In advance of the start of the new fiscal year on July 1, 2020, Gov. Gavin Newsom and the Legislature reached an agreement on the budget this week. Below are highlights of two budget trailer bills of interest to pharmacies. 

(AB 89/SB 121) contains language related to federal funding for contact tracing.  Specifically, it allows Department of Finance (DOF) to allocate those funds as directed by California Department of Public Health (CDPH), as long as the funds are not used by any state or local entity for applications that collect information relating to a person’s location and movement.  Please see below: 

SEC. 104. 

 Section 11.95 is added to the Budget Act of 2020, to read: 

SEC. 11.95. 

 (a) Federal legislation enacted between March 6, 2020, and April 24, 2020, is providing funding to the state to support testing and contact tracing in response to the COVID-19 public health emergency. The Department of Finance may allocate these funds to support testing and contact tracing as directed by the State Department of Public Health, provided that funds are not used by any state or local entity for applications that collect information related to an individual’s location and movement. This subdivision does not preclude a contact tracer from using a program to store, organize, or analyze any data otherwise affirmatively provided to the contact tracer by an individual. All testing and contact tracing must be conducted in compliance with applicable federal and state privacy laws. 

(b) Funds described in subdivision (a) may be allocated to offset or reduce appropriations in the 2019−20 and 2020−21 fiscal years that support the COVID-19 response between March 1, 2020 and June 30, 2021. If no item for a department currently exists to allow for adjustments for the additional federal funds allocation or additional reimbursements to be allocated, then an item may be created for this purpose. 

(c) The Department of Finance may adjust any item in Section 2.00 to account for additional federal funding or any additional reimbursements to support testing and contact tracing. If no item for a department currently exists in Section 2.00 of this Act to allow for adjustments for the additional federal funds allocation or additional reimbursements to be allocated, then an item may be created for this purpose. 

(d) Changes to any item in Section 2.00 may be authorized not sooner than 10 days after written notification to the Joint Legislative Budget Committee of the changes to the planned expenditures to support testing and contact tracing. The chairperson of the Joint Legislative Budget Committee or the chairperson’s designee may shorten the 10 days by written notification. 

AB 80/SB 102 does not include the proposed pharmacy reimbursement cuts for services such as providing self-administered hormonal contraceptives, vaccines, nicotine replacement products, travel medications, naloxone directly to patients and PEP/PrEP for HIV prevention. 

  • Requires CalOSHA to establish the Health Care Payments Data Program to implement and administer the Health Care Payments Data System, including health care data submitted by health plans and insurers, cities or counties that offer plans and other mandatory or voluntary submitters. Provisions require the office to use the data to produce reports, analyses, studies, etc. to support goals for improving public health, reducing disparities, and reducing health care costs and specifies that personally identifiable data submitted are exempt from disclosure. 
  • Authorizes CDPH to subsidize up to 30 days of PrEP and PEP medications without regard to whether a person was a victim of sexual assault. 
  • Contains several pharmacy provisions, including removing the Rx copay in Medi-Cal and requiring DHCS to implement a supplemental payment pool for non-hospital 340B clinics.   
  • Contains the “best price” language, specifically defining “best price” to mean the negotiated price for any specified entity, including entities both within and outside the USA.  
  • Authorizes DHSC, upon approval of DOF, to seek the necessary federal approvals to establish and administer a drug rebate program to collect rebate payments from drug manufacturers for drugs furnished to select populations of CA residents who are ineligible for full-scope Medical.  
  • Repeals the provision that limits prescribed drugs under the Medi-Cal program to not more than 6 drugs per month, unless prior authorization is obtained. 

Also in California... Legislation of interest to chain pharmacies passed the Assembly and was referred to the Senate Health Committee for further consideration. 

  • AB 2077 (Ting) Hypodermic needles and syringes – NACDS supports 
  • AB 2203 (Nazarian) Insulin cost-sharing cap – NACDS neutral 

For more information, contact NACDS’ Mary Staples at 817-442-1155.