Legislative leaders to scrutinize state health insurance plan, pharmacy benefit managers [Northeast Mississippi Daily Journal, Tupelo]

Northeast Mississippi Daily Journal (Tupelo)

Jun. 10—JACKSON — Leaders of the Capitol's two insurance committees hope to find long-term solutions to the recent cash crunch in Mississippi's insurance plan, which covers the nearly 200,000 state employees and retirees.

The House and Senate Insurance Committees are scheduled to conduct a joint hearing on July 19-20 on both the state's managed care insurance program and the drug middlemen known as pharmacy benefit managers.

"The elephant in the room is that our state health insurance plan is bleeding cash right now," Senate Insurance Chairman Water Michel told the Daily Journal.

Michel, R-Madison, said state employees filed around $120 million in claims related to COVID-19 last year, which put a significant strain on the system and caused lawmakers to use one-time money to plug the hole.

To temporarily stop the hemorrhaging, lawmakers agreed to supplement the recent loss with American Resource Plan Act dollars they received from the federal government.

"We just want to make sure we're staying ahead of the curve with the plan," Michel said.

The plan is overseen by the Department of Finance and Administration, but benefits are administered by Blue Cross & Blue Shield of Mississippi, which works with another PBM to deliver drugs to enrollees.

Pharmacy benefit managers, or PBMs, are subcontractors often hired by health plans or employers to manage drug benefits, negotiate drug pricing with manufacturers, and reimburse pharmacists. Part of PBMs' job involves negotiating rebates and other discounts from drugmakers. In exchange, they provide a drugmakers' product with preferred placement.

But this rebate and negotiation process is often cloaked in secrecy and has caused a litany of states like Ohio, Oklahoma, Georgia, New Mexico, Kansas and Arkansas to scrutinize the practice.

The hearing comes after State Auditor Shad White's office in March inked an agreement with a data analytics firm to harvest a large swath of data from any PBM that has a contract with the state.

When asked if the investigations by the auditor's office could have any relevance to the upcoming hearings, Michel deferred to House Insurance Chairman Hank Zuber, who he said is the main official organizing the hearing.

Zuber, R-Ocean Springs, said the hearings are scheduled to take place, but the agenda for them has not been finalized.

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