Vermont Legislature SmartTranscripts:

[Rep. Alyssa Black, Chair]: Good morning, it is January 15. Morning, House Healthcare. And we're starting work on H577. We have legislative counsel in with us to to do a walk through. So thanks for taking the time.

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: Sure. Good morning, Jen Harvey from the office of legislative counsel. I'm gonna put the language up on the screen. We are looking at h five seventy seven. Was introduced by Representatives Black and Berbeco. And this is an act relating to establishing the Vermont Prescription Drug Discount Card Program. You're going hear from the Treasurer's Office about it. So I'm going to tell you what's in the bill and they can tell you more of the details of the program. This would add a new sub chapter to a chapter in Title 18, Sales of Prescription Drug Cost Containment. And this new sub chapter would be entitled the Vermont Prescription Drug Discount Card Program. The first section establishes the program itself. It establishes this Vermont Prescription Drug Discount Card Program administered by the Office of the State Treasurer, and the purpose is to pool prescription drug purchasing power with other US states and territories and nongovernmental organizations. And the program would be made available to all Vermont residents. The language allows the State Treasurer to cooperate with other US states and territories, regional consortia, non governmental organizations, or a combination of them to pool prescription drug purchasing power in order to reduce prescription drug costs, negotiate discounts with manufacturers, centralize prescription drug purchasing, and establish volume discount contracting. And it defines volume discount contracting to mean the negotiated purchase of a large quantity of a prescription drug at a decreased cost. It allows the treasurer to require reasonable fees to be charged to defray program costs and it not withstands a provision of existing statute that says only the General Assembly can set fees to, in order to allow the treasurer to determine the amount of the fee and method of collection based on actual costs. I don't think they're knowable yet. It requires an annual report beginning in January 2028 to this committee and the Senate Health and Welfare Committee and the Governor detailing the activities of the program during the previous calendar year, including how many Vermont residents pharmacies participated and the amount of savings on prescription drug costs that was achieved. A lot of the rest of the section is some implementation pieces. So section 4,692 creates the Vermont Prescription Drug Discount Card Program Fund, and that would be a special fund to be administered by the State Treasurer to support the program. And into the fund would go any monies appropriated by the General Assembly, any money transferred to the Fund from the federal government, other state agencies, or other governmental sources, any money from payment of fees or other monies due to the program, and any gifts, grants, or donations made to the program or received by the treasurer for the program. Basically, anybody's money is welcome and it will all go into this for the program and it will all go into this fund to be used for the program. It also requires the treasurer to credit all interest earned on the fund to the fund And any unexpended and unencumbered monies in the fund at the end of the fiscal year would remain in the fund. So, roll over to the next. Two is an implementation report. This would require that by next January, so exactly one year from today, today is 01/15/2026, the Treasurer would report to the General Assembly on the implementation of the Prescription Drug Discount Card Program, including any recommendations for improving its administration, any fees to be charged to participants, and an estimate of the projected cost to the state if they determine additional financial support is needed. Section three appropriates $50,000 in fiscal year twenty twenty seven from the general fund to the treasurer's office, the costs of developing and implementing the program. And the act would take effect on July 1, which is the first day of the twenty twenty seven months of the year. And that's it.

[Rep. Alyssa Black, Chair]: Any questions for Jen? You don't need to answer this now.

[Rep. Allen "Penny" Demar, Member]: I

[Rep. Alyssa Black, Chair]: believe, but I think it's going to come up. If you don't remind us, a few years ago we did, I think with some of our PBM stuff, what we currently have in statute around copay accumulators. If people pay out of pocket for things, does it go to their cost sharing? And I'm wondering what we currently have in statute.

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: Yep, I think I can pull that up now if you want. I think the main piece that I'm thinking of is in the health insurance statutes, specifically around prescription

[Rep. Karen Lueders, Member]: drug coverage.

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: Couple of provisions. I mean, have a lot of provisions affecting

[Rep. Alyssa Black, Chair]: out of

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: pocket, but I think that's actually this. Yes. Here we go. Alright. Let me put this up on the screen. So this language is in eight BSA section 4,093. So we're in health insurance statutes in Title VIII. We have a number of provisions around what a health insurer or pharmacy benefit manager doing business in Vermont must do, must allow the pharmacist, must do with respect to the beneficiary or covered individual. So here we have that a health insurer or pharmacy benefit manager shall not do any of the following. Is this piece yes. Shall not do any of the following. And when we scroll down to f, it says exclude any amount paid by or on behalf of a covered individual, including any third party payment, financial assistance, discount, coupon, or other reduction when calculating a covered individual's contribution toward the out of pocket limits for their prescription drug costs, which is in another section of the statute, their deductible or to the extent not inconsistent with federal law, the amount of annual out of pocket maximums applicable to their plan. And this is only for certain types of drugs, drugs for which there is no generic or interchangeable biological product. So for our purposes, just think of it as generics. So because this says that that the provisions of this subdivision f relating to all these different types of payments to only apply to a prescription drug for which there is no generic or for which there is a generic or interchangeable biological product, but the covered individual has gotten has obtained access through prior authorization, a step therapy protocol, or the pharmacy benefit managers or health insurers exceptions and appeals process. And then there's also some carve outs around high deductible plans if it is determined that applying those the amounts paid out of pocket for through other avenues would disqualify the plan for eligibility for health savings account. There are very specific federal requirements around what can be covered, how monies can be used in a high deductible plan in order to maintain eligibility for health savings account.

[Rep. Alyssa Black, Chair]: So if someone were to utilize this in lieu of going through their health insurance. They would not be able to use anything from their HSA. That's It's

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: more about whether the plan structure and the implementation of the plan itself would disqualify the plan from eligibility for health savings accounts. So it's not about the individual's usage of money from their health savings account to pay for a prescription drug, but about whether that out of pocket expenditure that didn't use the insurance plan could be counted toward meeting their deductible under a high deductible plan without that causing a problem for the plan's compliance with the requirements to be compatible with the health savings account.

[Rep. Alyssa Black, Chair]: Do I understand?

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: If this language means that somebody could not use money from their health savings account to pay for a prescription drug if they were using the Vermont Prescription Drug Program discount card. And I said, that's not quite what this says. What this says is, and maybe I should just back up to say there are, again, there are very specific parameters under federal law about what can count toward a deductible and what can be covered without cost sharing for a high deductible plan in order for that plan to be eligible to be used with a health savings account. So if you have a high deductible plan and it allows you to, for example, have certain things covered without any out of pocket requirements, if Vermont law allows no cost sharing for a particular item or service that is not considered under federal law to be eligible for first dollar coverage without out of pocket from the consumer, then the fact that that plan allows those monies to be or allows the person to have full coverage without any out of pocket would make that plan ineligible for health savings account. So you couldn't use a health savings account with that high deductible plan. You'd have to meet the high deductible without using a health savings account. So we try to be very careful in Vermont law to not do anything with our requirements for plan design, covered benefits, plan administration that would disqualify a plan from a high deductible plan from being eligible for Health Savings Account. So what this language is saying is if it would cause somebody, if it would cause a high deductible plan to lose its eligibility to be paired with a health savings account because of the application of this non health insurance spending going toward the deductible or out of pocket, then that provision around being able to apply that out of pocket money to the deductible doesn't apply to those plans. We're not trying to do anything to disrupt somebody's plan's eligibility for health saving care.

[Rep. Alyssa Black, Chair]: Go ahead.

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: Which I think probably made it more confusing.

[Rep. Alyssa Black, Chair]: I give an Yes.

