COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:0545H.01I Bill No.:HB 198 Subject:Pharmacy; Insurance - Health Type:Original Date:March 27, 2023Bill Summary:This proposal creates provisions relating to insurance coverage of pharmacy
services.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND
AFFECTED
FY 2024FY 2025FY 2026General Revenue
Fund*
(Unknown, could
exceed $10,980,000)
(Unknown, could
exceed $10,980,000)
(Unknown, could
exceed $10,980,000)
Total Estimated
Net Effect on
General
Revenue
(Unknown, could
exceed $10,980,000)
(Unknown, could
exceed $10,980,000)
(Unknown, could
exceed $10,980,000)
* The fiscal impact is unknown, however, MCHCP estimates that it would be greater than $18
million split between General Revenue, Other Funds and Federal Funds.
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND
AFFECTED
FY 2024FY 2025FY 2026
Other Funds
(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000)
Total Estimated
Net Effect on
Other State
Funds(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000)
Numbers within parentheses: () indicate costs or losses. L.R. No. 0545H.01I
Bill No. HB 198
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND
AFFECTED
FY 2024FY 2025FY 2026Federal Funds(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
Total Estimated
Net Effect on All
Federal Funds(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2024FY 2025FY 2026Total Estimated Net
Effect on FTE 000
☒ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2024FY 2025FY 2026Local Government(Unknown)(Unknown)(Unknown) L.R. No. 0545H.01I
Bill No. HB 198
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March 27, 2023
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FISCAL ANALYSIS
ASSUMPTION
§376.411 – Insurance coverage of pharmacy services
Officials from the Missouri Consolidated Health Care Plan (MCHCP) state that MCHCP is
not a health care plan under the definition of §376.1350. However, §104.801, requires MCHCP
to follow any law which mandates coverage of specific health benefits, services or providers.
Since this legislation is mandating providers, MCHCP assumes it does apply to MCHCP.
Section 376.411, mandates that every pharmacy and provider be treated the same when covering
clinician-administered drugs. Today MCHCP uses several channel management programs to
provide drugs at the lowest cost possible. This bill would restrict usage of these programs and, as
a result, MCHCP costs could increase by limiting MCHCP’s ability to direct coverage under the
channel with the lower cost. MCHCP pharmacy benefit manager currently estimates that it saves
around $39 million from these programs. The fiscal impact is unknown, but MCHCP estimates
that it would be greater than $18 million.
Oversight assumes this legislation applies to MCHCP and, therefore, will reflect MCHCP’s
estimate of an unknown loss, possibly exceeding $18 million to the General Revenue Fund,
Other State Funds and Federal Funds.
General Revenue$10,980,00061%Federal Funds$4,500,00025%Other Funds$2,520,00014%Total$18,000,000100%
*MCHCP Fund Split Percentages provided by Budget & Planning
Oversight assumes this provision could have a fiscal impact on local government health plans
and, therefore, will reflect an unknown loss to local political subdivisions.
Officials from the Missouri Department of Transportation (MoDOT) assume the proposal
will have no fiscal impact on their organization or the MoDOT/DPS-MSHP health plan.
Officials from the Department of Commerce and Insurance, the Department of Social
ServicesMissouri Department of Conservation, the City of Kansas City and the City of
Springfield each assume the proposal will have no fiscal impact on their respective
organizations. Oversight does not have any information to the contrary. Therefore, Oversight
will reflect a zero impact in the fiscal note for these agencies. L.R. No. 0545H.01I
Bill No. HB 198
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Officials from the Department of Public Safety, Missouri Highway Patrol defer to the
MoDOT/MHP Health Care Board for response relating to the fiscal impact of this proposal on
their organization.
Oversight only reflects the responses received from state agencies and political subdivisions;
however, other cities and various county officials were requested to respond to this proposed
legislation but did not. A listing of political subdivisions included in the Missouri Legislative
Information System (MOLIS) database is available upon request.
