Joint Public Health
July 5, 2022
Bledsoe [00:03:47] Ladies and gentlemen, we’re going to start our meeting if you would take your seat. All right, the Chair sees a quorum. I have just a few things to say. If you look at your agenda, Item E, we’re going to– Mr. Price is going to hand out some information on Item E. We ask that you review it, and then in August, we’re going to have someone here to discuss it. And I think it’d be very beneficial. This is about an update on the Pharmacist’s Association request for funding from the American Rescue Plan. It’s very important. And he’s coming to, by your desk to give you the information. I need a motion to approve the May 31st and June 1st minutes. Motion. Do I have a second? All right. All those in favor say aye. All those against. All right. Motion passes. Thank you. Now, Item D, we have the Arkansas Medicaid formulary requirements. Would John Vinson please come up and we’ll get started? And John, and anyone else you want to bring with you. And please introduce yourself for the records.
Vinson [00:05:52] Good morning, John Vinson, CEO of the Arkansas Pharmacy Association. Thanks for having us, Madam Chair, Mr. Chair, members of the committee.
Lomax [00:06:02] Kyle Lomax, pharmacist, independent pharmacy owner in the northeast Arkansas area.
Cooper [00:06:09] Brandon Cooper, pharmacist, independent pharmacy owner from Jonesboro. And I also serve as strategic advisor for the Arkansas Pharmacists Association.
Bledsoe [00:06:18] All right. Thank you for being here. Mr. Vinson, you’re recognized to start your topic.
Vinson [00:06:26] Thank you very much. Members of the committee, we’re here today to talk about an issue with pricing for prescription drugs that are covered through the Arkansas Medicaid program. And of course, there are also three– actually four — passes as well, or the provider-led care organizations that follow the same formulary and cover the same policy on these drugs. And over the last 20 years, there have been an increasing number of prescription drugs that are required to be brand name to be stocked by pharmacies when there is a much less expensive generic on the market, at least for the purchase price to the pharmacy. So we want to tell you a little bit more about that. You also have a handout, I think, in front of you that Mr. Price provided that goes through, I believe, some of the specific drugs. There are many more than what is on this chart. And the chart has some green– and if it’s printed in color. I’m not sure if it’s color black and white.q But it’s says brand and generic at the top and then it has trileptal, oxcarbazepine, lamictal and lamotrigine and several different strengths of those products. And just to be clear, there are some other drugs like inhalers for kids — Flovent, Fluticasone, which are not on this chart. What are some others? Like some of the medicines for children with attention deficit disorder like Concerta and some other products. We didn’t want to go through all of them. We just have a few examples of the most recent ones that are causing some issues. I do, I do want to say, like with DHS, with working with Medicaid and their staff– I know they’re going to present in a minute– we do have a very collaborative working relationship with them. We’ve met about this recently. But we’ve received a lot of phone calls to our office and to the pharmacists that are here with me today about the challenges of stocking some of these brand name drugs that are $1,500 or $1,600 to stock a bottle of 100. And you may only have a prescription for 30, for example. So you may be stuck with 70 pills at about $1,000 that you can’t be reimbursed for. And that’s why Lamictal and trileptal are on the list, because they happen to be quantity sizes that are much bigger than a single package. I’m going to turn it over to Kyle Lomax from northeast Arkansas and he’ll give you some more specifics.
Lomax [00:08:54] So Saturday afternoon, my last prescription that I filled was for a brand name, Concerta. That medication cost around $1,700 to purchase, and the generic equivalent costs about $170. So we’re talking about $1 a tablet versus $17. So for that medication, it’s specifically hard for me to move it to another patient because the Medicaid program, most other payers only pay for the generic version. So for that single patient, that medication is going to most likely sit there and go out of date if that patient changes strength, which is quite common in that particular medication. Another one I think that’s really recent is Lamictal. A dollar– really it costs us about 6 cents a tablet to purchase that and the brand name cost is about 17. So you can see that I can purchase the generic version and it sat on the shelf and if it happens to go out of date, it won’t be a huge loss. But the brand name definitely puts more financial burden, especially in a lower volume pharmacy that we can’t move that product to another patient.
Vinson [00:10:18] And just to clarify, the reason they have these policies, and I know when DHS staff members come up and explain, they, they negotiate either for a state supported brand or through a preferred drug list. They’re able to get rebates from the manufacturers that mean that the overall– you know, what they report to us, it’s proprietary. We don’t know the details, but we just trust that whenever they– the the total amount they pay would end up after rebates being less than what the generic would be if they were buying the generic, if that makes sense. But for the average mom and pop pharmacy, even the chain pharmacies, we don’t ever see any of that rebate and we’re not able to purchase at those low prices. So our members are having to pay the full amount, which in this case with Lamictal, which is a medicine used to treat either seizures or for patients that might have mental health issues like bipolar disease, we would have to– our members would have to pay the full price in order to stock those. Brandon, you want to explain what NADAC is and have anything you want to add to that?
Cooper [00:11:25] Sure. I think what you’ll see on your chart, instead of actually showing like invoice costs from various pharmacies, Medicaid uses NADAC pricing, which is an actual more true representative of what it costs across the board. So you’ll see the NADAC price there is actually posted on a website, and I think I’ve included that on the handout as well. And for each drug, what they do is do surveys fairly regularly amongst pharmacies whether they be independent, chain, you know, your large big box store. So it represents more of a true cost when you average it out across the board. So that’s actually a more representative cost that we have here is the NADAC pricing and that’s actually what the reimbursement is based on for Arkansas Medicaid. So you’ll receive the NADAC pricing plus a dispensing fee. And so you can see there’s quite a wide variance there if you’re receiving the same dispensing fee as well, you know, whether you’re dispensing something that costs thousands of dollars rather than single dollars. And so one other issue I wanted to raise was if all insurance plans were as easy to work with with Medicaid, we’d be in great shape. Because like John mentioned, we have a really good relationship with those folks. We’re able to call them. We can get a hold of someone to remedy a lot of the issues. But what I ran into recently with, with a child on a Friday afternoon was with one of these medications, the trileptal suspension. They were actually covered one of the past plans. So in other words, Medicaid, you know, the state then contracts with these other entities. So you have to deal with another PBM insurance plan instead of Medicaid. Well, it’s almost impossible to get a hold of someone to help with an issue there. So if it were Medicaid and we actually reached out to Medicaid to try to get their, their help to try to get the generic covered because the child was going to have to do with– and we called all over town to try to locate the brand name. We could not do that. And tried to get them this medication so they wouldn’t have to go until Monday. And it took absolutely all day to get a hold. With the help of Medicaid, finally, we were able to get a hold of someone at one of these PASSE plans to get that covered for this child. So you throw a whole new wrinkle into the equation as well when you’re dealing not only with Medicaid, but then these various PASSE entities. But like John mentioned, through my role working with the association as well, I received countless calls from throughout the state from pharmacists who were worried. They’re like, you know, we can understand an inhaler or unit of use products where you’re using one thing. But when you’re dealing with bottles of 100 tablets– and these medications, the doctors will change the strengths and the doses around so often that you’re going to be stuck with a lot of this thousand dollar, these thousand dollar products stuck on your shelf that are simply going to be there unless, you know, you can find someone else to buy it from you. But sometimes that’s impossible in these smaller communities. And so I think that’s one of the issues they had. And I actually received reports from a lot of the pharmacies in these smaller communities where they were like, We just can’t afford to do this. We would rather just give the product away. So in other words, they were just giving them the generic product. And in that case, it helped no one rebate-wise because they were giving it away. So they were not going to stock that brand name and lose, you know, all the dollars through keeping that in stock and actually just gave them the tablets to get them through. So I think that’s, that’s another area that this presents quite a problem, especially in some of these smaller communities.
