Relates to improving and expanding the pharmaceutical insurance coverage program for certain medicare enrollees; creates the expanded pharmaceutical insurance coverage panel, to be responsible for expanding pharmaceutical insurance coverage.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A5422
SPONSOR: Kim
 
TITLE OF BILL:
An act to amend the elder law, in relation to improving and expanding
the pharmaceutical insurance coverage program for certain medicare
enrollees
 
PURPOSE:
The Elderly Pharmaceutical Insurance Coverage program has changed
dramatically since it was created. This bill will restore oversight and
transparency to the function of the program and expand it to phase in
coverage for persons younger than age 65 who are enrolled in Medicare
Part D. The bill also changes the name of the program to be known as the
Expanded Pharmaceutical Insurance Coverage program.
 
SUMMARY OF SPECIFIC PROVISIONS:
Section 1. Changes the name from the Elderly Pharmaceutical Insurance
Coverage program to the Expanded Pharmaceutical Insurance Coverage
program.
Section 2. Prohibits income derived from any increase in the calculation
of a cost of living benefit in social security income or pension bene-
fits from being used to determine enrollee eligibility for the program
or for benefits defined based on income, and provides that EPIC shall
include medical marijuana as a covered drug.
Section 3. Restores the EPIC panel and the advisory committee, 60% of
the later being composed of consumers, and requires an annual report.
Section 4. Re-defines the age of eligibility to phase-in persons under
the age of 65 who are enrolled in Medicare Part D.
Section S. Restores the enrollment process so that the burden of screen-
ing for potential eligibility for the federal Low Income Subsidy (also
known as Extra Help) rests with the EPIC program and not the enrollee,
ensures that EPIC applicants are enrolled in the program and eligible
for its benefits while additional information is collected to qualify
them for LIS if applicable, and restores the EPIC program responsibility
for offsetting any Part D late enrollment penalty costs within limits.
Section 6. Requires the EPIC program to post the manufacturers and drugs
that are covered under an agreed to rebate program.
 
JUSTIFICATION:
THE EPIC program has made numerous changes administratively that have
negatively impacted enrollees without a public process to review
proposed changes. These changes include:
*a change in the application starting in 2020, that requires enrollees
to determine if they must disclose asset, not otherwise a program
requirement, if they fall into the income category that would allow them
to apply for the federal Low Income Subsidy (LIS.) In prior years, an
EPIC applicant was enrolled in without an asset test and if the EPIC
staff found that the self-reported income could qualify for LIS (150%
FPL,) the enrollee would be contacted for additional information on
assets so that an application to LIS was completed on behalf of the
enrollee. Additionally, while the current statute includes a role for
EPIC staff to assist enrollees who are eligible for the Medicare Savings
Program (MSP, 135% FPL,) which without an asset test, will also qualify
an enrollee for LIS, the EPIC program does not assist with MSP enroll-
ment or make a referral to an agency that will.
*a change implemented in October 2019 that eliminated the previous bene-
fit to include payment of any Medicare Part D late enrollment penalty
for certain enrollees.
*a change in January 2020 that eliminates past records of EPIC partic-
ipation for any enrollee that failed to pay their quarterly dues on
time. Their EPIC number and all income information on their records is
now eradicated, and upon late payment of the dues an enrollee must reap-
ply for the program as if they were never a member.
In addition to making corrections to restore and improve program oper-
ations, the changes noted above are addressed in this bill. Further, in
order to improve transparency and accountability, the EPIC panel and
advisory committee are re-convened, along with a requirement for an
annual report to the Legislature.
During SFY 2019-20, the Executive enacted a reduction in funding for the
EPIC program, derived from savings due to provisions in the Affordable
Care Act that covered more of the costs of Medicare Part D drugs in the
coverage gap, also known as the "donut hole." In SFY 2020-21, the Execu-
tive has proposed a further reduction attributed to continuing savings
due to the federal expansion of donut hole coverage. Rather than concur
with the savings proposed, the Legislature finds that it is time to
expand the EPIC program to offer benefits to residents with Medicare
Part D who are under age 65. The bill does that incrementally, starting
by lowering the age to 60 in 2021, and continuing to bring the age limit
down in five year brackets in successive years.
The legislation also addresses the need to have the EPIC program provide
assistance with out of pocket costs for medical marijuana, which is not
covered by Medicare. The legislation also incorporates provisions of
another bill that exempts from income to be considered by the EPIC
program that which is derived from a cost of living adjustment to social
security or pension payments.
The EPIC program requires drug manufacturers to participate in the
state's rebate program in order for their drug to be covered. While this
public policy has been well established, EPIC enrollees are unaware
about whether they will have coverage until they get a refusal at their
pharmacy. This information would be particularly important to have
during open enrollment when an enrollee is choosing Medicare Part D
coverage. The tools to compare plans indicate how much out or pocket
costs will be, and the EPIC guideline provides coverage for drugs
covered by a Part D plan, unless the drug manufacturer does not partic-
ipate in the rebate program. Medicare counsellors assist enrollees in
understanding what their future out of pocket costs will be when choos-
ing a Part D plan, but cannot give a full picture without knowing wheth-
er a manufacturer is excluded from EPIC. This bill will require the list
of manufacturers and drugs participating in the rebate program.
 
FISCAL IMPLICATIONS:
To be determined, but has been made difficult without publicly available
annual reports on the program. In part, costs associated with program
expansion to a lower age limit will be offset by rejecting the proposed
program savings of $16.5m proposed for SFY2020-21.
 
EFFECTIVE DATE:
This act shall take effect immediately, with the provisions in sections
2 and 4 taking effect on January 1, 2021.