SF4848

Purpose

This bill changes how health plans calculate an enrollee’s total contribution toward cost-sharing and the out-of-pocket maximum. It sets new rules for what counts toward those calculations and when they apply.

Key Definitions

• Costsharing: Copays, coinsurance, and deductibles.
• Pharmacy benefit manager: Defined as the PBM per the bill (reference to the existing definition in statute 62W.02, subdivision 1.15).

Main Provisions

• Calculation of cost-sharing and out-of-pocket contributions:
  • When determining an enrollee’s overall contribution, the health plan, insurer, or PBM must include any amount paid by the enrollee or paid on the enrollee’s behalf by another person.
  • This inclusion applies to prescription drugs that the plan covers, regardless of whether those drugs are covered under the medical benefit or the pharmacy benefit.
• Timing of application:
  • The calculation is to be applied only after the enrollee has met the plan deductible.
  • If applying this section before meeting the deductible would cause Health Savings Account (HSA) ineligibility (per 26 U.S.C. § 223) or catastrophic health plan ineligibility (per 42 U.S.C. § referred to in the bill), then the calculation would still take effect only after the deductible is met.

Significant Changes to Existing Law

• Adds a requirement that total cost-sharing contributions count amounts paid by others toward the enrollee’s cost-sharing or out-of-pocket maximum, not just what the enrollee personally pays.
• Extends the calculation to prescription drugs covered by the plan, regardless of whether those drugs fall under medical or pharmacy benefits.
• Introduces a condition tying the timing of these calculations to deductible status and potential federal program eligibility (HSA and catastrophic plan eligibility), potentially delaying application of the rules if early application would affect those programs.

Practical Implications

• Enrollees could see changes in how quickly their cost-sharing contributions are tallied toward meeting the out-of-pocket maximum, especially when families or others contribute toward drug costs.
• The inclusion of contributions from others may change the perceived burden of cost-sharing in some scenarios.
• The rules interact with federal eligibility rules for HSAs and catastrophic plans, which may affect when the provision applies for some individuals.

Implementation Notes

• Applies to prescription drugs approved for coverage by the health plan, regardless of whether they are covered under the medical benefit or the pharmacy benefit.
• Uses existing definitions and cross-references to other parts of Minnesota law and federal tax/benefit provisions.

Relevant Terms costsharing; out-of-pocket maximum; enrollee contribution; copays; coinsurance; deductibles; Pharmacy Benefit Manager; PBM; prescription drugs; medical benefit; pharmacy benefit; Health Savings Account; HSA; 26 U.S.C. § 223; catastrophic health plan; United States Code; deductible status; calculation of cost-sharing; health plan; health insurance.