The bill has a substantial impact on existing laws governing health care service plans and health insurers by altering how costs are reported and calculated. By requiring insurers to pass rebates on to enrollees and provide clear estimates of their cost-sharing reductions, SB 873 is expected to alleviate some financial burdens on consumers purchasing prescription medications. It also introduces an annual reporting requirement to the Legislature to monitor the impacts on drug prices and health care premiums.
Summary
Senate Bill 873, introduced by Senator Bradford, addresses the cost-sharing structure for prescription drugs within California's health care plans. Set to take effect no later than January 1, 2025, the bill mandates that defined cost sharing for prescription drugs be calculated at the point of sale, with prices reduced based on a significant portion (90%) of any rebates received. This legislative change aims to enhance transparency in drug pricing, allowing enrollees to receive a more accurate estimate of their costs at the moment of purchase.
Contention
Notably, the bill includes provisions that could lead to new legal obligations for health care service plans, specifying that willful violations would be deemed a crime. This raises concerns about potential uncertainties among providers regarding compliance and operational adjustments. Additionally, although SB 873 aims to improve consumer protection, some stakeholders argue that its requirements could inadvertently complicate existing insurance processes or could lead to increased operational costs for health care service plans. As a result, discussions around the bill may encompass various perspectives on both its intended benefits and unintended consequences for the health care industry.
Insurance: other; an enrollee's defined cost sharing for prescription drugs; provide for. Amends secs. 5, 7 & 9 of 2022 PA 11 (MCL 550.815 et seq.) & adds sec. 10.