Vinson [00:14:51] It’s also often that the wholesalers just won’t have it because there’s no other plan that they deliver to that uses these brand name products. It would be a rare situation where a patient might have an allergy to something in a generic pill, which is not very often, but occasionally that happens, but we’ll frequently have wholesaler out of stock. So if it does happen on a Friday afternoon and it’s not during normal business hours, then what do you do? You know, do you loan them a few? Do you, like you said, dispense it for free? There’s not a good way to reach these call centers to get these prior authorizations approved on nights and weekends. It’s only during business hours. And that’s it. What else? Any questions from committee members?
Cooper [00:15:38] I’ll also mention this as well. You know, when you’re talking about the rebate dollars, which we understand that, you know, our state employee plans use that as well, state employees, their insurance plan. And when they use these formulary committees, you know, that decide, first of all, the way that one works is, you know, they decide which is the most effective product, which one are we going to receive the most efficacy from if we use this product? And then after all those things are, you know, all in line, then they’ll say, okay, well then if we farm this off to try to, you know, get rebates back from the drug companies, then which one is more cost effective? But I think in this case, if you can see from, you know, $1,600 for 100 of the brand name versus $6. Unless you’re receiving a 99% rebate, it’s just, it’s kind of hard for us out in the world to kind of grasp that, exactly how that rebate system works.
Vinson [00:16:29] In other words, how could the juice be worth the squeeze? And I know they’re going to come up and explain, but our members don’t understand. You know, if something costs $0.30 or $6, how you could possibly get enough back in savings to make it worth it, you know, like on these most recent examples. Some of the ADHD meds may have been $300 versus $150. And so you could see pretty quickly, if you had a 75% rebate, it might lower the price, $50 or $100. But on lamictal, it’s hard to understand.
Bledsoe [00:16:59] All right. Thank you. We have a couple of questions. Representative Bentley.
Bentley [00:17:06] Thank you, Chairman. Thank you all for being here. So can you just– are you bringing something for us to do today or is this just to make us aware of the situation? I’m sorry if I missed something at the beginning, but exactly what do you want from this body today?
Vinson [00:17:17] So just to clarify, I know Senator Wallace had gotten some calls from pharmacies up in northeast Arkansas, and did you ask for us to bring this forth? Yeah. So I got a call asked to come, you know, to report to the committee on what the issue is. We didn’t have a specific ask. But you want to comment, Senator Wallace?
Bledsoe [00:17:38] Oh, well, I think we–
Vinson [00:17:40] Can we do that?
Bledsoe [00:17:40] Well, I think it needs to be in form of a question. So and then also, ladies and gentlemen of the committee, we’re going to have DHS come up next. And so if you have questions for these three gentlemen, let’s ask them now. But if you would–
Vinson [00:18:00] And I can answer that, Representative Bentley, if I could, Senator. So our, like, our wish would be, you know, in an ideal world, there would not be any brand name medicines that are required when a low cost generic is available. We understand there could be fiscal implications for that, but like, none of the other plans do that, so it makes it hard with Medicaid. Then the second best thing would be to work with DHS to make, you know, point of sale edits available, you know, when, or when you do get a prior authorization, for them to last longer. Those are kind of the asks we would have of DHS if they could do that. But we understand there’s fiscal impacts on both sides.
Bentley [00:18:44] Can I have a quick follow up, chairman, if that’s okay? Real brief. And this really does not have to do with what we have, what we’re talking about today. But I think it’s very important for our constituents to hear from you. I hear in the news and other things that pharmacists are not prescribing emergency contraceptives or that contraceptives are being hard to find. And if you would also follow up with that on the legislation that we passed to allow pharmacies to dispense oral contraceptives because it’s so much in the news. Can you just give us a brief summary of that, Mr. Vinson?
Bledsoe [00:19:09] But I think we’re on– I think maybe that might be off the subject.
Bentley [00:19:18] It is off the subject, but since it’s very much in the news right now, I think our constituents would like to hear from him that they are available and what the process is.
Bledsoe [00:19:24] Let’s wait until the end and then I’ll go back to you.
Bentley [00:19:27] Okay. Thank you.
Bledsoe [00:19:28] All right. Thank you. All right. Senator Wallace, you’re recognized for a question.
Wallace [00:19:48] Thank you, Madam Chair. Do we know what’s being done in the states around us– Missouri, Tennessee?
Vinson [00:20:06] In terms of what other states, so, sir, I don’t I can’t answer on specific states around us. I wasn’t prepared for that. But I do know, I do know it’s common around the country for state Medicaid programs to require brand name drugs when there are generics available if there are significant discounts or rebates that the state can get. I know there have been, there’s debates about whether that’s good policy or not and how that affects a patient’s ability to access the medicine, depending on what drug it is. And, and so it’s always a constant battle of figuring out what makes sense financially when it doesn’t disrupt access.
Wallace [00:20:47] Follow up, Madam Chair?
Bledsoe [00:20:48] Yes.
Wallace [00:20:49] So if you had one ask today, if you had one shot at getting something fixed on this, what would be your top priority?
Vinson [00:20:57] I think that if they’re, if it’s a bottle of, you know, like where it’s not a single use product, it would be ideally not required. So if you have to– like, a Flovent inhaler where it’s a single unit of use and you stock a single inhaler and then you dispense it and there’s none, there’s not $1,000 of drug that you can’t use left on the shelf, that would be a good place to start. And then obviously, like I mentioned a minute ago, an easier way to get a prior authorization approved when a manufacturer or when the wholesaler or the product’s not available, so you don’t have to turn away the patient without medicine.
Wallace [00:21:38] Thank you, sir.
Bledsoe [00:21:41] All right. Representative Cloud.
Cloud [00:21:48] Thank you, Madam Chair. Excuse me. John, you mentioned that the rare possibility of an allergy, you know, with a generic or whatever. Could you all kind of give us a primer and educate us on the chemical composition of a brand versus a generic?
Vinson [00:22:06] Sure. Go ahead, Kyle.
Lomax [00:22:08] So, FDA, there’s a book called the Orange Book. And in that, they’ll have the brand and then the generic equivalent. So my, earlier, I talked about Concerta. Early on, after that product came off patent, there were a few generics that were not therapeutically equivalent. As you get on later into like 2018, you start seeing generic AB what is therapeutically equivalent brand– or generics come on the market multi-source and you start seeing the price come down because you have multiple manufacturers manufacturing a generically equivalent product. And that’s, in most of the cases on where there’s a brand on the generic formulary, I mean brand formulary for Arkansas Medicaid, it’s multi-source. And what we’re seeing in the market is we’re seeing a deflation in prices for generics. But at the same time, we’re seeing an inflation in brand name prices, which is market driven. And but, you know, in smaller town pharmacies, which I’m a part of, you know, one of those drugs that’s branded could represent anywhere from 2 to 5% of your total inventory in one setting and for one patient. And that’s, it can be a struggle when it’s thin margins. So Orange Book and it’s therapeutically equivalent.
Vinson [00:23:33] The other thing we didn’t mention, you know, that’s not directly, you know, access the patient. But the more brand names the pharmacy has stock, the less they’re able to purchase from their wholesalers. In other words, the wholesalers want you to use generics. The state employee program wants us to use generics. And most employer and insurance plans want you to use generics. So the more generics you buy, the bigger discount and better you can purchase your drugs. The more brands you have to stock and buy, the less of a discount the wholesalers will give our pharmacies on buying and making those purchases. Because it’s expensive for the wholesalers to purchase and stock and deliver these brand name drugs as well, especially when 99% of the market is generics for like Lamictal, for example. So it hurts– might help the state, but it hurts the rest of the supply chain. It’s what I’m trying to say. And I think that’s why they’re sometimes out of it and don’t have it because it’s expensive for them.
Cloud [00:24:34] Follow up?
Bledsoe [00:24:35] Yes.
Cloud [00:24:36] So what I’d like to drill down to is the actual chemical composition of the brand versus the generic.
