Insurance & Commerce - Senate
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Bills discussed (16)
| Bill | Title | Sponsor | Status |
|---|---|---|---|
|
SB103
Act 425
· 4 mentions in agenda, chapter, transcript
Matched: “…vin Sen. Clint Penzo REGULAR AGENDA Number Sponsor Subtitle SB103 C. Penzo TO CREATE THE PHARMACY NONDISCRIMINATION ACT; TO R…”
|
TO CREATE THE PHARMACY NONDISCRIMINATION ACT; TO REQUIRE PHARMACY BENEFITS MANAGERS TO ACCEPT ANY PHARMACY … | C. Penzo | Notification that SB103 is now Act 425 |
|
HB1488
Act 391
· 2 mentions in agenda, chapter
Matched: “…ESS TO PUBLIC RECORDS BY A TITLE AGENT AND A TITLE COMPANY. HB1488 Wardlaw TO AMEND THE STANDARD NONFORFEITURE LAW FOR LIFE IN…”
|
TO AMEND THE STANDARD NONFORFEITURE LAW FOR LIFE INSURANCE; AND TO REQUIRE AN INSURER TO … | Wardlaw | Notification that HB1488 is now Act 391 |
|
HB1517
Act 347
· 2 mentions in chapter, agenda
Matched: “HB1517 Ray TO ESTABLISH THE EARNED WAGE ACCESS SERVICES ACT.”
|
TO ESTABLISH THE EARNED WAGE ACCESS SERVICES ACT. | Ray | Notification that HB1517 is now Act 347 |
|
HB1620
Act 350
· 2 mentions in agenda, chapter
Matched: “…ENT'S GENERAL OMNIBUS AMENDMENT OF ARKANSAS INSURANCE CODE. HB1620 Gramlich TO AMEND THE LAW CONCERNING PHARMACY BENEFITS MANA…”
|
TO AMEND THE LAW CONCERNING PHARMACY BENEFITS MANAGERS; AND TO REGULATE PROCESSING AND PAYMENT OF … | Gramlich | Notification that HB1620 is now Act 350 |
|
SB104
Act 514
· 2 mentions in agenda, chapter
Matched: “…ONABLE TERMS OF PARTICIPATION; AND TO DECLARE AN EMERGENCY. SB104 C. Penzo TO AMEND THE ARKANSAS PHARMACY BENEFITS MANAGER LI…”
|
TO AMEND THE ARKANSAS PHARMACY BENEFITS MANAGER LICENSURE ACT; TO PROTECT PATIENTS' RIGHTS AND ACCESS … | C. Penzo | Notification that SB104 is now Act 514 |
|
SB405
Act 555
· 2 mentions in agenda, chapter
Matched: “…AND TO REGULATE PROCESSING AND PAYMENT OF PHARMACY CLAIMS. SB405 J. Dismang TO AMEND THE ONLINE MARKETPLACE CONSUMER INFORM…”
|
TO AMEND THE ONLINE MARKETPLACE CONSUMER INFORM ACT. | J. Dismang | Notification that SB405 is now Act 555 |
|
SB432
Act 428
· 2 mentions in agenda, chapter
Matched: “…HE USES OF THE CONSTRUCTION ASSISTANCE REVOLVING LOAN FUND. SB432 J. Petty TO AMEND THE LAW CONCERNING ACCOUNTANTS; AND TO AM…”
|
TO AMEND THE LAW CONCERNING ACCOUNTANTS; AND TO AMEND THE DEFINITION OF SUBSTANTIAL EQUIVALENCY FOR … | J. Petty | Notification that SB432 is now Act 428 |
|
HB1367
Act 346
· 1 mention in chapter
Matched: “HB1367 Warren TO AMEND THE ARKANSAS TITLE INSURANCE ACT; AND TO RE…”
|
TO AMEND THE ARKANSAS TITLE INSURANCE ACT; AND TO REGULATE ACCESS TO PUBLIC RECORDS BY … | Warren | Notification that HB1367 is now Act 346 |
|
HB1583
Act 348
· 1 mention in chapter
Matched: “HB1583 Bentley TO MANDATE COVERAGE FOR ACQUIRED BRAIN INJURY.”
|
TO MANDATE COVERAGE FOR ACQUIRED BRAIN INJURY. | Bentley | Notification that HB1583 is now Act 348 |
|
HB1595
Act 349
· 1 mention in chapter
Matched: “HB1595 Steimel TO ENACT THE STATE INSURANCE DEPARTMENT'S GENERAL O…”
|
TO ENACT THE STATE INSURANCE DEPARTMENT'S GENERAL OMNIBUS AMENDMENT OF ARKANSAS INSURANCE CODE. | Steimel | Notification that HB1595 is now Act 349 |
|
SB123
Act 553
· 1 mention in agenda
Matched: “…Staff Only'. PENDING FISCAL IMPACT Number Sponsor Subtitle SB123 G. Leding TO AMEND THE LAW CONCERNING COVERAGE FOR MAMMOGRA…”
|
TO AMEND THE LAW CONCERNING COVERAGE FOR MAMMOGRAMS AND BREAST ULTRASOUNDS. | G. Leding | Notification that SB123 is now Act 553 |
|
SB140
· 1 mention in agenda
Matched: “…CONCERNING COVERAGE FOR MAMMOGRAMS AND BREAST ULTRASOUNDS. SB140 J. Boyd TO MANDATE THE USE OF BIOSIMILAR MEDICINES UNDER HE…”
|
TO MANDATE THE USE OF BIOSIMILAR MEDICINES UNDER HEALTH BENEFIT PLANS; TO REQUIRE A HEALTHCARE … | J. Boyd | Sine Die adjournment |
|
SB331
· 1 mention in agenda
Matched: “…MUM REIMBURSEMENT RATE FOR BREAST RECONSTRUCTION SURGERIES. SB331 G. Leding CONCERNING COVERAGE FOR GENETIC TESTING FOR INHER…”
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CONCERNING COVERAGE FOR GENETIC TESTING FOR INHERITED CANCER MUTATIONS; AND TO CREATE THE GENETIC TESTING … | G. Leding | Died in House Committee at Sine Die adjournment. |
|
SB420
Act 736
· 1 mention in agenda
Matched: “…1583 Bentley TO MANDATE COVERAGE FOR ACQUIRED BRAIN INJURY. SB420 Hester TO EXPAND ELIGIBILITY FOR WATER DEVELOPMENT STATE PR…”
|
TO EXPAND ELIGIBILITY FOR WATER DEVELOPMENT STATE PROGRAMS; TO AMEND THE WATER AUTHORITY ACT; AND … | Hester | Notification that SB420 is now Act 736 |
|
SB58
Act 52
· 1 mention in transcript
Matched: “…ive body allowed hospitals to get pharmacies coming up with SB 58. I think this is critical because this bill allows those ho…”
|
TO REMOVE THE PROHIBITION ON NONPROFIT, TAX EXEMPT, OR GOVERNMENTALLY-FUNDED HOSPITALS HOLDING A LICENSED PHARMACY … | J. Dismang | Notification that SB58 is now Act 52 |
|
SB83
Act 424
· 1 mention in agenda
Matched: “AGENDA (Revised 3/13/2025 @ 8:30 AM) Moved SB83 from Pending Fiscal Impact to Regular Agenda Senate Committ…”
|
TO MANDATE COVERAGE FOR BREAST RECONSTRUCTION SURGERIES; TO REQUIRE PRIOR AUTHORIZATION FOR BREAST RECONSTRUCTION SURGERIES; … | J. Bryant | Notification that SB83 is now Act 424 |
Machine transcript
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Speaker 3
0:20
I. You want to go on the other. It's a little
Speaker 12
0:43
end of the table anyway, you know me. That's ridiculous.
Speaker 15
0:50
Yeah Yeah. Call Senate Insurance Commerce to order, uh, We will begin
Speaker 17
1:03
with uh Senate Bill 103. We're going to do the bills that have been in physical impact first. Don't go all the way down there.
Speaker 24
1:21
I. OK. Just. In your guest, introduce yourselves and you're welcome again. Clint Penzo
Senator Clint Penzo
Unverified
1:38
District 31 Springdale. Simon Deborusov, Highland's Oncology Group.
Speaker 30
1:55
Senator Johnson, senators and committee members, thank you for affording me the time to talk about SB 103, SB 103 is all about expanding access to care, if we don't expand access to care, no matter how many pharmacies that we have in the state, if they can't join the networks that the PBMs control. Patients cannot get their medications as an oncology practice, we write, you know, 8 to 12 prescriptions for patient. We hope as physicians that that they're able to access
their medications and when there's roadblocks and barriers to them getting their medications. It's very frustrating and their health deteriorates, so basically this is modifying the any willing provider laws in the state of Arkansas, as you have heard during the SB 58 and the Rule 128 hearings. There's a lot of deficiencies in regards to Arkansas patients not being able to access their medications because their pharmacies are not included in certain networks for certain drugs.
Major PBM companies create networks and carve out networks with, you know, single drugs or specific drugs and those networks only have one option customarily, and that is the mail order pharmacy owned by the PBM company, and so those prescriptions have to go out of state at that point, there's a lot of breakdowns that can occur and sometimes patients don't get their medications. They don't arrive in the mail, and patients also lose the ability to talk to a local pharmacist and pick up the rest of their
medications in unison in one place wherever they desire. So that any willing provider laws, there's a Supreme Court ruling from April of 2003 that says states have the ability to enforce laws that govern insurance practices in the state and so this is not about modifying benefits. This is not about enforcing benefits as you guys saw, there's a $0 impact on this bill for the largest plan
in the state, you know, the school and state plans. This is just about affording patients the ability to pick a pharmacy and get their medication from a pharmacy. Um, so the bill clarifies and modernizes the architi willing provider laws. It specifically states, you know, that PBMs cannot arbitrarily exclude pharmacies that qualify. So if a pharmacy is willing and able to accept the terms and conditions of the network and the pharmacy wishes to apply to be a part of that network. They cannot be
arbitrarily. excluded. Furthermore, it requires the terms imposed by the PBM companies to be reasonable and relevant. These are not words that we have come up with. These are words straight from CMS. So this problem does not exist in the Medicare Advantage plans because the federal regulation has these exact words reasonable and relevant terms of participation. Um, as I mentioned before, there's no cost impact. Hopefully there's a benefit.
Patients will be able to access their medications, pick them up, their health conditions will not deteriorate, and the second benefit is patients will gain access to highly rated community pharmacy options, whichever ones they choose. If you look online at the mail order pharmacies that they're being steered to all of them actually none of them have a rating higher than 1.7 stars. If you read the reviews posted not anonymously by real people in America. There's a lot of frustration. People are not
getting their medications. People are not getting their service, and then compare that to any local pharmacy in the state of Arkansas. Go to Google Maps, read the reviews. More than 4.5 stars. Happy customers getting the services. that they deserve and then Also, my final point, uh, This legislative body allowed hospitals to get pharmacies coming up with SB 58. I think this is critical because this bill allows those hospital
pharmacies to also enter in the networks. They should have the ability to service patients and as they informed the legislative body they want to access, expand access to care in rural communities as well. Well, they should be able to join these PBM networks when they spin up these pharmacies. Without any arbitrary exclusions. Thank you. Is there any question from the
Speaker 17
6:26
committee, Senator Flowers? Thank you, Mr. Chair.
Senator Stephanie Flowers
Unverified
6:35
I'd like the bill. I would like to know. More of what's going on, um, You mentioned. State and school
plans they use PBMs. Yes, ma'am. And the PBM networks.
I'm trying to figure out major pharmacies in these networks, is that what you, you, you're finding, Senator Flowers,
could you pull the mic to you, or thank you do you find more major like Walgreens, it's part of a PBM
Speaker 42
7:16
network. Yes, ma'am, all of us, every pharmacy in the state of Arkansas if
Speaker 30
7:21
they wish to dispense medications and get reimbursed by an insurance company, they need to join a lot of major networks, you know, you have your top 3. nationally that control, I think, over 75% of the nations's networks of pharmacies, and they, they dictate the rates
that pharmacies get reimbursed. They have terms of who is in and who's out, but yeah, all pharmacies, Walgreens, Walmart, local pharmacies, community pharmacies are all in a bunch of
Senator Stephanie Flowers
Unverified
7:50
different networks, but presently they can be excluded by the network by a specific network.
