefit plan, as established in the employee retirement income security act of 1974, as amended.

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(d) Nothing in this section shall apply to the title XIX state plan pursuant to title XIX of

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the Social Security Act to provide Medicaid coverage or title XXI state plan pursuant to Title

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XXI of the Social Security Act to provide medical assistance coverage. The services provided

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shall be in accord with title XIX [42 U.S.C. 1396 et seq.] and title XXI [42 U.S.C. 1397 et seq.]

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of the Social Security Act.

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     27-20.8-4. Severability. -- If any provision of this chapter or the application thereof to

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any person or circumstances is held invalid, such invalidity shall not affect other provisions or

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applications of the chapter, which can be given effect without the invalid provision or application,

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and to this end the provisions of this chapter are declared to be severable.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO INSURANCE - PRESCRIPTION DRUG BENEFITS

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     This act would control costs to consumers of newly released, non-generic prescription

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drugs.

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     This act would take effect upon passage.

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