Vinson [00:24:43] So in some cases, the brand and generic have exactly the same chemical composition, meaning the same– like even the, the brand name manufacturer will actually manufacture the generic version, too, and market it separately. If it’s a different company and not the same company, in some cases it may be exactly the same chemical composition. In some cases, there may be something in the bind that binds the pill together that might be a different ingredient than what the brand name has in it. And so if that binding agent in the, in the chemical, somebody is allergic to that, for example, they might have a reaction to that pill where the brand name doesn’t have that binding agent. But the active ingredient that actually causes the therapeutic effect is exactly the same between brand and generic. In terms of absorption, there could be slight differences, but it’s very small, considered negligible in terms of therapeutic effect and how fast it might be absorbed. And that kind of goes back to what did they use to bind it together and how fast does it dissolve in the stomach, if that makes sense. But the active ingredient is exactly the same between a brand and generic.
Cloud [00:25:57] Thank you.
Vinson [00:25:58] Thank you.
Bledsoe [00:25:59] All right, Representative Perry.
Perry [00:26:05] Thank you, Madam Chair. Is there a difference between the name brand and generic for the shelf life as far as expiration date?
Lomax [00:26:26] Manufacturer sets that based on the date it was manufactured. So most of ours, we see about 18 months to 2 years shelf life on, on most of the products. But there shouldn’t be, there shouldn’t be that much a difference as far as between the brand of the generic. The manufacturer just sets it.
Perry [00:26:47] Okay. All right. Thank you.
Bledsoe [00:26:48] All right. Representative Payton.
Payton [00:26:52] Thank you, Madam Chair. So based on the work of this body a couple of years ago, regarding the insulin rebates and and how these rebate programs work, the Arkansas attorney general has entered suit under the Arkansas Unfair Trade Practices Act, and it seems that these rebates also would violate antitrust laws and border on collusion. It’s quite possible that in the coming months we’ll see a resolution in that case. Do you see any of these? A very similar situation, it sounds like to me. Do you, do you see any need that these should be included– these companies and these products should be included in that litigation?
Vinson [00:27:43] Thanks for that question, Rep. Payton. I do– I am aware of that lawsuit. And I know the Federal Trade Commission is also looking at this right now and threatening legal action in terms of the private market, you know, in terms of the private PBMs and the private industry. I have not heard that they’ve looked into it with Medicaid yet. And I know you asked, do I think they should? I’d like to– I’d love to hear their presentation on how this works and, and why they pursue these. You know, they’re up next.
Payton [00:28:18] So I guess my real question is Arkansas Code, which I can’t quote this chapter and verse, actually addresses rebates as an unfair trade practice when they’re unearned rebates. And the idea is that the manufacturer and the middlemen, whether it be PBMs or whoever, use rebates to capture market and fix prices in a way that becomes an unfair, unfair trade practice. I’d hate to find out that DHS or Medicare or Medicaid, the state of Arkansas, is participating in a rebate scheme that borders on unfair trade practices, which seems to be affecting our suppliers at the retail level. So if, if any of this seems very similar to what has been happening in the insulin market, I’d like to get a list of those, a complete list of those drugs and manufacturers. But I’d hate to think that Medicare and Medicaid and Arkansas DHS would be participating in unfair trade practices. Thank you.
Bledsoe [00:29:33] All right. Representative Wing, you’re recognized for a question.
Wing [00:29:37] Thank you, Madam Chair. I wanted to go back to the generics. Is there a list where the consumer can see which generics are identical, and if there are differences between the generics and the name brand, what those differences may be just for each individual drug so that they can know, because that can be quite confusing for a lot of the consumers?
Lomax [00:30:01] FDA publishes an online resource called the Orange Book. And that’s where all the professional pharmacists look and see where the equivalency ratings are. It’s, it’s online and you can access it at any time.
Wing [00:30:16] So any consumer can go look at the Orange Book and that will tell them exactly here’s the name drug, and here’s the generic, this is identical, or it might be different, but it might be, like you said, the binding agent or whatever?
Lomax [00:30:30] There’s, yeah when you do the search, it’ll tell you the manufacturer and if it’s AB rated, which they would consider therapeutically equivalent.
Wing [00:30:38] Okay, great. Thank you very much.
Bledsoe [00:30:40] All right. We’re going to have– I’m going to let Representative Bentley ask the question that you wanted to ask about the birth control. Okay, wait a minute. All right. Let’s, let me go to Chairman Ladyman and then we’ll go back to Representative Bentley. You’re recognized.
Ladyman [00:31:02] I’ve got questions about the process, and maybe DHS when they come up, this might be for them. But, but I’d like to get your opinion. So who, who makes the decision that we have to use the brand name? I think somebody mentioned the committee a while ago. I mean, that’s, that’s Medicaid, I understand. But who does that? And is that state by state? Do you understand my question?
Vinson [00:31:31] I do understand the question and I would defer to DHS because they’ll be able to explain exactly how that works.
Ladyman [00:31:38] Okay.
Vinson [00:31:39] And it does vary state to state. Yes. But they’ll be able to answer better.
Ladyman [00:31:44] Okay. Follow up, if I may? On the rebates– so I’ll ask the pharmacist here, you don’t see anything about the rebate. How do you know the cost of this? I mean, do you pay for this drug when you get it? Or how does that work?
Vinson [00:32:05] What our pharmacies know is what the wholesalers charge the pharmacies. So they see that on their invoice. They can see it in their ordering system, what it’s going to cost. And then they pay whatever that price is that the wholesaler offers. They can look to secondary wholesalers and to other wholesalers to try to find a better price, and they often do. They always try to get the best price. And the better price they purchase at, the lower that NADAC value is because it’s a reflection of the true average purchase price across all the pharmacies averaged out done by a national accounting firm. But the rebate side and whether or not they get a 50% or 75% or 99% and whether or not it’s better for the state or not, none of that is visible to us. We’re just trusting that that’s really the best thing for the state financially because, you know, that’s the decision they make, and there’s very smart people sitting out in the audience. They’re going to come up and present in a minute. But it’s not, you know, it’s not clear or transparent to the consumer that that really is a cost savings for the state.
Ladyman [00:33:14] So when you order Lamictal, you pay $1,620?
Cooper [00:33:21] Like I mentioned before, the NADAC is kind of an average. Some pharmacies may be paying a little more than that and some may pay $1,640–
Ladyman [00:33:28] But you pay that?
Cooper [00:33:30] Yes, we pay that when we purchase the bottle. Yes.
Ladyman [00:33:33] So does the rebate come back to you then?
Cooper [00:33:37] No. If you’re speaking of the Medicaid rebates, then that goes back–
Vinson [00:33:41] So for example, on Lamictal 100 milligrams, I’m just picking one, a bottle of 100. If if the pharmacy really pays $1,620.51 or a little less or a little more, within $5 either side, and then they might dispense a 30 count or a 60 count– so they’re not even dispensing the full amount– and then they may be reimbursed– and I’m just pulling a number to be easy here, $1,000 plus a $10 dispensing fee. So they really are reimbursed close to what they paid for it, plus a dispensing fee from Medicaid. But then they may have another $500 sitting there that never gets used if that patient’s dose changes or there’s no other patient on it. If they happen to have a lot of patients on it, it’s not as big a deal because it moves and it turns over. But still, you’re having to purchase a brand name drug that cost thousands, you know, $1,600 versus $10 to stock it.
Ladyman [00:34:42] So, so I just want to make sure that the issue here is just the inventory, the cost that you carry, and then if you have to dispose of that because it’s outdated.
Vinson [00:34:51] Correct.
Ladyman [00:34:52] Then that’s a cost to your bottom line, is that correct? So, I mean, this is a big problem. I have two pharmacists in my district who told me they give out the generic free and that’s less cost to them. So it’s a big issue. Thank you.
Bledsoe [00:35:13] All right. There are no other questions. But Representative Bentley, if you would like to ask your question now about the–
Bentley [00:35:22] Thank you, Chairman. Just because it’s been in the news so much because of recent rulings on Roe versus Wade, we’ve heard that some pharmacies are not dispensing contraceptive emergency contraceptives. Can you dispel that or have you heard that at all? Just because it’s been in the news? And the other thing is if you’ll just update where we are on the legislation we passed to allow you guys to dispense contraceptives. If you can just update those things quickly for our constituents, I’d appreciate it.
