Prescription drug cost sharing.

Plain English Breakdown

The official source does not provide specific penalties or criminal consequences, only administrative penalties and potential violations of existing laws.

Prescription Drug Cost Sharing

The bill requires health care service plans and insurance companies to include manufacturer-provided discounts in patients' total out-of-pocket expenses.

What This Bill Does

• Requires health care service plans and insurance companies to count any support from drug manufacturers towards the patient's total out-of-pocket costs, including discounts or vouchers.

Who It Names or Affects

• Health insurance companies and managed health care plans
• People who have prescription drug coverage through these plans

Terms To Know

Out-of-pocket maximum

The most a person has to pay for their healthcare costs in a year.

Cost sharing requirement

How much a patient must pay towards the cost of their prescription drugs.

Limits and Unknowns

• Does not specify how drug manufacturers can offer support to patients.
• The bill's full effects on healthcare costs are unclear.

Official Summary Text

SB 1199, as amended, Weber Pierson.
Prescription drug cost sharing.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and makes a willful violation of the act a crime. Existing law also provides for the regulation of health insurers by the Department of Insurance. Existing law, except as provided and under certain circumstances, prohibits a person who manufactures a prescription drug from offering a discount, repayment, product voucher, or other reduction in an individual’s out-of-pocket expenses associated with their health insurance or health care service plan. Existing law generally imposes specified cost sharing limits on covered prescription drugs.
This bill would require a health care service plan or health insurer, when calculating an enrollee’s or insured’s overall
contribution to an out-of-pocket maximum or cost sharing requirement under the plan contract or insurance policy, to count any amount paid by the enrollee or insured or on behalf of the enrollee or insured toward the enrollee’s or insured’s cost sharing, including any form of direct support offered by drug manufacturers that is
permitted.
permitted, except as provided.
The bill would prescribe an administrative penalty for each violation by a health insurer that is enforceable by the Insurance Commissioner after appropriate notice and opportunity for hearing. Because a willful violation of these provisions by a health care service plan would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to
reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.

Current Bill Text

Download Bill PDF