Health care costs are rising in CT. Here’s how new laws aim to fix that.

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Among the top priorities for Gov. Ned Lamont and state lawmakers during this year’s legislative session was a slate of measures aimed at controlling the swiftly rising cost of health care for Connecticut residents. 

House Bill 6669, which passed both chambers on the final day of the session, contains several of those measures — although many were pared back from what the governor originally proposed.

Here’s what the new regulations will mean for you.

Drug discount cards for all

Many Connecticut residents could see lower prescription drug costs under a new program offering discounts at pharmacies across the state.

By the end of this year, Connecticut will join Oregon, Washington and Nevada in offering a discount card through ArrayRx, which negotiates discounts with pharmacy networks and rebates with drug manufacturers to make many common drugs available at a fraction of the price. 

Any state resident will be able to sign up and download the card online. Discounts will range from 20% off brand name drugs to as much as 80% off the cash price for generics. The card will especially benefit individuals with high-deductible plans, those whose plans don’t cover certain drugs or people who do not have insurance. State employees and Medicaid participants will also be enrolled in the program. 

Fostering competition in health care markets

The bill also aims to promote competition in Connecticut’s health care markets, which could mean lower prices and improved access to care for residents.

In recent years, Connecticut’s large health care systems have been growing through acquisitions of smaller hospitals and doctors’ offices. There’s rising concern that reduced competition among fewer, larger hospital systems has led to rising costs for inpatient and outpatient hospital services.

Researchers have pointed to certain common clauses health care providers include in their contracts with insurance companies that can limit options for consumers. For example, a health system might include terms known as “all-or-nothing” clauses, in which the health system refuses to contract with an insurer if that insurer doesn’t also contract with all the system’s affiliated providers across all markets. 

Other clauses, known as “anti-tiering” or “anti-steering,” serve to undo some insurers’ attempts to encourage competition among health care providers. Health plans have taken to offering incentives — like lower copays or deductibles — to patients who choose higher-quality, lower-cost care, in other words “steering” them to these more efficient providers. Or they might place more efficient providers in a preferred “tier.” Advocates and researchers say powerful health systems have interfered with those practices by requiring, in contracts, that insurers include their networks in preferred tiers — regardless of their performance or prices. 

H.B. 6669 bans all of the above: all-or-nothing, anti-tiering and anti-steering clauses. The law will also require insurers to provide more transparency to health care providers about how they end up in certain tiers.

“Ultimately, the goal of this is to increase competition,” said Maureen Hensley Quinn, a director with the National Academy for State Health Policy, which helped draft the legislation for Connecticut and other states. “We expect to see, over time, that that will reduce some of consumers’ premium costs, as health care prices are better negotiated and can come down a bit.”

Canceling medical debt

In a separate bill, the legislature also approved $6.5 million to help erase medical debt for low-income households.

The funding set aside was substantially lower than what Gov. Ned Lamont had initially proposed — $20 million that he said potentially could have canceled as much as $2 billion in medical debt for thousands of residents. Legislators, facing fiscal constraints, instead settled on $6.5 million for the cause, which they said could still help clear hundreds of millions in medical debt.

Limiting hospital “facility fees”

Consumers often see “facility fees” on their health care bills, which cover operational expenses separate from the provider’s fee for the services rendered. 

Connecticut already had limits on the facility fees hospital systems could charge for some select outpatient services offered at offsite locations, away from the hospital’s main campus. This year the legislature extended that ban to the same services offered at a health system’s main campus — unless they are rendered in the emergency department, and with certain exceptions (observation stays for wound care, orthopedics, oncology and organ transplant, among others).

The governor’s original proposal to eliminate a wide range of facility fees, saving Connecticut consumers hundreds of millions of dollars a year, was pared back. 

Seeking better health outcomes for HUSKY enrollees

Medicaid, known as HUSKY in Connecticut, provides health coverage to people with incomes below certain thresholds. Over a quarter of Connecticut residents currently receive coverage through Medicaid.

H.B. 6669 requires several executive branch agencies, including the Department of Social Services and the Office of Health Strategy, to develop a strategic plan for HUSKY that addresses community health and equity and improves health care access and outcomes for enrollees. The plan is due by January 1, 2025.

Connecticut extended HUSKY coverage to the work of community health workers, as well as to children up to age 15 regardless of their immigration status — so long as their families meet the qualifying income limits for Medicaid.

What’s missing: a cap on out-of-network costs

Earlier versions of the legislation proposed setting a price cap on how much hospitals could charge patients if they were “out-of-network,” or if the patient’s insurance carrier doesn’t have a contract in place with the hospital.

Experts said that would have driven down hospital prices across the board. By fixing the out-of-network rate, health care providers would essentially be forced to lower in-network rates as well, since it would make little sense to charge more to insured patients.

That measure failed to make it into the final bill, but lawmakers may revisit it in future sessions.