Rhode Island 2025 Regular Session

Rhode Island House Bill H5463 Compare Versions

Only one version of the bill is available at this time.

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5	5	2025 -- H 5463
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7	7	LC000992
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9	9	S T A T E O F R H O D E I S L A N D
10	10	IN GENERAL ASSEMBLY
11	11	JANUARY SESSION, A.D. 2025
12	12	____________
13	13
14	14	A N A C T
15	15	RELATING TO STATE AFFAIRS AND GOVERNMENT -- OFFICE OF HEALTH AND
16	16	HUMAN SERVICES
17	17	Introduced By: Representatives Stewart, Potter, Cruz, Cotter, Kislak, Tanzi, and Handy
18	18	Date Introduced: February 12, 2025
19	19	Referred To: House Finance
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22	22	It is enacted by the General Assembly as follows:
23	23	SECTION 1. The intent of this legislation is to protect Rhode Islanders and the state 1
24	24	Medicaid program from high prescription drug costs by requiring greater pharmacy benefit 2
25	25	manager (PBM) transparency and accountability. 3
26	26	SECTION 2. Section 42-7.2-5 of the General Laws in Chapter 42-7.2 entitled "Office of 4
27	27	Health and Human Services" is hereby amended to read as follows: 5
28	28	42-7.2-5. Duties of the secretary. 6
29	29	The secretary shall be subject to the direction and supervision of the governor for the 7
30	30	oversight, coordination, and cohesive direction of state-administered health and human services 8
31	31	and in ensuring the laws are faithfully executed, notwithstanding any law to the contrary. In this 9
32	32	capacity, the secretary of the executive office of health and human services (EOHHS) shall be 10
33	33	authorized to: 11
34	34	(1) Coordinate the administration and financing of healthcare benefits, human services, and 12
35	35	programs including those authorized by the state’s Medicaid section 1115 demonstration waiver 13
36	36	and, as applicable, the Medicaid state plan under Title XIX of the U.S. Social Security Act. 14
37	37	However, nothing in this section shall be construed as transferring to the secretary the powers, 15
38	38	duties, or functions conferred upon the departments by Rhode Island public and general laws for 16
39	39	the administration of federal/state programs financed in whole or in part with Medicaid funds or 17
40	40	the administrative responsibility for the preparation and submission of any state plans, state plan 18
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44	44	amendments, or authorized federal waiver applications, once approved by the secretary. 1
45	45	(2) Serve as the governor’s chief advisor and liaison to federal policymakers on Medicaid 2
46	46	reform issues as well as the principal point of contact in the state on any such related matters. 3
47	47	(3)(i) Review and ensure the coordination of the state’s Medicaid section 1115 4
48	48	demonstration waiver requests and renewals as well as any initiatives and proposals requiring 5
49	49	amendments to the Medicaid state plan or formal amendment changes, as described in the special 6
50	50	terms and conditions of the state’s Medicaid section 1115 demonstration waiver with the potential 7
51	51	to affect the scope, amount, or duration of publicly funded healthcare services, provider payments 8
52	52	or reimbursements, or access to or the availability of benefits and services as provided by Rhode 9
53	53	Island general and public laws. The secretary shall consider whether any such changes are legally 10
54	54	and fiscally sound and consistent with the state’s policy and budget priorities. The secretary shall 11
55	55	also assess whether a proposed change is capable of obtaining the necessary approvals from federal 12
56	56	officials and achieving the expected positive consumer outcomes. Department directors shall, 13
57	57	within the timelines specified, provide any information and resources the secretary deems necessary 14
58	58	in order to perform the reviews authorized in this section. 15
59	59	(ii) Direct the development and implementation of any Medicaid policies, procedures, or 16
60	60	systems that may be required to assure successful operation of the state’s health and human services 17
61	61	integrated eligibility system and coordination with HealthSource RI, the state’s health insurance 18
62	62	marketplace. 19
63	63	(iii) Beginning in 2015, conduct on a biennial basis a comprehensive review of the 20
64	64	Medicaid eligibility criteria for one or more of the populations covered under the state plan or a 21
65	65	waiver to ensure consistency with federal and state laws and policies, coordinate and align systems, 22
66	66	and identify areas for improving quality assurance, fair and equitable access to services, and 23
67	67	opportunities for additional financial participation. 24
68	68	(iv) Implement service organization and delivery reforms that facilitate service integration, 25
69	69	increase value, and improve quality and health outcomes. 26
70	70	(4) Beginning in 2020, prepare and submit to the governor, the chairpersons of the house 27
71	71	and senate finance committees, the caseload estimating conference, and to the joint legislative 28
72	72	committee for health-care oversight, by no later than September 15 of each year, a comprehensive 29
73	73	overview of all Medicaid expenditures outcomes, administrative costs, and utilization rates. The 30
74	74	overview shall include, but not be limited to, the following information: 31
75	75	(i) Expenditures under Titles XIX and XXI of the Social Security Act, as amended; 32