[Unidentified Committee Member (female)]: So as I just ripped my shirt sweater. Let's say I am and maybe I'm giving an example that isn't even applying to this, but this is what I have in my mind. So I go to the pharmacy and I'm picking up medication. We have a high deductible plan. We have an out of pocket expense before we get to the deductible for prescriptions. I go in and I find out that the prescription is going to cost me $100 with my insurance. And I say, oh, well, what would it be with this prescription card? And they say 50. So I say, great, I'm going

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: to pay 50. That 50 does not count towards my deductible. It doesn't necessarily not. We just don't It's not that it necessarily doesn't We don't know. We don't know. So that's what this language is saying is if doing it If you paying that $50 out of your pocket would cause your plan to lose its eligibility for high deductible. If you applied it to your deductible, basically, if the fed say no, then it doesn't apply to your deductible. You can still use the card. You can still pay the $50 instead of a $100. You may not be able to credit it towards your deductible if that is in conflict with the federal administration of the high deductible plan HSA.

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: So it all depends on

[Rep. Alyssa Black, Chair]: the plan you have?

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: It's gonna depend on the plan you have. Basically, we're making this somebody else's problem to figure out whether you can apply. Mean, it's sort of a case by case, really plan by plan basis. Thank you.

[Rep. Karen Lueders, Member]: Well, how would a person deal with that?

[Rep. Alyssa Black, Chair]: Oh, sorry. Well, no, I'm just hearing from our healthcare advocate that he'd like to try.

[Rep. Francis "Topper" McFaun, Vice Chair]: Riding a number of steps higher.

[Rep. Alyssa Black, Chair]: Federal law is complicated. Really?

[Rep. Francis "Topper" McFaun, Vice Chair]: We say all

[Unidentified participant]: the time in

[Rep. Francis "Topper" McFaun, Vice Chair]: the European compliance with federal law. I think that's what we're

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: saying.

[Rep. Alyssa Black, Chair]: Yeah, it

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: is basically saying. But it's calling out more specifically what type of federal law we would be concerned about.

[Rep. Karen Lueders, Member]: But then how would that affect the individual trying to do that? What would they have to do?

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: What would they have to do? They would have to pay the $50 They would have, they could, if they are in the habit of, I don't I don't know how the plans currently administer the you can apply things that you spend out of pocket, through your insurance plan to your deductible. However, they currently administer that piece. They might say, no, we can't count that towards your deductible or your plan loses its eligibility. They may just say this type of plan doesn't allow that because of this piece of

[Rep. Karen Lueders, Member]: the- And they'd be told that by the pharmacist or how would they know that

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: I don't I can't speak to how So that's

[Rep. Karen Lueders, Member]: what I'm worried about is the individual getting caught in this thing.

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: I don't think they're getting caught. I mean, you know, ultimately, they're making the decision that it's better for them to have to pay $50 out of pocket than a $100 out of pocket. You know, whether it could be a more complicated decision if somebody were to decide they'd rather pay a $100 out of pocket in order to have it counted toward their deductible because they're very close to meeting the deductible. I don't know in that very specific instance how this would work, but I think it would be the insurance company saying, sorry, that doesn't count under this kind of plan.

[Rep. Alyssa Black, Chair]: Okay, thanks for clearing that. Thank you

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: for bringing it up.

[Rep. Alyssa Black, Chair]: I suspect we will be asking the question multiple times over the next. Good morning Treasurer Pichat. Welcome.

[Sean Scanlon, Connecticut State Comptroller]: You.

[Rep. Alyssa Black, Chair]: Have a seat.

[Rep. Karen Lueders, Member]: Enjoy.

[Rep. Francis "Topper" McFaun, Vice Chair]: How are doing?

[Mike Pieciak, Vermont State Treasurer]: Well, nice to see everyone this morning. I believe that comptroller Sean is joining virtually, and he has a conflict starting at maybe at maybe about ten minutes or so. So I think maybe I was gonna defer to him to begin if we can do that. Okay.

[Rep. Alyssa Black, Chair]: Yeah. Do you wanna take a ten minute break?

[Mike Pieciak, Vermont State Treasurer]: Or I think he I think he yeah. He's on. Yeah. He only has ten minutes. Okay.

[Rep. Alyssa Black, Chair]: Got it. Certainly, I understand that as much as I understand that. Absolutely. Let's defer. Hi,

[Sean Scanlon, Connecticut State Comptroller]: I'm here, but I can't turn my camera on. So whoever is managing

[Rep. Alyssa Black, Chair]: the Okay. Well, welcome.

[Sean Scanlon, Connecticut State Comptroller]: Alright. Well, I'll I'll just dive in, and if someone wants to turn my camera on, would love to see you all. But I can see you, and I can see my friend and colleague, mister treasurer there. And as a Here

[Rep. Francis "Topper" McFaun, Vice Chair]: we go.

[Rep. Alyssa Black, Chair]: Okay. There we go.

[Sean Scanlon, Connecticut State Comptroller]: Former state legislator in Connecticut before I was elected comptroller, it's great to be amongst legislators, and madam chairman, thanks for having me today. I, again, as a former legislator am absolutely not going to read my full testimony here. I'll just summarize it and say that a few years ago in Connecticut, like all states, we were seeing person after person coming up to us and talking about the high cost of drugs and how that was impacting them. And so in 2023, our governor and I introduced legislation similar to the legislation you're putting forward today, that would allow Connecticut to be the fourth state to join the ArrayRx consortium. And as comptroller, I run the largest health care plan in the state of Connecticut. 250,000 people get their insurance through my office, and because of the leverage that we have, we're able to try to lower the costs, and we often are always able to lower the cost of our plan members because we have the leverage to really make a difference when it comes to negotiating drug prices. That's not the case for most people in Vermont or Connecticut or anywhere in the country, and what ArrayRx allows us to do is to use that kind of leverage to lower drug prices for everybody regardless of what kind of insurance they have, and so our legislature passed the bill in 2023. We began rolling out the card in 2024, and what we've seen so far is about an average of 80% savings for our residents on generic drugs. It's about $200 annual savings to people, which is real money for people on a fixed income, and we see people sort of telling us that they don't have choice of picking their drugs over necessities, like paying their car bill or paying their rent or buying groceries at a time when all those things just seem to be going up and up and up. So I was really excited, when treasurer of let me know that he was interested in joining this coalition. We now have, five states. So Vermont will be the sixth state in the nation to, roll out this drug discount card. And at a time when, you know, regardless of what your political affiliation is, we look at Washington and see nothing but chaos and fighting. I think states are really stepping up to take the lead in solving problems, again, on a bipartisan basis. This is a coalition of red states and blue states that are in array r x, And I'm just really hopeful that Vermont will, you know, pass this bill and and join the committee that oversees the program and and help our residents in a sick state save money on drug costs.

[Rep. Alyssa Black, Chair]: Any questions for comptroller? I learned that other states don't have treasurers, they have comptrollers.

[Sean Scanlon, Connecticut State Comptroller]: Connecticut weirdly has both a treasurer and a comptroller.

[Rep. Alyssa Black, Chair]: Which is better? Representative McDonald has a question for you.

[Rep. Francis "Topper" McFaun, Vice Chair]: Madam chair. How do you administer this program?

