SENATE BUDGET AND APPROPRIATIONS COMMITTEE

 

STATEMENT TO

 

ASSEMBLY, No. 3080

 

STATE OF NEW JERSEY

 

DATED:  MARCH 4, 2013

 

      The Senate Budget and Appropriations Committee reports favorably Assembly Bill No. 3080.

      This bill requires, in certain circumstances, health insurers (health, hospital and medical service corporations, commercial individual and group health insurers; health maintenance organizations, health benefits plans issued pursuant to the New Jersey Individual Health Coverage and Small Employer Health Benefits Programs, the State Health Benefits Program, and the School Employees’ Health Benefits Program) that provide coverage for prescription eye drops, to provide health benefits coverage for expenses incurred for a refill of prescription eye drops in accordance with Guidance for Early Refill Edits on Topical Ophthalmic Products provided to Medicare Part D plan sponsors by the Centers for Medicare and Medicaid Services.

      The requirement to provide this coverage is conditioned on two factors: (1) the prescribing health care practitioner indicates on the original prescription that additional quantities of the prescription eye drops are needed; and (2) the refill requested does not exceed the number of additional quantities indicated on the original prescription by the prescribing health care practitioner.

      The Centers for Medicaid and Medicare Services issued guidance on topical ophthalmics to prevent the unintended interruption of drug therapy in situations in which patients legitimately need earlier refills of prescription eye drops. While the guidance acknowledges that health insurers monitor appropriate refill periods as part of utilization management, the guidance also recognizes that the self-administration of prescription eye drops may involve some reasonable amount of waste and that earlier refills may be appropriate in some circumstances.

      As reported, this bill is identical to the SCS for Senate Bill Nos. 2166 and 2336, which was also reported by the committee.

 

FISCAL IMPACT:

      The Office of Legislative Services (OLS) concurs with the Executive estimate in the Fiscal Note for this bill.  This bill would change the State Health Benefits Program/School Employees’ Health Benefits Program (SHBP/SEHBP) prescription drug policy regarding the frequency of refills for prescription eye drops to coincide with the policy of the Centers for Medicare and Medicaid Services (CMS) for Medicare Part D plan sponsors for topical ophthalmic products.

      Under this bill, the SHBP/SEHBP would be required to apply the CMS’s policy to all active plan participants and non-Medicare eligible retirees thereby increasing costs to the State in FY 2013 by $214,592 and costs to the local governments by $165,408, totaling $380,000.  Total State and local government costs increase annually with an assumed annual medical inflation rate of eight percent, to $410,400 for FY 2014, and $443,232 for FY 2015.

      The OLS notes that Express Scripts estimates that the provisions of this bill will increase costs to the SHBP/SEHBP by less than 0.01 percent.