Legislature(2003 - 2004)
04/20/2004 02:15 PM House HES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 543-MEDICAID AND PRESCRIPTION DRUGS Number 0144 CHAIR WILSON announced that the first order of business would be HOUSE BILL NO. 543, "An Act relating to medical assistance coverage for prescription drugs; and providing for an effective date." CHAIR WILSON reminded the members that HB 543 has been heard twice before; therefore there will be no public testimony today. Number 0221 REPRESENTATIVE Coghill moved to adopt HB 543, version H, as the working document. There being no objection, version H was before the committee. Number 0292 CHAIR WILSON moved to adopt Amendment 1, [labeled 23-LS1835\H.1, Mischel, 4/8/04] which reads as follows: Page 3, lines 27 - 30: Delete: "a preferred drug list adopted by the Department of Health and Social Services before the effective date of this Act may be implemented until the effective date of regulations adopted under this Act or until six months after the effective date of this Act, whichever date occurs first" Insert: "a preferred drug list initiated by the Department of Health and Social Services before the effective date of this Act must be reviewed for consistency with regulations adopted under this Act and may not be implemented before the effective date of the regulations adopted under this Act, except that a prescription drug list initiated before the effective date of this Act may be implemented for prescription drug coverage under the senior care program established under ch. 3, SLA 2004, until the effective date of regulations adopted under this Act or until six months after the effective date of this Act, whichever date first occurs" CHAIR WILSON began discussion on Amendment 1 by explaining that by deleting current language and inserting new language it would require that the prescription drug list (PDL) be reviewed for consistency with regulations that are adopted by the Department of Health and Social Services. She added that the PDL for the senior care program which was initiated prior to this legislation is exempt. Chair Wilson reiterated that it is not her intention to negate what has already been done, but to ensure that the PDL still be reviewed. The review must take place within six months or by the effective date of the regulations, whichever date is first, she summarized. Number 0426 REPRESENTATIVE CISSNA objected. CHAIR WILSON stated that she believes it is essential to have regulations in place so that if there are changes to be made there is a guarantee that those changes must go through the administrative procedures process. REPRESENTATIVE CISSNA said she is objecting because HB 543 is a very complicated bill and she needs more time to figure out how this amendment affects the PDL. CHAIR WILSON told the members that Alaska is one of 33 states that has a PDL, and is included in that list because of the Senior Care program. All of the states who have PDLs, except Ohio, have implemented it through regulation to ensure that there is clarity in the parameters of the PDL. REPRESENTATIVE CISSNA asked for the source of the list of states with PDLs. She said she would like to know what the programs are like because she suspects they may be very different from each other. CHAIR WILSON agreed that each state is different. She said she believes this is important because it is essential that the department follow through with a consistent regulated process. It is the legislature's duty to ensure this is done, Chair Wilson emphasized. Number 0561 REPRESENTATIVE CISSNA shared that last year she went to a meeting in Chicago conducted by the National Conference of State Legislatures (NCSL). One of the workshops focused on PDLs and the experiences of other states, she said. There is a huge lobby effort from the pharmaceutical companies and doctors because it brings down a lot of expenditures to the pharmaceutical companies. The prices of pharmaceuticals are going up faster than any other sector in the health care market. Representative Cissna told the members that this is one reasonable way to bring the costs down. She agreed with Chair Wilson on the importance of oversight in this process. She said her only concern is that this requirement may make it difficult for the department get at this as soon as is needed. Number 0683 CHAIR WILSON commented that the amendment was given to the members at the last meeting. Number 0695 REPRESENTATIVE SEATON said that he is trying to figure out what the effect of this would be. He said he understands this amendment would allow for the PDL to go forward under the Senior Care program. However, it would prevent that PDL from being applied to any other Medicaid program until regulations could be adopted and a new drug list constructed in compliance with those regulations. What is the fiscal impact of that change, he asked. CHAIR WILSON replied that the department makes and changes regulations in other areas all the time. That cost is normally absorbed in the department's budget. She told the members that there is a fiscal note in this case and believes it was included to stop the bill. REPRESENTATIVE SEATON clarified that he is not speaking about the fiscal note with respect to creating regulations. The way this is set out means the PDL, the savings that were anticipated cannot go into effect until regulations, and a new PDL is in place. CHAIR WILSON responded that lot depends on how quickly the department works to implement the regulations and PDL. She added that it will not be $20 million. REPRESENTATIVE SEATON asked if there is a revised fiscal note. CHAIR WILSON replied that there is a zero fiscal note. Number 0850 A roll call vote was taken. Representatives Wolf, Seaton, Wilson, and Gatto voted in favor of Amendment 1. Representatives Cissna voted against it. Therefore, Amendment 1 passed by a vote of 4-1. Number 0932 CHAIR WILSON moved Amendment 2, which reads as follows: Page 4, line 2: Delete "January 1" Insert "March 1" CHAIR WILSON explained that this amendment delays the date of implementation of a PDL on mental health drugs. She reminded the members of discussions concerning the importance of making