TO: | Honorable Jane Nelson, Chair, Senate Committee on Health & Human Services |
FROM: | John S. O'Brien, Director, Legislative Budget Board |
IN RE: | SB409 by Janek (Relating to restrictions on the interchange of antiepileptic drugs and drugs used to treat or prevent seizures.), Committee Report 1st House, Substituted |
Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
---|---|
2008 | ($1,379,672) |
2009 | ($3,492,997) |
2010 | ($3,991,844) |
2011 | ($4,391,028) |
2012 | ($4,830,131) |
Fiscal Year | Probable (Cost) from GENERAL REVENUE FUND 1 |
Probable (Cost) from FEDERAL FUNDS 555 |
Probable (Cost) from VENDOR DRUG REBATES-MEDICAID 8068 |
Probable Revenue Gain from VENDOR DRUG REBATES-MEDICAID 8068 |
---|---|---|---|---|
2008 | ($1,379,672) | ($2,786,831) | ($474,358) | $474,358 |
2009 | ($3,492,997) | ($7,400,316) | ($1,328,513) | $1,328,513 |
2010 | ($3,991,844) | ($8,549,917) | ($1,578,663) | $1,578,663 |
2011 | ($4,391,028) | ($9,404,908) | ($1,736,530) | $1,736,530 |
2012 | ($4,830,131) | ($10,345,399) | ($1,910,183) | $1,910,183 |
Based on information provided by the Department of Aging and Disability Services, the Department of State Health Services, the Board of Pharmacy, and the Office of the Attorney General it is assumed that any additional costs related to the duties and responsibilities of those agencies associated with implementing the provisions of the bill could be covered within available resources.
The Employees and Teacher Retirement Systems (ERS and TRS) both indicate no fiscal impact; however, members of the ERS and TRS group insurance plans are responsible for the additional cost when a brand-name prescription is dispensed and a generic equivalent is available. Members could experience a substantial increase in out-of-pocket prescription drug costs.
The Health and Human Services Commission (HHSC) indicates an impact to Medicaid and the Children's Health Insurance Program (CHIP) from increased brand-name prescriptions. HHSC estimates a cost of $4.2 million All Funds, including $1.9 million in General Revenue Funds offset by a gain in Vendor Drug Rebates of $0.5 million, in fiscal year 2008 increasing each year to $15.2 million All Funds, including $6.7 million in General Revenue Funds offset by a gain in Vendor Drug Rebates of $1.9 million, by fiscal year 2012. The agency has assumed that some prescriptions will continue to be filled with generic equivalents. In fiscal year 2006 there were 253,320 prescriptions for anticonvulsive drugs filled generically through the Medicaid Vendor Drug program. The difference in average prescription cost between generic and brand-name drugs was $166.45 in fiscal year 2006 in Medicaid. If all 253,320 generic prescriptions had been filled with brand-name drugs, the cost would have been an additional $42.2 million All Funds, including $16.6 million in General Revenue Funds offset by approximately $5.7 million in additional Vendor Drug Rebate collections. Although HHSC estimates a fiscal impact per fiscal year ranging from $1.9 to $6.7 million in General Revenue Funds, the impact could be substantially higher or lower if a greater or lesser percentage of prescriptions are filled as brand name instead of generic.
Source Agencies: | 302 Office of the Attorney General, 323 Teacher Retirement System, 327 Employees Retirement System, 515 Board of Pharmacy, 529 Health and Human Services Commission, 537 State Health Services, Department of, 539 Aging and Disability Services, Department of
|
LBB Staff: | JOB, CL, PP, LR
|