Vinson [00:35:48] Emergency emergency contraception or Plan B, which is hormonal contraception over the counter, and there’s several– Plan B is one brand name. There’s like ten or 11 other generic names for that. But it’s levonorgestrel. Initially, the media incorrectly put out statements. I don’t want to name who it is, but I mean, there was misinformation in both Missouri and Arkansas on whether or not that was legal. In fact, the media said it was illegal. It is our understanding that it is not illegal because it’s contraception. And the state law that was passed in 2019 allows an exception for contraception. So we are educating our members that it is legal in the state. Of course, talk to your own attorney. But our understanding is that it’s legal. I know that the state has been working on some language around that to share with the State Medical Society and Pharmacy Association and some others. I have not seen anything yet that we can distribute, but we’d love to have an official position on it from the state. It has been, in some cases, temporarily out of stock from wholesalers, but that’s been not very often. Are you able to– are you hearing about anything in Northeast Arkansas that people are able to get it?
Lomax [00:37:08] I have not had anybody say there’s been a supply chain issue at all.
Vinson [00:37:12] It’s been rare, but I have heard a couple of times where that was an issue. But my understanding is our members are providing it or it’s available out in community pharmacies.
Bledsoe [00:37:26] All right.
Vinson [00:37:26] Thank you for that question.
Bledsoe [00:37:28] All right, ladies and gentlemen, we are going on with the second part of the program. Mr. White and Elizabeth Pitman. If you would, come to the table, please. Please recognize yourself.
White [00:38:03] Thank you Madam Chair. Mark White, Department of Human Services.
Pitman [00:38:06] Elizabeth Pitman, Division of Medical Services.
Bledsoe [00:38:08] All right, you’re recognized.
Pitman [00:38:10] Do you want me to begin? I don’t want to repeat what Mr. Vinson and the other gentleman said. They were very accurate, and they were correct. We do have a very good working relationship with them. We have actually spoke on this issue several times. But just to give you a brief overview of the process and to your question, Representative Ladyman, we do have a drug review committee that establishes our PDL, our preferred drug list. It is made up of state pharmacists and physicians. It does have a DHS representative on it as well. We’re there. Our Magellan contractor is there as well. But these pharmacists and physicians actually review each class of medication. And this Lamictal is in what we call the anticonvulsant class, which I’m not a pharmacist or doctor so I won’t get too detailed on that, but they review that class for and they look at the drugs for efficacy, the clinical appropriateness of the drugs and make recommendations to us. And so they don’t just use one drug in a class, they’ll choose multiple if that’s appropriate. And they make those recommendations to us, and then we adopt those, and we then look at price. So that the DRC, Drug Review Committee, does not look at price at all. So that first level of review is not considering that. That’s really considering clinical efficacy because of the proprietary rules by the federal government, we can’t really share any of the actual pricing information with that DRC. So they don’t get the rebate offers or anything like that. That’s something that we look at internally. We do not generally overturn their recommendations. But if their recommendation is to choose the drugs within the class based on what’s most cost effective for the state, then that’s what we do. And so that’s sort of how the process works. It’s a very brief overview. If you have more detailed questions, I do have someone here from the pharmacy program who can help answer those.
Bledsoe [00:39:56] Could you pull your microphone–
Pitman [00:39:57] Sure. I’m sorry. I have a very soft voice, so just tell me to speak up. And so that’s how the overview of the process works. In this particular instance, we do receive a fairly significant federal rebate, and Mr. Vinson explained that very well. So the pharmacist buys it at their wholesale cost and we reimburse them at that average or NADAC cost that they went through. We don’t– we claim the federal rebate every quarter when we report to CMS what our drug expenditures were and they give us that money back. And so that’s how the state realizes that savings is that it’s a return from the federal government based on those rebate agreements that we enter into on a quarterly basis and it goes back into the Medicaid accounts. So that’s how the rebate process works. So, and they also went through that there’s several different types of rebates. But once you factor in all of those rebates, if we actually used the name brand of this class in every case– which I’ll go through how we don’t actually require that here in a minute– but we would actually look at, just for this class, about $1 million in savings a year. So that’s what the federal rebate is getting us. Now, that being said, we do realize that there are some reasons that you don’t want to use that name brand clinically. There can be some clinical reasons like they described, that some allergies may exist or some other factors. But there can also be some stocking issues, some market issues. If you can’t find the drug or if it’s very unrealistic to stock it on your shelves, we do allow for a pharmacist to call and get a prior authorization. Generally, that process is pretty easy. We have a voice response system. It is, it is only open Monday through Friday 8 to 4:30, but we usually can issue a prior authorization within a couple of minutes. If you have any problems with that during that time and you had any issues getting that, we ask that you ask you escalate that to our program, because that is actually run through Magellan, our vendor. That’s who runs the call center. So if for any reason you have any issues with Magellan in that prior authorization process, please escalate that to my staff and they can help work with that. We are looking at right now, we do refills on a every 30 day basis. So prior authorization every 30 days, we are looking at whether or not that’s realistic in this case, and, and we do allow for some longer prior authorizations. Happy to talk to Mr. Vinson about how to work that out. We can even go up to a year. I mean I just spoke with Miss Neuhofel about that, so I did get that confirmed. So please have pharmacists that are having problems reach out to us so that we can work with them through that process, and so that way we can take into consideration low volume pharmacies, like a lot of independent pharmacies that are here testifying today that maybe do not have a lot of clients who use Lamictal. So they can’t– they stock a 100-pill bottle and they may only prescribe 30 or 60, and so they, they end up throwing some away. That’s not appropriate. And we do want to offer those pharmacist PA’s versus your chain pharmacies, your Walmarts, your targets, where they can, they can stock and supply that name brand and we can realize that savings. So we do want to work with the independent pharmacies so that they’re able to get those prior authorizations. Miss Neuhoful, I think was working with Mr. Vinson on helping issue a statement around this issue to all of his members so that they understand that process and how to take advantage of it and how to escalate it if they have any problems. I’m happy to take any questions.
White [00:43:13] And Madam Chair if I can just add one additional piece just to be very clear. Although we as a state, we do have authority to pursue agreements with manufacturers around rebates, most of the rebates are negotiated by the federal government. In fact, that’s what typically triggers Medicaid coverage of a drug is when CMS negotiates that rebate with that manufacturer and then they make that available at the states. So I just want to be clear about that. This is a very– an area where it’s very– the federal government is very heavily involved. And we receive the benefit of that, but also sometimes the headaches from that as well.
Bledsoe [00:43:46] All right. Go ahead.
Pitman [00:43:48] Well, I was just going to say, to add to that, if we do have a state preferred brand, we do have to report that to CMS. So if we enter into our own rebate, we report that to CMS as well, and that’s required.
Bledsoe [00:43:58] All right, Chairman Ladyman.
Ladyman [00:44:00] So just to be clear, I think what I heard you say, in layman’s terms here– so this Lamictal situation, so a druggist or pharmacist can actually request to use the generic and you all can approve that on an individual basis.
Pitman [00:44:24] Yes, sir.
Ladyman [00:44:25] Okay. One other question. When you talk about the rebates, these are not approved individually, but they’re approved by groups?
Pitman [00:44:36] So the rebate is entered into with a manufacturer of the drug. So we enter into– I can’t think of the name of the drug manufacturer, but the maker of Lamictal is who are entering into that rebate agreement. And they’re the one– and then we claim that rebate. The federal government enters into some–
Ladyman [00:44:54] What I’m talking about is the process that you talked about where you get approval to use the generic or the name brand–
Pitman [00:45:03] Yes, sir.
Ladyman [00:45:04] –that’s not on an individual drug basis. In other words, your rebate is based on a volume of drugs that are close in a family or whatever.