Speaker 30
7:58
Is that the problem? Yes, absolutely. And so there are carve out specialty networks that the PBM companies manage, and they only
allow their own affiliate pharmacy entry into that network and so all the three major PBM networks have such a specialty pharmacy carveout network where the only player in that network is their own affiliate pharmacy Network. I have personally over the years attempted to apply to these networks. It's very, very difficult process because there's no information published online as to what are the terms and conditions and
qualifications working on a consumer complaint filed through the Arkansas Insurance Department. The Arkansas Insurance Department received notice that the reason that we can't fill the prescription is because we're not in the network, so I said, OK, let's have fun. Let me go ahead and try to enroll in this network, and I told the Arkansas Insurance Department attorney, this will be fun, but it'll be good for you. watch. So but right out the gate I got an NDA, meaning I, that I cannot disclose anything and so I emailed the Arkansas Insurance Department, said, Hey, I would
love for you to follow along, but I've been
Speaker 42
9:13
silenced, and so, but I already know most
Senator Stephanie Flowers
Unverified
9:17
likely I will get rejected. So, so does the organization that you're affiliated
with. Belong to a PBM Network. No, we
Speaker 30
9:29
participate in several PBM networks because we have to dispense oncology drugs to our members. Unfortunately you do or you don't. We, we enroll and
participate in them. We're not owned by PBM where where we participate just like a Walgreens does. We have to fill out forms. We have to abide by their terms and conditions, and then
Speaker 51
9:55
we can help their members. So PBMs actually
Senator Stephanie Flowers
Unverified
10:00
own pharmacies. Yes, ma'am. And so are you saying that all pharmacies in Arkansas even local independent pharmacies are
Speaker 30
10:10
Part of a network PBM network. Yes, in order to get reimbursed for prescriptions, we have to join their networks. If we're not part of their network when you try to fill a prescription, you might get a rejection, which means the insurance company through the PBM is
Senator Stephanie Flowers
Unverified
10:28
saying I'm not paying for that prescription. So the insurance company is, I mean, how is it that I have insurance. Why is it that I, I'm just not
looking to my insurance. To reimburse for my prescriptions. That that's
Speaker 30
10:46
a great question, and that's the way that it should work. Unfortunately, all major insurance companies partner with PBMs to administer pharmacy benefits because of the number of drugs before the because of the complexity of the subject matter and they don't all have subject matter experts in those drugs, so they partner with major PBMs to manage that side of their business, but as you mentioned at the end of the day,
Senator Stephanie Flowers
Unverified
11:11
the plan is still in charge. The insurance plan, ma'am. So, so
are, so it's the insurance company. That has this relationship
Speaker 30
11:26
with the PBM or Yes, there are some insurance companies that also are owned by PBMs and or
Speaker 28
11:34
vice versa. It's very vertically integrated among the top 3.
Speaker 62
11:38
And how will this bill affect That situation.
Speaker 30
11:44
This bill allows the Arkansas Insurance Department to make sure that when a pharmacy tries to join a network that things are handled equitably that if the pharmacy is willing and able to meet the terms and conditions that there cannot be an arbitrary exclusion, so once we review the terms and conditions and say I can do this. I will participate in this, and these are fair terms. These are not like you must run a bot farm or something like that to to move drugs automatically. You know, these are reasonable
terms in the industry. In that case, if the PBM says no, In that case, the Arkansas Insurance Department has the ability to look into the matter and make an independent judgment. Was this fair or not and reasonable and relevant and reasonable and relevant,
Senator Stephanie Flowers
Unverified
12:31
so right now the insurance department has no ability to do that.
Speaker 28
12:37
So Arkansas, any willing provider laws are a little
Speaker 30
12:40
bit outdated, and they don't specifically state this
middleman, the PBM, the third party entity, so there's a lot of debate here and there. States that have newer any willing provider laws have tightened some of this, so that's why we're bringing additional clarity to this matter and saying even though there are contracted partner of yours that's managing part of your network, you are
Senator Stephanie Flowers
Unverified
13:05
still bound by these laws. I remember when any willing was uh Allowed in Arkansas and that was around 2005 when I first came into the legislature. Jay
Bradford was the chair of the public health committee, and that's when that law came in. It was a big fight over just getting any willing provider passed. So, and, and I think it was more a discussion about what doctor you're going to be able to see, not drugs. So now we've and I never remember even hearing That term PBM. Until later
Speaker 30
13:49
when did PBMs get so big. I think they've been around since the 1970s, but as they've expanded their business, they've acquired sufficient financial means to start pursuing other avenues. You have PBMs and their rebate aggregator companies that are even manufacturing drugs now and so it's gotten, it's slowly grown over the years. Initially when PBMs came out to your question, their goal was to manage the formulary for an insurance company. It was a
limited goal, but then I guess Business opportunity came up and they said, oh, we can manage the network as well and then another business opportunity came up and said, oh, we're managing the network, we can manage a pharmacy that we own, and
Senator Stephanie Flowers
Unverified
14:36
then, well, you know Senator Flowers, just this last question. I was looking at my smartphone the other day and what popped up was Walgreens was
about to be sold or and, and I'm really concerned about that because we
don't have CVS here and uh I'm, I'm just wondering what's going to happen. Because a
lot of people go to Walgreens for their medication. And I'm concerned about that, so this will build you're saying will allow for Pharmacies. To engage with these PBMs. And get some redress from the insurance department. If they
are dealt with unreasonably. And I think with things that are Not relevant. And what about the nondisclosure agreement. Will that just nix that this bill nicks that,
Speaker 30
15:36
uh, in regards to the first question, yes, that's the goal. Any pharmacy in the state of Arkansas should get equitable treatment, including Walgreens, including Walmart, including anyone, so none of this bill carves
Speaker 28
15:49
out any specific pharmacy. It's a fair
playing field for all in regards to the nondisclosure agreement, I don't know if that will impact that or not that practice or not, most likely not. Um, of course, you know, that would be at the discretion of the Arkansas Insurance
Speaker 30
16:03
Department if they review such cases and they make a determination that that is not reasonable or relevant or have to see it
Speaker 42
16:11
though, right? That would be up to the department's discretion, OK, thank you, Senator Johnson. Thank you,
Senator Mark Johnson
Unverified
16:20
Mr. Chairman. I think in one of our ALC
meetings I referred to to dealing with PBMs is playing the game of whack a mole. If you op them down one time, it pops up somewhere else. I, I won't belabor the point with my colleagues. I wrote a pretty long article in the Democratic Gazette about 10 days ago about PBMs and how they operate. Uh And I especially appreciate what Senator Flower said about losing a Walgreens and getting and not
having a a CVS, although CVS is an owner of a PBM, and they're probably one of the worst culprits of abusing the vertical integration. I want to, I want to remind and I want to ask the gentleman just a moment about this, but do you consider the the business model where I'll just say CVS and there may be others, but that's one I'm aware of that on pharmacies, do you consider that that's vertical integration. You consider that a monopoly, a monopolistic practice to have
Speaker 46
17:29
vertical integration like that. In my personal opinion, yes, I consider that to be a monopolistic practice, and I
Speaker 28
17:38
believe the FTC and the DOJ are looking into it. Unfortunately, things are, you know, at the federal level move kind of slowly, but we should see more and more progress, but I'm
Speaker 46
17:47
hopeful and optimistic that in the interim the state of Arkansas can do whatever they can to protect our patients, and
Senator Mark Johnson
Unverified
17:54
as you know, when the state of Arkansas got involved in trying
to rein them in. It went to the US Supreme Court, and we want to unanimous decision. I would like to read this is from Constitution of Arkansas Article II, Section 19, it says Per perpetuities and monopolies are contrary to the genius of a republic and shall not be allowed, and I would, so I guess saying that this Not just might not be what they're doing might not be a good idea, but it's probably unconstitutional. Would you
agree? Yes, sir. OK. Well, this is a good bill, Senator Penzo, and I appreciate you bringing it, uh, the transparency issue with the NDA's and I trust the commissioner to look at that. I'm not so sure that maybe we need to after he looks at that, maybe come back with some kind of legislative fix on that, but again, that's playing more whack a mole, but I appreciate your testimony. It's been very informative. Thank you. Thank
Speaker 17
19:00
you, Mr. Chairman. Is there any other questions
Senator Stephanie Flowers
Unverified
19:12
about the committee? Senator Flowers Thank you, Mr. Chair. Um, I just, I'm just curious because I need to
understand this, you know, because I guess. Most of all of our constituents are taking some kind of prescription, you know, and so
I, I, I'm just trying to understand so if somebody asked me a question about this, then
I'll know, you know, at least what you say, but do the feds have rules on PBMs for Medicare? Yes, they do. And do they Are they um close to what you're trying to do, what Senator Pinzel is proposing in
Speaker 30
19:54
the bill? Absolutely. A lot of the language, especially the reasonable and relevant was
Senator Stephanie Flowers
Unverified
20:00
copied straight out of federal regulation,
OK. Well, sounds pretty good. So
we don't have a problem necessarily with Those individuals that get their prescription prescriptions through
Speaker 46
20:15
Medicare. It it does perform better because they're not excluding pharmacies on the Medicare
Speaker 28
20:21
space because they're prohibited from doing that but unfortunately that is 45 to 50% of the population, we still have the rest of Arkansans, especially hardworking Arkansans
that have not retired yet, and they remain
Senator Stephanie Flowers
Unverified
20:36
impacted with loopholes. So and also the last question, Mr. Chair. So this may
actually help the State and school plans. Would you think?
Speaker 80
20:50
In my personal opinion and reading what the Department of Justice has published
Speaker 28
20:55
and what the FTC has published, and the multiple lawsuits even by like United States Postal Service where they have caught the PBM's
redirecting to their own pharmacies and making money. There's actually a couple of cases out there where they're suing to get back the money. I believe that, and I can't prove it, of course, for the state of Arkansas, but I believe by opening up access it will actually save the state money because again the PBMs control the
Speaker 30
21:20
rates that the local pharmacies get. So if they're not redirecting a prescription to their own pharmacy and paying themselves more. You could reason
Speaker 28
21:28
that. You know, it'll drive down rates, but I don't have any facts or figures behind that
right now, but there's a lot of different cases out there that are very interesting, where a lot of private organizations and public organizations are clawing back their money, I believe Ohio maybe also the Medicaid program is trying to get back $60 million that they found, so there's a lot of very interesting things out there. I would ask one
Senator Stephanie Flowers
Unverified
21:56
more question if the chair allows. Yes, we got one to
Speaker 91
21:59
speak against the bill, so we get done.
Senator Stephanie Flowers
Unverified
22:05
So with these state and school plans, are they negotiating with the PBM or is it, I mean, how, how does it work? I mean, the state has Our benefits and I think it's through Blue Cross Blue Shield. Is it Blue Cross Blue Shield that negotiates with the PBMs or the state. negotiating on the school district negotiating. For rates or where they can get
Speaker 30
22:35
drugs from the PBMs. Unfortunately I wish I knew the answer to this question. The state is a very complex being. I'm
Speaker 28
22:44
not sure who at the state level makes the final decision. I'm sure that there's probably committees at different levels that make the determinations of what PBM partners they choose and what healthcare partners they choose, maybe somebody from the insurance department would know way
Speaker 89
22:55
better than me. I don't want to misspeak. I would like to know the answer to that if the insurance
Senator Stephanie Flowers
Unverified
23:01
department knows. I'd like to know. We've had so
many issues with the rising costs for teachers and school employees. So if they, they're here and they can Nobody's lifting, I don't know if that would
Speaker 95
23:21
be EBD or I think it'd be EBD if, if you want to come to the table. Are they here? Yes. I would like
Speaker 101
23:38
welcome to answer the question. Grant Wallace, director of EBD, I don't know that I want to
Senator Stephanie Flowers
Unverified
23:46
come to the table, but I will answer questions. Well, I don't
Speaker 101
23:50
know if you heard my question. Yes, ma'am. OK, well, if you would give me a response. So this is a competitively bid RFP process for our pharmacy benefit manager that process was recently done this selection was in February of 2020. 3 and it's Navidus health solution is our current vendor,
but they went through a competitive bid process and that is how these are prescription benefits are administered is we do have a separate vendor that covers that and it is through an RFP
Senator Stephanie Flowers
Unverified
24:25
process that they are selected. were was your department subject to a nondisclosure
Speaker 101
24:32
agreement? Well, we, yes, we have NDAs and BAAs just because we're sharing personal private health
information from our members to these various vendors, so that is standard that we have those agreements now in relation to network rates and things of those natures that we have guarantees that are within our contract, but we are arm's length away from what they are the PBM. itself is negotiating with the various pharmacies and all of that. We don't get involved in that. We just look at the guarantees that we are contractually obligating ourselves to with the pharmacy benefit manager.
