There is a common saying that goes, “If all you have is a hammer, everything looks like a nail.” We tend to rely on tools that are familiar and easily accessible. This is certainly true for lawmakers in Tallahassee. Legislators see a problem, real or perceived, and they want to pass a law that fixes it.
Passing laws without accounting for their full consequences doesn’t hit the nail on the head! In fact, it often does more harm than good. This is true of the newly proposed health care law SB 1550 / HB 1509. Health care is a sector already drowning in red tape and excessive regulations and SB 1550 / HB 1509 would add new, counterproductive government mandates that raise prescription drug costs for small businesses, large employers, seniors, and Florida families.
Before they act, lawmakers should look for solutions to high prescription drug costs that focus on encouraging real competition and advancing free-market principles, not passing more regulations that result in higher costs to all of us.
In recent years, Florida lawmakers have made positive steps to reduce health care red tape, like increasing access to telehealth and expanding roles for advanced registered nurse practitioners, and it would be a shame to reverse that trend now. SB 1550 / HB 1509 would increase health care and prescription drug costs for employers by restricting their ability to use lower-cost pharmacy options in their health plans. Higher health care costs for job-creators makes it more difficult for them to offer good paying jobs with competitive benefits.
The proposed law would take choices away from patients by preventing their employers from covering certain pharmacies. Today patients can take advantage of low-cost programs that provide home delivery of prescriptions. This service is especially important for seniors and other patients who may have mobility and transportation restrictions, and helps patients stay on their long-term therapies to improve their health. The current bill would unfortunately restrict these options.
More health care regulations this year would mean additional costs for employers at a time when they can ill afford it. Last fall, the National Alliance of Healthcare Purchaser Coalitions released a survey showing just how significant a concern health care is for small and large employers alike. An overwhelming 82 percent majority of employers agreed that rising health care costs impact their ability to remain competitive. Increased health care costs also clearly have negative consequences for employees: 73 percent of employers agreed that rising health care costs directly or indirectly crowd out salary or wage increases for their workers. When it comes to cost-drivers, 9 in 10 employers said drug prices pose a significant threat to the affordability of employer-provided health coverage for employees and their families.
Florida employers and families cannot afford additional mandates and cost increases. Many Florida businesses already face steep competition from businesses in other states and overseas. It has never been harder for them to attract and retain workers and keep costs down at the same time. Health care benefits are a major expense for employers and a significant part of benefits packages that workers consider when choosing between job options. Florida has successfully encouraged businesses and skilled workers to move here by reducing government overreach and bureaucracy. But burdensome health care mandates like SB 1550 / HB 1509 would move our state in the wrong direction.
Containing prescription drug costs must be a priority for Florida lawmakers, but how they try to reduce costs is as, if not more, important than the fact that they act at all. As AARP highlighted in October, “List prices on more than 1,200 prescription drugs rose faster than inflation between July 2021 and July 2022, rising on average 31.6 percent.” These continued price increases by big drug companies aren’t sustainable for the employers and patients who ultimately end up footing the bill. Legislators should focus their actions on the drug companies setting the prices – not unintentionally limiting the pharmacy benefits employers provide to control these high prices. Until drug companies’ continuous price hikes are reined in, costs will increase for everyone else.
Rising prescription drug costs are a challenge, but the legislature needs to bring its full toolbox to bear – not just the “hammer” of restrictive employer mandates and more red tape. Instead of passing new regulations like SB 1550 / HB 1509, lawmakers must instead advance solutions that promote competition and employer choice, while focusing on the drug companies that continue to pad their bottom lines by setting higher prices. This is a critical issue for job-creators that Florida can’t get wrong.
Mike Wheeler is a Consumers Advisory Committee Member for Floridians for Government Accountability. He’s a lifelong Floridian who has spent his career in the logistics and distribution industry, both as a corporate team member and an independent contractor.