[Sean Scanlon, Connecticut State Comptroller]: Great question, representatives. So I have two staff members in my office, two paid positions that the governor added to the budget to administer this. One of them is a director whose job is really to interface with the consortium. So there's executive directors in each state. They meet, you know, a couple times a week. She's meeting with drug companies and PBMs and sort of doing the administrative stuff. And then I've got a young guy who's more of a community liaison. You know, there's no multi million dollar marketing budget for this. So he's going to senior centers and senior fairs and other public events to promote the program and hand out flyers and try to get people to sign up. So in total it's a budget of two staff members. I think our total budget is around $150,000 a year for this program.

[Rep. Alyssa Black, Chair]: I'm sorry, what was the budget?

[Sean Scanlon, Connecticut State Comptroller]: It's about $150,000 a year.

[Rep. Alyssa Black, Chair]: May I ask where you get that $150,000 a year?

[Sean Scanlon, Connecticut State Comptroller]: It's just out of our general fund budget through my office, so it's part of my office's budget. I freed up the money in my agency to hire these folks, but it's funded through the what we call just the general appropriation budget in Connecticut. I'm not sure what you call it in Vermont.

[Rep. Alyssa Black, Chair]: General fund? General fund. Same thing.

[Rep. Francis "Topper" McFaun, Vice Chair]: Yep.

[Rep. Alyssa Black, Chair]: Oh, I'm sorry. Did you wanna follow-up? A

[Rep. Francis "Topper" McFaun, Vice Chair]: 150,000 connects three people. Two. Two. Two. Two.

[Rep. Alyssa Black, Chair]: Go ahead. Oh, Wendy. Go go ahead, Allen. And then

[Rep. Allen "Penny" Demar, Member]: What do you collect for for fees and other monies on your program?

[Sean Scanlon, Connecticut State Comptroller]: So we don't collect any fees. It's not something that all the money goes directly from the person buying the drug, at the point of sale to the PBM, which is called Navitas that we work with. We don't collect any money at the point of sale and then no money passes through our office. It's all done by the PBM. Our budget is simply administrative in terms of running program and marketing the program and talking about the program. It's not actually collecting any fees.

[Rep. Alyssa Black, Chair]: I think Brian had a question, Representative Cina.

[Rep. Brian Cina, Member]: So, I think you mentioned six states, and I see Connecticut, Vermont, Oregon and Washington identified in the literature here, but could you tell us what the other two states are that are part of this? I believe you identify as a collaborative.

[Sean Scanlon, Connecticut State Comptroller]: Yes, it's Arizona, Connecticut, Nevada, Oregon, and Washington.

[Rep. Brian Cina, Member]: Arizona, Connecticut, Nevada, okay, Washington, Oregon?

[Unidentified participant]: Yes. Remember the state of Ohio also.

[Rep. Brian Cina, Member]: Okay, because I was like, it's five, all right, so six. Six, Ohio.

[Sean Scanlon, Connecticut State Comptroller]: Ohio is coming online. They're not officially online yet, I don't believe, but they're coming online now.

[Rep. Brian Cina, Member]: Do you find that more states involved gives you more negotiating power and leverage?

[Sean Scanlon, Connecticut State Comptroller]: Absolutely, the more states that we can get in, better ultimately we will be, and I think the more we can lower the cost of drugs. You know, I heard you, I was sitting here listening, you were debating a bill, you know, PBMs. We work with what's called a transparent PBM, that's Navitas, where they're very forthcoming about their rebates and how it all works, but most PBMs are not that way, as most of you probably know. And so we found a very, very good transparent PBM here, and they've been very, very clear with us that the more states that we get and the more volume that we do, the more they'll be able to lower the cost of drugs. I should have said this right now but one of the beauties of this program is that here in Connecticut, Navitas is accepted at 98% of the pharmacies in our state. So CVS, Walgreens, Walmart, the big chains, they accept the card. But what's really important to us, and I'm sure it's the case in Vermont too, as a state that's a New England rural state, we still have a lot of independent small pharmacies in our communities and this card is accepted at most, if not all of those two, outside that 2%. So we found a way to work with a company that is broadly accepted at 98% of the pharmacies in our state.

[Rep. Brian Cina, Member]: Two more quick questions. One is that reading this literature here, was talking about how the challenges are expected to grow as federal policy changes for people having access to medication and that this approach might allow continued access. So would that mean that anyone in the state could apply for this card regardless of their insurance status or whatever we call it, and they would get the price the same as anyone else. It may not apply to a or anything like that, but like Blue Cross Blue Shield people will pay $6 Medicaid, I wish, Medicaid people will pay $6 MVP people, would be paying the same price for the medicine regardless of their insurance. Not saying that there's additional benefits like deductibles and co pays, the actual cost out of pocket would be the same?

[Sean Scanlon, Connecticut State Comptroller]: That's correct, So you cannot use both this card and your insurance at the same time. What we tell people is they go to a pharmacy. We've spent countless hours, I have personally with the pharmacy association, training the pharmacist to basically say that somebody would walk in and say, is it cheaper, you know, if I use my Rarex card or my Medicare card or my Anthem card or if I'm uninsured? And then whatever cheaper price there is, they use that card. That's the simple educational tool that we try to get people to understand.

[Rep. Brian Cina, Member]: That's helpful because what I just heard you say, I understand it correctly, is we're giving the consumer, so to speak, more choices. If they have insurance and this card, they can still pick a cheaper option, so it's saving people money and that they're in control of that. They're making the decision. Last question that I have, because I think I saw another hand, so I want to be clear, is that have you seen any challenges rolling this out? Any challenges we could learn from if we go down the step?

[Sean Scanlon, Connecticut State Comptroller]: Our challenge is that there are not enough people in this for the need that's out there, and we, you know, struggle with, you know, again, not not having a a large marketing budget for this. The marketing budget is is me and this young guy named Jake going to senior centers and small towns and walking around talking to people. And so we have 26,000 people that are actively using it, which is great and it's helping those people tremendously, but we're a state of 3,000,000 people. And so we certainly could have more people into it. I have been lobbying the governor pretty hard to, you know, give us some money to put some advertising behind this. And I think we will get that done hopefully this session. And I think with advertising dollars, you'll see the program grow tremendously in Connecticut. But I think the struggle that all of us have as a state is not that it's not working and not that it's not a great product, it's that we have got to put some effort behind making it a success or more successful through marketing. Thank you.

[Rep. Alyssa Black, Chair]: Allen?

[Rep. Allen "Penny" Demar, Member]: I think you guys answered for me. I got good insurance. I don't pay much for but the card might not benefit me at all. But I've got a grandson that's uninsured. So can you tell me how that's gonna work?

[Sean Scanlon, Connecticut State Comptroller]: Yeah. So I I go to a lot of senior centers, I get this question. A lot of people say, look, I'm on Medicare. I have pretty good drug coverage. I don't really need this. But undoubtedly what happens at each of these things is somebody raises their hand and say, hey, I thought I had good health insurance and I'm on Medicare until I got prescribed this prescription and I had to realize that Medicare actually wasn't great for that. And so what I tell people all the time is no matter what plan you have and even if it's the best plan ever, should always check to see and you may save money with their ARX. But your point, representative, is even better, which is that there's no age requirement for this. There's no income requirement for this. It's literally for everybody. So it's for your grandson. It's for your landscaper. It's for your neighbor. And we're just trying to spread the word about this for as many people as we possibly can because anybody can save with this card. It's not just for one kind of person.

[Rep. Allen "Penny" Demar, Member]: But what is the how do they pay for it? He has no insurance. Is he gonna pay the same price for that medicine?

