At the end of 2021, Governor Hochul left New Yorkers with little to celebrate as she signed into law a package of bills that will, in their totality, significantly increase the cost of coverage for employers and individuals. The bills range from: increasing taxes on health care coverage; to unnecessarily increasing the cost of coverage for prescription drugs; to creating unsafe conditions for the distribution of prescription drugs. This package of bills caters to special interests instead of everyday New Yorkers and protects profits at the expense of affordability.
It is no surprise that a number of these bills protect manufacturers and other drug lobbyists, as virtually everyone recognizes the power of this special interest lobby. However, by adopting their preferred policies, New York is ignoring the impact these changes have on the cost of coverage, specifically in controlling the spiraling costs of prescription drugs. Next to hospital costs, prescription drug costs is the single largest driver of health insurance premiums in New York. At a time when the health care financing and delivery system is strained by the global pandemic and health care costs continue to rise from inflationary pressures, it is incredulous to believe that the state would enact legislation catering to special interests on the backs of New York businesses and consumer striving to afford coverage.
The specific package of coverage breaking bills includes: 1) an increase in taxes on health insurance to pay for the runaway early intervention program; 2) forcing health plans to abandon the delivery of prescription drugs through affordable and safe mail order delivery and instead provide increased payments and force delivery by less qualified and less safe drug retailers; 3) prohibiting health plans from making mid-year changes to their prescription drug formularies which will allow drug makers to enjoy monopoly profits on new drugs, even when lower cost drugs are introduced during the plan year. It also allows them to hike drug prices at will, knowing plans are forced to continue to pay until the end of the year; and finally, 4) limiting benefit managers ability to enact cost saving mechanisms that reduce the cost of prescription drugs.
This package of bills does nothing to address the affordability of health care. New York hospital costs and drug prices are among the highest in the nation. Further, New Yorkers pay more in “hidden” health care taxes than any other state in the country. This tax, known as Covered Lives Assessment, is a billion-dollar tax on health insurance felt by every New Yorker who has private insurance. The Governor has increased this burden another $40 million.
At a time when New York has been the model for reducing the ranks of uninsured and with universal coverage within reach, it is hard to believe that our elected officials continue to enact laws that drive-up the cost of health coverage and harm New York taxpayers.
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