sure the PDL is working and the process is in place. The department told the members that its plan was to wait a year before working on mental health drugs. This date would be about a year from now, while the legislature is in session and can observe any changes, she added. Number 0989 REPRESENTATIVE SEATON objected for purposes of discussion. There is a six-month period for the department to adopt and implement regulations. This amendment would create an additional two-month delay, he commented. He told the members that he does not see the point in delaying the implementation another two months unless it is the legislature's intention to overturn the regulations the department adopts. If that is the case, then all the work the department had done would be negated, and it would have to start over again and which would mean another one-year delay would occur. CHAIR WILSON told the members she feels strongly about this amendment. The separation of powers for checks and balances is essential. She stated that she wants the legislature to be in session when these changes occur so there is an awareness of the impact of these changes. Number 1093 REPRESENTATIVE GATTO questioned the purpose of singling out psychotropic drugs for special treatment. He said he believes that any class of drugs deserves special treatment. Representative Gatto said he would like to hear some justification for this. Number 1112 CHAIR WILSON explained that there has been testimony about the history of mental health treatment. At one time API was full to capacity and now the new facility is much smaller. Over the years drugs have been developed that allow individuals with mental illness to lead productive lives. She said she believes changing medication on these people could end up costing the state more money because of additional hospitalization. Chair Wilson pointed out that many of the states have chosen not to put mental health drugs on the PDL at all. There have been cases where individuals were taken off of drugs and suicides occurred. She cautioned that there needs to be great care with respect to these drugs. Chair Wilson clarified that she is not saying don't include these drugs on the PDL, but to proceed slowly and carefully. REPRESENTATIVE SEATON asked how this would proceed. He asked if it would be a case where individual patient's drug treatments would be monitored to see how they react to treatment. Representative Seaton reiterated that the bill sets out a program where the department must adopt regulations, and there is a delay to ensure implementation is working. He questioned what the legislature would be monitoring because he does not see it reviewing individual drugs for inclusion in the PDL. CHAIR WILSON responded that mental health patients are far more fragile than other patients. She said she believes it is important to proceed in a smooth and careful way. The department told the committee that it planned to wait one year before reviewing psychotropic drugs. However, she said she found out that the department was referring to the fiscal year, not the calendar year. At the next meeting the PDL Committee is planning on taking up these drugs with the intention of putting the PDL in place starting July 1. That is not the impression the committee was left with originally, she stated. REPRESENTATIVE SEATON maintained his objection. Number 1322 REPRESENTATIVE COGHILL told the members that he believes there is already increased scrutiny on psychotropic drugs. He pointed out that there will be a new session in January when the legislature can review the progress. Representative Coghill said he is concerned about the cost-containment issue related to the delay. Number 1434 REPRESENTATIVE WILSON replied that she believes it is important that the legislature already be in session when the changes take effect. Number 1439 REPRESENTATIVE COGHILL said he does not think this date change will make any difference and opposes the amendment. A roll call vote was taken. Representative Wilson voted in favor of Amendment 2. Representatives Gatto, Wolf, Coghill, Seaton, and Cissna voted against it. Therefore, Amendment 2 failed to be adopted by a vote of 1-5. Number 1491 REPRESENTATIVE SEATON REPRESENTATIVE moved Amendment 3, as follows: On Page 2 Delete: Lines [2] and 4 CHAIR WILSON objected for discussion purposes. REPRESENTATIVE SEATON explained that this section relates to the regulations that will be adopted and he believes this subsection is inappropriate because this appeal refers to "person" which could mean a company, not just an individual. He told the members that he has spoken with some of the industry members and agreed that it would not be their intention to have each drug manufacturer appeal each decision which would then slow down the construction of the PDL. Appeals for patients are already covered in subsection (4), he added. Representative Seaton commented that he believes it was just a drafting error and should be eliminated. CHAIR WILSON withdrew her objection. There being no further objection, Amendment 3 was adopted. Number 1588 REPRESENTATIVE SEATON directed the members' attention to page 2, line 9. He asked if the Alaska Care program only uses the terms "medically necessary." He questioned whether the terms "dispense as written" would add confusion. Using the terms dispense as written does not allude to the fact that there is any medical necessity in dispensing a particular drug, he pointed out. Number 1623 REPRESENTATIVE SEATON moved Amendment 4, as follows: Page 2, line 9, After "prescription the phrase" Delete "dispense as written," Page 2, line 10, After "medically necessary" Delete ", or other wording with similar import" REPRESENTATIVE SEATON told the members that he believes this change will eliminate any confusion for doctors when writing prescriptions. There being no objection, Amendment 4 was adopted. Number 1696 REPRESENTATIVE SEATON moved to report HB 543, as amended, 23- LS1835\H, out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHB 543(HES) was reported out of the House Health, Education and Social Services Standing Committee.
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