New Healthcare Regs Would Cost PA Taxpayers $50 Million

A bill on the floor of the state House would circumvent consumer freedom when it comes to prescription drugs. Many employers, including the state, encourage employees to buy less costly prescription drugs through mail order pharmacies.

HB 511 would prohibit companies from offering incentives to employees to utilize mail order pharmacies.

Prohibiting incentives to use mail order drugs would cost state taxpayers nearly $50 million in the first year, according to a Pennsylvania Office of the Budget analysis. HB 511’s fiscal note states:

As a cost-savings measure, OA [Office of Administration] and PEBTF [Pennsylvania Employee Benefit Trust Fund] have encouraged the use of a mail order pharmacy. HB 511 would eliminate these savings, increasing overall costs by decreasing the effective discount rate and guaranteed minimum formulary rebate and increasing the dispensing fee. . . Although HB 511 allows for the possibility of an exemption for PEBTF, the process for evaluating and determining such an exemption is unclear. Assuming that the PEBTF is not exempt from the requirements of HB 511, we anticipate an increase of more than $47.5 million in the first year alone.

Even with an exemption for state employees, is it fair to enact one set of rules for government and another for private business? HB 511 is an anti-competitive bill that takes away choices from consumers in order to enact a one-size-fits-all system that will increase health insurance costs.