SB 1142/HB 915 Banning Non-Medical Switching
Health Insurance Mandate Report: s. 627.6465, 627.662, 641.31 F.S.
For medically stable patients with complex, chronic or rare medical conditions, SB 1142/HB 915 would
prohibit commercial health maintenance organizations (HMOs) and pharmacy benefit managers (PBMs)
from non-medical switching. This includes putting these medically stable patients who have previously
been approved for coverage for a particular medication into situations where their medication is moved
to a more restrictive tier during the health plan year, where their out of pocket costs are increased
during the health plan year and/or changing or removing coverage for a drug. The bill does not limit
HMOs or PBMs from making formulary changes for patients who are not stable and do not have
complex, chronic or rare medical conditions and does not prevent a pharmacist from enacting a generic
substitution.
Some commercial insurance companies and pharmacy benefit managers are limiting or excluding
coverage of prescription drugs for medically stable patients with complex, chronic or rare medical
conditions, requiring patients to switch to insurer-preferred drugs that may be less effective for them.
They do this either by making formulary changes that limit or restrict access to a particular drug, or by
increasing out-of-pockets costs for a particular drug, thereby encouraging the patient to switch to a less
expensive alternative. This means patients who have been stabilized on one therapy (as determined by
their physician) might be switched to an alternative therapy – regardless of the health impact on the
patient.
Achieving control of a disease, particularly for chronic, complex and rare medical condition, is often a
difficult process that may require patients to go through years of trial-and-error with their physician to
find the therapy that works for them.
A patient with a chronic, complex or rare medical condition who has achieved stability (as determined
by their physician) on a medication should not be subject to insurer or PBM-initiated coverage
restrictions or increased out-of-pocket costs during the health plan year in order to stay on the drug that
has been proven to work for them.
(a) To what extent is the treatment or service generally used by a significant portion of the
population.
This bill would apply to a very small portion of the population. According to a 2012 survey of privately
insured individuals under the age of 65, only 3 percent of health plan members have cancer, an autoimmune disease or some other specialty condition.i Only a fraction of these patients are stabilized on a
drug therapy. The small population should not undermine the significance of these changes; for patients
with a complex, chronic or rare disease, persistence in their drug treatment is extremely important.
Studies have shown that patients with complex, chronic and rare conditions who have been stabilized
on drug therapy and are then switched to another drug, experience negative health consequences and
use more health care services. A study of patients with Crohn’s disease found that switching from one
therapy to another was associated with loss of effectiveness within one year.ii In a study of epilepsy
patients, those individuals that received ambulance, emergency or inpatient hospital care for epilepsyrelated medical events (e.g. seizures, toxicity) had 81% greater odds of a drug switch within the previous
6 months than patients that did not use those services.iii
(b) To what extent is the insurance coverage generally available.
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Insurance coverage of a benefit or treatment is not the issue addressed in the proposed legislation. The
bill is concerned with HMOs and PBMs using barriers to coverage that encourage patients with complex,
chronic and rare conditions who are stable on a drug to switch to alternative medications with the goal
of lowering costs for the payer (e.g., formulary changes, increasing out-of-pocket costs, or
discriminatory tiers). For this population, however, the results are often increased overall health care
costs when non-medical switching occurs.
(c) If the insurance coverage is not generally available, to what extent does the lack of coverage
result in persons avoiding necessary health care treatment.
A 2011 study of patients with cancer found that financial factors including high cost sharing, complexity
of a patient’s drug treatment and lower patient income can compel patients to switch or forego
necessary medications. Of the patients studied, 23 percent did not pick up the originally prescribed
medication, but switched to an alternative treatment, resulting in a delay of treatment; 10 percent of
patients did not pick up the initially prescribed medication or an alternative within 90 days of receiving
the prescription. The study also found that prescription abandonment was four times more likely when
out-of-pocket costs exceeded $500 (25 percent abandonment), compared to out-of-pocket costs of
$100 or less (6 percent abandonment). iv
(d) If the coverage is not generally available, to what extent does the lack of coverage result in
unreasonable financial hardship.
If a patient is forced to switch to a new drug because of the financial burden imposed by their health
plan or PBM, the new drug may be less effective for that patient or have more negative side effects,
resulting in increased medical costs due to more frequent use of emergency room and inpatient hospital
services, as discussed in section (a). A decision to switch therapy should be a clinical decision made by a
physician in consultation with the patient and based upon the patient’s history and current response to
treatment.
(e) The level of public demand for the treatment or service.
As discussed in section (b), only around 3 percent of commercial health plan enrollees have complex,
chronic or rare medical conditions. v Very few people require medical treatment for complex, chronic
diseases. A 2012 survey showed only 4 percent of people have more than $2,500 in out-of-pocket
medical spending in a year,vi indicating the level of public demand for medications addressed in this bill
would be quite low.
(f) The level of public demand for insurance coverage of the treatment or service.
Because of the complexity of treating rare, complex and chronic diseases, in addition to appropriate
physician oversight, it is an important coverage benefit for these patients to have access to medications
that meet their individual medical needs. However, what we are seeing occur is commercial health plans
and PBMs are progressively doing the opposite, instead restricting coverage and shifting medication
costs to enrollees. In 2008, approximately 7 percent of commercial plans had four or more tiers on their
drug formularies. In 2014, this more than doubled to 20 percent of health plans using four or more
tiers.vii Additionally, some commercial health plans and PBMs have added an even higher out of pocket
cost for patients through a co-insurance tier which require patients to pay a percentage of the health
plans cost of the medication.
(g) The level of interest of collective bargaining agents in negotiating for the inclusion of this
coverage in group contracts.
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Unknown.
