Wednesday, December 14, 2011

Gov. Andrew Cuomo signs law that bars insurers from forcing people to use mail-order pharmacies 

Gov. Cuomo said Tuesday he signed into law two controversial bills regulating insurance companies, including one blocking them from requiring policy-holders to get medication from mail-order pharmacies.

The other measure, pushed by the Orthodox and Hasidic Jewish communities, prevents insurers from tacking on extra co-payments or other costs to those who purchase fertility drugs from local drug stores and not mail-order pharmacies.

In a message announcing his approvals, Cuomo said he supported the bills' objectives only after lawmakers in the Legislature agreed to address his "concerns" in amendments that are expected to be passed early next year.

Among the amendments is a provision stating that retail pharmacies must agree in advance to accept the same reimbursement rates and terms that insurers now have with mail-order pharmacies.

"With the understanding that these amendments will be passed, I approve these bills," Cuomo wrote. The bill prohibiting insurers from requiring policy-holders to use mail-order pharmacies generated months of heated debate in the Legislature.

Supporters warned vetoes would limit consumer choice and put neighborhood pharmacies out of business. Backers from the pharmacy industry said there would be no problem in forging agreement on accepting the provisions now in place between mail-order services and insurers.

"Gov. Cuomo's action will send a signal to the entire country that New York believes in competition and consumer choice," said Ray Macioci, president of the New York City Pharmacists Society. "Let the market decide who can best serve consumers."

On the other side, the mail-order industry, business groups and the U.S. Postal Workers Union had urged vetoes, saying it would save insurers and businesses money to have policy-holders use only mail-order services.

The Federal Trade Commission called the bills "problematic" and warned they would drive up prescription drug prices. Opponents of the bills said Tuesday they were buoyed by the pending amendments Cuomo announced. "While we still believe that a veto would have better served New Yorkers, the amendments agreed upon today will help to keep the cost of prescription drugs for small businesses and consumers from dramatically increasing," said Jonah Houts, a spokesman for mail-order company Express Scripts.


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