Pitman [00:45:12] I think I understand. So if I don’t, please let me know so I can clarify. So we look at a class of drugs when we’re deciding what to fit on the PDL and what not to. So for example, ADHD, any medication that is used to treat ADHD, and for that example, specifically, there’s short acting and long acting. And our physician representative was very adamant that we had to have a long acting agent on our PDL. So we have both short acting and long acting agents regardless of price, right? We had to have both of those on even if one is cheaper than the other. So we choose based on that what types of drugs to put on our PDL. If, if everything’s equivalent within that class of drugs, then we look at how much rebate or how much money it’s going to cost the state to use which drug. And that is done on a drug by drug basis, not– but when we look at what to cover, it’s done as a group.
Ladyman [00:46:05] Okay. Thank you.
Pitman [00:46:06] You’re welcome.
Bledsoe [00:46:10] Representative Payton, you’re recognized for a question.
Payton [00:46:13] Thank you, Madam Chair. So when you submit a budget, where do these rebates– where’s this income show up in your budget? I mean, does it come in unexpected and unregulated or do you project it in your budget? Because I don’t remember ever seeing that line in the budget.
Pitman [00:46:33] It’s not a separate line in the budget, but we do project it when we do our pharmacy projections, we do consider. So we know how much money we’re going to have to pay out, but we do consider in our total budget how much money we’re going to get back in rebates.
Payton [00:46:46] So I guess what kind of oversight is on what’s coming in, what’s expected, whether or not we get what we expect? And then what oversight does– I mean, when you spend that money, is it under the normal appropriation process?
Pitman [00:46:59] Yes, sir, it is. And CMS governs our rebate agreements and all of that pretty, pretty tightly, as Mr. White explained.
Payton [00:47:07] Okay. If I could have a follow up, Madam Chair? I guess, how do you, how do you find out how your rebate percentage is comparative to, say, insurance companies? Because I know in the insulin thing that I became very familiar with, you know, Wal-Mart was able to negotiate an 85% rebate and our state plans were only getting 60%. So how do you know if you’re doing a good job on negotiating those rebates?
Pitman [00:47:38] So I don’t know much about the insulin lawsuit because we’re not governed by the insurance regulations, so we’re actually not a part of that lawsuit. So I can’t speak to that very well. I do know Miss Neuhofel was telling me while we were in the audience that we get some insulin products for basically no, no money. So we’re paying nothing. So we get fairly significant rebates on insulin products. So I think we’re doing fairly well comparatively. I don’t know exactly. We may be able to find out, but I can’t tell you right now.
White [00:48:05] And I would add that, Representative Payton, we, we may not have a lot of visibility into what rebates are being paid to the insurance companies since these rebates on the Medicaid side are primarily negotiated at the federal level. But with that said, we did do a rule change that came through you all a few months back, it does allow us to partner with other states. So if one of the states finds out that there is an opportunity there to pursue, then we can join as a group of states and get better value.
Payton [00:48:33] Okay. Thank you, Madam Chair.
Bledsoe [00:48:35] Thank you. Senator Wallace, you’re recognized for a question.
Wallace [00:48:40] Thank you, Madam Chair. Miss Pittman, first of all, thank you. You’ve always been, anytime I talk or work with you, you’ve been great to work with. So I want to thank you for that and recognize you for that. Now I’m looking at Exhibit D and if I understand what you’re saying is, on every drug and on this sheet, that if a pharmacist would call for a prior authorization, then we could use the generic.
Pitman [00:49:10] Yes, sir.
Wallace [00:49:11] Okay, Madam Chair, if I could, I’d like to get perhaps Mr. Vinson to comment on that. And I want to hear their, their comments on how difficult that is from the user point of view.
Bledsoe [00:49:27] All right, Mr. Vinson, if you’d come back to the table, please.
Wallace [00:49:33] And then I have a follow up after that.
Bledsoe [00:49:35] All right. Please identify yourself again for the record.
Vinson [00:49:40] John Vinson, CEO of the Arkansas Pharmacists Association.
Bledsoe [00:49:45] You’re recognized.
Vinson [00:49:46] Thank you, Madam Chair. To get the prior authorizations, if it is with Medicaid and through Magellan and during business hours, it’s pretty easy to do, especially if they’re allowing more than the 30 day and you’re allowing a, you know, six month to a year. It is still pretty difficult right now with the PASSEs, you know, the four PASSEs. It’s more difficult because they, they all have their own PBM and their own process. It’s more challenging. That’s something we’ll have to work on with the PASSEs to make it more streamlined. But if it’s on a weekend or after hours, then it’s very difficult. If there’s not a point of sale override or ability, you know, in place, then it’s difficult after hours.
Bledsoe [00:50:34] All right. Does that answer your question, Senator?
Wallace [00:50:36] Well, it brings up another one for me.
Bledsoe [00:50:39] All right. Go ahead.
Wallace [00:50:40] So it sounds like our issue is not so much with Medicaid as it is with the PASSE program.
Vinson [00:50:48] It’s a little bit of both. I mean, it’s– during business hours with the PASSEs, there’s an issue, and certainly after hours it is hard, like in the example Brandon shared with Trileptal, where the brand name seizure medicine’s not available from the manufacturer and it’s a Friday afternoon. You know, do you, on good faith, dispense it for free because that patient certainly doesn’t have $100 out of pocket to spend. They just don’t. And so that, you know, without having a point of sale override or some ability to do that at 6:00 on Friday or 8:00 in the morning on a Saturday, then it’s not easy with Medicaid either, just to be clear. It’s better with Medicaid, but in certain instances it’s difficult, especially after hours.
Wallace [00:51:36] Madam Chairman, I’m just wondering if there’s anybody here from any of the PASSE programs that could address that.
Bledsoe [00:51:43] I don’t see anyone, but we will be meeting in August, on August 8 at 10:00, and we could have maybe someone there.
Wallace [00:51:56] I would appreciate that.
Bledsoe [00:51:56] All right.
Vinson [00:51:57] And Cynthia did provide us some great email addresses and phone numbers and a way to hopefully streamline that that we didn’t have before that’s going to help improve on that from DHS, Cynthia Neuhofel, Director of Pharmacy. So we’re continuing to work on it, Senator.
Wallace [00:52:15] Thank you, sir.
Vinson [00:52:16] Thank you.
Bledsoe [00:52:16] All right. Thank you. All right, Representative Bentley.
Bentley [00:52:23] Thank you, Chairman. Just real quickly, can you just give me an average what you get monthly in rebates on the CMS end.
Pitman [00:52:34] We claim rebates quarterly, and I don’t have that number. But we can, we can get you an average.
Bentley [00:52:39] Thank you.
Bledsoe [00:52:41] All right, ladies and gentlemen, I see no other questions. We thank you for being here and for the discussion. And again, we will be discussing Item E in our next public health meeting. All right. We’re going to Item F. And Mr. Price has a handout and Mark– Mr. White and Ms. Pittman will be sitting where they are. Delay your leaving.
White [00:53:17] Thank you, Madam Chair. Again, Mark White, DHS. We’ve got a handout has some more information for you, but we’ll give just a brief walkthrough. We were asked to talk about the status of rate reviews for psychiatric residential treatment facilities or PRTFs. Of course, just a little bit of background, which I’m sure that most all of you know, we’ve been engaged in the process for the last couple of years of reviewing all Medicaid provider rates. That’s what the governor directed by executive order back in 2019. Since then, we’ve been working through it for each one of the 95 provider types. We look at their rates to see if it needs to be updated and then make corresponding updates for those rates. We’re in the last round of getting everything finalized. We intend to have all of those rate reviews completed through the end of this year. We’ve been looking at all of the behavioral health entities, trying to look to them together so that we come up with rates that are consistent across that behavioral health system. And so we’ve been working through that. I’ll let Miss Pitman talk in more detail about where we are on PTFS specifically.
