news-record.com

RALEIGH (AP) — An overhaul of the state employee health insurance plan that's supposed to be on the fast track keeps getting delayed as lawmakers and lobbyists try to resolve a flap over prescription drugs.

For a third time this week, the Senate delayed floor debate Thursday on legislation that would reduce benefits, increase premiums and inject $625 million in taxpayer money into the State Health Plan through mid-2011. A floor vote has now been pushed to next Tuesday.

Bill sponsor and Senate Majority Leader Tony Rand said he's giving colleagues more time before a vote because many are still worried about a prescription drug program for people with chronic illnesses.

Independent pharmacists argue the so-called "extended retail" program could force them to lay off workers or close down because more customers would get their drugs by mail order. The health plan leaders estimate it would save the cash-strapped plan $90 million over the next two years in lower drug costs and argues the program has been effective in other states.

"The providers have asked for more time to present alternative ways of handling the problems," said Rand, D-Cumberland. "What we're trying to do is find something that's fiscally responsible and addresses the needs of our employees and the needs of the health plan."

Lawmakers had set an April 1 deadline for getting the final bill to Gov. Beverly Perdue's desk because plan administrator Jack Walker said the plan would soon run out of money to pay its bills to doctors and hospitals.

Some pressure eased when Perdue said she would tap $250 million from the state's rainy-day reserve fund so the plan could pay those bills in the last three months of the fiscal year.

But Rand said lawmakers still need to finish by the end of the month or the state could lose $45 million in savings because it won't be able to make benefits and premium changes by July 1.

The proposal for the State Health Plan's 667,000 public employees, retirees and their family members, come with higher co-payments and deductibles and other eroded benefits.

Employees who insure their spouses and children would see their monthly premiums increase by 7.8 percent annually for the next two years, or from $489 to $569 for the family rate. Employees would continue to pay no monthly premiums for their own coverage.

The "extended retail" prescription drug program would require plan members who receive long-term drug prescriptions for conditions such as diabetes and high blood pressure to obtain medications through an in-network pharmacy or through the mail. The patient would be charged a large co-payment if they don't participate.

Small-town community pharmacists have been sending e-mails and making phone calls to legislators urging them to reject the pharmacy plan. They argue it's unprofitable for them to participate and would cede prescriptions to out-of-state mail order sites.

Patients also don't follow their doctor's orders as well unless they speak with a local pharmacist at pickup, said Mike James, a lobbyist for the Association of Community Pharmacists.

"Mail order, quite honestly as a pharmacist, is bad medicine," said James, who also owns Person Street Pharmacy in Raleigh.

State Health Plan and Medco Health Solutions, the plan's pharmacy benefits manager, say 82 percent of pharmacies and 40 percent of the independents, participate in a similar plan in Illinois. Medco says out-of-state chains would receive $60 million more from the state in higher drug costs if the changes aren't implemented.

Rand said House leaders also are involved in the discussions so that any compromise or replacement savings could move quickly through both chambers and onto Perdue's desk.

Added Rand: "We need the largest savings that we can accomplish with the bill."