Researcher: JKL Page 1 4/6/22
OLR Bill Analysis
SB 357
AN ACT CONCERNING COPAY ACCUMULATOR PROGRAMS AND
HIGH DEDUCTIBLE HEALTH PLANS.
SUMMARY
This bill applies the state’s copay accumulator program prohibition
(see BACKGROUND) to high deductible health plans (HDHPs) to the
maximum extent permitted by federal law. It applies it to HDHPs that
are used to establish a health savings account (HSA), medical savings
account (MSA), or Archer MSA to the maximum extent permitted by
federal law and that does not disqualify the insured from receiving the
associated federal tax benefits.
Under federal law, an HDHP is a health plan that satisfies certain
requirements, including those related to minimum deductibles and
maximum out-of-pocket expenses. Individuals with eligible HDHPs
may make pre-tax contributions to an HSA, MSA, or Archer MSA and
use the account for qualified medical expenses.
According to the Internal Revenue Service (IRS), an individual
covered by an HDHP who also uses a discount card for health care
services or products, may still contribute to an HSA as long as the
individual must pay the costs of the covered health care until the
HDHP’s minimum annual deductible is satisfied (IRS Notice 2021-0014).
EFFECTIVE DATE: Upon passage, and applicable to policies or
contracts delivered, issued, renewed, amended, or continued on or after
January 1, 2022.
BACKGROUND
Copay Accumulator Program Prohibition
PA 21-14, which took effect January 1, 2022, requires certain health
carriers (e.g., insurers and HMOs) and pharmacy benefits managers, 2022SB-00357-R000355-BA.DOCX
Researcher: JKL Page 2 4/6/22
when calculating a covered individual’s cost sharing liability (e.g.,
coinsurance, copayment, or deductible) for a covered benefit, to credit
discounts provided and payments made by a third party for any portion
of the cost sharing. Thus, it prohibits copay accumulator programs,
under which drug manufacturer discount cards, coupons, and copay
assistance generally do not apply toward a covered individual’s cost
sharing responsibility.
COMMITTEE ACTION
Insurance and Real Estate Committee
Joint Favorable
Yea 17 Nay 0 (03/22/2022)