A controversial bill that would add a $10.64 'dispensing fee' to every prescription filled in Alabama may not make it through the 2024 legislative session, which ends May 20th.
House Bill 238 was passed by voice vote from the House Insurance Committee last month. That vote allowed it to advance to the next step, a vote on the House floor.
Included among House Insurance Committee members who support HB238 is Rep. Jamie Kiel (R-Russellville). But Kiel believes the bill will run out of time before it can advance through the House, Senate and back to committees if there are any revisions.
“Advancing out of committee was just the beginning of the legislative process,” Kiel said. “It must still go to the House floor, Senate floor, then the governor. And if there are any changes, back to committee.”
Even without coming up for a vote on the House floor, HB238 has generated its share of controversy, as its opponents say the bill would create a tax on prescriptions that would hit the pockets of those who can least afford the additional cost.
Another concern from those opposed to HB238 is that it would restrict the state's ability to investigate allegations of fraud, waste and abuse by Pharmacy Benefit Managers (PBMs), who are third-party administrators of prescription drug benefits in a health plan.
Among its opponents are Lynda Kirkpatrick, Chairman of the Marion County Democratic Party.
“This bill could inadvertently shield unethical practices within the pharmacy industry, to the detriment of Alabama's consumers and insurers,” Kirkpatrick said.
Another opponent of HB238 is the Alliance of Alabama Healthcare Consumers. In a release, the Alliance states the bill 'will have an effect on all Alabamians with pharmacy benefit coverage by increasing the premiums and/or out of pocket expenses at the pharmacy.'
Additionally, their argument against the bill is that it will place substantial financial burdens on Alabama employers and their employees that will add up into the millions.
Kiel says HB238 isn't a tax at all, because no revenue is being generated for the state.
“It's not a tax. The government has to receive money for something to be a tax. I know social media posts going around say otherwise, but it's not a tax. They're trying to paint it that way so insurance companies don't have to pay pharmacies for prescription drugs,” Kiel said.
Instead, Kiel explains, the bill would provide protection for pharmacies so they would no longer lose money filling certain prescriptions.
“If you go to your pharmacy to fill a prescription and the pharmacist pulls it up and say it costs $300. Then he pulls up your insurance and sees it will only pay $250 for that drug,” Kiel said.
“The pharmacist then has two options—fill it and lose $50, and do that every month losing money, or saying they don't have it in stock. Then you as the consumer don't have your medicine, and you go to the next pharmacy, which may also say they don't have it in stock,” he explained.
Kiel said that continued pattern can result in local pharmacies having to close their doors.
“When you fill prescriptions at a loss, you can't do that forever. Multiple pharmacies have closed because of that. We're averaging 27 pharmacies closing each year in Alabama since 2017,” Kiel said.
What HB238 would do, Kiel said, is to require an insurance provider to remit to the pharmacy the actual cost of the prescription plus $10, an estimated cost of what it costs to dispense it.
Kiel said Medicaid in Alabama already reimburses pharmacies in this manner. They take the average cost of the drug, plus a $10 dispensing fee.
Kiel believes losing pharmacies, especially in rural areas, is a significant problem that needs to be addressed. And whether the bill ultimately passes doesn't change the need to find a solution to that problem, he explained.
“I voted to bring the parties to the table so that we can have access to medicine in rural areas where pharmacies are closing,” Kiel said. “It brings some light on the subject, which is what's most important—to bring light to the fact we're losing rural pharmacies and people aren't receiving the medicine they need.”
Although Kiel's brother is a pharmacist in Russellville, Kiel said that doesn't pose a a conflict prohibiting him from voting on HB238.
“It was a pharmacist who brought the legislation (to the House),” Kiel said. “It's a very broad bill. I don't not vote on the education budget because my wife is a teacher, so there's no conflict in voting on this.
Since the bill was filed, Kiel said there has already been some small progress toward finding a solution for this important issue.
“The legislation was filed to start a conversation about how pharmacists are reimbursed by PBMs and insurance companies. I know both sides came to the table to discuss this. I think it's essential for them to continue the conversation so rural Alabamians can continue to have access to medicine,” Kiel said.
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