SF563 and HF489 are companion bills that would require health plans to share prescription drug rebates directly with the consumers, instead of sharing the rebates with the employers to reduce premiums and health costs. Despite being promoted as a benefit to the consumer, these bills may lead to the use of higher-cost drugs even when less expensive, equally-effective drugs are available.
Both bills have survived the first “funnel” deadline of the Iowa legislature.
Whether your health plan is self-funded or fully-insured, it is expected that these bills (if passed) will raise premiums and increase overall spending on drugs. Based on actuarial calculations, premiums could increase 2-3%.
Pharmaceutical manufacturers have made these bills a priority, and have been successful at attracting state and national attention to these proposals. However, efforts to curb prescription drugs at a national level are already well underway with Senator Chuck Grassley leading a bi-partisan effort in Washington to lower drug prices and increase transparency.
LMC is dedicated to keeping employers informed of important issues such as these. Please contact us to learn more! Employers who are concerned about the potential impact of this legislation should immediately contact their Iowa legislators. A vote is expected to take place in the very near future
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