(h) To what extent will the coverage increase or decrease the cost of the treatment or service.
There is no indication that this bill will have an impact on the cost of the treatment. The proposed
legislation is intended to limit insurer and PBM-initiated non-medical switching for patients with
complex, chronic and rare medical conditions who have been stabilized on a drug therapy.
There is evidence that preventing insurer-initiated medication switching would actually decrease overall
healthcare costs for these patients. For example:


An analysis done comparing autoimmune disease patients stable on one treatment to stable
patients switched to another medication for reasons unrelated to efficacy or safety found that
patients who were switched experienced more hospital and physician visits and an overall
increase in health care expenditures compared to patients who were not switched from their
medication.viii
A study using medical records of patients with a variety of diseases who were stable on their
medication for a significant amount of time compared outcomes of patients who were switched
from their therapy for cost reasons to those that remained on their therapy. The study found
that stable patients who were switched for cost reasons had significantly more follow-up
physician visits, and 43 percent adjusted treatment due to side effects or lack of efficacy after
one year.ix
(i) To what extent will the coverage increase the appropriate uses of the treatment or service.
Eliminating insurer-initiated medication switching for medically stable patients could increase
appropriate use of medications by ensuring patients with complex, chronic and rare medical conditions
who have been stabilized on drug therapy are not forced to use drugs that have been proven not to
work for them in the past. Keeping patients stable on therapy will be beneficial not only to the patient,
but to the overall healthcare system.

A 2008 study on the use of statins to prevent cardiovascular disease found that increased copayment amounts cause discontinuation and a lack of compliance. Furthermore, “the
prevalence of short-term statin use and poor compliance may lead to complications for the
patients and financial losses for the health care system.”x
(j) To what extent will the mandated treatment or service be a substitute for a more expensive
treatment or service.
This bill is not intended to mandate a more (or less) expensive treatment or service. Instead, the bill
intends to protect stable patients from commercial insurer and PBM practices that would force them to
switch therapies that have been deemed clinically appropriate by their physician.
(k) To what extent will the coverage increase or decrease the administrative expenses of insurance
companies and the premium and administrative expenses of policyholders.
As explained in section (b), this bill will only affect a small number of plan members who are already
stabilized on a prescriber-recommended drug therapy. Premium expenses of policyholders would be
expected to be slightly lower as health plans would avoid costs incurred when switching a medically
stable complex, chronic patient to a drug that has proven not to be effective for them.
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(l) The impact of this coverage on the total cost of health care.
Switching a stable patient who has a complex, chronic or rare disease for non-medical reasons may be
dangerous, is usually unnecessary, and rarely if ever generates overall health care cost savings. There is
no reason to think the provisions of this bill would increase the total cost of health care. In fact, total
health care costs are more likely to decrease since there are costs associated with patients being
switched from therapies that work to those that do not, (see section (a)).
i
IMS Institute for Healthcare Informatics. Healthcare Spending Among Privately Insured Individuals Under Age 65. Feb 2012.
http://www.imshealth.com/files/web/IMSH%20Institute/Reports/Healthcare%20Spending%20Among%20Age%2065/IHII_Spen
ding_Report.pdf
ii Van Asshe, Gert, Vermeire, Severine, Ballet, Vera, Gabriels, Frederik, Noman, Maja, D’Haens, Geert, Claessens, Christophe,
Humblet, Evelien, Vande Casteele, Niels, Gils, Ann, Rutgeerts, Paul (2011) Switch to adalimumab in patients with Crohn’s
disease controlled by maintenance infliximab: prospective randomized SWITCH trial. Gut Online, 10.1136/gutjnl-2011-300755
iii Zachry, III, Woodie M., Doan, Quynhchau D., Clewell, Jerry D., Smith, Brien J. (2009) Case-control analysis of ambulance,
emergency room, or inpatient hospital events for epilepsy and antiepileptic drug formulation changes. Epilepsia, 50(3), 493-500
iv Streeter SB, Schwartzberg L, Husain N, Johnsrud M. Patient and Plan Characteristics Affecting Abandonment of Oral Oncolytic
Prescriptions. J Oncol Prac; 2011 :48s-51s.
v IMS Institute for Healthcare Informatics. Healthcare Spending Among Privately Insured Individuals Under Age 65. Feb 2012.
http://www.imshealth.com/files/web/IMSH%20Institute/Reports/Healthcare%20Spending%20Among%20Age%2065/IHII_Spen
ding_Report.pdf
vi Peterson-Kaiser Health Systems Tracker. A substantial share of the population spends $200 or less on out-of-pocket health
care services. 2012. http://www.healthsystemtracker.org/chart-collection/how-do-health-expenditures-vary-across-thepopulation/?slide=12
vii Kaiser Family Foundation. Employer Health Benefits Survey, 2014. http://kff.org/health-costs/report/2014-employer-healthbenefits-survey/.
viii
Liu Y, Skup M, Lin J, Chao J. Impact of non-medical switching on healthcare costs: a claims database analysis. Abstract submitted to 20th Annual Meeting of the
International Society for Pharmacoeconomics and Outcomes Research; Philadelphia, PA; 16-20 May 2015.
ix Gibofsky A, Skup M, Johnson S, Chao J, Rubin DT. Analysis of Outcomes After Non-Medical Switching of Anti–Tumor Necrosis Factor Agents. Abstract submitted to
European League Against Rheumatism (EULAR) Annual Meeting; Rome; 10–13 June 2015.
x Thiebaud, Patrick, Bimal V. Patel, and Michael B. Nichol. The Demand for Statin: The Effect of Copay on Utilization and Compliance. Wiley InterScience. Health
Economics, 22 June 2007. Web.
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