[Sean Scanlon, Connecticut State Comptroller]: Yes. I would pay anybody is paying for the price based on what the the price is because they can't use their insurance at the same time. And again, the the challenge for us here is just to make sure people understand that. But let's say that your copay for something with insurance was $30 and the price of using your a rx card is only $15 obviously you would choose to save the $15 and use the Rx card versus paying what your traditional copay is. In some cases the copay is cheaper than Rx and you should use your insurance. It just depends on the drug.

[Rep. Alyssa Black, Chair]: Allen, I'm sorry I missed your hand before. I apologize. And

[Sean Scanlon, Connecticut State Comptroller]: I'm sorry to say to the committee that I unfortunately have to go, but I can take maybe one more question if that's okay.

[Rep. Karen Lueders, Member]: Excellent. Fairly simple. Thank you.

[Unidentified Committee Member (new)]: I've heard you mention the senior population a lot, several times. Kind of a two part question. I'm wondering if you feel that, as of right now, they are the population that uses this car the most, and maybe that's parallel to your needs for some people as they age.

[Sean Scanlon, Connecticut State Comptroller]: Interesting question. I'd say they use it the most in the sense that seniors are typically the highest utilizers of prescription drugs in our society, according to the plan that I run-in most plans. But I would tell you that the growing number is the concerning trend which is younger people who can't afford health insurance for different reasons and you're seeing them utilize it more because they're opting to go without insurance because they can't afford the premium or the deductible, but they're using our card because they don't have health insurance and if they get sick and need a prescription, they use the card. I think that that's an alarming national trend that we're experiencing, but it's certainly something we see on our policy.

[Rep. Allen "Penny" Demar, Member]: Thank you.

[Rep. Alyssa Black, Chair]: Thank you, and thank you for making the time for us.

[Sean Scanlon, Connecticut State Comptroller]: Yeah, know. I'm so grateful to be here. I thank you, Madam Chair, for your leadership on this bill and certainly to the treasurer for his leadership too, and I really hope that this win or this bill is a pass and you become the next state to join us. It'd be great to work across state lines on this important topic.

[Rep. Alyssa Black, Chair]: Thank you.

[Mike Pieciak, Vermont State Treasurer]: Thanks, Sean.

[Rep. Alyssa Black, Chair]: Great. Let's move it to our treasurer.

[Rep. Francis "Topper" McFaun, Vice Chair]: Well, thank

[Mike Pieciak, Vermont State Treasurer]: you very much for having me in this morning. Thank you also to the committee for taking the time to have this testimony and hear from the folks that from our office and Sean and others that are in support of the bill. And thanks also to the chair and the vice chair for their leadership on co sponsoring the bill as well. Just appreciate that support and appreciate, again, just the time to be here today. So the healthcare committee, if we go to our first slide, I think is obviously well aware of the issues around rising costs in Vermont. You probably don't need to belabor this point. But no matter how you slice it, Vermonters are spending a lot of money on healthcare. One estimate, I recently saw that 20% of our pay on average is going toward healthcare costs. Every dollar of every $5 we earn is being spent on healthcare. And within that category, within healthcare prescription drugs is a significant cost driver. We saw prescription drug cost premiums rise by 27% for some Vermonters between 2024 and 2025. And then nationally, the amount of money that folks have spent over the last five years on prescription drugs has gone up over 25%. So close to $100,000,000,000 of out of pocket costs on prescription drugs in 2024. So healthcare costs are rising. A significant portion of this health care costs are prescription drug costs. What ArrayRx is attempting to do, as you heard from Jen Carby and Sean Scanlon, is reduce health care costs, specifically reducing pharmaceutical costs. And as Sean mentioned, on generic drugs, by use of the card, you can see a savings of up to 80% at the pharmacy and up to 20% on name brand drugs. So a significant savings. Sean mentioned that on average in Connecticut, they're seeing about $200 of savings annually per prescription. Another way of looking at that is that they're seeing over $200 of savings per month for their average card user. So that's thousands of dollars a year. And even in a state like Vermont, if we had similar uptake to Connecticut, that would be millions and millions of dollars in savings collectively for Vermonters on pharmaceutical costs, things that are going toward their everyday needs instead of going to pharmaceutical companies. So, what is ArrayRx? You heard Sean talk about it a little bit. He'll have a leader from his office coming in as well to talk to the committee that's on the steering committee of ArrayRx to go in more detail. But it was founded by the states of Oregon and Washington, and it offers this free discount card program, as well as other programs that states can join as well. Again, to help people save on prescription drug costs, matter their age or income status. As you heard, there are other states in the partnership. Oregon, Washington, Arizona, Nevada, Connecticut, soon to be Ohio. And that the state of Oregon is basically the administrator of the program. There are state of Oregon employees who are running this program. It's not a for profit entity. It's not a nonprofit entity. It's really state governments running this for state governments. And I just want to underline this part at the bottom, and I think you heard Sean talk about it. When states collaborate, people win. Why I emphasize that and put that here is that we've seen this in a number of examples. This is something we couldn't do by ourselves. It's something that even Oregon and Washington didn't feel they could do by themselves. They partnered together at the beginning. And by leveraging each other's number of residents, leveraging each other's purchasing power, by leveraging each other's size, we're able to do more collectively than any of us can do individually. So I think it's a great model for the discount card program, and I just generally think it's a great model for states working collaboratively together. Here's some key features of ArrayRx. You heard no cost of Vermonters free enrollment, no member or pharmacy fees paid by Vermonters. Again, we heard about the broad coverage, but all FDA approved prescriptions plus a number of over the counter items as well. Those strong savings that we talked about Accepted broadly, so 65,000 pharmacy networks nationwide. You heard in Connecticut, I don't have the percentage for Vermont, but you heard 98% of the pharmacies in Connecticut. I would think we'd have a similar number just given our makeup in terms of who does business in each state. Transparent tools, which I'll get into, but an easy online price and pharmacy comparison for folks to understand before they go to the pharmacy, which would be better for me to do, to use this discount card, to use my insurance, Which pharmacy would it be better for me to go to? Would it be better for me to go in person to the Walgreens? Or is it better for me to use the online pharmacy? Those decisions can be made at home without having to feel pressure at the pharmacy. Another important key to the ArrayRx program is that personal data is secure and not sold. That's not true for other programs that are run on a for profit basis. That data is often shared and sold, and that is not done here. There's no profit motive for the state collaborative coverage gap support. So again, a lot of different scenarios and we'll get into them, including a scenario of somebody that's uninsured. But there are a lot of different scenarios where this card becomes beneficial to somebody. You have a gap in coverage because you're switching jobs. You have a gap in coverage because your insurance is changing for a variety of reasons, as well as being able to use this card when you do have insurance. It can benefit, in fact, everybody in various situations. And then the ArrayRx card compared to some other pharmacy benefit cards has friendly pricing for pharmacies. They, and you'll hear from the ArrayRx steering committee, they are not in the business of trying to put pharmacies out of business, particularly rural pharmacies that could be the only point of access for prescription drugs. They want to partner with those pharmacies to make sure that their residents that are in those states, and hopefully Vermonters, are getting as low a price as they can, but that those prices are not driving independent pharmacies or pharmacists out of business, because obviously we need those pharmacies to be able to distribute those drugs.

[Rep. Allen "Penny" Demar, Member]: What's the difference? We have other GoodRx, OptumRx, WellRx. What makes this different than all the rest?

[Mike Pieciak, Vermont State Treasurer]: Yeah. So I think it's those two points I just mentioned. One is privacy. Those cards largely sell data. Two, various fires of that that use it for commercially purposes. The other one is the pharmacy reimbursement. There's no profit motive here. So again, the ArrayRx system wants those independent.