FISCAL IMPACT – State
Government
FY 2024
(10 Mo.)
FY 2025FY 2026GENERAL REVEUE
FUND
Loss – MCHCP
Elimination of channel
management programs
(§376.411)
(Unknown, could
exceed
$10,980,000)
(Unknown, could
exceed
$$10,980,000)
(Unknown, could
exceed
$$10,980,000)
ESTIMATED NET
EFFECT TO THE
GENERAL REVENUE
FUND
(Unknown, could
exceed
$10,980,000)
(Unknown, could
exceed
$$10,980,000)
(Unknown, could
exceed
$$10,980,000)
OTHER FUNDSLoss – MCHCP
Elimination of channel
management programs
(§376.411)
(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000)
ESTIMATED NET
EFFECT TO OTHER
FUNDS
(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000)
(Unknown, could
exceed $2,520,000) L.R. No. 0545H.01I
Bill No. HB 198
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FISCAL IMPACT – State
Government (continued)
FY 2024
(10 Mo.)
FY 2025FY 2026FEDERAL FUNDSLoss – MCHCP
Elimination of channel
management programs
(§376.411)
(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
ESTIMATED NET
EFFECT TO FEDERAL
FUNDS
(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
(Unknown, could
exceed $4,500,000)
FISCAL IMPACT – Local GovernmentFY 2024
(10 Mo.)
FY 2025FY 2026LOCAL POLITICAL
SUBDIVISIONS
Loss – Local Political Subdivisions
Elimination of channel management
programs (§376.411)(Unknown)(Unknown)(Unknown)
ESTIMATED NET EFFECT TO
LOCAL POLITICAL
SUDBVISIONS(Unknown)(Unknown)(Unknown)
FISCAL IMPACT – Small Business
No direct fiscal impact to small businesses would be expected as a result of this proposal.
FISCAL DESCRIPTION
This bill establishes requirements for insurance coverage of certain pharmacy services. This bill
provides that a health carrier, pharmacy benefits manager, or agent of such entities are prohibited
from imposing any penalty, impediment, differentiation, or limitation on: L.R. No. 0545H.01I
Bill No. HB 198
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(1) Participating providers for providing medically necessary clinician-administered drugs,
regardless of whether the participating provider obtains such drugs from a provider that is in the
network;
(2) A person who is administered medically necessary clinician administered drugs regardless of
whether the participating provider obtains such drugs from a provider that is in the network; or
(3) Any pharmacy, including any class B hospital pharmacy as defined in Section 338.220,
RSMo, which is dispensing medically necessary clinician-administered drugs regardless of
whether the participating provider obtains such drugs from a provider that is in the network.
This prohibition does not apply if the clinician-administered drug is not otherwise covered by the
health carrier or pharmacy benefits manager.
A health carrier, pharmacy benefits manager, or agent of such entities may not discriminate,
lower the reimbursement, or impose any separate contract terms upon an entity based upon that
entity's participation in the 340B drug pricing program, described in 42 U.S.C. Section 256b, or
limit a patient's freedom to use any such entity, as described in the bill.
All pharmacy claims processed by a pharmacy that participates in the 340B drug pricing program
are final at the point of adjudication.
This bill defines "biological product", "biosimilar product", and "reference product" as having
the same meaning as given to the terms under federal law. A health carrier, pharmacy benefits
manager, or agent of such entities that provides coverage for a reference product or biosimilar
biological product must provide coverage for the reference product and all biological products
that have been deemed biosimilar to the reference product.
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space. L.R. No. 0545H.01I
Bill No. HB 198
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SOURCES OF INFORMATION
Department of Commerce and Insurance
Department of Public Safety –
Missouri Highway Patrol
Department of Social Services
Missouri Department of Conservation
Missouri Department of Transportation
Missouri Consolidated Health Care Plan
City of Kansas City
City of Springfield
Julie MorffRoss StropeDirectorAssistant DirectorMarch 27, 2023March 27, 2023