Cutting Costs and Choices for State Workers

by Pearl Hahn

State and county workers are in for a few changes to be made in their prescription drug plans next year on January 1. Trustees of the Employer-Union Health Benefits Trust Fund (EUTF) enacted reference-based pricing for three categories of drugs that will feature cheaper alternatives to alleviate rising costs.

These drugs include cholesterol-lowering statins, anti-heartburn/ulcer drugs or proton pump inhibitors, and allergy medications or non-sedating antihistamines. Other changes EUTF made include mandating usage of a Florida pharmacy for maintenance drugs and requiring generic drugs. Under the reference-based pricing program, a patient must receive a doctor’s exception in order to stay with his current prescription if he prefers it over the lower-cost drug.

According to a physician, the new policy raises issues because all drugs within classes of medication are not the same. Forcing a switch in prescription impedes doctor-patient care and the compatibility of treatment involving multiple drugs.

While cost-cutting should be a priority in all areas of state spending, EUTF’s new program is doing so by interfering in the doctor-patient relationship, eroding the decision-making power of doctors, and imposing on consumer choice.

For state workers who are unhappy with the reference-based pricing plan, now would be a good time to look into Health Savings Accounts (HSAs), which offer greater patient control and more flexibility. An HSA combines a high deductible health plan (HDHP) with a savings account to pay for health care using pre-tax dollars. Participants with  an HDHP meet their deductible by paying medical bills out-of-pocket rather than with co-payments and co-insurance. People with HSAs usually have lower premiums than those under a traditional health plan.

The result would be a win-win situation, granting state employees greater control over their health care using money already spent on their behalf and reducing costs for the state.

Pearl can be reached at pearl@grassrootinstitute.org