Senator Stephanie Flowers
Unverified
25:14
Is there some restriction, some law that says
you can't know what the PBM is negotiating with the farm, the manufacturer of the drugs, I'm unsure of
Speaker 101
25:25
that, obviously now there's two different things in the question that you just asked. Now as far as the pricing of the drug and that we do have a better insight into that because there are publicly disclosed pricing that is going on, and state law does require
That a PBM reimburse a pharmacist at the NADA, which is the national acquisition drug costs minimum that that that's the floor. They have to they have to hit that amount so that that is kind of the best publicly available. You also get into wholesale acquisition costs. You get into the manufacturing acquisition cost. You get into various pricing mechanisms on some of these drugs. And we do see some of that when
it comes to our guarantees, but specifically the pharmacist specific agreement on each individual drug with the PASO or the PBM, we don't get into that as well, and we we're not in the dispensing fee either. So
Speaker 70
26:29
flowers. I need to go to Senator Johnson. Mr. Chairman,
Senator Mark Johnson
Unverified
26:36
I will ask Senator Flowers to complete hers before I Senator Johnson, I'll be quick. Thank you, Mr. Wallace. You've obviously looked at this bill.
Do you see anything in it that has a conflict with your existing PBM contract, right? We
Speaker 101
26:55
have an open network, so this would not apply to us. We don't, we don't get into that, so there were no concerns, and I think that's why Segal's impact came into the way it did. We're not excluding or directing any of our members anywhere. We have a wide open network, so that that's why you're
Senator Mark Johnson
Unverified
27:11
getting the response that you are so maybe phrase the question this way. So you de facto already
have any any willing provider process for your members, sir, of which of course I am one. Yes sir. OK. Thank you, Mr. Wallace. Thank you,
Speaker 99
27:27
Mr. Chair. Senator Flowers, you got any more? All right, thank you. Uh, we have 12 signed up to speak against this bill. Philip Christofani or something like that, you can clarify that. Just go ahead and Introduce yourself and and who you're with and you're welcome to begin.
Speaker 115
27:57
Thank you, Mr. Chairman, members of the committee. I'm Phil Christopherelli. I am the senior director of state affairs with the Pharmaceutical Care Management Association, the National Trade Association representing the country's PBMs. I'm here to testify in opposition to Senate Bill 103 today, as has been mentioned in the committee testimony. Arkansas already is and any willing provider state the law requires that our companies
contract with any pharmacist who wants to comply. with the terms and conditions of the contracts. Unfortunately this bill goes much farther than that, and gives the department an unprecedented level of authority and renegotiating those contracts pursuant to a complaint process. The bill contains a number of very neighbor nebulous terms and standards such as reasonable, relevant, arbitrary, discriminatory and we believe that that is going to make it extremely difficult for our
members to Comply with Arkansas that the Arkansas statute, should it go into effect, our main concern is that the terms and conditions that are placed in these contracts tend to focus around patient health and safety, and they aren't arbitrary. They are there for a reason, and if we start renegotiating those terms out of the contract so that every individual participant can
can access. these highly sensitive drugs, there are going to be adverse consequences to patient health and ultimately the costs associated with our clients, which is ultimately your constituents who are trying to receive their pharmaceutical drugs at the lowest price possible. I would further emphasize that this bill has an emergency clause that we don't believe is going to prevent adequate time for the department to Implement it in a way that is
thoughtful. I don't really see the purpose for an emergency clause here and with that, Mr. Chairman, I'd be happy to take any of your members' questions. Thank
Speaker 91
30:08
you for your testimony, Senator Boyd. Thank
Senator Justin Boyd
Unverified
30:12
you for being here today and and testifying. I just The Federal Trade Commission has issued a couple of reports, at least a couple, on the activities of pharmacy benefit managers. Are you familiar with one of the findings where there was a drug that the cost of the
pharmacy was about $66 for a cancer drug. It was for leukemia, and then when the PB and then what they found is PBMs were directing to the local pharmacy or when they went to a local pharmacy, the reimbursement was $97 if they went to a preferred pharmacy. It was $2700 on average and when they went to the PBM home delivery, it was $19,200. Are you familiar with that widely publicized I'm familiar with the FTC report.
Speaker 116
30:55
Yes, yes, Senator. OK. Would you agree that that's
Senator Justin Boyd
Unverified
31:02
egregious to go from $97 to
Speaker 115
31:05
$19,200. I, I would certainly agree that there were problems cited in that report, but I think what's important, Senator, is to understand that that was a very incomplete study of the PBM industry. It was the 2nd interim report released by the Biden administration on their way out the door. It was not a full report, and it certainly cherry picked a lot of the data that was involved and did not give a full perspective of the benefits
Senator Justin Boyd
Unverified
31:32
that PBMs provide to their clients. So you're just saying $19,200
versus $97 versus even $2700 was just some cherry picked thing that didn't really make
the I don't believe that your member. to certain pharmacies that you own that, that, that just happened by accident, really, that doesn't really normally go on. I don't
Speaker 116
31:53
believe that's representative of a broader industry practice. No, Senator. Well, you certainly
Senator Justin Boyd
Unverified
31:57
are welcome to have your opinion, but I think there's a reason the
Senator Reginald Murdock
Unverified
32:03
Federal Trade Commission published that. Thank you. Senator Murdoch.
Thank you, chair, and thank you for being here to testify. Thank you, Senator Penzo for bringing this bill. Uh, we've been dealing in the legislature now with PBMs and their, their Their actions for several years now. I've been here quite A few years and we've been really dealing with those those bad actions. My concern is that
this bill basically gives access. It opens up the process and it also gives AID who is our protector. More ability to watch over what PBMs have done. Now you as when you're getting paid by these people, so I really don't expect you to sit there and really acknowledge what they have done and say yes we've made some mistakes. We've been wrong and we're fixing our wrongs. That's really a good way
to come to try to get something done in progress, but I don't expect that. I expect it to be kind of like what you just did with Senator Boyd and just kind of push it off and blame the report versus taking responsibility for the actions. Here's the problem is that every time since I've been here that we've brought the PBMs to the table, their representatives. They they speak as you speak about what's wrong with the report or how it's OK, but you never come transparent or ready
to disclose or willing to accept the scrutiny, pull back the covers if you will. That's what makes sense to us as we try to protect the people that we serve. We're not trying to increase rates. We're not trying to cause anybody a problem, but PBMs have not provided us. A reason really that you need to be in the equation, honestly. Outside of some political reasons you you were able to be a part of it. That being said, and I've been texted by and I won't name the entity because they they're not testifying
about this not being a good deal, but I want them to tell me too why it's not a good deal because it's, it's truly just talking about access, opportunity, opening up opportunity to more. So we can have a better opportunity to serve our constituents and give an AID the chance to police. My question to you is. The pushback, you have not articulated. I'm gonna give you another chance. Why it's not good that AID have the
Speaker 115
34:42
opportunity to protect the people that we serve. Certainly, Senator, I think that AID should use its regulatory authority to the full extent possible, and I will tell you that Arkansas more than virtually any other state has has granted the department an extensive amount of regulatory authority over PBMs I will respond just for a moment to some of your comments. I will tell you that it wasn't that long ago that I was sitting in
your chair. I was a member of the Missouri General Assembly for 8 years. I was the insurance chairman, and I certainly respect the amount of time that you folks put in to evaluate these difficult issues and when I was in your chair, I had a, I had, you know, the same view that I have on PBMs right now, which is that they provide lower prices to our constituents and allow them to access life saving medications at a price that they
can afford and I think that that's Something that's worthy of protecting and part of why I'm
Senator Reginald Murdock
Unverified
35:50
here today. I will say that your question sir. Thank you. Have you seen
and do you understand Why we As an Arkansas legislature have done what we've done. We've noted the examples you've heard Senator Boyd and uh and there have been those type of egregious examples of what has been done with the pharmacies and what it has done to the cost
for prescriptions. Have you not seen that at all
Speaker 134
36:17
in your experience in Missouri. So what I will tell you that what I have seen nationally, Senator, you not answered my question. I'm attempting to Senator
Speaker 115
36:28
Missouri, yeah, and I think what I saw in Missouri is part of what is going on across the entire country, and that is that there are very large pharmaceutical companies that are charging astronomical prices for drugs, and there needs to be
a countervailing force in the marketplace to bring those to bring those prices down. PBMs serve in the role to do that, and absent the PBM, you are going to force all of your health plans, all of your employers, to negotiate individually with these very powerful drug companies, and you're going to see prices rise, and so I think that the legislature needs to be extremely cautious when they try to overregulate this industry from the state level. You're
Senator Reginald Murdock
Unverified
37:16
exactly the reason why there is a problem in my opinion. Thank
Speaker 17
37:23
you, Chair. Is your explanation? Is there any other questions? Go ahead, Senator
Senator Stephanie Flowers
Unverified
37:30
Flowers, and then we'll go to Senator Johnson. So I, I think I heard you say this would be harmful to patients. Besides, Noting High prices. So how, how would it be harmful?
To patients because the drug is a drug and I guess the formulary for the drug is, I mean, they don't mix and match stuff, do they? I mean, like, uh, if I get a Drug for simvastatin. are metformin. Are Jardiance. Are you saying that it's It could be different from
Speaker 114
38:19
One pharmacy to another just Is that what you're
Speaker 115
38:26
saying? No, ma'am. I'm saying that the dispensing of those drugs is a process that involves a level of patient safety and care, and our terms and conditions in our contract reflect that
Senator Stephanie Flowers
Unverified
38:37
and when we have that safety and care.
Speaker 115
38:40
I mean, these are highly complex specialty drugs in a lot of cases, and there's a reason why certain practices and procedures need to be followed when they're
dispensed. And our contracts take into consideration those realities and aren't pharmacists taught in pharmacy school how to dispense certainly, certainly they are,
Senator Stephanie Flowers
Unverified
38:59
what is the PBM you all are teaching institute
too. What is this? No, ma'am, we are ensuring that our patients or that
Speaker 115
39:12
our clients have access to drugs at that they can afford at a low cost and in a way.
Senator Stephanie Flowers
Unverified
39:23
is safe. That is what PBMs do. I'm just having trouble with the In a way that is safe. Are you suggesting that my pharmacist is not,
may not be giving me a safe drug if I'm not, if if the
Speaker 115
39:42
pharmacy is not hooked up with a certain PBM? No, ma'am, but there are certainly levels of accreditation for pharmacies, and those accreditation processes are put in place to ensure that the pharmacist
Senator Stephanie Flowers
Unverified
39:54
that's dispensing the drug is doing it in a
Speaker 115
39:59
way that's appropriate. Do PBMs? A credit. There are third party institutions that accredit pharmacies, but sometimes we require a level of accreditation for the dispensing of certain drugs. In our contracts. Thank you, Senator
Senator Mark Johnson
Unverified
40:18
Johnson. Thank you, Mr. Chairman. Sir, have you ever heard of someone named uh Wesley Bosing.
