Employer-sponsored health care premiums have been on the rise for years, and now, Big Pharma is adding fuel to the fire by pushing legislation in Alabama that would further increase premiums.
The Alabama Legislature is considering legislation – Senate Bill 252 – that would hike out-of-pocket health care costs for more than two and half million Alabama patients who depend on health insurance provided by their employer.
Proponents argue the bill will lead to lower drug costs. The reality is just the opposite.
SB 252 is, in fact, nothing more than a Big Pharma-backed policy proposal that would boost their own profits at the expense of our citizens while infringing on the rights of private enterprise.
Big Pharma hopes the hardworking people of Alabama will not notice. Alabamans know better than allowing the government to dictate what businesses can and cannot choose what is best for their employees, especially when it makes health care more expensive for our families.
Specifically, SB 252 undermines the savings made available through the private market, placing the burden of rising costs on the state’s businesses and in turn, Alabama patients and families.
SB 252 would ban fundamental pay-for-performance incentives in the private health care marketplace, which is an essential means for employers to secure significant savings on prescription drugs for their employees. This ban will directly lead to higher premiums for Alabama’s patients and families while doing nothing to address the skyrocketing costs of drugs.
If implemented, this bill disincentivizes pharmacy benefit managers (PBMs), who so many of our businesses in Alabama rely on, from using their negotiating power to secure significant savings on prescription drugs based on volume for the very same businesses that hire PBMs to do just that. It’s been shown that, on average, PBMs save $1,040 per patient per year on prescription drug costs.
An analysis of Big Pharma’s policies, included in SB 252, found it would lead to premiums increasing for Alabama’s patients and families by more than $383 million in the first year alone. The savings that PBMs secure for the employers that hire them would instead go straight to the pockets of Big Pharma.
Simply put, Alabama’s businesses, patients and families will not tolerate Big Pharma’s deceitful, profit-boosting legislation.
There is no reason Big Pharma should be dictating how employers choose to secure health care savings for their employees and their families. Our businesses that voluntarily choose to hire PBMs should be free to choose how to compensate them for the services they provide, including incentivizing the PBM to secure greater savings when they negotiate with drug companies.
The negotiating power of PBMs contributes to greater savings that lowers prescription drug costs for Alabama’s patients and families.
I urge our state lawmakers to reject SB 252 and tell Big Pharma to mind its own business rather than interfering with ours.
Eric Hare serves as CEO of Global K9 Protection Group, one of the largest canine detection companies in the United States, based in Opelika, Alabama.