Relating To Reverse Auction Procurement.
If enacted, SB2874 would direct the Hawaii Employer-Union Benefits Trust Fund Board of Trustees to conduct a comprehensive study exploring the feasibility and potential financial benefits of this automated procurement approach. It seeks to identify the administrative requirements, feasibility, and potential cost-savings involved in implementing this technology-based strategy for HB's procurement processes. The bill is projected to accelerate the procurement timeline significantly — potentially reducing the selection process from several months to a matter of weeks, similar to the New Jersey model.
SB2874 is a legislative proposal aimed at implementing reverse auction procurement methods specifically for selecting pharmacy benefit managers (PBMs) intended to administer prescription drug benefits for state employees, dependents, and retirees in Hawaii. The bill draws inspiration from New Jersey, which successfully executed a reverse auction model, resulting in significant time savings and cost reductions in their procurement processes. This initiative aims to streamline procurement in Hawaii and explore similar cost-saving opportunities without impacting the coverage or costs for members.
The notable points of contention surrounding SB2874 revolve around ensuring that members do not experience cuts in benefits or increased costs as a result of transitioning to a reverse auction model. Questions about the practical implications of implementing such technology and how well it could be adapted to fit Hawaii's existing healthcare and procurement frameworks are likely to arise during discussions. The efficacy of the reverse auction model in achieving projected savings while maintaining the integrity and quality of healthcare services remains a point of debate among stakeholders.