I don't know that I have. Have you heard of his mother? Her name is Loretta Bosing. I believe I have. OK, so then you might know that, that uh Ms. Bosing is a Missouri resident don't know she would have been your constituent, but she is from Missouri and uh I learned about her. Her son, Wesley, who was a transplant survivor was forced to use a mail order pharmacy by their PBM. Her son
had to take anti-rejection drugs because of his transplant and This is public records, so I'm not violating his his HIPAA rights or anything. She was forced by her PBM to switch from a trusted local pharmacy that kept the anti-rejection drugs refrigerated properly and instead they forced her onto a mail order, uh, in one case, the medications arrived on her front porch late,
uh, damaged, not she didn't know at the time not usable. They'd spoiled because they hadn't been kept refrigerated and she, uh, Uh Administered it to him and he had a serious reaction, almost died, and I'm, I'm, I'm not saying that this is not at first I will say that is not a unique story based on my research, but that this is an example where she would have been protected and Wesley would have been protected if they had still been able to go to their local
pharmacy and get that prescription filled. So I'm, I'd want to know if you were, do you have a comment about that and how I'm missing the point somehow or another. of how PBMs would help a consumer in that case rather than hinder them getting
Representative Kenneth B. Ferguson
Unverified
42:14
what that lady's son needed. Senator, I'm not privy to the facts of any individual's case
Speaker 115
42:20
and especially the one that you articulated. What I can say generally is that PBMs represent
over 280 million Americans and that there is no law in place that requires any employer, any health benefit plan to hire a PBM. They can completely opt out of that program if they so choose. The reason that they hire a PBM is because they are happy with the service that they're receiving from their PBM and so it is completely optional. It's completely voluntary, and there's a reason that our clients hire us, but do PBMs,
Speaker 116
43:00
are any of them owned by insurance companies. There are certainly relationships between
Senator Mark Johnson
Unverified
43:05
insurance companies and PBMs. Yes, Senator, that's not a direct answer to my question. Are there some that are owned. OK, well then there goes that once again yet another monopolistic practice. I could go on, Mr. Chairman, but I think I made the point. Thank you, sir, for your being willing to appear in your testimony. Thank you,
Senator Missy Irvin
Unverified
43:24
Mr. Johnson. Senator Irvin. Thank you. Um, what you're here
to testify on this bill just give me what is,
Speaker 134
43:35
what's the most egregious part of this bill to you? Uh, well, I think the emergency clause is highly problematic, but in
Speaker 115
43:43
the context of the bill, it's the unprecedented level of involvement that the State Department would be able to have to rewrite these contracts that were freely negotiated. OK, and
Senator Missy Irvin
Unverified
43:54
so that would be within what section of the bill?
Speaker 115
44:00
I'd have to bring up my my bill copy, Senator,
Senator Missy Irvin
Unverified
44:08
but I'm happy to do so. And I'm, I'm assuming like on page 8 on line 2, it talks about if they would be fined if they performed the prohibited activity. And then, and I just wanted to know exactly where we're referring to in the bill as the prohibited activities. So I'd have to go through the
Speaker 115
44:32
bill, Senator, and it may be something that I have to get back to you on because I do not have encyclopedic knowledge of all of its contents, but certainly there's a complaint process and the department is empowered through that complaint process to essentially change the terms of our of those contracts. Under
Speaker 116
44:48
the complaint process. Is that what you're
Senator Missy Irvin
Unverified
44:53
saying? Yes. Um, OK, well, I'm going to give
you some time to, to look at that, if you don't mind, but, um, to the bill's sponsor, I guess, to do, uh, or who the, um, Those items that you have listed on page 8, like lines 2 through 9 about prohibited activity. Can you just point me to where that prohibited activity then would be referring to in inside the bill. Does that make sense? Yes, ma'am. Senator Ervin,
Speaker 30
45:34
that clause, uh, that you're referring to on page 8 is to provide clarification in regards to who performs the activity, the prohibited activity is anything mentioned in the bill such as not allowing a pharmacy to join that has met the reasonable terms and conditions imposed by the pharmacy benefits manager. The purpose of that language there. is to I'm trying to, I'm trying to
explain it real simple, is to clarify either if the PBM does it or somebody they hire does it or somebody that they solicit does it because there's a lot of tricks that are always used where they can come back to you and say, oh, the actual PBM entity did not do that activity, but then when you look to see who did that activity, they contracted it with someone that Imposes a term that was egregious or outside of industry
Senator Missy Irvin
Unverified
46:36
standard. Did that help clarify or make it more confusing? No, no, no, I think it's like I think Senator Flowers helped me a little bit with it, but on page 6 on lines 27 through 36, uh, I think is where you're talking about they shall not, and I just have one more question, which is you're not Uh, you're not limiting mail order. Pharmacies, are you? No, so if they wait just because I've heard from a lot of
constituents that they, they like using their mail order pharmacy, so they
don't want to Have the state of Arkansas ban mail order pharmacies.
Speaker 30
47:16
Yes, ma'am. So this means this bill does not limit a mail order pharmacy. It does not kick out a mail order pharmacy. It allows all the other specialty pharmacies in the state of Arkansas, some of them owned by large institutions that are doing a fantastic job. It allows them to enter these networks or apply to stand a chance to apply
to enter these networks and not be arbitrarily excluded and Looked up we were briefly talking about accreditation. I looked up on URA, which is a major insurance company preferred accreditation. We actually have 5 specialty pharmacies in the state of Arkansas that are ERA accredited that I would love for them to be able to dispense drugs to our oncology patients. It would be amazing, and they are, they have passed that bar, you know, and so I'm not quite sure why they are prohibited.
Senator Missy Irvin
Unverified
48:11
I, uh, the reference that you just spoke to about that accreditation is that in this bill
Speaker 30
48:18
anywhere. No, that just basically covered under reasonable and relevant, and the reason that language is phrased that way is because it was copy pasted from federal regulation. That's how CMS chose to do it, and it's been working in that avenue for Medicare patients, so instead of reinventing the wheel, we copied that language, of course. CMS cannot come in and make the
arbitrating decision of is it reasonable or relevant, so we found the agency that is most knowledgeable in the state, which we believe is Arkansas Insurance Department. Because they do so much work reviewing PBMs, and so they know what is reasonable and relevant or that is of
Senator Missy Irvin
Unverified
48:55
my opinion that no, I appreciate that. I think I, I mean, if there is a level of accreditation that
we accept, I think it probably would be a good idea to put that language in a piece of leg in a bill,
just so that we're real clear as to what relevant and reasonable terms of participation would actually mean or how it would be interpreted. I just think that would maybe be helpful. I mean, just based on what your testimony is, I mean,
that's just a suggestion, but I always like to have things more clearly defined in legislation as best we can. These terms that are I like your explanation that this is what they use at the federal level, but I still think relevant and reasonable terms of
participation is very vague and leaves it to to determination of an executive branch agency that sometimes what they may consider to be reasonable when may not be considered what we would consider to be reasonable. And if you have more of definitive definitions of participation that meet these levels of accreditation, we find that a lot in other pieces of legend. legislation. So it's just something that I I just wanted to ask about, I think it would actually be
helpful to the bill if you had
Senator Reginald Murdock
Unverified
50:22
a little bit more. Uh Defined terms in there. Thank you. Yes, ma'am. Senator Murdoch. Thank you, chair. Uh along those same lines, uh, that Senator Irvin is talking about. I'm getting some concerns. Not on the PBM side. There's nobody have any concerns about the, the what we're trying to do with PBMs. Everybody seemed to understand that except for the gentleman here, um, as relates
to accreditation and standards in this bill, the, the, I must say maybe vagueness or generality as it relates to uh we go to page 5, line 12, which is what the senator just referred to to some degree. It just say are consistent with the industry standards, so Senator Penzo, if you guys can help me. Ensure that the accreditation standards would not be reduced. There are standards, I'm told
that we have that we that we should utilize that our already Above board if we open it up to the others. Would this bill reduce our standards down to pick them up or are they up to the standards that are considered acceptable already. You understand my
Speaker 46
51:40
question? Yes, sir. So I 100% agree with
what Senator Ervin says. She brought that up, I believe,
Speaker 30
51:50
in Rule 128, you know, it's very nebulous to say relevant and reasonable, just like as you mentioned as well, unfortunately I don't know how this legislative body would feel about naming specific accreditation in in language you guys may not like that as well, so that's why we kind of left it up to a department that reports to this. a body to issue additional rule and findings of what is
considered reasonable and relevant, and then also we have the pharmacy department, the Department of Pharmacy that I believe can provide a very firm opinion as to what in the industry is considered
Speaker 28
52:29
reasonable and relevant, and there are several, I'm I'm going to ask any questions,
Speaker 17
52:34
uh, I'm either dismiss our our our person. the end of the table or if the senators have no more questions for him. Does anybody have any more questions for the testimony?
Speaker 127
52:49
I don't have it but I don't if there's no, you're dismissed. Thank
Senator Reginald Murdock
Unverified
52:55
you. The PM guy. Go ahead. OK, so it, so in simple and for in the sake of time, hopefully we can get some testimony because I, you know, I hear what you're saying and you're basically resaying what you're saying. I guess what I'm wanting to hear from anyone in here that has issue with the standards. I want to hear the specifics of what this bill is running us
into that we need to avoid. So
Speaker 12
53:29
hopefully those people will come to the table. Thank
Speaker 93
53:35
you. uh We have one more testimony that right,
Speaker 91
53:40
I've dismissed him from the table. If you would. Joie in.
Speaker 184
53:52
After she gets done with her testimony. Hi, I'm Jody Ered. I'm the executive vice president of the
Speaker 185
54:04
Arkansas Hospital Association and apologize for being late. Um, so to your point, Senator Murdoch, that's the exact issue that we have. So currently, especially for, especially for specialty drugs, there are certain accreditation standards that are really high on purpose. Sometimes the manufacturer puts
those out because you've got to handle them a certain way or they're really expensive or you have to store them in a certain way. So what we don't want is for those accreditation standards to be watered down, so that's our main concern. If the senator will let us and the the drafter of the bill we're happy to offer language that can help those accreditation standards to sort of sharpen it up and make sure that patient safety is paramount and that we're doing everything we need to do with those
accreditation standards to protect patients. um because we appreciate the pharmacy board, but that's not usually its role, so we need to make sure we're doing the right thing for patients by tightening that language if
Speaker 119
55:07
he'll. Yes. Senator Boyd and then Senator Murdoch. So, so I want to
Senator Justin Boyd
Unverified
55:12
be crystal clear. You just said we don't trust the pharmacy board to do its job and make sure that it is inspecting proactively inspects pharmacies, and you're
saying it it doesn't have the expertise with licensed pharmacists and the public members to adequately set regulations.
Speaker 189
55:29
Oh, I'm absolutely not disparaging the pharmacy board at all. What I'm saying is I want when
Speaker 185
55:35
the manufacturers have certain specialty drugs that They have accreditation standards for for how we're handling those. I want to make sure that those are paramount and the highest. We absolutely trust the pharmacy board, but there are checks and balances in the system. So what we want to be able to do is offer language
that's very specific to say if JO accreditation has this standard, we want to make sure we're following that standard. If there are specialty drugs with certain accreditation standards that we've paid for to make sure that we are handling the drug right to make sure the manufacturer will sell us the drug that we're following that. Standard also absolutely
Senator Justin Boyd
Unverified
56:11
trust the pharmacy that in state law. Those are separate entities. I mean, our We have a pharmacy board to make sure we're offering up
to the public a minimum standard and then if somebody wants to go
above and beyond that, like it's, it's, I mean, is there a state law saying you have to have joint commission accreditation.