76	76	(ii) Expenditures, outcomes, and utilization rates by population and sub-population served 33
77	77	(e.g., families with children, persons with disabilities, children in foster care, children receiving 34
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81	81	adoption assistance, adults ages nineteen (19) to sixty-four (64), and elders); 1
82	82	(iii) Expenditures, outcomes, and utilization rates by each state department or other 2
83	83	municipal or public entity receiving federal reimbursement under Titles XIX and XXI of the Social 3
84	84	Security Act, as amended; 4
85	85	(iv) Expenditures, outcomes, and utilization rates by type of service and/or service 5
86	86	provider; 6
87	87	(v) Expenditures by mandatory population receiving mandatory services and, reported 7
88	88	separately, optional services, as well as optional populations receiving mandatory services and, 8
89	89	reported separately, optional services for each state agency receiving Title XIX and XXI funds; and 9
90	90	(vi) Information submitted to the Centers for Medicare & Medicaid Services for the 10
91	91	mandatory annual state reporting of the Core Set of Children’s Health Care Quality Measures for 11
92	92	Medicaid and Children’s Health Insurance Program, behavioral health measures on the Core Set of 12
93	93	Adult Health Care Quality Measures for Medicaid and the Core Sets of Health Home Quality 13
94	94	Measures for Medicaid to ensure compliance with the Bipartisan Budget Act of 2018, Pub. L. No. 14
95	95	115-123. 15
96	96	The directors of the departments, as well as local governments and school departments, 16
97	97	shall assist and cooperate with the secretary in fulfilling this responsibility by providing whatever 17
98	98	resources, information and support shall be necessary. 18
99	99	(5) Resolve administrative, jurisdictional, operational, program, or policy conflicts among 19
100	100	departments and their executive staffs and make necessary recommendations to the governor. 20
101	101	(6) Ensure continued progress toward improving the quality, the economy, the 21
102	102	accountability, and the efficiency of state-administered health and human services. In this capacity, 22
103	103	the secretary shall: 23
104	104	(i) Direct implementation of reforms in the human resources practices of the executive 24
105	105	office and the departments that streamline and upgrade services, achieve greater economies of scale 25
106	106	and establish the coordinated system of the staff education, cross-training, and career development 26
107	107	services necessary to recruit and retain a highly-skilled, responsive, and engaged health and human 27
108	108	services workforce; 28
109	109	(ii) Encourage EOHHS-wide consumer-centered approaches to service design and delivery 29
110	110	that expand their capacity to respond efficiently and responsibly to the diverse and changing needs 30
111	111	of the people and communities they serve; 31
112	112	(iii) Develop all opportunities to maximize resources by leveraging the state’s purchasing 32
113	113	power, centralizing fiscal service functions related to budget, finance, and procurement, 33
114	114	centralizing communication, policy analysis and planning, and information systems and data 34
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118	118	management, pursuing alternative funding sources through grants, awards, and partnerships and 1
119	119	securing all available federal financial participation for programs and services provided EOHHS-2
120	120	wide; 3
121	121	(iv) Improve the coordination and efficiency of health and human services legal functions 4
122	122	by centralizing adjudicative and legal services and overseeing their timely and judicious 5
123	123	administration; 6
124	124	(v) Facilitate the rebalancing of the long-term system by creating an assessment and 7
125	125	coordination organization or unit for the expressed purpose of developing and implementing 8
126	126	procedures EOHHS-wide that ensure that the appropriate publicly funded health services are 9
127	127	provided at the right time and in the most appropriate and least restrictive setting; 10
128	128	(vi) Strengthen health and human services program integrity, quality control and 11
129	129	collections, and recovery activities by consolidating functions within the office in a single unit that 12
130	130	ensures all affected parties pay their fair share of the cost of services and are aware of alternative 13
131	131	financing; 14
132	132	(vii) Assure protective services are available to vulnerable elders and adults with 15
133	133	developmental and other disabilities by reorganizing existing services, establishing new services 16
134	134	where gaps exist, and centralizing administrative responsibility for oversight of all related 17
135	135	initiatives and programs. 18
136	136	(7) Prepare and integrate comprehensive budgets for the health and human services 19
137	137	departments and any other functions and duties assigned to the office. The budgets shall be 20
138	138	submitted to the state budget office by the secretary, for consideration by the governor, on behalf 21
139	139	of the state’s health and human services agencies in accordance with the provisions set forth in § 22
140	140	35-3-4. 23
141	141	(8) Utilize objective data to evaluate health and human services policy goals, resource use 24
142	142	and outcome evaluation and to perform short and long-term policy planning and development. 25
143	143	(9) Establishment of an integrated approach to interdepartmental information and data 26
144	144	management that complements and furthers the goals of the unified health infrastructure project 27
