Viagra, Cialis coverage for Delaware state employees cut

DOVER — A state committee tasked with examining government employees’ health care voted Friday to make mostly minor increases in copays and prescription costs as part of a plan to fill a multi-million-dollar shortfall.

In addition, the panel chose to cut state coverage of erectile dysfunction drugs. The committee also did not raise any deductibles.

The vote, originally set for March, was pushed back multiple times in the wake of an outcry from the government employees and legislative pressure.

Sharply increasing costs and a depleted surplus had contributed to a $60.1 million shortfall, which the State Employee Benefits Committee sought to solve through a variety of cost increases. The planned deductible hikes alone would have brought in about two-thirds of the needed money.

However, after conversations with lawmakers, committee members opted to fill the gap through a combination of smaller hikes and an allocation of General Fund money.

Ken Simpler

Kenneth Simpler

Under the plan, a few increases here and there will generate $15 million, with the rest coming from funds set aside by legislators.

For the approximately 3,400 government employees who relied on state health care to pay for Viagra or Cialis, they will have to pay out-of-pocket at a much higher rate. Currently, members pay $45 per month for six pills. Starting July 1, those rates will no longer apply, save for state employees who have a medical condition, other than erectile dysfunction, that requires the drugs.

Cutting those drugs will save the state $2.7 million.

According to Brenda Lakeman, director of the Statewide Benefits Office in the Office of Management and Budget, Cialis and Viagra range between $33 and $80 per pill out-of-pocket. Most states offer erectile dysfunction coverage, she said.

Although Viagra and Cialis will see the largest change, other areas will also be affected by the vote.

Thirty-day prescription drug costs will actually drop 50 cents to $8 for generic drugs, while preferred drugs will rise from $20 to $28 and non-preferred will increase from $45 to $50. For a 90-day supply, costs will double.

Both primary care physicians and specialists will cost an extra $5 in copays, while outpatient surgery will see a change. Preferred provider organizations will no longer be completely covered but will instead carry the same higher cost as health maintenance organization plans: $50 for ambulatory surgery and $100 for an outpatient hospital.
Lab and X-ray copays will also rise $5 each, and advanced imaging copays will jump to $35. General rates will increase anywhere from about $4 to $38, depending on the plan.

A 5-percent fee to participating groups will raise about $4 million, with the majority of that sum coming from the

Ann Visalli

Ann Visalli

University of Delaware.

Aside from erectile dysfunction drugs, the changes will not take place until Sept. 1, and state employees can change their plans starting July 1.

“You’ll have an opportunity to open enrollment, to make a new plan selection. You know, maybe some of the recommendations we make today may cause people to change plans,” said Ann Visalli, director of the Office of Management and Budget, said Friday. “We don’t usually get a lot of disruption; people like their plans, but that opportunity will also be there.”

The lone dissenter in the committee’s vote, state Treasurer Kenneth Simpler, questioned the viability of making piecemeal increases rather than focusing on deductibles.

“I would substitute all the small changes with one small deductible increase of 125 to 150,” he said.

Earlier, Mr. Simpler had expressed concern that the committee would be overburdening the subset of state employees who rely on several prescription drugs. In addition, deductible increases would be less risky for the state, since they would apply to a broader population, he said.

Describing the situation as “on the razor’s edge,” Ms. Visalli said committee members will meet over the next few months to plan for fiscal year 2017 and examine ways to refine the process.

Normally, the health care changes are set by April, but members of the General Assembly stepped in this time, leading to a delay.

The Joint Finance Committee will have to find $21 million to set aside for premium changes, which can generate $45.1 million to cover what remains of the shortfall after Friday’s vote.

Ms. Visalli is confident JFC members will be able to allocate the needed millions, whether it be from cuts elsewhere, higher revenue projections or other areas.

“It will be looked at as no different than any other cost increase that appears in the spring, but because the number is significant and it was linked to other changes that we had to make here, it was important for us to really open up that dialogue,” she said.

Geoff Klopp, president of the Correctional Officers Association of Delaware and a member of the SEBC, voted for the changes. He had resisted the initial proposals as too heavily impacting state employees but said this plan represents an acceptable compromise.

“We worked to find as palatable a solution as possible in these difficult times,” he said afterward.

 

Reach staff writer Matt Bittle at mbittle@newszap.com

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