Speaker 185
56:30
No, but if you don't have joint commit, if you don't have joint commission accreditation, then the Arkansas Department of Health has those same roles in order to make sure our facilities are doing what they're supposed to do. So if you all are amenable, we can give you language quickly. Uh, Mr. Chair,
Senator Clint Penzo
Unverified
56:49
I'd, I'd, uh, we can, we can pull this one down for
now, um, discuss the language, uh, being that this has been tied up with a fiscal impact until today. I would like that quickly and and we can hopefully bring it back up pretty soon. That won't take up any more time in the committee right now. Go ahead, Senator Ervin, and
Speaker 24
57:12
then Senator Murdoch. I, I appreciate that, Senator Penzo,
Senator Missy Irvin
Unverified
57:18
and I, I, I'll be a co-sponsor on the bill too. I mean, if you want to add that as
part of the amendment because I, I just, I just think it helps to have some clarification. That's all. I don't think it hurts anything, but. Senator
Speaker 12
57:32
Murdoch, all right. Thank you, Senator. If you're going to pull your bill. Go ahead. You know I'm sitting
Senator Stephanie Flowers
Unverified
57:45
here and I'm listening to this and, and some of this. I don't understand because I don't see some of the issues. That are being raised.
Coming from this bill. Number one, we have licensure for PBM
networks, don't we? PBMs. And certainly you would think the state has some level of requiring a credit. Pa, the think and, and the other thing is with the pharmacist and the pharmacies, they're licensed, I guess they're inspected.
And then uh the gentleman from PBM. He, he says, uh, the bill allows the insurance commissioner to rewrite the contracts. I don't see that in this bill. It's clear what the options are when a complaint
is received. And that's on page 7. If they're found, a violate the section. Line 25.
On downs gives the Options for the insurance commissioner imposing a fine. prohibiting the PBM manager to from marketing selling, da da da da, but revoking or suspending the license of the pharmacy benefits manager. And I don't see anything about revoking a contract. are rewriting, well, that's uh.
and just revoke or suspend the license, but I don't
see. I don't see where it says rewrite the contract. Can you help me with that?
Speaker 17
59:45
Is that that in here? Thank you, Senator Flowers. Senator, you've pulled a
Senator Clint Penzo
Unverified
59:52
bill down, yes, and, and I will, you know, some of the arguments that were brought up about safety and cost are not legitimate arguments of, you know, increase in access and
lower costs go hand in hand, and that's what this bill does. Safety, I totally trust our pharmacists in Arkansas, are doctors that prescribe the drugs and The insurance department to look over everything, so, so I do have faith in our, our state to handle this. The other concerns, you know, we're we're OK with looking at the suggested language if we can make it a better bill. um, I, I, I agree with what a lot of what you said, Senator Flowers, but,
but just for I'm, I'm, I'm OK with pulling this
down and, and if we can make it a better bill, we will, and if we don't like the amendments, we'll bring it back the way
Speaker 206
1:00:45
it is, so. With that said, I would like to pull it down and if
Senator Clint Penzo
Unverified
1:00:55
we could move to 104. We're going to move to Senate Bill 104. Um, I'll go ahead and let
Simon introduce yourselves again and Clint Penzo District 31 Springdale.
Speaker 30
1:01:07
Simon De Britsov, Highlands Oncology Group. So Senate Bill 104 committee members and Chair Johnson is, I call it the sister bill to Senate Bill 103. They were split up on purpose because they touched two different areas of the law. Senate Bill 104 makes changes to the PBM Licensure Act and so the problem that's being solved is there's a few other loopholes that are being exploited and so to tighten up
and to clarify and to protect patients. So the first part of the bill is to ensure that a PBM doesn't interfere with the patient's right under the health benefit plan between a patient and the health benefit plan. Keep in mind health insurance companies hire PBMs to administer the benefits. Unfortunately our patients, when they have an issue, they call the PBM. They try to get clarity, and they get told, oh, you need to talk to the health insurance plan. Then they call the health insurance plan and the health insurance
plan says, oh no, this is administered by the PBM. And so then the patients stuck in a loop not getting an answer because both parties are pointing fingers at each other, so this basically clarifies that when a patient has a concern, they are to speak with the parent entity that controls the PBM that contracted the PBM and that parent entity, sorry, that subsidiary entity cannot interfere with the patient's rights to discuss whatever it is they wish to discuss with the plan that's paying for it. Uh, the second part is prohibiting
of ghost network. I believe you guys heard about this during Rule 128. There was some testimony from a House of Representatives member that he got letters because his pharmacy went out of network and closed, and the letter included alternative pharmacies that he could access and he mentioned all of them were closed, so this letter included a bunch of pharmacies and a network that were not accessible to him because they were no longer around, so that's
what a ghost network is. I know there's been some discussion about defined ghost network. It's a pretty well industry defined term. It can be Googled, but we define it in here as well. That's basically what it means is a network of pharmacies that don't exist or are not accessible, so those should be prohibited. Also, I believe the everybody at the state level that is regulating PBMs is interested in accurate lists of pharmacies that are doing business in the state. There was discussion of how many pharmacies closed, how many pharmacies opened, and
confusion. about these lists that are contradicting and so that that solves that gap there as well. Um, and then there's a prohibition on requiring the use of a specific affiliate pharmacy, not any mail order pharmacy, but just an affiliate pharmacy. So if that is the only option in your network, then that's not a valid option. Add another option and then you're perfectly fine and so the language there is kind of going hand in hand.
With the network adequacy laws that Arkansas has for PBMs, and they require the exclusion of solely just mail order pharmacies, so that's just tightening up that language there and then finally disclosing PHI to an affiliate. So when a doctor orders a prescription for any drug, and then we submit it to the PBM. There have been cases where all of a sudden the affiliate pharmacy is calling the patient. I had a patient. that called me and she said, Will you please have this
pharmacy that I don't know about stop calling me. Stop harassing me. I don't want to use them. I have no idea where they got this information from. What transpired is the BBM rejected the script, but then they sent the information to their pharmacy, and that pharmacy started calling the patient, and she, she wanted it to stop, and so that that just baffled me when that happened, so yeah, this is PHI, patient health information, even though they're a fi li ated with each other. It shouldn't, it's not appropriate to share it to another entity
that a patient doesn't even know about, and then finally allow exceptions as afforded by health plans, so currently specifically for our patients, I'll tell you the worst story that I have. Uh, I, I encountered a patient that was in a wheelchair. He had some mental disabilities. He had no caregiver at home, and the PBM mandated a mail order should be shipped to him. It was one of 12 medications, part of his oncology treatment, and I
got on the phone and I begged and pleaded and I said this man is in a wheelchair. He's got no home support. He's not able to pick up this medication like there has to be some reasonable medical exceptions that we can employ here, and they said no. So unfortunately that patient died, so he did not get his medication, so that's the last part of the bill. It's very long because it specifically states which accommodation should be considered. It does not mandate anything on the PBM, but it says there should be a process where you consider the patient's
medical limitation. You should consider their complex therapies, how many other drugs they're taking. together, their physical limitations. Can they get the mail, you know, and a socioeconomic limitations, not everybody has access to a mailbox, you know, and also some patients are, you know, confined to an inpatient stay. How are they going to get their medication. So this part basically says the PBM must have a process to evaluate these conditions instead of just saying no. Um, and I believe that's
Speaker 46
1:06:49
It maybe I missed something, but I'll be
Senator Mark Johnson
Unverified
1:06:52
happy to. Answer any questions, Senator Johnson. Thank you, Mr.
Chairman and Doctor, uh, you heard my comments earlier on on the previous bill about Ms. Bossing and their son that his drugs were were forced on the mail order. Does the language you're referring to in Senate Bill 104, would it have potentially uh helped avoid that situation. I know you told about a worse situation where the patient
passed away, but would 104 help that situation where the family was forced to use the mail order pharmacy in the uh the drugs spoiled on the front porch because they weren't kept
refrigerated and or went through the mail and she really tried to avoid that. We did, we did
Speaker 46
1:07:43
help in that type of situation. Yes, Senator, that is specifically under page 9.8 medication storage and effi efficiency efficacy, I can't say
Speaker 42
1:07:54
that word. I give up. OK, so yeah, the medication storage should be considered. So if the provider has concerns that
Speaker 28
1:08:00
shipping this medication may not make it there, may not be stored correctly. That is a concern that should be evaluated and you
Speaker 30
1:08:05
know, factored into the conversation with the PBM before they force a mail order pharmacy. Great, thank you. Really it's, it's very, I mean
Senator Mark Johnson
Unverified
1:08:13
it's probably a good bill all the way around, but that part is very important. Thank you, Mr. Chair. Are there any other questions?
Speaker 17
1:08:25
Seeing none, we have one to speak against this bill. Introduce
Speaker 116
1:08:40
yourself again and and who you're with and you're welcome again. Phil Christinelli for the pharmaceutical Care Management Association, the trade
Speaker 115
1:08:48
association representing the nation's PBMs here to testify against Senate Bill 104. I would reiterate my
previous testimony as it relates to the use of nebulous standards to evaluate contract terms, reasonable and relevant are also included in this particular bill. this bill creates this new definition of self-administered prescription drug that we believe is overly broad, captures very many sensitive specialty drugs which brings in all of the concerns that were articulated earlier about the
health and safety of patients and accreditation standards, so the same problem exists here. Um, we believe that the insurance department already has sufficient authority to regulate PBMs. However, this bill creates this new bifurcated system where the mandates of the PBMLA are now brought into the unfair trade Practices Act and allowing the Attorney General regulatory
oversight of the these companies as well alongside the insurance department. I think that that's going to introduce a number of uncertainties and inefficiencies into the client's process that should be considered. I would, you know, reemphasize that Arkansas already has an affiliate steering wall that is in place and this bill, you know, creates this very strange rubric of criteria that needs to be
evaluated for every person that we cover as it relates to affiliate pharmacies and the implementation of that, I'm Simply uncertain as to how it would work, um. I would go on to say that we're slightly confused about the creation of this new ghost network prohibition, I will say that Arkansas law and Medicare standards already require PBMs to offer an adequate network of
pharmacies and our companies are in compliance with those standards and so I'm not quite certain what what the introduction of the ghost network language really brings and further This bill also is subject to an emergency clause that is quite concerning, so happy to entertain further questions. Any questions, uh, Senator Boyd, thank you again
Senator Justin Boyd
Unverified
1:11:28
for being here today. So what I understood you
to say is Arkansas's licener requirements are inadequate for pharmacists and that there's no way in Arkansas licensed pharmacist could determine how medication is stored or whether to counsel appropriately. Is that what you said or did you say that we really need to to codify other requirements in the state law because Uh, I'm, I'm not quite sure
Speaker 116
1:11:53
what part of my testimony you're referring to, Senator. Is it as it relates to specialty drugs
Senator Justin Boyd
Unverified
1:11:57
that a licensed pharmacist could not figure out how to appropriately store and counsel it, and we had to have all this
other regulation on top of that education, training and Board
Speaker 115
1:12:10
of Pharmacy Standards in order to do that. We believe accreditation standards are important
Senator Justin Boyd
Unverified
1:12:15
and exist for a reason. Yes, Senator. OK, I'll take that as you
Speaker 213
1:12:24
feel like we inadequately Train our pharmacists. Thank you.
Speaker 202
1:12:28
What What accreditates The PBMs for anything can a PBM dispense drugs to individuals
can, can, can, can they set standards for care on drugs. Can a PBM do that?
Speaker 115
1:12:42
So PBMs don't dispense drugs. We pay for them. Is there anybody
Speaker 202
1:12:46
else got a question, seeing none, you're dismissed. There anybody else to speak for against this
Speaker 17
1:12:56
bill? Saying none, you want to close your bill?
I, I believe I'm close. I just would ask for a good vote. A motion by Senator Penzo, seconded by Senator Johnson, any discussion saying none. All in favor say aye. I opposed
Speaker 217
1:13:20
like sign. Thank you, Senator. Thank you committee. Senator Bryant.
Speaker 220
1:13:53
we So we need to get this thing down
Speaker 24
1:14:10
we're going to go to House Bill 1595.
Senator Justin Boyd
Unverified
1:14:30
Thank you, Mr. Chair. State Senator Justin Boyd, with your permission, I'd like to bring someone up from the insurance
commission just in case there's a question that goes over my head. So House Bill 15 1595 is the Arkansas Insurance Department general omnibus bill, um. So I'm gonna, I'm gonna just quickly go through each of the 5 sections and tell you what each of the five sections do, and then if we have questions, then I'll be here, Mr. Commissioner, do you want to introduce yourself? Alan McLean, insurance commissioner.