145	145	initiative and that will facilitate the transition to a consumer-centered integrated system of state-28
146	146	administered health and human services. 29
147	147	(10) At the direction of the governor or the general assembly, conduct independent reviews 30
148	148	of state-administered health and human services programs, policies and related agency actions and 31
149	149	activities and assist the department directors in identifying strategies to address any issues or areas 32
150	150	of concern that may emerge thereof. The department directors shall provide any information and 33
151	151	assistance deemed necessary by the secretary when undertaking such independent reviews. 34
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155	155	(11) Provide regular and timely reports to the governor and make recommendations with 1
156	156	respect to the state’s health and human services agenda. 2
157	157	(12) Employ such personnel and contract for such consulting services as may be required 3
158	158	to perform the powers and duties lawfully conferred upon the secretary. 4
159	159	(13) Assume responsibility for complying with the provisions of any general or public law 5
160	160	or regulation related to the disclosure, confidentiality, and privacy of any information or records, 6
161	161	in the possession or under the control of the executive office or the departments assigned to the 7
162	162	executive office, that may be developed or acquired or transferred at the direction of the governor 8
163	163	or the secretary for purposes directly connected with the secretary’s duties set forth herein. 9
164	164	(14) Hold the director of each health and human services department accountable for their 10
165	165	administrative, fiscal, and program actions in the conduct of the respective powers and duties of 11
166	166	their agencies. 12
167	167	(15) Identify opportunities for inclusion with the EOHHS’ October 1, 2023 budget 13
168	168	submission, to remove fixed eligibility thresholds for programs under its purview by establishing 14
169	169	sliding scale decreases in benefits commensurate with income increases up to four hundred fifty 15
170	170	percent (450%) of the federal poverty level. These shall include but not be limited to, medical 16
171	171	assistance, childcare assistance, and food assistance. 17
172	172	(16) Ensure managed care organizations (“MCOs”) and pharmacy benefit managers 18
173	173	(“PBMs”) working for the Rhode Island Medicaid program are transparent, do not increase 19
174	174	unnecessary costs for the Rhode Island Medicaid program and patients, and demonstrate that they 20
175	175	improve patient health outcomes, by: 21
176	176	(i) Requiring contracts with MCOs ensure PBMs: 22
177	177	(A) Cease activities that result in spread pricing, a payment model where the PBM charges 23
178	178	a health plan more than it reimburses the pharmacy for a prescription drug and retains the 24
179	179	difference; 25
180	180	(B) Use pass-through pricing, a payment model where the PBM charges the health plan or 26
181	181	insurer the same amount it reimburses the pharmacy, with no additional profit margin, and retains 27
182	182	only a pre-determined administrative fee; 28
183	183	(C) Prohibit discriminatory treatment of non-affiliated pharmacies and pharmacists; 29
184	184	(D) Cease utilization management processes, including prior authorizations, step therapy 30
185	185	and non-medical drug switching, that delay, reduce or prevent medically necessary care; 31
186	186	(E) Ensure enrollee benefits result from discounts, price reductions, or other financial 32
187	187	incentives provided to PBMs by drug manufacturers including, but not limited to, rebates for 33
188	188	formulary placements; and 34
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193	193	(F) Provide information and documents that permit enforcement of this subsection to 2
194	194	EOHHS. 3
195	195	(ii) Analyzing and making recommendations to the governor and the general assembly by 4
196	196	January 1, 2026 about: 5
197	197	(A) Creating a single Medicaid PBM; 6
198	198	(B) Carving out pharmacy benefits from the managed care program; 7
199	199	(C) Adopting a Medicaid uniform preferred prescription drug list (PDL); and 8
200	200	(D) Removing MCOs and moving to a Connecticut-style Medicaid program. 9
201	201	(iii) Promulgating rules and regulations, and employing staff and independent contractors 10
202	202	familiar with pharmacy benefit managers’ operations and finances to implement and enforce this 11
203	203	section; and imposing civil fines up to ten thousand dollars ($10,000) per violation and taking any 12
204	204	other enforcement action not prohibited by law. This subsection does not limit the attorney general 13
205	205	from taking any actions against PBMs. EOHHS may consult with OHIC, the commissioner of 14
206	206	insurance, DBR and other state authorities to ensure effective MCO and PBM oversight. 15
207	207	SECTION 3. This act shall take effect upon passage. 16
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214	214	EXPLANATION
215	215	BY THE LEGISLATIVE COUNCIL
216	216	OF
217	217	A N A C T
218	218	RELATING TO STATE AFFAIRS AND GOVERNMENT -- OFFICE OF HEALTH AND
219	219	HUMAN SERVICES
220	220	***
221	221	This act would set controls on Medicaid prescription drug costs by imposing transparency 1
222	222	and accountability requirements on managed care organizations (MCOs) and their pharmacy benefit 2
223	223	managers (PBMs). 3
224	224	This act would take effect upon passage. 4
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