Pitman [00:54:24] Thank you. So we actually had our first kickoff work group with all provider stakeholders last Wednesday, June 29. We presented a lot of the slides that you have here today to that work group. And within that slide deck you see the timeline for completing this. So we are working with a vendor, Milliman, who was our actuary, and they brought in some experts in the behavioral health space to help us with this. And we are working with stakeholder groups. So we’re looking at each of those provider types that Mr. White just went through for behavioral health services being actively involved. For PRTFs, this means all 13 PRTFs– I believe it’s 13– will, will be involved. So each one of those PRTF providers will be involved in this. We will conduct all the stakeholder webinars through the next month, so through July of 2022. Like I said, we kicked off last week and will complete those groups this next month. We’ve gotten cost surveys that we had sent out previously. We’ve grouped those together. We’re going to look through those and then we’ll work to develop the comparison rate assumptions and draft rates through the month of September. And then in October and November, we’ll work with that stakeholder group again to finalize that draft report and recommendation. And so that is the process that we’re going through and happy to answer any questions about it.
Bledsoe [00:55:43] All right. Thank you. Any questions from the committee? All right. Representative Bentley.
Bentley [00:55:51] Thank you. Thank you, chairman. Are you going to look at maybe making this retroactive to the beginning of the fiscal year since this is going of take a little while, sounds like here for this rate review.
Pitman [00:56:00] We can look at retroactive options based on what the rate is. So we’ll need to see what the actuaries say about it. We have some options. I don’t know if all the way back to the fiscal year will be possible based on what they provide and based on what CMS will allow. There’s also some requirements around notice, that you have to give the notice prior to the date that the rate’s effective and in most mechanisms with CMS. So we may have some limitations there, but we can definitely look at what options are available that are appropriate for retroactive rates.
White [00:56:27] And if I can just add, we have had a couple of situations in the past where we have gone back farther. We’ve been able to use some flexibilities that CMS made available as a result of the pandemic. Those are starting to come to a close. And so that is narrowing our options for retroactive payments. But I just want, just since I know it’s happened in some other instances, I just want to be clear that that’s an opportunity we may not have going forward.
Pitman [00:56:48] And to follow up on that, when we have done that, we’ve had some form of actuarial studies saying it’s appropriate to retro that rate back. For example, the therapeutic community ones we just did that, the actuaries had actually said back in October of last year that that was appropriate. So we were able to carry it that far. So CMS does actually look at the appropriateness of the rate that you’re, that you’re asking for as well as what they allow. So we’ll look at both pieces. But if retroactivity is appropriate, we will pursue it.
Bentley [00:57:16] So one just real brief follow up, Chairman?
Bledsoe [00:57:19] Yes.
Bentley [00:57:19] Do we have, we do have a number that you’re looking at at all right now as far as increase? Just real brief, if you’re looking at any number at this point, do we have anything?
Pitman [00:57:27] We don’t have a specific number in mind. We are looking at a per diem, and I believe that’s also in your slide deck, continuing to pay on a per diem basis. So we’re looking at the cost. We’re also looking at something called comparison rates, which are often used in managed care programs because these PRTF services are primarily PASSE services. So comparison rates allow for quality and effectiveness of the service as well as acuity of the member to be considered in setting those rates by the managed care entity. So basically Medicaid comes in and says this is a good negotiating starting point for the rate and the PASSEs can use that from there.
Bentley [00:58:01] Okay. Thank you, Chairman. I appreciate it.
Bledsoe [00:58:03] All right. Senator Sullivan, you’re recognized for a question.
Sullivan [00:58:08] Thank you, Madam Chair. You know, we heard this a while back, we’re going to take something into consideration in response to people. So when we talk about being retroactive payments, I’m not real comfortable with we’re going to take it into consideration. You think it’s deserved or not deserved?
Pitman [00:58:29] I mean, I don’t want to say whether it’s deserved or not deserved. We’ll look at all of the information provided.
Sullivan [00:58:34] Yeah, we’re going to take it into consideration is what I’m hearing you saying. I think, you know, the cost for these folks– they’re, they’re, they’re they’re paying these costs right now. And I think it would be my consideration that they deserve some sort of consideration for those past occurrences. So that’s your opinion, this is my opinion. It sounds from the, the timeline that you gave about these monthly updates, would it be appropriate to say by our meeting in December that you’ll have finalized this? And if not, why not?
Pitman [00:59:11] If not, we’ve gotten off the timeline because that is the plan is to have a final report by December.
Sullivan [00:59:16] Okay. So you’ll meet as frequently as you need to meet–
Pitman [00:59:19] Yes, sir.
Sullivan [00:59:19] –in order to hammer this out by December, our December meeting. Okay. Thank you, Madam Chair. Thank you.
Bledsoe [00:59:25] All right, thank you. Any other questions from the committee? All right, seeing none, thank you so much.
White [00:59:31] Thank you.
Bledsoe [00:59:32] All right, ladies and gentlemen, going down the agenda to Item G. Michael McCallister and Daniel Pilkington, would you please come to the table? And if you would, introduce yourselves for the record.
McAlister [01:00:04] Good morning. I’m Michael McAlister. I’m the managing attorney at the Department of Energy and Environment.
Pilkington [01:00:11] Good morning. My name is Daniel Pilkington. I’m an attorney at the Arkansas Department of Energy and Environment, Division of Environmental Quality.
Bledsoe [01:00:18] All right. Thank you. You’re recognized.
McAlister [01:00:20] Thank you. We’re here this morning for review of a Pollution Control and Ecology Commission Rule 27. This is an update to that rule. It has been through the rulemaking process with the commission. They initiated the rulemaking. It went to public notice and comment. This rule is to– this changes to update the rule to reflect some changes from previous legislative sessions about the authority of environmental officers and also for wastewater operator licensing issues. And that’s been through the process, and we’ll go after review here to ALC before the end of the month for final approval. And we’re here for that review.
Pilkington [01:01:18] Just to clarify, the changes were for the environmental officer program and the solid waste licensing changes–
Bledsoe [01:01:24] All right.
Pilkington [01:01:25] –instead of wastewater.
McAlister [01:01:25] I’m sorry, I misspoke. Solid waste license operator.
Bledsoe [01:01:30] All right. Representative Payton, you’re recognized for a question.
Payton [01:01:34] Thank you, Madam Chair. So it seems that the environmental officers being given policing authorities to issue citations, how much of that authority do they already have to issue citations? Or, or does this include entering premises and investigation? What is it?
Pilkington [01:01:57] Previously before the changes that were made that are addressed here, they had authority to cite people for violations of environmental laws. That was very specifically defined. This change actually addresses an expansion of what they can cite people for from a compliance standpoint. It includes things like open burning and things that were not previously in the definition. So they have an expanded role in what they can do from an enforcement standpoint. However, they have not been given any rights or authorities that go beyond what they can do as an officer. They’re not an actual law enforcement officer. They’re not allowed to carry a firearm. They’re allowed to do certain things through a warrant process that we have, but they have not really expanded upon that further.
Payton [01:02:41] So if I may, what all comes under the definition of open burning?
Pilkington [01:02:47] Most of the time, the reason why the program was originally created was to deal with open dumps. For instance, if you see a big pile of solid waste that is illegally disposed, what they’re supposed to do is to try to make sure through the citation enforcement process that those illegal dumps are remediated and cleaned up.
Payton [01:03:06] Okay. I’ll go back in the queue if I get another question. Thank you, Madam Chair.
Bledsoe [01:03:11] All right. Thank you. All right, Representative Dotson.
Dotson [01:03:17] Thank you, Madam Chair. So were these rules a result of the, the acts that were passed to require the expansion of their citation authority?
Pilkington [01:03:31] Yes. Part of the changes dealt with the expansion of the environmental officer’s authority to issue citations. Yes.
Dotson [01:03:37] And that was part of the legislation that was passed?
Pilkington [01:03:39] That’s correct. Yes.
Dotson [01:03:41] Thank you.