So Section 1 amends Arkansas Code 23-67304 by removing the requirement that the administrator for the Arkansas Workers' Comp Insurance plan maintained a physical office in the state. This work can be done remotely and up to this point there is no knowledge that an insured has ever visited that that office. Section 2 adds foreign reciprocal insurers to 23-70-110, which requires domestic reciprocal insurers to post a bond with insurance commissioner requiring these insurance to post a protects consumers and its
consistent with the requirements applicable to other insurers. A foreign insurer, what that means is an insurer incorporated in a state other than Arkansas but selling insurance in Arkansas just to clarify what foreign means. Domestic insurance companies are examined every 5 years. The commissioner has no reason to examine hospital and medical service corporations any more frequently. Therefore, this amendment lessens the frequency for hospital and medical service corporations from 3 to 5 years.
Uh, Section 4 amends code 23-79-205 allows for service of process against an insurer in the manner provided by Rule 4 of the Arkansas Rules of Civil Procedure. This amendment simply allows for service of process consistent with the way corporations are normally served in Arkansas and then Section 5. Um, 23-79-0501, uh, created the Arkansas Comprehensive Health Insurance Pool, a nonprofit legal entity that provided health care coverage to persons
that could obtain coverage due to preexisting conditions. However, pursuant to federal law preexisting conditions are no longer a basis for denial of health care coverage and individuals can now find health insurance coverage without this program. In 2013, the General Assembly passed Act 17713 to 2013, ending chips. operations as CIP was no longer needed. The repeal is merely cleanup of the code. So again this is all just really clean up language. I've had no one express any opposition to any of this to me.
Speaker 226
1:17:06
You want to add anything. No, sir, I think that's a summary that did a good job.
Senator Justin Boyd
Unverified
1:17:18
All right, is there any questions from the committee. Seeing none, uh, you close your bill. I'm
Speaker 202
1:17:23
closed. Make a motion do pass. Motion by Senator Boyd, seconded by Senator Murdoch. Any discussion saying none, all in favor say aye. I'll oppose like sign. Thank you, Senator.
Senator Justin Boyd
Unverified
1:17:47
This is House Bill 1620. Thank you, Mr. Chair. Uh, Representative Gramlich is in committee
and Senator Hammer, as we know, runs a lot of bills, so they've asked me to do this, uh, so I'm going to do this if there are people in the audience, if I get in over my head, who can come answer more in depth questions. So House Bill 1620 is
cleanup language. Uh, it's PBM audit Bill of Rights definitions. Um, so the first thing it does is ensures that Arkansas Medicaid honors the pharmacy Bill of Rights. Uh, the second thing it does It has new audit definitions that support Arkansas Insurance Department and enforcement, including audit, prepayment audit, prescription validation request or review and randomly selected. So it provides definitions of all those.
It includes timely payment. Uh, so pharmacy, so basically it clarifies manufacturer coupons, so manufacturers from a pharmacist's standpoint. And here's Representative Gramling, um, I, I'll defer it. I'm on 3 of the best part.
Representative Zack Gramlich
Unverified
1:19:13
that real quick. All right, so, yeah, part, part 3 of the bill basically just oh
yeah, that Gram like State Representative District 50. Uh, so yeah, part, part 3, what it is trying to do is it's going to ensure that PBMs are reimbursing in a timely manner. 7 to 14 days on electronic claims 30 days on written claims. I mean, we have, I mean, truthfully, there are some that are waiting months to get reimbursed and then these pharmacies are just having to hold that debt on their on their balance and so this is going to ensure that they're getting
reimbursed in a timely manner so that they can continue to continue to operate. Um. Also, if there are PBMs who aren't following that and they're taking too long, we're going to put a 12% per per month late payment on claim fees for clean claims. You talked about the clean claims stuff. I'm sure already and also manufacturers are going to have to follow the same reimbursement stuff, for example, there are some for a while you could get certain drugs and for like half price
from different companies and those companies would take, I've heard as long as 6 months to get re. im b ur s ed and so you'd have pharmacies holding 40 to $500 in the red just waiting on these companies to get them reimbursed, and one pharmacist had waited over 150 days to get reimbursed and finally decided that he didn't want to, he just wasn't going to stay open any longer. He's just going to close up shop and sell because he didn't want to have to keep, keep trying to get to get reimbursed, so um that's what the bill does, assuming Senator
Boyd did a good job on the first part, and with that we'd
Speaker 91
1:20:57
like to answer any questions. Are there any questions? See none have no one signed up to speak for or against the bill. Go
Senator Justin Boyd
Unverified
1:21:09
to clothes she bills. Yes, I'm closed, Senator. We're
Speaker 17
1:21:11
closed. Make a motion. Do. Motion by Senator Boyd, seconded by Senator Johnson, all in favor say aye. All opposed like sign. Thank you. Thank
Speaker 202
1:21:17
you for coming and cleaning up. Thank you, Mr. Chair. Thank you, Betty.
Senator Clint Penzo
Unverified
1:22:03
Thank you, Mr. Chair. Clip Penzo District 31 Springdale, uh, House Bill 1367, uh, regulates access to public records by title agent and the title company. Each circuit clerk is a custodian of their county's public records. In recent years, out of state third parties have persuaded largely inexperienced circuit clerks to delegate that authority to them. That's not to do that is not a duty they can delegate to some
other entity. Those third parties then watermark the documents as their own versus the public records there. And allow access to the documents for a profit. This bill reinforces the circuit clerk's custodial role and brings the current statute into the electronic age. Previously, the statute contemplated mechanical transmittal of documents. This covers the current electronic transmittal of these documents. Well, the circuit clerks and land title groups were meeting. They agreed to a maximum fee per
month for the electronic transfer of the documents to licensed members of the title industry. The circuit clerks and the Arkansas Land Title Association are in complete support of this bill. answering questions.
Speaker 91
1:23:18
Go ahead, Senator Flowers. So What, what are
Senator Stephanie Flowers
Unverified
1:23:28
you saying here? What, what is this, who's paying this fee of the
Not to exceed $150. The title companies and title insurance agent or whoever gets the The documents On the records. Yeah. Yes. The title
companies. So they're gonna have to pay 150.
Senator Clint Penzo
Unverified
1:24:07
Dollars that could provide some better clarity than I can. introduce yourself
Wes Lassa
Unverified
1:24:21
name is Wes Lasa. I'm here with Arkansas Land Title Association. My mic not on you. Is that better? All right. My name is Wes Lassa.
Speaker 249
1:24:37
I'm here with Arkansas Land Title Association. Your
Senator Stephanie Flowers
Unverified
1:24:44
question, Senator Flowers, again just to make sure about this fee not to exceed $150 per
month. That's going to be charged to the insurance agent, the title insurance agent or the agency.
Speaker 251
1:25:01
Or a person affiliated with the title insurance agency
Wes Lassa
Unverified
1:25:08
historically title companies are an abstract
Speaker 253
1:25:10
companies across the state have worked with the various circuit clerks across the state to obtain documents for them to build. tidal plants which they then use to research title to a piece of real property to issue title insurance policies to underwrite the title insurance policies, and so what this is explaining is that the circuit clerk will provide those to the title
agencies for no more than $150 per month, so it's the title agency that will be paying the circuit clerk for a monthly download
Senator Stephanie Flowers
Unverified
1:25:49
essentially. And so So like A data scout, you familiar with that?
Yes ma'am. And so when you go on that Website There you can get more detailed records and I I assume that's mostly used by title insurance
Speaker 246
1:26:12
companies to some degree for tax records, I would
Speaker 253
1:26:15
say more so than real property records, but this would be more specific to a title company, say, in your county that's located in your county across the street from the courthouse or around the corner working with that circuit clerk to obtain the documents that had been filed of record related to real property within that month. It's already an existing
arrangement between the title companies, but because of these third party software vendors that have come into the state who have essentially taken over and somehow, I guess you could say they've become a de facto custodian of the record because they then control the digital images of everything that's been recorded. They're trying to charge, you know, 50 cents a page or some astronomical fee for documents that title companies have
historically gotten for a nominal charge. And so what this says is this isn't going to be an agreement between the circuit clerks and those title companies directly and taken out this third party software provider from having any control over what that charge should be because they're after all the circuit. clerk's records. They are the custodian. Well We,
Speaker 12
1:27:38
we have a, a circuit clerk here if you would like.
Speaker 34
1:27:49
conversation to give clarity for you. I'm just curious, you're in the title insurance business.
Senator Stephanie Flowers
Unverified
1:27:57
Yes, ma'am. And, and I'm not. Understanding So much this um. You're gonna pay for the download of those records per month. Yes,
Senator Clint Penzo
Unverified
1:28:12
ma'am. So, so currently, currently they are. The problem
is that a third party vendor is coming in and taking what's supposed to be a public record accessible to the public and charging a fee. For for managing uh like if a circuit clerk doesn't want to manage their own stuff, this third party's coming in. Managing it and then charging. Super high fees for access to public records instead of like a legitimate fee of what it would cost. You know, because normally the public can go in and get copies of stuff.
Yeah, normally, so is that going to be cut out now? No, that's what we're wanting to keep and we're just
Senator Stephanie Flowers
Unverified
1:28:57
going to cut out the third party it didn't, I don't understand
how, I guess that's why I see in the clerk's office, these people that are there and I don't know what the heck they're doing half the time, but they look like they're looking through some deep books. Yes, ma'am. Is that what
Speaker 253
1:29:15
you're talking about these vendors? No, ma'am, those would be standup searchers. What we're talking about in this This is a revision to the
Arkansas Title Insurance Act, so it only deals with licensed title insurance companies within the state. And so they have historically had arrangements with the circuit clerks of the particular counties that they operate in where they obtain copies of documents that have been filed off record within that particular county. They then take those documents, index those into a tidal plant that's indexed geographically for research purposes. So in certain
counties where these third party vendors have come in place, they basically take over. the digital records of that circuit clerk and so when those title companies go, Hey, Madam Clark, Mr. Clark, I need to get my monthly download. They're saying sorry, we've brought in the software system. You now have to deal with ABC software company and no, by the way, ABC software companies is now charging you.
100% more, 500% more than what you've customarily paid the clerk, and the clerk doesn't have access to say, oh, you can, you can have it here. I'm going to go around
Senator Stephanie Flowers
Unverified
1:30:33
the software provider. How does the clerk's office have authority to even enter into one of those
Speaker 257
1:30:39
arrangements with a vendor. That's, that's a separate
Senator Stephanie Flowers
Unverified
1:30:41
issue, but I mean that's like for the the person who represents
Speaker 202
1:30:45
a certain clips. Senator Flowers, if you would introduce yourself and, and you're welcome to. to give your testimony, he is
Speaker 91
1:30:53
speaking for both of these gentlemen have signed up to speak for
Speaker 265
1:30:58
this bill, so go ahead. Thank you, Chair. My name's Kyle Sylvester. I'm the circuit clerk for Washington County. I'm also the legislative chair
Speaker 91
1:31:08
for the Arkansas Circuit Clerks Association. If you would, if you want to speak for the bill or help answer. Yes, ma'am. Can, can
Senator Stephanie Flowers
Unverified
1:31:14
you repeat your question? I want to know how under what authority does the circuit clerk Have
To hire a vendor. To organize and even distribute, To organize and even distributeal public records. So
Speaker 267
1:31:35
with electronic recording throughout the nation. Senator Flowers. The circuit clerks in each county will use a vendor to be able to index index the images as they come in under
Speaker 266
1:31:51
what authority were the custodian of
Senator Stephanie Flowers
Unverified
1:31:54
the record. So does the law allow you to take public records. And allow for
a third party to sell them. That's so for I'm just
Senator Stephanie Flowers
Unverified
1:32:11
law written? I, I never heard of it. Senator Flowers, I believe it's
Speaker 253
1:32:24
in 1414 111, uh, which allows circuit clerks and other county officials to utilize certain third party vendors to assist them with some of their duties. However, that particular statute indicates that they still have to have the ability to pull those records down, extract those records, do everything. anything with respect to those records and essentially says they can't, they shouldn't never
not be the custodian of the record and in control of those
Senator Stephanie Flowers
Unverified
1:32:58
documents. What we believe is where are they allowed to to contract with the A vendor, a third party to sell the records. Is that I I'll pull up
the statute to see. I never heard of this. Senator Flowers, we're going to move on
Speaker 202
1:33:14
or we'll be here this afternoon after we get off the floor. Thank you. Go ahead, Senator Irvin. Thank
Senator Missy Irvin
Unverified
1:33:22
you. And this, how would this does this have the
the backing of all of the county clerks. I'm just curious as to how this because you're, you're now saying that it shall be. Provided, um, In their electronic format and then the time required to, I understand the purpose of the bill, I guess, is this
going to be, will this Will these small counties be able to comply with this legislation. Yes ma'am, they will because of, because they are now required to
keep this in electric electronic format. Yes ma'am. They are now required. They are required by law to
Speaker 267
1:34:09
keep all these records. In electronic format currently if, if, if that particular county is utilizing an electronic recording system. It's it's a requirement for those images to be accessed online, not necessarily the index, but the images. Accessed online but not that's
Senator Missy Irvin
Unverified
1:34:23
not on a website, but like Senator Urban, if you would look
Senator Clint Penzo
Unverified
1:34:32
at line 7 on page 2, I believe that paragraph F addresses your your question. OK, yep.