[Rep. Allen "Penny" Demar, Member]: You say there's no profit, but if you're going to have a I think they said they had 150,000 budget. Right. I think you're asking for 50 to start up.

[Mike Pieciak, Vermont State Treasurer]: Right.

[Rep. Allen "Penny" Demar, Member]: You're gonna have to have employees too.

[Mike Pieciak, Vermont State Treasurer]: Yeah. So we'll have employees in our office that are working on this program.

[Rep. Allen "Penny" Demar, Member]: So where do they get their money if ever the card's free and there's no pharmacy?

[Mike Pieciak, Vermont State Treasurer]: Yeah. Yeah. So there is the way that a rare x gets paid to administer this program. So if you think about a drug that has a $100 cost and you're getting an 80% discount on that drug, so you're paying $20 Now, the discount may in fact actually be $16 or $17 or $15 But it's baked into the discount. So that cost is going to arrear ex to fund their operations. But for the state of Vermont, to your point, we will have people, it actually gets into this point about program administration. But we'll have folks working on the outreach and the marketing and responding to questions. But the administration of the actual program is done with ArrayRx with the state of Oregon. So, anticipate or we're asking for some startup marketing costs, but we're not asking for new positions to run the program.

[Rep. Allen "Penny" Demar, Member]: Will there be a fee to pay Oregon for overseeing

[Mike Pieciak, Vermont State Treasurer]: this? So fortunately, where we are in the lineup, we won't have to pay a fee. States that are gonna join after us are likely going to have to pay a fee to join. So, it's a good time for us to pursue this. But in terms of your question in the program operation, ArrayRx, the state of Oregon, the steering committee, they negotiate contracts with the nationwide pharmacies through their PBM bulk purchasing volume discounts. They're doing that work on the negotiation side. They operate a customer email and phone line if folks have questions about the system. Of course, people will come to our office as well. Know, inevitably, will just reach out directly to us. So that's something on our side of the equation that we'll have to manage. They administer the card and determine the eligibility. Leads to another I'm sorry. Oh, yeah.

[Rep. Allen "Penny" Demar, Member]: The PBM, are we gonna have our own or are we using the one nationally?

[Mike Pieciak, Vermont State Treasurer]: Yeah. The one with the collaborative.

[Rep. Allen "Penny" Demar, Member]: The social one.

[Mike Pieciak, Vermont State Treasurer]: Yeah. Yeah. Exactly right. And like you heard from the controller, the PBM is a transparent PBM in terms of the discounts and the pass throughs and all of that, which is great. Because sometimes that is a little bit murky space. Then ArrayRx maintains the data, maintains the IT support and the security and sort of that operational component. So, that's not something that falls to our office. And again, just to underscore the point, that fee that's embedded in the discount is what funds those operations for Oregon and for ArrayRx broadly. So what is our role in the program administration? You know, like you heard from the comptroller outreach to drive awareness of the discount card. You know, outreach is something our office does regularly with Vermont Saves, with our medical debt relief initiative, which I'll happily give an update on with programs like Able, achieving a better life experience outreach in terms of on plan property. We're often out and about in the community. One of the ways that we find that works most effectively, particularly for something like unclaimed property is through partnerships. So that's another role of our office to find partners to work with, to distribute awareness of the cards and information about the cards. We would anticipate partnering with the AARP on this program. They are great partner generally. They have a lot of resources of their own in terms of spreading the word and doing direct outreach to Vermonters for the card, and they've expressed a commitment to us to do that, which we really appreciate. And then every state has a participating member on the steering committee that sort of guides the governance of this collaborative. So to the representative's point, just to note, we are asking for an appropriation of $50,000 to start up with that marketing and that advertising. Like you heard the comptroller say, they think that that's gonna benefit them significantly. You know, whether this is enough or not, I think it's a really good amount to get going and start to drive awareness. And I think most of the outreach is gonna be done, quite frankly, through partnerships, through us in communities talking about this program. Yeah.

[Unidentified Committee Member (new)]: So this takes off.

[Rep. Karen Lueders, Member]: Would you be asking for money every year? And would that be?

[Mike Pieciak, Vermont State Treasurer]: We're for the what the 50,000 is is one time ask for marketing. So we wouldn't have necessarily ongoing ask for marketing. Maybe we'd come back and say, we think if we did X, Y, Z approach instead of the one we did, it would achieve a better result. But it's not going be in our base budget. The controller mentioned that they spend $150,000 and I believe they have one full time position and then another position that spends half of her actually, she's testifying today. Some of her time on this, but not all of her time on this. So we would anticipate similarly just, you know, at this point, spreading those administrative work of outreach and partnership development and steering committee on our current staff that's in the treasurer's office. That's our anticipation right now.

[Rep. Francis "Topper" McFaun, Vice Chair]: Thanks for coming in.

[Rep. Allen "Penny" Demar, Member]: Yeah.

[Rep. Francis "Topper" McFaun, Vice Chair]: How much cooperation or coordination is there with the present administration about this program?

[Mike Pieciak, Vermont State Treasurer]: Yeah, well, we did outreach to the Department of Vermont Health Access and their commissioner with the Green Mountain Care Board and some of their leadership. So we're happy to work with them and partner on whatever aspects of this program that can be partnered on. But we stand ready to do that.

[Rep. Francis "Topper" McFaun, Vice Chair]: But you're not doing it now. Is that what you're saying?

[Mike Pieciak, Vermont State Treasurer]: Well, we stand ready, but you need two people to agree to a partnership.

[Rep. Francis "Topper" McFaun, Vice Chair]: You haven't changed. Thank you for that answer.

[Rep. Alyssa Black, Chair]: Did you have a video? Or did you have more?

