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Lamont signs health care costs containment bill

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(The Center Square) — Gov. Ned Lamont has signed a bill to reel in Connecticut’s rising health care costs through stronger regulation of hospitals and drug prices.

The legislation, signed on Tuesday, calls for banning the use of anti-competitive health care contracting practices, improving transparency in pricing for medical treatments, limits on hospital “facility fees” and multi-state bulk purchasing program to lower prescription drug costs, among other changes.

Lamont said the new law takes a “multitrack approach” to paring down the state’s health care and prescription drug costs, among the highest in the nation.

“The quality of Connecticut’s health care system is among the best in the nation, however rising costs make accessing health coverage a barrier for far too many people,” the governor said in a statement. “Our administration is focused on addressing the policies and cost drivers that factor into these prices.”

“This is a complex issue that needs to be tackled from multiple angles and we need the involvement of all parties – insurers, hospitals, doctors, employers, and consumers – in this effort to provide real solutions to lower health care costs,” Lamont added.

A key provision of the new law authorizes the state to reduce some of the costs that often get tacked on to consumers’ medical bills, such as facility fees that charge patients for the use of medical and hospital offices during treatments, which Lamont says would save the state’s consumers millions of dollars a year.

The new law also includes a provision banning the terms in contracts between health care providers and insurers deemed “anti-competitive.” It would authorize the state to join a multi-state program that offers lower prices through the bulk purchase of generic drugs.

Another key provision is a new Drug Discount Card Program, which will authorize the state Comptroller’s Office to issue Connecticut residents free prescription discount cards with savings of up to 80% on generics and 20% on brand-name drugs.

“Prescription drug costs are out of control, and Connecticut residents need price relief,” Comptroller Sean Scanlon said in a statement.

In a fiscal note attached to the bill, the Office of Fiscal Analysis said the legislation would cost the state an estimated $800,000 to implement the new requirements, including $600,000 for the state Office of Health Strategy to conduct a study of pharmacy benefits managers’ practices of prescription drug distribution.

Health plans and hospital systems strongly opposed many of the bill’s provisions, who argued that it would drive up costs and impact patient care.

But negotiations between the Lamont administration and the Connecticut Hospital Association pared back provisions of the bill that hospitals argued would be “devastating” for the health care system, such as a proposed price cap on out-of-network care and tougher limits on facility fees.

The latest data shows Connecticut’s health care expenses increased by 6% to $34 billion in 2021, exceeding a goal set by Lamont to limit the state’s cost growth.

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