HF4618

Purpose

The bill changes how health plans and pharmacy benefit managers determine an enrollee’s share of costs. It requires including all amounts the enrollee or someone else pays toward cost-sharing and the out-of-pocket maximum, for prescription drugs and other covered benefits. The aim is to make the enrollee’s contribution more complete and consistent across medical and pharmacy benefits.

Key Provisions

• Definitions:
  • Costsharing: copays, coinsurance, and deductibles.
  • Pharmacy benefit manager (PBM): defined as in existing Minnesota law.
• Calculation rule:
  • When figuring an enrollee’s total cost-sharing or out-of-pocket maximum, include any amount paid by the enrollee or by another person on the enrollee’s behalf.
  • This applies to prescription drugs approved for coverage by the plan, whether they are billed under medical benefits or pharmacy benefits.
• Timing:
  • The calculation uses this rule only after the enrollee has met the plan deductible.
  • If applying this rule before meeting the deductible would affect health savings account (HSA) eligibility under federal law (26 U.S.C. § 223) or catastrophic health plan eligibility (42 U.S.C.)., the section’s application is limited to the post-deductible calculation.

What It Seeks to Accomplish

• Ensure enrollees’ cost-sharing contributions reflect all payments made toward them, including third-party payments, leading to a more accurate measure of what enrollees owe in a given year.
• Align the calculation with how HSAs and certain catastrophic coverage eligibility would interact, by imposing the post-deductible timing requirement.

Significant Changes to Existing Law

• Expands the calculation of an enrollee’s cost-sharing and out-of-pocket contributions to explicitly include amounts paid by others on the enrollee’s behalf.
• Applies this broader calculation specifically to prescription drugs covered by the plan, regardless of whether those drugs are billed under medical or pharmacy benefits.
• Introduces a timing constraint so that the broader calculation is used only after the enrollee has met the deductible, to avoid affecting HSA or catastrophic plan eligibility before deductible has been met.

Practical Effects

• Enrollees may see higher stated cost-sharing totals earlier in the year once third-party payments are counted after deductible.
• Health plans and PBMs must adjust their billing and calculation methods to include these additional payments for covered drugs and other cost-sharing amounts after the deductible is met.

Relevant Terms costsharing out-of-pocket maximum enrollee contribution copays coinsurance deductibles pharmacy benefit manager pharmacy benefit prescription drugs medical benefit Health Savings Account (HSA) 26 U.S.C. § 223 catastrophic health plan 42 U.S.C. (catastrophic plan eligibility)