[Mike Pieciak, Vermont State Treasurer]: I just wanted to talk a little bit more. We talked about the fees. I think we can slip ahead just to some of the how does this work. So this is a image of the ArrayRx website. You know, there is, you know, a website and a membership page to get a card delivered digitally is how most of the cards should be delivered. It does require an email. There is a phone number if somebody does not have an email, there's an alternative way to, you know, get the card. But all it requires is your name, your date of birth, and your Vermont address. Now they're very broad with this in terms of who it applies to. So Vermont address could be somebody that is working in Vermont. It could be a child that's home from college. It could be a friend that's visiting for a month. They're very broad in terms of eligibility. Everyone that has a Vermont address can get the card and get it instantaneously downloaded to their phone and used at a pharmacy. So they are very efficient, very fast in terms of the setup and the delivery. You're not waiting in the mail for a card to come for weeks and weeks and that sort of thing. I mentioned also the ArrayRx tools that they offer, being able to find a drug or being able to find a pharmacy. Those tools are online to find the pricing, to find which pharmacy offers those drugs and that works with ArrayRx and at what price are they the best. They have a search system, as you'll see on this slide, where you can type in any drug name, the generic or the brand name at various quantity levels for various supply levels. And it will come back with, again, all the various places that you may be able to purchase this drug and at what cost and at what price so that you can compare what works best for you. And again, depending on what your insurance is or if you don't have insurance, what works best for you. So we have some sample price differences here for folks. Again, they sort of presented in terms of the retail price, the ArrayRx retail price, and then there are a couple of mail order options that are larger in the number, but that's because it's a ninety day supply instead of a thirty day supply. But you can see relatively significant savings here just from the sampling of drugs that were selected on this price comparison. So you can go online and do that for every drug that you have for you or your family member or one that you're being prescribed or one that you're going to talk to your doctor about so that you have all that kind of price transparency. And the last thing I just wanted to talk about is who benefits from this discount card program. So, you've heard some testimony already that I think anybody can benefit, but there are some folks that, some targeted populations that I think have the opportunity to benefit the most. One of them is clearly the uninsured population. If you were speaking with your grandchild, they don't have any insurance. They don't have the option to have any pricing from their insurance, nor do they have any discussion about whether they should use their insurance because they have a deductible. Those are not options for them. So there are about 10,000 Vermonters, about three percent of Vermont residents that are uninsured. That rate is higher in places like Caledonia, Essex, Lemoyle, Orleans Counties. Essex County itself has an 8% uninsured rate. So benefiting rural Vermont in terms of the number of people that are uninsured. And the other thing to think about is that unfortunately, we have a really low uninsured rate, three percent, but it's expected, my expectation is that that number will go up in the future as a number of things happened. ACA subsidies have expired and people are feeling the pressure on that. Medicaid eligibility has been reworked, both in terms of the overall eligibility and certain ongoing work requirement eligibility that will make individuals no longer eligible, or maybe they'll have intermittent eligibility as they forget to do paperwork in a particular month. So there'll be more unfortunate opportunities for monitors to be uninsured in the coming years and then a growing population that could benefit from this. The other group, even though they're insured, are folks that are under insured, people that pay a lot out of pocket have high deductibles. This is a number that's pretty significant for the state of Vermont, 31% based on the health department's survey in 2025. So 131,000 Vermonters, 64 or younger are considered under insured in the state of Vermont. So that's another population that could benefit from this significantly. They have a really high deductible. It's late in the year. They're nowhere close to their deductible. Maybe it's a young person who has a high deductible plan. They're unlikely to hit their deductible, even though it's early in the plan year, and they will find a lot of benefit. Unfortunately, again, you could see this group growing in the coming years as the pressure on healthcare costs drive more people to plans that have larger deductibles or lower coverage, particularly on prescription drugs. Then the last group I wanted to talk about in terms of a broad group for insurance is older Vermonters that might be on Medicare, but they don't have a prescription drug coverage. They don't have a Part D plan, or maybe they do have prescription drug coverage, but some of their drugs aren't covered on their prescription drug plan. But generally, nationally, there's about eight to ten percent of seniors who have Medicare but don't have a pharmacy coverage add on to their hospital and doctor medical So there's a pretty significant number of people here that will benefit most directly. The other group of folks to mention are folks that do have insurance and their specific drug that they need is not covered. I'll give an example of that here in a minute. But anybody can benefit from this program, but these are populations that would have more likely than not disproportionate use and benefit from this card. I just have three examples to show to try to make it a little bit more tangible in terms of folks in different circumstances. But these are all fake tious individuals and just examples in terms of what somebody might expect for savings. So, here's an individual that's younger, 28 years old on a high deductible bronze plan. So, somebody that you might consider under insured and they need these medicines that treat ADHD and the like. And you can see the insurance price that they may get at a pharmacy and then the ArrayRx price. So that difference between those two numbers is that $153 per month in savings. So this person, again, very limited medical needs, potentially otherwise, they're under insured, they are young, they will benefit from this card and it's probably in their best interest to use this card for all twelve months of the plan year.

[Rep. Alyssa Black, Chair]: I'm still confused about this. Mainly because of not because of Jen Carvey, but mainly because of what we were trying to understand with council. If someone says, oh, I'm gonna get the Rx price and I'm gonna only pay $2.10 instead of $3.47. They have a high deductible bronze plan. And does that 200 if they paid the $3.47, the insurance price that would go towards their deductible. Does that $2.10 go to their deductible?

[Mike Pieciak, Vermont State Treasurer]: Yeah, so I know that we've talked to the healthcare advocate about Vermont law and there may be some ambiguity as to whether it does or not. You heard from Sean Scanlon in Connecticut, it clearly does not. Our expectation in presenting this was that it did not, that there was sort of an, you had to make that choice, Right? But I know that the healthcare advocate has some additional proposals and maybe some additional clarification to make that point. And Vermont, it does count toward your deductible. So, I know that's a point of ongoing discussion. But the one thing that's clear is you can't use your insurance to get a discount and then add that discount with the ArrayRx. It's one or the other from that standpoint.

[Rep. Alyssa Black, Chair]: To make a choice. And if you have a health savings account with that high deductible bronze plan, you cannot use your money that's sitting in your health savings account to pay that two ten, because that's federal.

[Mike Pieciak, Vermont State Treasurer]: Would need to stone a friend at Gen Carvey.

[Rep. Alyssa Black, Chair]: Or is that why we say except allowed by federal law, so we don't say it. Anyways, go ahead Allen.

[Rep. Allen "Penny" Demar, Member]: So help me understand this again, okay? Have some of my medications, I have a copay. Yeah. So my copay, I have this card and the drug is $23.58 and the rate price is $7.51 Okay, how is that going to affect me? Yeah. If I use my insurance and co pay, this don't come into play again, right? So if you

[Mike Pieciak, Vermont State Treasurer]: go in and write your insurance card, and they say, this is what you owe us on insurance. You say, well, it's $23.58 You say, well, let me just double check with this ArrayRx card. That's only $7.51 And then you make the choice, I want to pay less money or do I want to have that go to my deductible, like your overall And we get it clarified that this also goes to your deductible, and there's really no choice for you, it's really just which one

[Rep. Francis "Topper" McFaun, Vice Chair]: is your I don't

[Rep. Allen "Penny" Demar, Member]: have a deductible, have a co pay. So then take the person that's unemployed or no income. Yeah. He throws his card out. He still doesn't pay. If it's Medicaid, Medicaid takes care of whatever, right?

[Mike Pieciak, Vermont State Treasurer]: Right. So you're saying that you're giving an examination based on Medicaid. Yes. Yeah. So, know the

[Rep. Allen "Penny" Demar, Member]: So is it going to benefit them or does Medicaid pay the whole price? It would benefit them if

[Mike Pieciak, Vermont State Treasurer]: the price is lower. I guess what Medicaid has negotiated for the price could potentially be higher than this card. I would have to look at that a little bit more closely.

[Rep. Alyssa Black, Chair]: Very small co pays on prescription. Medicaid. I think it's $2.01,

[Unidentified participant]: 2, and 3.

[Rep. Alyssa Black, Chair]: $1.02, 3. You're never gonna beat their price.

[Mike Pieciak, Vermont State Treasurer]: Yeah. Somebody that's uninsured, they're not on Medicaid. Right. So, is the sort of insured price. They might even have a higher price that they're facing, just paying the retail price. But if they had this IRS card, they would pay this price, even though they have no insurance at all. So another example of somebody that has Medicare, but they have no pharmacy coverage, and they have a number of drugs that they need that treat a number of underlying health conditions. They have three prescriptions, so they're not dramatic savings. But when you add that all up, relatively significant $90 a month in savings. So again, just an example of somebody that could benefit and just give you a sense of how much that benefit could be. And then last, I wanted to call this one out because this is something that Connecticut has said that they've seen a lot of uptake in terms of folks that have a targeted benefit. So a lot of healthcare insurers are excluding GLP-one drugs for things that are not relating to underlying health conditions like diabetes or other reasons for GLP-one. These are the weight loss drugs, I think, that colloquially are known as. So a lot of folks that want these drugs for assistance with weight loss, they're no longer being covered by their insurance and they're also really expensive. So here's one brand of GLP-one, the retail price over $1,000 but the ArrayRx price is $265 still not inexpensive, but over $800 a month in savings for somebody that wants this drug. So this is somebody that doesn't have insurance. This somebody is that does have insurance, but this coverage is not provided for in their insurance. It's somebody that benefits across the board by having access to this card. And again, Connecticut said this is one of their highest uptake uses for the card in their states. So that's everything I wanted to just affirmatively present on. Peter Trombley, who's here, and David Sheer, who was here a little bit earlier. Feel free to follow-up with me or with them with any additional questions that you might have about this or any additional individuals that we can coordinate to bring in the testifier, any additional information that we can provide if committee happen to do so.

