From The Connecticut General Assembly, House Democrats:

Christopher G. Donovan, Speaker of the House
Denise Merrill, House Majority Leader

SPEAKER, COMPTROLLER SAY PRESCRIPTION DRUG BILL WILL GIVE MUNICIPALITIES RELIEF ON HEALTH CARE COSTS
For Immediate Use Doug Whiting
June 8, 2010 860-240-0160
203-400-2127

CCM, CSEA/SEIU, Insurance Committee Chair Voice Support for Bill Allowing Comptroller to Offer Municipalities Ability to Purchase Prescription Drugs Through State Employee Plan

House Speaker Christopher G. Donovan (D-Meriden), State Comptroller Nancy Wyman and State Representative Steve Fontana (D-North Haven) today said a new law allowing prescription drug pooling will give municipalities the chance to see substantial savings in their health care costs.

Governor M. Jodi Rell signed the legislation, HB 5295: An Act Concerning Municipalities and Prescription Drug Plans, into law yesterday. It had received strong bipartisan support in the General Assembly last month.

The bill gives municipalities the ability to buy prescription drugs through the state employee plan. By taking advantage of the bargaining power, low administrative costs and substantial discounts negotiated by the large state employee pool, municipalities could see significant savings.

Depending on municipal workforce size, cities and towns could save as much as $1 million - $1.5 million annually, in addition to savings achieved by the state. Small communities with fewer than 500 municipal employees could achieve savings of as much as $250,000 a year.

"It makes sense for the cities and towns to use the state's purchasing power to save money on their prescription costs--a key cost driver in health care," Speaker Donovan said. "Connecticut needs to keep moving forward with these types of reforms to make health care more affordable and to keep pace with federal reforms that are coming our way."

Comptroller Wyman recently allowed 16,000 members of the Teachers Retirement Board to use the state's purchasing power under a similar agreement that reduced costs for the teachers and the state by a combined $3 million.

"Our cities and towns are searching for ways to balance their budgets and keep property taxes down and this is one way the state can help do that," Wyman said. "This program is a model of how the state's bargaining power can be used to give taxpayers relief at the local level, and I hope that we can expand it to allow businesses and individuals to participate."

The Comptroller, negotiating on behalf of the nearly 200,000 lives in the state pool, has more bargaining power than individual municipalities negotiating coverage for far fewer people.

"Given that towns are struggling with double-digit insurance premium increases, this is absolutely the right time to help them to control their prescription drug costs," said Rep. Fontana, who chairs the Insurance & Real Estate Committee. "This bill will allow towns to save hundreds of thousands of dollars by buying prescription drugs for their employees through the state."

"The new law will not only deliver a reduction in prescription drug costs for workers and the municipalities that employ them," said Robert Rinker, Executive Director of CSEA/SEIU Local 2001, one of 13 unions in the State Employees Bargaining Agent Coalition. "With more people participating, it will also provide savings to the State. That's why our members supported the Speaker's plan to 'pool' prescription drug costs," said Rinker.

Gian-Carl Casa of the Connecticut Conference of Municipalities (CCM) said earlier this year that CCM supported the bill "as it would provide local governments with a much-needed option, of which they can voluntarily avail themselves, through such a state program. Municipalities will best be able to control rising healthcare costs if they have before them a menu of options so they can choose what works for their specific situation, including the option to join a state plan for prescription drug coverage."

The bill was endorsed by the Commission on Municipal Opportunities and Regional Efficiencies (MORE) because it permits municipalities and the state to realize substantial discounts on some of their most expensive health care costs at a time when they are struggling with budgets and declining revenue.

Last year, the legislature passed a bill commissioning the development of a plan enabling Connecticut to join an existing multistate Medicaid pharmaceutical purchasing pool and to consolidate drug purchasing across the state. Bulk purchasing of prescription drugs holds the potential of saving significant state dollars and the measure passed with bipartisan support.

The State Comptroller appreciates input on this and other issues from residents of the state. Please feel free to contact her office by phone - (860) 702-3300; mail - OSC, 55 Elm Street, Hartford, CT 06106; or, via E-mail - osc.opinions@po.state.ct.us

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