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H 7947Health Insurance

Insurance - Prescription Drug Benefits

This bill requires insurance companies to count financial assistance, like drug coupons, toward a patient's deductible and out-of-pocket limits.

Held for study
Population
Affected
25
Email Legislator
Introduced Feb 27, 2026Committee House Health & Human Services

Plain-English Summary

This legislation requires health insurance companies and pharmacy benefit managers (PBMs) to change how they calculate a patient's out-of-pocket costs. Specifically, it mandates that any payments made on behalf of the patient—such as coupons from drug manufacturers or assistance from charitable organizations—must count toward the patient's deductible and out-of-pocket maximums. This rule applies primarily to brand-name drugs without generic equivalents or drugs approved through special authorization processes. The bill includes exceptions to comply with federal Health Savings Account (HSA) regulations and applies to health plans starting January 1, 2027.

For younger readers

Imagine you have a piggy bank that you must fill up with money before your insurance company starts paying for your medicine. Sometimes, nice people or companies give you special coupons to help pay for that medicine. Right now, the insurance company might not count that coupon money toward filling your piggy bank. This new law says they have to count that coupon money. This means your piggy bank gets filled faster, and the insurance company starts paying for your medicine sooner. This rule will start for most people in the year 2027.

Who & Where It Applies

Impacted groups
Patients with chronic conditionsHealth insurance companiesPharmacy benefit managersPharmaceutical companiesEmployers offering health plans
Impacted communities
All

Constitutional & Fiscal Check

None Likely

Estimated cost
Amount unknown
Estimated revenue
None

Bill Analysis

Both viewpoints
For Progressives
  • Protects vulnerable patients with chronic conditions or serious illnesses from high out-of-pocket costs by ensuring that financial assistance actually reduces their deductible burden.
  • Prevents insurance companies and pharmacy benefit managers from "double-dipping" by taking copay assistance money while still requiring the patient to pay the full deductible amount.
  • Strengthens the social safety net by ensuring that charitable aid and manufacturer assistance effectively bridge the gap for low-income patients who cannot afford high deductibles.
  • May inadvertently support high drug prices by subsidizing pharmaceutical corporations and encouraging the use of expensive brand-name drugs over cheaper alternatives.
  • Could lead to insurance companies raising premiums for all policyholders to recover the revenue lost when they can no longer exclude third-party payments from deductibles.
  • Delays implementation until January 1, 2027, leaving patients exposed to financial hardship and "copay accumulator" schemes for several more years.
For Conservatives
  • Prevents insurance companies from manipulating contract terms to deny consumers credit for payments made, ensuring patients get the full value of financial transactions made on their behalf.
  • Includes specific language to protect the tax-advantaged status of Health Savings Accounts (HSAs), safeguarding a tool often favored by conservatives for personal healthcare management.
  • Reduces the immediate out-of-pocket financial burden on families without requiring direct government spending or tax increases.
  • Interferes with the free market and private contracts by dictating how private insurance companies must calculate deductibles and manage their risk pools.
  • Distorts market price signals by masking the true cost of expensive drugs through third-party payments, potentially discouraging the use of cost-effective generic alternatives.
  • Likely to result in higher insurance premiums for the general population as insurers shift costs to maintain profitability in response to the government mandate.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 42 additions · 3 deletions

SECTION 1. Sections 27-20.8-1 and 27-20.8-5 of the General Laws in Chapter 27-20.8 entitled "Prescription Drug Benefits" is hereby amended to read as follows: 27-20.8-1. Definitions. For the purposes of this chapter, the following terms shall mean:

(1) "Cost sharing" shall mean any copayment, coinsurance, deductible, or annual limitation on cost sharing (including, but not limited to, a limitation subject to 42 U.S.C. §§ 18022(c) and 300gg-6(b)), required by or on behalf of an enrollee in order to receive a specific healthcare service, including a prescription drug, covered by a health plan, whether covered under the medical or pharmacy benefit. (1)(2) “Director” shall mean the director of the department of business regulation. (2)(3) “Health plan” shall mean an insurance carrier as defined in chapters 18, 19, 20, and 41 of this title. (3)(4) “Insured” shall mean any person who is entitled to have pharmacy services paid by a health plan pursuant to a policy, certificate, contract, or agreement of insurance or coverage including those administered for the health plan under a contract with a third-party administrator that manages pharmacy benefits or pharmacy network contracts.

(5) "Insurer" shall mean any person, firm, or corporation offering and/or insuring healthcare services on a prepaid basis including, but not limited to, a nonprofit service corporation, a health maintenance organization, the Rhode Island Medicaid program, including its contracted managed care entities, or an entity offering a policy of accident and sickness insurance.

(6) "Person" shall mean a natural person, corporation, mutual company, unincorporated association, partnership, joint venture, limited liability company, trust, estate, foundation, nonprofit corporation, unincorporated organization, or government or governmental subdivision or agency.

(7) "Pharmacy benefit manager" shall mean any person or business who administers the prescription drug or device program of one or more health plans on behalf of a third party in accordance with a pharmacy benefit program. This term includes any agent or representative of a pharmacy benefit manager hired or contracted by the pharmacy benefit manager to assist in the administering of the drug program and any wholly or partially owned or controlled subsidiary of a pharmacy benefit manager. 27-20.8-5. Cost sharing calculation.

(a) When calculating an enrollee’s overall contribution to any out-of-pocket maximum or any cost sharing requirement under a health plan, an insurer or pharmacy benefit manager shall include any amounts paid by the enrollee or paid on behalf of the enrollee by another person that is either:

(1) Without a generic equivalent; or

(2) With a generic equivalent where the enrollee has obtained access to the prescription drug through any of the following:

(i) Prior authorization;

(ii) A step therapy protocol; and

(iii) The healthcare plan or carrier’s exceptions and appeals process.

(b) If under federal law, application of subsection (a) of this section would result in Health Savings Account ineligibility under 26 U.S.C. § 223 (Internal Revenue Code), this requirement shall apply only for Health Savings Account qualified High Deductible Health Plans with respect to the deductible of such a plan after the enrollee has satisfied the minimum deductible under 26 U.S.C. § 223, except for items or services that are preventive care pursuant to 26 U.S.C. § 223(c)(2)(C) (Internal Revenue Code), in which case the requirements of subsection (a) of this section shall apply regardless of satisfaction of the minimum deductible under 26 U.S.C. § 223.

(c) This section shall apply with respect to health plans that are entered into, amended, extended, or renewed on or after January 1, 2027.

SECTION 3. This act shall take effect upon passage.