[Rep. Alyssa Black, Chair]: Great. Brian, who has a question and then Leslie?

[Rep. Brian Cina, Member]: Yeah. I've been waiting for the end, I have a

[Mike Pieciak, Vermont State Treasurer]: list. Nice.

[Rep. Brian Cina, Member]: And obviously, if you need an answer to that, we follow-up. So the first one is earlier in the presentation, you said end other programs, like people qualify for this and other programs. And I was wondering what the other programs might be. With the Rx? Yes.

[Mike Pieciak, Vermont State Treasurer]: Yes, they have like five or six different programs that they offer around opportunities for Medicaid systems to work together to share information and data and potentially drug purchasing as well. So if the state of Vermont were to go in that direction, it would be another agency that would want to enter into those aspects of the partnership, not our office.

[Rep. Brian Cina, Member]: So other programs at the state level, not the individual level? Yeah, other programs are similar. Because sometimes you get a gym membership benefit or something with a So it's at the higher level. That's good to know.

[Mike Pieciak, Vermont State Treasurer]: And just one point on that. On the steering committee, one thing that we've heard from the members of it is that some other states are thinking about joining, not even to join for a specific program, but to just join to engage in the conversation and the collaboration that's happening across states to hear what they're working on in the area of healthcare and what policy ideas could be exported to their state. So I think it's not a specific program, but I think there is a general benefit just in that collaboration and coordination.

[Rep. Brian Cina, Member]: That ties into two other questions. I'll just throw all those in here. You just mentioned that we would be like grandparented in, I'm trying to be gender neutral here, like would that not have to pay a fee in the future if we do this now, so there's some sense of not necessarily urgency, but there's maybe a benefit to being timely about this. And so I'm curious why we would be grandparented in. And then the other question related to interstate partnership or collaboration is, you were just alluding to, which is what other aspects of insurance and could this eventually lead to interstate collaboration or interstate insurance plans, combining our risk pools, that kind of thing, that's potentially low cost.

[Mike Pieciak, Vermont State Treasurer]: Yeah. So I mean, on the timeliness point, what I view as timely, then the reason we decided to propose this now, because the controller mentioned it to me back in 2023, is really those targeted groups I mentioned and how we expect them to grow next year and in the coming years. Like more people uninsured, more people uninsured, more people not having pharmacy coverage that are on Medicare because there's so much disruption in that marketplace with Medicare Advantage leaving Vermont and a lot of people not knowing that they also have to get pharmacy coverage. And then also the advent of those weight loss drugs, those become more and more and more popular. So like in each of those categories that already have a benefit now, we expect them to grow over the coming years. So that's where we felt the sense of urgency. But when we did engage with the Rare Rx, they did also on top of that say that we would be basically the last state that didn't have an initiation fee because there are startup costs for them to get a state on board, but we wouldn't, we have the benefit and the luxury of not having to pay those. They're planning to implement them going forward, but because we had engaged with them joining, we're not gonna have to

[Rep. Brian Cina, Member]: So they're being nice, basically. They're being nice to us. They're like, look, we're already talking.

[Mike Pieciak, Vermont State Treasurer]: We're gonna

[Rep. Brian Cina, Member]: change our policy, but since we've established this relationship, we're not gonna ask you. We're not gonna that's cool. And it's a real simple reason.

[Mike Pieciak, Vermont State Treasurer]: And on the interstate compact, I do think it can lead to other interesting areas of collaboration. Somebody was just talking to me about this, and it's not to say you can't do it, but one of the challenges with states working together on something like that risk pool is almost inevitably one of the states is going to win and one of the states is going to lose in terms of who's subsidizing who. So, think it ends up being more of like a political issue between the states of like, how do you work that out? Because it's not a good look if the residents of one state are paying for the residents of another when they go and ask their political leaders, why are we paying XYZ state? So it's something that would have to sort of be figured out as a hurdle. But there's a lot of different places this kind of collaboration could go to.

[Rep. Brian Cina, Member]: Okay. And then those are two questions. You mentioned that BICS could be used at certain pharmacies, and you showed us the search. I'm curious, can it be used at hospital or other facility pharmacies and could this potentially be a way that the hospitals could work with patients to reduce costs through the hospital system? If you don't know, it's okay, but I was just wondering because UVM has a pharmacy.

[Mike Pieciak, Vermont State Treasurer]: Yeah, they do.

[Rep. Brian Cina, Member]: And what if the patient's like, hey, this is going to be cheaper. If I use my card, can the hospital let them? Or when they're in the facility as a patient, are they not allowed to do that? That's a-

[Mike Pieciak, Vermont State Treasurer]: Right. Most hospitals would have a pharmacy like that. My sense, and I get you the definitive answer, is that this is for drugs that are administered out of hospital. So we'll get a definitive answer.

[Rep. Brian Cina, Member]: It's not a deal breaker, or it's just an opportunity as seen for cost savings, we could, if even it shaved a little bit off the expenses of patients on their own facilities. And then you mentioned all people need is an address, what if they're homeless? Do they have to give a mailing address? Could it be a PO Well, I saw a PO box, but could it be like the community resource center or the shelter?

[Mike Pieciak, Vermont State Treasurer]: There's a place where they're getting their mail, then that would be sufficient.

[Rep. Brian Cina, Member]: And the last question, I'm trying to be quick.

[Rep. Alyssa Black, Chair]: No, go ahead.

[Rep. Brian Cina, Member]: Is This might've been answered in the mix, I don't remember and I think it's important, like when people use the card and they're spending out of pocket on the medication through this program as opposed to using another program, do those out of pocket expenses count towards a deductible or not? That was the piece that I'm missing. They don't? See

[Rep. Alyssa Black, Chair]: you're No, not even that's

[Rep. Karen Lueders, Member]: what I understood. It does not.

[Mike Pieciak, Vermont State Treasurer]: The way that there could you know, the law you could change the law to make it such that it would.

[Rep. Alyssa Black, Chair]: Why don't we hold this question until Charlie testifies? Because I think Charlie probably is gonna have some things to say about it.

[Rep. Brian Cina, Member]: But I think the immediate answer is no.

[Mike Pieciak, Vermont State Treasurer]: Well, I think it's maybe.

[Rep. Brian Cina, Member]: Okay. We believe it in maybes. Believe it in maybes. Because that's so it's not just unclear to me. And that makes me feel a little better because I'm like, this is still unclear. Okay.

[Mike Pieciak, Vermont State Treasurer]: And to be clear, like in other states that have different laws, it was more clear. When Connecticut said, like in Connecticut, it's clear that it does not count toward your deductible. Okay. But they are pursuing, as I understand, a change in their statute to change that element. But in their law and other states, it's clear that it doesn't. It's a choice. Do you get the discounted drug or do you pay a higher amount and have it counter your deductible? So again, somebody that's uninsured or doesn't have prescription drug coverage, there's no choice there. For others that or their specific medications aren't covered, like with the GLP-one. But somebody that is under insured, they have to make that determination.

[Rep. Francis "Topper" McFaun, Vice Chair]: I get it. Thank you.

