California Affordable Drug Coverage Bill Passes

In May, the California Assembly Health Committee passed legislation, authored by Assemblywoman Fiona Ma (D-San Francisco), to protect Californians with life-threatening diseases from escalating insurance costs for medication. The committee passed Assembly Bill 310 with a 12 to 6 vote after hearing compelling testimony. The bill places a $150 co-payment cap for a one-month supply of medication, as well as prohibits health plans and insurers from using co-insurance and places an annual out-of-pocket limit on prescription drug costs if a plan or insurance policy maintains an annual limit.

AB 310, which is sponsored by the Alliance for Biotherapeutics and the Multiple Sclerosis Society, was introduced in response to health plans that are reclassifying drugs into a new tier and adopting a new method of payment for specialty drugs called co-insurance where a patient pays a percentage of the cost of the drug, as opposed to a traditional co-payment. Specialty drugs are used to treat diseases like multiple sclerosis, rheumatoid arthritis, HIV, cancer, hemophilia, primary immunodeficiency diseases and hepatitis. The bill will now go to the Assembly Appropriations Committee.

“AB 310 is about establishing reasonable cost controls for consumers living with chronic and life-threatening illnesses,” said Assemblywoman Ma. “Specialty drug pricing dramatically increases the costs of vital medication, discriminates against the most vulnerable populations and jeopardizes the health of Californians by placing the cost of medications beyond reach. People should not have to choose between bankruptcy or death.”

Last year, New York became the first state to pass a bill that prohibited insurers from creating specialty tiers. Other states, including Indiana, Connecticut, Nebraska, Pennsylvania, Rhode Island and Vermont are considering similar legislation.