What's happening
This bill limits prescription drug copayments so they cannot exceed the pharmacy's cost after a patient's deductible is met.
Why it matters
Protects consumers from overpaying. By capping copayments at the actual amount paid by insurers to pharmacies (after deductibles are met), the bill ensures individuals aren’t charged more out-of-pocket than the true cost of their prescription, potentially saving patients money.
Targets “spread pricing” practices. The legislation addresses situations where insurers or pharmacy benefit managers (PBMs) charge patients a copay higher than what the pharmacy receives, curbing a practice that can lead to hidden profits for middlemen at the expense of patients.
Increases transparency in drug pricing. By tying copays directly to the transaction price between insurer and pharmacy, the bill may help shine a light on the real costs of prescription drugs, making it harder for insurers or PBMs to obscure what is actually paid.
Potential to lower overall healthcare costs. For patients who have met their deductibles, this change could reduce financial barriers to accessing necessary medications, potentially improving adherence to prescriptions and leading to better health outcomes.
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Who cares
Headline styles
Limit Prescription Copays
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to insurance
- Referred to insurance
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1792
2019-2020 Regular Sessions
IN SENATE
January 16, 2019
Introduced by Sen. RIVERA -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance
AN ACT to amend the insurance law and the education law, in relation to copayments for prescription drugs
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subsection (h) of section 4325 of the insurance law, as added by chapter 487 of the laws of 2010, is amended to read as follows:
(h) No corporation or insurer organized or licensed under this chapter which provides coverage for prescription drugs shall require, or enter into a contract which permits, a copayment which exceeds the usual and customary cost of such prescribed drug or which exceeds the total price paid to the pharmacy for such prescribed drug after the insured has met the annual deductible requirement.
§ 2. Section 6826-a of the education law is amended by adding a new subdivision 3 to read as follows:
3. The copayment amount shall not exceed the total price paid to the pharmacy for the prescribed drug, except in cases where the insured has not met the annual deductible requirement.
§ 3. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07751-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the insurance law and the education law, in relation to copayments for prescription drugs
Purpose
This bill relates to copayments for prescription drugs.
Summary of provisions
Section one amends subsection (h) of section 4325 of the insurance law by prohibiting a copayment for a prescription drug that exceeds the customary cost of the drug or the total price paid to a pharmacy for a prescribed drug after an insured customer has met the annual deductible reauirement.
Section 2 amends section 6826-a of the education law by adding a new subdivision stating that a copayment for a prescribed drug cannot exceed the total price paid to a pharmacy except in cases when an insured customer has not yet met his or her annual deductible requirement.
Section 3 sets forth the effective date.
Justification
Some Pharmacy Benefit Managers, (PBMs) set higher copays for prescription drugs for insured customers. As a result, pharmacies are required to charge customers a copay, which can be as much as $50 for a drug that may only cost $11.65. The PBM then collects the excess $38.35 from the pharmacies. This is a roundabout way for PEMs to collect extra payment. In some instances, customers would actually pay less for prescriptions if they did not have insurance.
There are currently class-action lawsuits pending against some PBMs for this unscrupulous practice. Passing this bill, however, will proactively protect customers by preventing insurance companies and PBMs from over- charging customers.
Legislative history
New.
Fiscal implications
None to the State
Effective date
Immediately
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.