H. B. 4800
(By Delegates Michael, Leach, Doyle, Kelley,
Facemyer and Border)
(Originating in the Committee on Finance)
[March 1, 2000]
A BILL to amend article sixteen, chapter five of the code of West
Virginia, one thousand nine hundred thirty-one, as amended,
by adding thereto a new section, designated section seven-a,
relating to establishing a new prescription drug program
within the public employees insurance agency; requiring the
executive director to appoint an advisory committee; setting
forth guidelines for the new program; authorizing contract
amendments; and requiring reporting.
Be it enacted by the Legislature of West Virginia:
That article sixteen, chapter five of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended by adding thereto a new section, designated section
seven-a, to read as follows:
ARTICLE 16. WEST VIRGINIA PUBLIC EMPLOYEES INSURANCE ACT.
§5-16-7a. Prescription drug program.
(a) Findings--The Legislature finds that the rapidly rising
cost of prescription drugs places an undue financial burden on the state of West Virginia, the payors, and the consumers of
prescription drugs. The Legislature further finds that those
rising costs are related to the following factors:
(1) National pharmaceutical trends reflecting that
prescription spending has doubled in the past eight years from
forty-nine billion dollars per year to an estimated one hundred
nineteen billion dollars in the year two thousand. This trend
reflects successes in drug therapy research, drug effectiveness,
and an overall improvement in the quality of life. However, the
trend also signals an increase in drug cost and utilization,
which impacts all West Virginians directly or indirectly;
(2) The aging of our state population and increased life
expectancy of our citizens have a significant impact on the
rising cost and utilization of prescription drugs in West
Virginia. When these factors are combined with the escalating
number of drug-related preventative treatments, increased product
development, and growing consumerism in the prescription drug
market, many West Virginians are forced to utilize an increasing
portion of their income to maintain their physical and mental
health;
(3) Four decades ago, more than ninety percent of drug costs
were paid by consumers. Now, more than half the cost of
prescription drugs are supplemented by governmental and private
health insurance, thus removing usual market forces that serve to
control costs. This poses a substantial burden on the taxpayers
of West Virginia to support the state's health benefit programs,
as well as their own; and
(4) Despite the data reflecting a substantial percentage decrease in physician and hospital expenses, the number of drugs
reaching the billion dollar sales mark has doubled since 1994,
which contributes to the overall increase in health care
expenditures in the United States.
(b) Advisory committee--The executive director of the public
employees insurance agency shall appoint an advisory committee of
six persons to assist in the development of a rational and
equitable program for prescription drug coverage. The committee
is to be composed of physicians representing specialists and
primary care practices, pharmacists, including clinical
pharmacists and a representative of the vendor for the
prescription benefit program. The executive director shall serve
as the chairperson.
The committee shall meet routinely, upon the
call of the chairperson.
The advisory committee may form any
number of ad hoc committees, representing expertise in the
particular area of study for that committee, to assist with the
development and implementation of the program authorized by this
section.
(c) Program design--The advisory committee shall design a
prescription drug strategy statement to guide all decisions made
by the committee. The strategy statement shall reflect
consideration of the goals of a pharmacy benefit program, the
needs of the various populations served and the overall value to
the state of these expenditures.
In developing the drug program,
the committee shall focus on specific disease states or
conditions, the appropriate pharmaceutical management or
treatment of those disease states or conditions, and prioritize that information for purposes of establishing the appropriate
level of third party coverage, giving consideration to the
appropriate priority given to coverage for life-saving, life
enhancing, life lengthening, life style and cosmetic drugs. In
determining the levels of third party coverage, the committee may
continue to separate generic prescription drugs from the brand
name prescription drugs.
(d) Implementation--This drug program shall be implemented
no later than the first day of July, two thousand one. The
committee shall continuously evaluate the program and make
necessary revisions to maintain conformity with the goals of the
program, which are to be (1) responsive to the needs of the
employees insured by the program, and (2) fiscally accountable to
the taxpayers of the state of West Virginia.
(e) Contracts--Upon the effective date of this section, the
executive director shall amend any existing prescription benefit
program contract, or enter into a separate contract, to establish
the prescription benefit program authorized in this section:
Provided, That for a new contract, the provisions of section nine
of this article shall apply.
Section seven-a is new; therefore, strike-throughs and
underscoring have been omitted.