B6A4D745AEC3C81C872586BF0001C181 Hearing Summary

Representative Lontine,
bill co-sponsor, presented HB21-1237.  The bill directs the Department
of Personnel and Administration (DPA) to enter into a contract with a pharmacy
benefit manager (PBM) for the administration of state employee health insurance
through a reverse-auction process prescribed by the bill, and then use
that platform to audit claims.  State employee insurance offered through
Kaiser Permanente is exempt from this requirement.  It creates avenues
for other public and private health insurance plans to participate jointly
with the state.



Technology platform.  By November 1, 2021, DPA must obtain a technology
platform, and associated services from the platform operator, capable of
conducting a reverse-auction for a PBM.  The platform must be equipped
with certain automation and price comparison capabilities specified in
the bill.  In addition, the platform must be able to perform automated
line-by-line review of all invoiced PBM drug claims to identify any deviations
from the terms of the PBM contract.  DPA may perform a market check
during the term of the PBM contract to evaluate the incumbent PBM’s drug
pricing for continuing competitiveness.



Fee.  The platform, operator services, claim review, and market
checks will be paid for by a per-prescription fee paid by the winning PBM
directly to the platform operator.



Joint participation.  Any other self-funded public sector health
plan may use the processes and procedures established in the bill individually,
collectively, or as a joint purchasing group with a state employee health
insurance plan.  After completion of the first PBM reverse auction,
self-funded private sector health plans with substantial participation
by Colorado employees may also participate in a joint purchasing pool with
state employees for subsequent PBM reverse auctions.  Any health plans
participating in a purchasing pool retain autonomy over their drug formularies
and benefit designs.



She distributed a handout to the committee (Attachment H).

Representative Rich, bill co-sponsor, continued introducing the bill.

The sponsors responded to questions from the committee.

The sponsors responded to questions from the committee.

Mr. Blum and Mr.
Burdge continued to respond to committee questions.



Submitted written
testimony can be found in Attachment I.

The bill sponsors made closing comments on the bill.

Committee members made closing comments on the bill.