Speaker 24
1:34:44
That's perfect. Thank you. Thank you. All right. These, these have testified for the bill. Is there any other questions? Saying no you want to close your bill. Just ask for
Speaker 17
1:34:58
a good vote. Motion to pass motion by Senator
Penzo, seconded by Senator Irvin, and a discussion all in favor say aye. I'll, I'll oppose likean. Thank you, Senator, you passed your bill. Thank you. Senator Gilmore. It's come to the table and
Speaker 15
1:35:26
run. the 1517. All right. House Bill 1517.
Senator Ben Gilmore
Unverified
1:35:41
Go ahead and introduce yourself and you're welcome, Mr. Chair. Thank you, members of the committee,
Senator Gilmore, District 1 here for House Bill 1517 to establish the earned wage Access Services Act. Thank you. Members, this is a bill I'm really proud to be here for because I think it has the opportunity to ensure that a lot of Arkansans have the help that they need. This bill creates
a framework and a structure to ensure a practice that's really
already happening in the state with a lot of employers and that, that practice is allowing employees to utilize wages that they've already earned and just get that in a more timely manner, meaning that when someone is working and they have earned a wage, and I think it's going to, I'm going to say that a lot because this is wages they have already earned, um, that they can access those funds maybe before the paycheck comes and so reason that's important, I think
a lot of times, and we already know this, that a lot of Arkansans, a lot of Americans live paycheck to paycheck. They are typically they don't have a lot of money in savings, and so this bill creates a framework for that to exist and a consumer friendly protected way and so if you look through the bill, you'll see we we define a lot of terms and we create the parameters by which those consumer protections are encased in statute, and I think what what's
Important to note about this bill is this is trying to make sure that that our constituents are protected from those who would maybe prey on them from keeping them from being going into debt with high interest rates and other things that could negatively impact them down the road from, you know, just being having financial security that we, I think, want all of our constituents to have. So I'm not going to talk the bill to death. I'd like to open it up for questions if there are any, and happy to Take some.
Speaker 208
1:37:47
Questions from the members. Seeing none, we have
Senator Ben Gilmore
Unverified
1:37:55
wish. I don't, I think we're, I think we're good if if the committee's good. All right, uh, you want to close your bill? I'm closed members. I'd appreciate a good vote. Thank
Speaker 17
1:38:06
you for your motion by Senator Boyd, second by
Speaker 202
1:38:08
Senator Johnson. Any discussion all in favor, say aye. All opposed like sign. Thank you, Senator. Thank you, senators.
Senator Ben Gilmore
Unverified
1:38:17
Appreciate your work on that. You want to 1488, if I may, Senator. OK All right, uh. And I think per the chair and the majority leader's rule that we are going to add my name on if the committee so chooses. We're
Speaker 17
1:38:42
gonna Senator Irvin moved to suspend the rules to uh to add a voice
amendment for co-sponsor. Uh, 2nd Senator Boyd, all in favor say aye. All opposed like signed. Senator Irvin, do you want to add I moved to
Senator Missy Irvin
Unverified
1:38:59
add Senator Gilmore as Senate sponsor per verbal amendment. Alright. Second by Senator McKee,
Speaker 17
1:39:06
all in favor say aye. All opposed like sign, if you would present your bill as amended. Thank you, Mr. Chair. Thank you,
Senator Ben Gilmore
Unverified
1:39:19
members for that presenting House Bill 1488 as amended with
me as the sponsor, members, this is seeking to address an issue that I had in my district and represented Wardlaw's district where a constituent of ours was trying to cash out of his life insurance and it became a burdensome process that extended a lengthy period of time. And so this is a consumer protection bill, as as I would call it. and
and basically it just gives the framework for him, for anyone to, to do that and making sure that they are protected, um, and how that operates. You'll see there under C1 policy death benefit shall remain in full force until uh effective until payment is made. That's just making sure that they have coverage, and then number 2 there, it sets a 30 day framework to make sure that they can basically get out of that, get there. money back and in incentivizes
the company to relinquish that in a timely manner. I don't want to belabor the point here either, but happy to
Speaker 91
1:40:30
take questions if there are some. Senator Irvin, you got a question?
Speaker 15
1:40:43
Any questions, uh, We have 1 to speak against this bill. Derrick Smith.
Speaker 17
1:40:56
Just to introduce yourself and who you're
Derek Smith
Unverified
1:41:02
with because I can't read it. Good morning Mr. Chair Committee. My name is Derek Smith. I'm with the Mitchell Williams law firm here in Little Rock, and I'm here on behalf of State Farm. I will I'll start by saying we're not. Against the policy that's being offered by the bill, we just have some concerns with with how it would impact the business. Principally around the lack of
an effective date or application to policies issued after the passage of the statute, as you know, life insurance is issued one time and the contract is signed at that date and typically doesn't, shouldn't change after that date. And so as the case in other statutes or other statutes in this provision of the code, we think it would be beneficial to expressly state that these new contractual obligations apply to contracts issued after the effective date of the statute. And don't necessarily apply to contracts that were issued and
Speaker 17
1:41:59
agreed to prior to the statute. So I don't think it addresses the contract at all, but I'm no lawyer, and I don't confuse matters. So, I mean, if it don't expressly say so in this piece of legislation, it applies from here forward. Am I wrong with
Speaker 288
1:42:22
any lawyers in the room? So the bill doesn't state, so
Derek Smith
Unverified
1:42:29
if, if you in other sections of the non-forfeiture law and this this is not amending that section, correct? It's amending the chapter that applies to non-forfeiture benefits, and so you will see examples where statutes will say, in addition to other applicable sections of this chapter, this particular section will apply to policies issued on or after a particular date. Usually the date that the law is enacted in the absence of that, we are concerned that someone
could claim that this applies to policies and contracts that are issued
Speaker 17
1:43:04
before the effective date. So just matter
Speaker 287
1:43:07
of question, wouldn't you have to Get a new contract with that person if that is the case. I, I'm not sure. Can you repeat that, Mr. Chair, if it's not in their current contract and it wasn't in law whenever they enacted that contract or life insurance, wouldn't you have to
Derek Smith
Unverified
1:43:32
redo or renew that contract with that individual that is precisely the circumstance we're attempting to avoid when this is incorporated into the law, all you will see is the statute. Someone reading the statute will not know that it was passed in 2025. And so when they see it, surrender their contract, they will immediately think that they are entitled to the interest payment after 30 days. They will immediately believe that they're entitled to continuing the coverage even though their
Speaker 206
1:44:02
policy doesn't provide for that. Well, I, I kind of think it's good policy either way,
Senator Mark Johnson
Unverified
1:44:11
so I really don't care, but Senator Johnson, thank you, Mr. Chairman,
and I, I, first of all, Derek, thank you for this, that point. I, I won't even debate the point. I really, my question is really for Senator Gilmore. This is really only setting and An established interest rate for that company who fails to pay
within 30 days instead of we agree that that money has has time value. It's just using the prime rate in the Wall Street Journal on the day that the man was that the man was, is that, am I reading that correctly, Senator, I
Senator Ben Gilmore
Unverified
1:44:45
think you're reading the language correctly, Senator. I think the point is to incentivize timeliness and to not drag it out because I think at the end of the day, a company would rather have your money working for them than precisely. Thank you, Senator. Yes, sir. Thank you. Thank you, Mr. Chairman. Senator Murdoch.
Speaker 17
1:45:08
Any other questions? Seeing none, uh, thank you and you're dismissed. Thank you. You want to close your bill. Thank you, members,
Senator Ben Gilmore
Unverified
1:45:17
and I appreciate the discussion. I, I thank Mr. Smith. I just candidly, this is the first that
I've I've heard of any objections, and so I realized that my name was just added to the bill, so maybe he hasn't had a chance to reach out to me and I look forward to a conversation, um, and so I appreciate that, but I think it's a good consumer protection bill, and I would ask for a good
Speaker 202
1:45:39
vote on this bill. Thank you, members. Thank you, Senator. What's the will of the committee motion by Senator McKee. by Senator Johnson, any discussion, seeing none, all in favor, say
Speaker 24
1:45:54
aye. I opposed like sand. If you would grab oh. Yeah, well,
Speaker 17
1:46:03
uh, So Senator Gilmore, if you would tell Senator Dismay he's on deck.
Can't do that uh, Senator Petty, I have no idea what bill you're running, so if you would tell us.
Senator Jim Petty
Unverified
1:46:20
Thank you, Mr. Chair. Senate Bill 432. Jim Petty, Senator, District 29. Go ahead and present your bill. Thank you. Thank you, Mr. Chair. Members, this is a I'm calling it a
workforce pipeline bill, as we all know we have a workforce problem and this bill is attempting to address that issue in the field of accounting. There's a growing shortage of accountants and CPAs in Arkansas and the rest of the country as well, even our Office of Personnel Management, the other day made reference To some of the vacant positions that we have and so I followed up with her on that, and there
are 166 accounting accountant type CPA positions that are vacant in our state government here. There's also an estimate that approximately 75% of the public accounting CPAs are going to retire within the next 15 years, and so this bill is attempting to address that pipeline problem. We've worked with the Arkansas State Board of Public Accounting. We've had conversations with labor and licensing and then the the profession, the Arkansas Society
CPAs, to craft a bill to address this problem. We, we referenced four sections but the meat of this bill is in Section 1712309 dealing with experience. And so this is providing an alternative pathway to licensure. In reality, it's going back to the way it was before they passed the 150 hour requirement in order to be licensed that's the the path that I took.
I got my bachelor's degree and and did not have to have the 150 hours and so what this bill, the substance of this bill does is that it offers the ability To get your bachelor's degree, graduate, and immediately go to work, start working on taking the exam, but while you're working, you're taking the exam and you're gaining experience and, and so instead of having 30 hours of classroom, you've got a
year or however long it takes you to to to get that experience in in taking the exam and so this, this bill will Offer an alternative pathway for those that choose. It doesn't take anything away, so you can reach that licensure by going to work immediately upon graduation rather than going for 150 hours and that's the substance of it. The other part dealing with exam
fees, the state board has a pipeline initiative currently where they waive or assume some of the fees for qualifying Arkansas citizens taking the exam. The other section 311 substantial equivalency. This is taking that out of the law, the accountancy law that we have and putting it into board rule so that we can adopt those uniform Accountancy Act changes more
expeditiously and in the last one is kind of a clean up dealing with a revocation of a license for and it's Clarifying, dealing with quality of the auditor quality of the work, and so as it relates to peer review, it's just kind of clarifying some language to what is currently in practice today, and as Senator Gilmore said, I will not belabor stand here and try to answer any questions that you might have. Thank you for
Speaker 202
1:50:23
bringing this exciting bill. questions from the committee seeing none, uh, there is no one to speak for against the bill.
