Committee approves H.577 draft to create prescription drug discount card; bill moves to Appropriations and Ways & Means
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Summary
A legislative committee approved H.577 (draft 2.02), which would create a prescription drug discount card and require insurers and pharmacy benefit managers to count amounts paid via the card toward an individual’s deductible and out-of-pocket limits; the Treasurer testified that a modest uptake could save Vermonters about $18 million annually.
Jen Harvey, legislative counsel with the Office of Legislative Council, introduced draft 2.1 of H.577 and told the committee the bill "creates the prescription drug discount card program" and includes amendments so amounts paid with the card are "attributed toward their deductible and out of pocket responsibilities." Harvey said insurers and pharmacy benefit managers (PBMs) would be required to permit attribution of third-party payments and discounts toward deductibles and out-of-pocket maximums and to "make readily available on their website a downloadable proof of payment form" so covered individuals can submit proof.
Harvey described changes in section 3 intended to clarify what a PBM may charge when a consumer does not use a health plan: the PBM cannot require a covered person to pay more than the lesser of the plan cost-sharing amount, the maximum allowable amount for the drug, or the pharmacy’s usual-and-customary cash price after known discounts. Harvey said the bill’s language also excludes a prescription drug discount card from the statutory definition of "discount" for this pricing calculation, so PBM obligations are clear when a consumer pays outside a benefit.
Mike Pichak, Vermont state treasurer, testified in support and said the program should be inexpensive to operate for the Treasurer’s Office. Pichak described an estimate that if roughly 1% of eligible Vermonters use the discount option, "the annual discounted savings would be about $18,000,000 across the board for Vermonters." He also noted the bill includes a $50,000 appropriation to help launch the program and outlined outreach plans, including earned media and partnerships, to increase uptake.
On implementation, Pichak said the Treasurer’s Office intends to partner with ArrayRx for the operational collaboration, but must complete state contracting; that process could take from a few weeks to a couple of months. If contracting proceeds efficiently, the office hopes to make cards available "before the end of the year," with coordinated outreach to encourage use.
A committee member asked how border residents who fill prescriptions in neighboring states would be affected. Pichak said Vermonters with a Vermont connection (for example a Vermont address or Vermont employer) could register and use the card and that many national pharmacy chains accept the ArrayRx card; he noted there are "65,000 plus pharmacies" in the network nationwide.
The Chair moved to adopt H.577 draft 2.02; the motion was seconded. The clerk called the roll and recorded affirmative votes from the members listed; the motion passed on a roll-call vote. The Chair asked Representative Lindsay Critchlow to report the bill. The Chair warned that H.577 must next go to Appropriations and Ways & Means, so it likely will not reach the floor immediately.
What happens next: the bill is forwarded for committee review in Appropriations and Ways & Means per legislative procedure. If those committees advance the bill, the Treasurer’s Office would proceed with contracting with ArrayRx and start outreach work to increase uptake and track usage for future reporting and coverage decisions.
(Reporting here is based solely on remarks recorded in the committee transcript.)