Bledsoe [01:03:42] Any other questions? All right, seeing none, without objection, this rule stands as reviewed. Thank you for being here. Ladies and gentlemen, going on, we have Item H. And we’ll have Mr. White and Melissa Weatherton back. We’ll have you back. If you would identify yourself for the record again and Miss Weatherton. You as well, please. Thank you.
White [01:04:22] Thank you, Madam Chair. Mark White, Department of Human Services.
Weatherton [01:04:25] Hi. Good morning. Melissa Weatherton, director for Developmental Disability Services.
Bledsoe [01:04:30] You’re recognized.
Weatherton [01:04:31] Thank you. So today I’m here to explain what we are trying to do on transportation for our adult day treatment facilities and our early intervention day treatment facilities. We have two types of transportation that run children and adults to and from these clinics every day. The providers can choose whether or not to use contracts we have in place with brokers or they can own and operate their own vans and be reimbursed for, for that transportation cost to them. For many, many years, for as long as I’ve been in this position, the transportation, if you owned and operated your own vehicles, was based on a methodology called loaded mile, which meant when someone loaded the van, the very first person to get on, we considered the van to be loaded. And at that point, no matter how many miles you drove or how many people you picked up, you were paid based on that loaded person. And so in ’19, in 2019, they were paid $1.80 a loaded mile, and we went in and immediately adjusted it up to $2.09 back at that time in an effort to give them some financial relief. But we wanted to go forward with a more comprehensive rate review, which we have now done. And we are changing the methodology in which they are paid to more closely resemble the other ways we pay transportation, which is on a per person, per mile basis. That’s what the contracts for the brokers are paid for doing this service to and from these clinics. So we want to mimic that. So we are here today– we had to change the methodology in the state plan pages and then we also had to change the, the language in the manuals for these types of clinics. And it is a substantial increase, as you will see, by changing it from a loaded mile to a per person per mile. And it’s about a 75% increase to their transportation cost. The providers we’ve had conversations with are extremely satisfied and feel like that they are now able to not lose money on their transportation when they take their children and adults to and from these clinics. I think some of them are here today in support. In addition to that, we did go in and make several just grammatical edits and clarifications while we had the manuals open. And so those were also in this package that was brought before you today. And I’m happy to answer any questions.
Bledsoe [01:07:17] All right, any questions from the committee? All right. Seeing none, without objection, we will–
Weatherton [01:07:28] Thank you.
Bledsoe [01:07:31] This rule stands as reviewed. All right. And next, we have Item I. We have not only Mr. White, but we have Miss Pitman again. Just identify yourself for the record, and we will let you get started.
Pitman [01:07:56] Elizabeth Pitman, Division of Medical Services.
Bledsoe [01:07:58] Okay.
Pitman [01:08:00] We’re here today to present the rule updates to the cost reporting manual for skilled nursing facilities. As you can see from the summary, quite a few changes were made. A lot of those were clarifying changes. We worked with the Arkansas Health Care Alliance, I believe, that group to do these changes. And if you can tell from the comments, they are all, they are in agreement with them. We are also about to start a second round to go through some other things that they did not feel were as crucial to get done within this timeframe but are important. And so we’ll be working on them in round two. Some of the major changes that we did agree on with that association and implement for an August 1 start date include a change to how we do the per bed value. So we’re now have three definitions of the types of residence rooms, and we’ve increased the per bed value to incentivize private or semi-private rooms. If you have the old community style room, the per bed value did not increase. And so we are trying to incentivize really private and semi-private rooms in light of the pandemic and the health concerns that were raised by that. We changed the filing timeline, extended it out so that facilities have longer to file their cost reports at the end of every year. We changed from rebasing every three years to rebasing annually. We also adjusted the minor equipment maximum allowed. It had been 500 for 20 years. We’ve taken that to 2,500, and we’re going to look at that and see if it needs to increase further over the next year. We have decreased the minimum occupancy rate, which was actually something we did, I believe through– we had done it earlier through an ARPA proposal or a ARES– I can’t remember, but we had done it earlier and we’re putting that in place permanently at 65% with an increase every, every year by 5% until we get back up to 75%. It was in the 80’s before. So this is an overall drop, but we do want to get it back up to where it needs to be. But we realize that due to the pandemic, there have been some market issues and we’ve adjusted that downward. And let’s see, we’ve also allowed them to include medication assisted salaries as direct care workers. So these are some of the major changes that we’ve done within that manual. As you can tell, there’s quite a few other things to make sure those things were effectuated and to clarify some of the older language. And happy to answer any questions.
Bledsoe [01:10:21] All right, ladies and gentlemen, do you have any questions?
Ladyman [01:10:25] So a lot of these were due to things that were done during the pandemic, like dropping the percent of occupancy and some were in place?
Pitman [01:10:33] Yes, a lot of these, a lot of these were done because we just have not updated this cost manual in 20 years. And it really needed to be updated to align with current market practices. Some of them were to reflect things we did learn during the pandemic. So the minimum occupancy, for example, nursing homes have just not had as many residents coming in and have not been able to meet those minimum occupancy thresholds. So we wanted to drop that for the pandemic, but we all realize that it needed to come back up. So we’re going to gradually raise it back up as the pandemic ends.
Ladyman [01:11:01] Thank you.
Bledsoe [01:11:02] All right. Representative Bentley, you’re recognized for a question.
Bentley [01:11:11] Thank you, Chairman. Just on the equipment line, we’re going from $300 to $2,500 dollars. So, we’re going to do another review on that? Because I know some of my constituents are having a tough time with even the $2,500 to pay for oxygen equipment and various other things. So when do we expect to look at that again? I know you said–
Pitman [01:11:29] We’re starting that, I think, now. I think it’s already started, the second round of look. And I believe Medicare goes up to $5,000. But we really couldn’t get a good estimate of what that would look like for providers just because of how this works. So we all agreed to meet at $2,500 for a short period of time, kind of see how that played out. And then we’re going to look at whether or not that is actually enough. Okay.
Bentley [01:11:51] And one other follow up quick, Chairman? I had a constituent call me this week who was injured at 28, was in a nursing home, and that was quite a few years ago and was receiving $40 a month after all, you know, their– Medicaid takes all their money to pay for the, for the bed in the nursing home. And so that was, I think it was 20 years ago they were getting $40 a month to have expenses, whatever they want to get their hair done or whatever with the $40. So now it’s still 20 years later, it’s still $40 a month. So is there anything we can look at for them? Because I know, just to get a haircut 20 years ago, it’s a little more expensive now than it was then. So and I don’t know how the funding works on that, so I just take this opportunity to ask if that’s okay.
White [01:12:28] I will have go back and double check that. My memory is that that personal allowance amount is set by federal law, but I’ll confirm that and let you know for sure if there is an option there for us with that.
Bentley [01:12:40] Thank you. Thank you, Chairman, for the lenience. I appreciate it.
Bledsoe [01:12:43] All right. Any other questions? Seeing none, without objection, this rule stands as reviewed. Thank you very much.
White [01:12:50] Thank you.
Bledsoe [01:12:50] All right. Ladies and gentlemen, going on down to J, we have Matt Gilmore and Charles Carter. If you’d come to the table, please. If you would introduce yourself for the record.
Gilmore [01:13:23] Thank you, Madam Chair. Matt Gilmore. Mr. Carter couldn’t be here today.
Bledsoe [01:13:26] All right. You are recognized.
Gilmore [01:13:29] Thank you, Committee. These are the rules for the Board of Examiners in Speech, Language, Pathology and Audiology. Most of the changes are due to legislation. There was changes around Act 725 from 2021 regarding the fee waivers for eligible individuals. There was changes around Act 135 regarding the continuing education requirements. There was also Acts 748 and 829 due to telemedicine. Some changes were made there. Also made some changes around the assistance and some flexibility for them as far as their licensure process. But happy to take any questions. We got some comments. We addressed those. Be happy to take any questions that I can.
