BILL NUMBER:S2786

TITLE  OF BILL:  An act to amend the social services law, in relation to
the collection of prescription drug co-payments

PURPOSE:  To require patients to pay co-payments for prescription  drugs
at the point-of-sale under Medicaid and Family Health Plus

SUMMARY OF PROVISIONS:

Section  1-  Amends  section 367-a of the Social Services law to require
the payment of prescription drug co-payments under Medicaid.

Section 2- Amends section 369-ee of the Social Services law  to  require
the payment of prescription drug co-payments under Family Health Plus.

Section 3- Effective date.

JUSTIFICATION:  Co-payments for prescription drugs in the State Medicaid
program  were  implemented  in New York State in 1995. Prescription drug
co-payments were also included when the Family Health Plus  program  was
created.   It is the current policy that Medicaid and Family Health Plus
beneficiaries cannot be denied services if  they  refuse  to  pay  their
co-payments  at  the point-of-sale. As a result, pharmacies in the State
of New York  have  experienced  serious  financial  losses  through  the
inability to collect the co-payments of $1 for generics and $3 for brand
              

name  drugs  under  Medicaid  and  $3 for generics and $6 for brand name
drugs under Family Health Plus. Survey data has found that the statewide
average of uncollectible co-payments is 50%, and the rate is even higher
in New York City with some pharmacies experiencing uncollectible co-pay-
ments of 90%.

Unlike other providers which receive funding from bad debt  and  charity
pools,  pharmacies  cannot  write  off their bad debt and do not receive
state assistance to make up for these losses. Uncollectible  co-payments
come  directly  out  of  the pockets of community pharmacies. Pharmacies
have also recently experienced significant reductions  in  reimbursement
under  Medicaid  and Family Health and are currently are paid one of the
lowest rates in the country. This hardship is exacerbated by the  losses
incurred through uncollectible co-payments in these programs. This situ-
ation  is  inequitable  and also jeopardizes access to pharmacy services
for all New Yorkers.

Recently, the pharmacy benefit under Medicaid and Family Health Plus was
changed and will now be administered by private managed care  plans  for
the  majority of beneficiaries. However, the co-payments remain the same
as does the policy regarding pharmacy collection.  This means that phar-
macies will continue to lose on  average  50%  of  co-payments  for  the
prescription drugs filled for approximately four million New Yorkers.

This  inequity  would be addressed through this legislation by requiring
Medicaid and Family Health Plus beneficiaries to pay  their  co-payments
to pharmacies at the point-of-sale when filling their prescriptions.

LEGISLATIVE HISTORY: S.4749A/A.7727 of 2011-2012

FISCAL IMPLICATIONS: None

EFFECTIVE  DATE:  This act shall take effect one hundred and eighty days
after it shall become law.