Speaker 24
1:50:34
Oh, you, you almost too late. Go ahead, Senator Irvin. No, just thank you, Senator
Senator Missy Irvin
Unverified
1:50:40
Petty. But on page 6 and 7 when you're striking all of that, is that now going
to be just in rural. OK, thank you. All right.
Speaker 91
1:50:54
Uh, will the committee, you're closed. I'm closed. All right, motion by Senator Ervin, second by Senator Boyd. Any discussion saying none, all
Speaker 17
1:51:03
in favor say aye. All opposed like signed senator, would you step through that door and get Senator dismay. If he's not ready, we're leaving.
Senator Jonathan Dismang
Unverified
1:51:42
Senate Bill 405. Thank you, Mr. Chairman Jonathan Diang, Senate District 18, many of you will
remember, or if you were here, we passed what was called the Inform Act a few sessions ago. essentially that did two primary things. It helped with retail theft and just being able toify who the sellers were on a marketplace, but also allowed you as a consumer to see who you were buying your product from
previously those items were shielded from your knowledge as you were buying, you were just buying through a marketplace. That was passed here in the Arkansas legislature where we were the first state in the country to do that, and then it was later adopted by on the federal level and passed on the federal level and so there are some changes and differences between our law and was ultimately passed on the federal level. This brings those things into compliance. So that we don't have restrictions or issues that may differ or create an additional hurdle that does not exist under the federal law.
Senator Reginald Murdock
Unverified
1:52:48
Any questions from the committee. You right. Go ahead, Senator, not necessarily the question but more clarity. What are some of those things that I guess the federal legislation
Senator Jonathan Dismang
Unverified
1:53:01
done something with it to add to what we've done, yeah, well, like, so for instance, we said we
found a good example for you. We had a combination of two factor authentication, public record search and the presentation of government issued identification. Theirs would be one or more reliable methods that enable an online
marketplace to determine that any information documents provided are valid, corresponding to the seller or an individual acting on behalf of the seller and not misappropriated or falsified. So just a difference in the way that we worded things, which could lead to a different interpretation. We also had a 24 hour period in certain provisions. The feds had 10 and so we take it to the tin that is as far as online marketplace you will require high volume third party seller to provide the online
marketplace within 24 hours is what we add of becoming a high volume, and then there's a list of bank account information, some other things, um, the feds were set at 10 and so we moved it to 10 from 24 to 10 to match up with what their requirements were. So that's, that's the kind of thing that you're looking at in the bill and if you look through, you can see where we're. be swapping a a time frame out or how we define what an ID is, um, that sort of thing. Thank you. Any other questions?
Speaker 202
1:54:20
No one to speak for or against the bill. You want to close your bill? It's closed motion by Senator Irvin, seconded by Senator Boyd. Any discussion saying none, all in favor say aye. All opposed, like I think you. Thank you, Mr.
Speaker 91
1:54:35
Chair. I'm committed. OK, we're going to go to House Bill 1583.
Speaker 15
1:54:45
Members, there's a number. A number of folks to speak.
1583. There's a number of folks to speak. For and on this bill,
Speaker 91
1:55:05
And, uh, I'm, I'm gonna, I'm going to
Speaker 285
1:55:14
let them judge by the committee's right,
Speaker 91
1:55:25
So just introduce yourselves and, and you're
Senator Justin Boyd
Unverified
1:55:29
welcome to begin. Uh, state senator Justin Boyd Fort
Danny Burcher
Unverified
1:55:31
Smith. Hello, Mr. Chairman, in committee. My name is Dr. Danny Burcher. I'm with the Brain Injury Program at UAMS is steep for digital health and that's it. So I'm
Senator Justin Boyd
Unverified
1:55:47
just going to turn it over to Dr. Burcher here to go through most of this is definitions and then we get into
what the bill does, and then there are a couple uh points at the end allowing the insurance commissioner to make rules, so with that said, turning over
Speaker 308
1:56:08
to him. Yes, sir. I just wanted to make a kind of give you a view of the landscape, and I'll try to make it as brief as I can. We're the lead brain injury program for the state of Arkansas, so we monitor this bill's about acquired brain injuries. We really focus on traumatic brain injuries who were part of the
trauma system, so we monitor that's probably one of the major impacts that happens with patients that have severe moderate to severe brain injuries. They come into the trauma centers by state law. They are required to report to us within 5 days of recognition, so we have a good handle on what's happening with them. We work with the rehab facilities and several of them are here. People that work in the rehab sector, and I want to the only thing that science that I want to share with you is if you're
familiar with the trauma and the golden hour. That's kind of dramatic, right? So what's really important about trauma is not that the paramedics are going to save you or that The nurses are going to save you in the ER. It's to get them to the trauma surgeon. The same correlate applies with rehabilitation. We have about a 1 to 2 year range where we see massive improvement in patients get rehabilitative care and what we're hearing from some of the rehab facilities is the problem
is there are limitations on what there are caps on what they're allowed to provide with their rehab, whether it's physical therapy, occupational therapy, cognitive therapy, all those things are listed in the bill. And so they're finding caps. They're finding limits to access to whenever they even have policies and so we, you know, I just need to speak to the facts of the matter, and that's what we're concerned about is that patients are not getting the
rehab that they need. They're being limited by people that are not in a position to really judge that. They're really limited, limited by arbitrary policies and rules. And I'll entertain any questions that you guys have. I would like to say this is brain injury month. Say it real quick. The governor had made a proclamation I could share that with you. This affects 46,000 people in the state we estimate overall on a yearly basis. It's about 350
to 400 referrals we get that have this particular type of problem and CMS has rated this as a chronic medical condition. Thank you for your time. Do
Speaker 208
1:58:41
you want to speak on the bill in or just
Speaker 308
1:58:45
the background? I am, I cannot speak as supporting the bill because I'm employed at UMS and I'm on UMS time and it's really just for information. All right. Is there any questions from the committee?
Speaker 99
1:59:04
Is there anyone who wants to go ahead and what? So
Senator Matt McKee
Unverified
1:59:09
I appreciate you bringing this bill. This is obviously a very important. important issue, um, obviously whenever we as a state require insurance to cover things. What kind of limitations do we put on that? What, how does that affect the cost of insurance. How can you speak to some of those
Speaker 308
1:59:29
things? Yeah, I wish I could give you down to the penny how this is going to impact, but it's hard
for us to estimate we are aware with our colleagues in Texas. We work with a lot of other states within our program that do similar things, and we understand they have a they have a similar bill that's been in place for several years. We understand the the overall cost has been 35 to 48 cents a policy. Now that's from Texas and we've heard from the House they're worried that, you know, the overview, you know, Texas is a huge state, so maybe they could cover it easier. I can't stand here and tell you absolutely it's going
to be that cost, but I really, that's my
Speaker 314
2:00:09
best guess is that it probably will not be a huge impact on a
Senator Justin Boyd
Unverified
2:00:15
policy. What, what I can say is the bill has been filed. I've had some discussions. with insurance people, uh, nobody has expressed opposition. They've just asked questions. I've offered to make amendments if they had any, nobody's offered an amendment, so that's really where, you know, I've had some, some questions, Senator Irvin. I would
Senator Missy Irvin
Unverified
2:00:34
say that the inclusion of the language that says
coverage for medically necessary treatment, then allows for those insurance companies to review the treatment and determine if it's medically necessary or not before they would issue, you know, and cover the payment, so I, I think that language in there speaks to your question and provides that level of safeguard. Any
Speaker 94
2:00:57
other questions? Seeing none, uh, I've got a number of people on this list. Do
Speaker 202
2:01:02
you want to testify? or do you want us to go to lunch?
Speaker 91
2:01:08
At a decent time. Absolutely, please stand up and let us know who you are, who, who are here for this bill, if you would. Go ahead, we'll start over here and we'll go around the room. She physical therapist for 30 years. I.
We as a committee appreciate and want to thank your your time for being here and that's why we, we did that and we would have loved to have every one of you down and give your testimony and thank you for the professionals for taking the time to come and share this and and we appreciate every one of you and uh and would you like to close your bill? Thank you, Mr. Chair. As you can
Senator Justin Boyd
Unverified
2:08:01
see by the support in the room and the lack of opposition in the room. This is clearly the right thing to do for Arkansas.
I make, I'm clothes for my bill and
Speaker 17
2:08:12
make a motion to pass. Motion by Senator Boyd, seconded by Senator Ervin. Any discussion. Go ahead, Senator
Senator Mark Johnson
Unverified
2:08:19
Johnson. I'll be brief, Mr. Chairman. I want to thank all the witnesses, uh, uh, we rarely get opportunities to feel like you leave and go home, that you did something really good today, and this helped me feel that way today, and I appreciate all of you and especially Mrs. Beck, who I would have been scared to vote against it anyway.
Speaker 202
2:08:42
Thank you, Mr. Chair. Thank you, uh, we have a motion 2. All in favor. Say aye. I'll oppose like sign. Thank you all for being here, uh, seeing no other business to come before the committee, we are adjourned.
Agenda
REGULAR AGENDA
CALL TO ORDER
SB103 C. Penzo TO CREATE THE PHARMACY NONDISCRIMINATION ACT; TO REQUIRE PHARMACY BENEFITS MANAGERS TO ACCEPT ANY PHARMACY OR PHARMACIST WILLING TO ACCEPT RELEVANT AND REASONABLE TERMS OF PARTICIPATION; AND TO DECLARE AN EMERGENCY.
SB104 C. Penzo TO AMEND THE ARKANSAS PHARMACY BENEFITS MANAGER LICENSURE ACT; TO PROTECT PATIENTS' RIGHTS AND ACCESS TO MEDICATIONS; AND TO DECLARE AN EMERGENCY.
HB1595 Steimel TO ENACT THE STATE INSURANCE DEPARTMENT'S GENERAL OMNIBUS AMENDMENT OF ARKANSAS INSURANCE CODE.
HB1620 Gramlich TO AMEND THE LAW CONCERNING PHARMACY BENEFITS MANAGERS; AND TO REGULATE PROCESSING AND PAYMENT OF PHARMACY CLAIMS.
SB405 J. Dismang TO AMEND THE ONLINE MARKETPLACE CONSUMER INFORM ACT.
HB1367 Warren TO AMEND THE ARKANSAS TITLE INSURANCE ACT; AND TO REGULATE ACCESS TO PUBLIC RECORDS BY A TITLE AGENT AND A TITLE COMPANY.
HB1488 Wardlaw TO AMEND THE STANDARD NONFORFEITURE LAW FOR LIFE INSURANCE; AND TO REQUIRE AN INSURER TO PAY INTEREST ON DEFERRED PAYMENT OF ANY CASH SURRENDER VALUE UNDER CERTAIN POLICIES.
HB1517 Ray TO ESTABLISH THE EARNED WAGE ACCESS SERVICES ACT.
HB1583 Bentley TO MANDATE COVERAGE FOR ACQUIRED BRAIN INJURY.
SB432 J. Petty TO AMEND THE LAW CONCERNING ACCOUNTANTS; AND TO AMEND THE DEFINITION OF SUBSTANTIAL EQUIVALENCY FOR THE PRACTICE OF ACCOUNTANCYPENDING FISCAL IMPACT
ADJOURN
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — INSURANCE & COMMERCE - SENATE, Mar 13, 2025 | Agenda | 2 | Official source ↗ |
Speakers
Speaker 3
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Senator Clint Penzo
Unverified
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Senator Stephanie Flowers
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Senator Mark Johnson
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Senator Justin Boyd
Unverified
Speaker 116
Senator Reginald Murdock
Unverified
Speaker 134
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Representative Kenneth B. Ferguson
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Senator Missy Irvin
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Speaker 127
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Representative Zack Gramlich
Unverified
Wes Lassa
Unverified
Speaker 249
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Senator Ben Gilmore
Unverified
Speaker 208
Derek Smith
Unverified
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Senator Jim Petty
Unverified
Senator Jonathan Dismang
Unverified
Speaker 285
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Danny Burcher
Unverified
Speaker 308
Senator Matt McKee
Unverified
Speaker 314
Speaker 94