Bledsoe [01:14:08] All right, Committee, do you have any questions? All right. Seeing none, without objection, this rule stands as reviewed.
Gilmore [01:14:17] Thank you.
Bledsoe [01:14:20] All right, K. We have Paula Day and Chuck Thompson.
Thompson [01:14:34] Good morning, Members. Madam Chair. Charles Thompson, Arkansas Department of Health. Mr. Gilmore’s up here assisting. We can get Miss Day if we go into substantive matters into the health safety issues. But really, what you all have before you is really two issues when it comes to effectuating the intent of the legislature. And if– so what you have before you is the update to the rules regarding home health. These– promulgation was done pursuant to– for compliance with Act 761 and Act 817. Act 761 as we reviewed it does actually– and I apologize, that was some old reference because we, as we reviewed Act 761, we actually already comply with that with home health. All home health agency individuals that have direct care workers have background checks that we didn’t need to do actually any substantive changes or any changes at all to, to the, to the rules. The other rule is regarding Act 817, which we’ve had quite a bit of input and public comment on. Act 817 regards the expansion of home health agencies when they already have a permit of approval. And so as we went through the public comment period and looked at the act and got everybody’s input and also reviewed the, the videos of presentation to committee as well as presentation on the floor of both chambers, the Department of Health determined that we believe the intent of Act 817 is to allow those that already have a permit of approval, home health agencies to expand without further permit approvals necessary as long as they have a, a office within 100 miles of, of the service area. So this means that if you have an, a principal or a branch office and then you put another one 100 miles from that, you could still go ahead and provide services and expand, expand your service area that way. I would be happy to take any questions. You have in the public comment report before you, and I would be happy to discuss anything you have questions on.
Bledsoe [01:16:49] All right. Thank you so much. Members, do you have any questions? All right. Seeing none, without objection, this rule stands as reviewed. All right, next we have J. And I’ll call Paula Day, Kirk Gardiner and Chuck Thompson. If you would, just stay.
Thompson [01:17:09] Thank you, Madam Chair. And I’ll, I’ll if– with your permission, I’ll call Kirk and Paula up as necessary.
Bledsoe [01:17:16] Okay.
Thompson [01:17:16] There’s not really. This is the rules update regarding hospice. The only changes are, one, while the changes are to get them in uniformity with the rules for hospitals and rules for critical access hospitals. First, tuberculosis control, it used to be that everybody had to have tuberculosis tests, employees. You don’t have to have that anymore when it comes to our hospitals, critical access hospitals. We’re just adding hospice to that list. They’re the last ones to not require. You don’t, not required to have tuberculosis tests. Just make sure that you have a policy to ensure that your tuberculosis control or any, any tuberculosis policies are in accordance with CDC guidelines. The other is adding the language regarding Act 311, which is no patient left alone act. This is to ensure that the language in here coincides with what was already in the rules regarding hospitals and the rules regarding critical access hospitals. This is Act 311, the exact language from what was passed by this body, by the General Assembly and added into the rules. This was already added into, like I said, to hospitals and critical access hospitals, which you all have already reviewed at last, last committee, last committee meeting. I’d be happy to take any questions.
Bledsoe [01:18:45] All right, any questions from the committee? Seeing none, without objection, this rule stands as reviewed. Going on down. Item M. Kelly Kersey and Mr. Thompson again.
Thompson [01:19:05] And thank you, Madam Chair. And I’ll call up Ms. Kersey if we need to get into the specifics of massage therapy technique.
Bledsoe [01:19:09] You’re recognized.
Thompson [01:19:10] Thank you, ma’am. This is an update to massage therapy rules. This is done in compliance, all of these are done in compliance with acts of the General Assembly for 2021. This includes– the majority are occupational licensure items, such as fee waiver, Senator Gilmore’s fee waiver, Act 135, also updating automatic licensure language for uniformed service members pursuant to the applicable acts and also the Earn and Learn Act. Now the Earn and Learn Act was the one where we received the most, the most comments on. And it was– we had some robust discussion during public comment– excuse me, pardon me– as well as the massage therapy technical advisory committee meetings. As we reviewed that and we have– and because of that, we’ve gone ahead and added some ad hoc committees to further explore the issues that were brought up in public comment. However, we are moving forward with the rules themselves so to ensure that we can effectuate and implement the acts that were passed by the General Assembly. When it comes to Earn and Learn, the question, the main question was the Earn and Learn Act provides that you can require tests for those individuals that are receiving their licensure through apprenticeship. This is, and this is consistent with what is required of those that go through massage therapy schools. So we wanted– so the– so we have required that there are three tests that have been required for at least a decade under the rules for individuals to be passed before they become licensed massage therapists. And we made sure that that, those tests, the the option was required of those that received their licensure through apprenticeship. Now, again, all that being said, we’re moving forward because the act, the Earn and Learn Act allows us to do that. However, we have started ad hoc committees. We’ve already had our first meeting last week. We’re going to have meetings all through the summer to study the issue, whether we want to go ahead and change the rule in the future. This was done as a result of the public comment and individuals in massage therapy with interest, and interest in this item. The ad hoc committees have members from schools, massage therapy, massage therapy spa owners, massage therapy licensed massage therapists and massage therapists instructors. So we’re going to move forward with that. You all may see us try to update these rules based on their, based on their recommendations in the future in the fall. But right now, we would ask for the go ahead and move forward with the rules as written. I’d be happy to take any questions.
Bledsoe [01:21:49] All right, ladies and gentlemen, any questions? Seeing none, without objection, this rule stands as reviewed.
Thompson [01:21:55] Thank you, Madam Chair. Thank you, Members.
Bledsoe [01:21:57] Thank you. All right. Going on down the agenda Item N. And I have on my list Daisy Dippel and Craig Smith.
C Smith [01:22:17] Thank you, Madam Chair. Craig Smith, Department of Health attorney. We will call Daisy Dippel if we have any substantive questions. But we’re here to– with proposed rules governing the advisory board for interpreters between hearing individuals and individuals who are deaf, deaf, blind, hard of hearing, or deaf. The changes are reflecting changes for the deadlines for renewals and making sure that’s a more intuitive process and licensees can know when they need to get their licenses renewed, when late fees apply and when they will have to submit a new application, as well as implement Act 135 and updating the licensure for, automatic licensure for military individuals, as well as include Act 725 for the fee waiver program. And if you have any questions.
Bledsoe [01:23:12] All right. Any questions from the committee? Seeing none, without objection, this rule stands as reviewed. Thank you for being here. All right, O. Don Adams, Laura Shue.
Shue [01:23:39] Thank you, Madam Chair. Members of the committee, I’m Laura Shue, and I’m general counsel for the Department of Health. And I have with me Don Adams, who is currently serving as the deputy director for administration, the interim chief of staff, and he also happens to be a registered sanitarian. So he’s here to answer any questions that you may have, any technical questions.
Bledsoe [01:23:56] Thank you, you’re recognized.
Shue [01:23:59] Thank you. We’re here to present the rule pertaining to the state board of sanitarians. We made miscellaneous corrections to references and descriptions, and we’re also implementing Acts 135 and 725 of 2021. We did have a public comment period. There were no public comments. And we’re here to answer any questions that you may have. Thank you.
Bledsoe [01:24:23] Any questions from the committee? Seeing none, without objection, this rule stands as reviewed.
Shue [01:24:31] Thank you.
Bledsoe [01:24:31] And then the next one, I believe, Laura, you’re on that one. P.
Shue [01:24:37] Yes. On Item P, we have the rules pertaining to water operator licensing. We had a public comment period and there were no public comments. We are implementing the Acts 135, 725 and Act 811 of 2021. And I have with me Lance Jones, the chief of engineering, here to answer any technical questions if you have any.
Bledsoe [01:25:02] All right, any questions from the committee? All right, seeing none, this rule stands as reviewed. And we thank you for being here. All right, ladies and gentlemen, do you have any new business to come before the committee? All right, seeing none, then we are adjourned.