[Rep. Alyssa Black, Chair]: I think, Leslie, you, I think everybody has If we could

[Jennifer Carbee, Legislative Counsel (VT General Assembly)]: share those slides, that would be

[Rep. Karen Lueders, Member]: really Yeah,

[Rep. Francis "Topper" McFaun, Vice Chair]: for sure.

[Rep. Karen Lueders, Member]: That would be really Oh, you got them?

[Rep. Alyssa Black, Chair]: So I have Karen, and then I have Topper, and I have Lori, and Wendy, And then me. Nice. Loves it. One

[Rep. Karen Lueders, Member]: thing that strikes me is that by paying only 20% of the cost of a drug, we're still being pharmacy friendly. So I'm trying to get my wrap around the enormity of how the pharmaceutical companies or whatever might be over checking. The extent of that, this seems extraordinary, but I don't quite understand how that mechanism could be so powerful. But my two questions are: Do you have any idea, given the groups that we have that you've identified, what the projected savings might be for Vermonters overall? And then secondly, would these savings anyway save the system?

[Mike Pieciak, Vermont State Treasurer]: Right.

[Rep. Karen Lueders, Member]: It's sort of a little bit what Representative Chittenden was talking about, that would like if folks are paying less for their yards, does that save the expense? Health insurance premiums or other?

[Mike Pieciak, Vermont State Treasurer]: Yeah, know it's a And your first question again?

[Rep. Karen Lueders, Member]: Just what are you projecting for

[Mike Pieciak, Vermont State Treasurer]: Yes, savings. So I think the answer the second one is yes, and we'll get into that in a second. But what are we projecting for savings? In Connecticut, they've seen on average, again, people that are using the card regularly over $200 a month in savings. So it all depends on how many people use the card and then collectively what those savings are. But even if we match what Connecticut has done and they had a pretty good ramp up, even though they are saying they want to have a lot more, we would see millions of dollars collectively saved. So significant amount total and a significant amount for an individual, potentially thousands of dollars a year. I think you saw those examples of someone saving $150 somebody saving $90 somebody that's using the weight loss drug saving $800 So, if you blend that all together in sort of an average, it gives you a sense of what someone might be seeing in terms of savings.

[Rep. Karen Lueders, Member]: Well, just to follow-up with that, given our population and the projections of the people we have in that population, do you put a number to that? Or is it just still completely

[Mike Pieciak, Vermont State Treasurer]: Yeah, I think the reason it's hard to say what our average will be because we just don't know the mix of all the various drugs. And then I think it's hard to say what the total will be because it's dependent on how many people sign up. But I think it's safe to say that it'll be millions when it is in in you know, when it's operationalized and we have the uptake that's similar to Connecticut. And and will it save money on programs? You know, You could imagine a state employee using this card and taking the discount and as a result, saving the plan money. It's not being picked up under the plan. You could see other scenarios like that for small businesses or commercial payers, people on the exchange. So I do think it has that potential to have those savings be felt also through different insurance plans as well as the individual saver.

[Rep. Alyssa Black, Chair]: Topper? Yeah.

[Rep. Francis "Topper" McFaun, Vice Chair]: Thank you. How long has this card been in effect, this program? How long has it been in effect?

[Mike Pieciak, Vermont State Treasurer]: Well, I know that they rebranded in 2022 to bring additional states into the collaborative, but I believe Oregon and Washington have been using it for, I don't know how much longer, but for longer than that. So it's at least been with these other five states since 2002. But those two states, Washington, Oregon, have had it for longer than that. Don't know.

[Unidentified participant]: Stephanie, I was from Connecticut and on the steering committee. I feel I asked that question better if the collaborative's existence is, I think, 2004 or five.

[Rep. Francis "Topper" McFaun, Vice Chair]: In the six states? Yeah. Since 2004?

[Unidentified participant]: For a long time it was just Washington and Oregon collaborating, and the drug CARD program is a part of more risk development, but hopefully Stephanie who's on could speak to some of those details in the pipeline.

[Mike Pieciak, Vermont State Treasurer]: So I think the rebranding of it being called the RayRx to bring in upper states was more recently in 2022.

[Rep. Francis "Topper" McFaun, Vice Chair]: I'm going to give you an example. I'm having a problem. When I go to the drugstore, there's several of these programs that can bring down your drug costs. And they ask me, do you want a noob, if it's Sonal Rx, whatever they are, they ask me, the reason they do that is because it's cheaper to get it the other way with the car. Now, what I have to do in my mind, because I do have the state's income control, I have to try to figure out, okay, how much am I gonna save? Have to get down to the end. Because in around September, I don't pay for anything. Right. And there's a tremendous savings for me personally. I have to take a lot of stuff. Well, that's the truth. So anyway, I just can't see somebody standing there like I do and try to figure that out. It's a fair point. It's better for me to use the guide now, and how much am I gonna save over those six or eight months? And Yeah. So It

[Mike Pieciak, Vermont State Treasurer]: seems complicated. I totally appreciate your point.

[Rep. Francis "Topper" McFaun, Vice Chair]: And most of the people that are gonna be in that position are gonna be old people like me. Right.

[Mike Pieciak, Vermont State Treasurer]: A lot of experience to make

[Rep. Alyssa Black, Chair]: A that shiny

[Rep. Francis "Topper" McFaun, Vice Chair]: person. Good looks and all that stuff, got the years behind me.

[Mike Pieciak, Vermont State Treasurer]: So the way I think about that, because you're absolutely right. That's the part where it gets complicated for an individual because they have to make that choice. So the way I think of it is first, what are the populations that don't make that choice? It just simply benefits them. And it is those folks that are uninsured, folks that have insurance, but don't have a Part D or other pharmaceutical coverage, folks that don't have the drug that is covered on their insurance. So those folks only benefit. There's no decision for them. And then there's younger people that are just don't, they're just not regularly meeting their deductible. It's a high deductible. It's a pretty easy decision for them. People that are late, like say you run out in September, but let's say somebody got prescribed a drug in September and they have a large deductible plan. Well, then they would say, Well, it's pretty clear I'm not going to get my deductibles here. But then it's those other folks, right, that are starting at the beginning of a plan year and are making those choices. And that is the population that it is a little bit more challenging for. You'll hear from the healthcare advocate about ways to look at laws that are in Vermont. But if that deductible if this discount card did count toward your deductible, then that difficult choice would go away because you wouldn't have to choose between them anymore. Like you would get the benefit of the discount card and it would count toward your deductible. So that's just something else to think about.

[Rep. Alyssa Black, Chair]: Thank you. Lori? I'm good. Okay. Sure.

[Rep. Karen Lueders, Member]: Who is actually eligible for this? Would non citizens be eligible? Because I saw you only had to put in your date of birth and an address. So would our migrant population be eligible for this car?

[Mike Pieciak, Vermont State Treasurer]: Anyone living in Vermont that has a Vermont address, name and date of birth. So whether that's somebody that There's an example that somebody from the RA RX steering committee gave us of a friend that was visiting them from Canada, I think, for a month, and they had something that they needed to get that had happened to them while they were visiting. So they downloaded the card, put their friend's address that they were staying at, got it instantaneously, went to the pharmacy and used it. So really, those are the eligibility requirements. It's pretty broad.

[Rep. Karen Lueders, Member]: So just a Vermont resident?

[Mike Pieciak, Vermont State Treasurer]: Or even a Vermont address, because it can be someone living in New Hampshire that works in a Vermont company, and they can put their Vermont business address in. That is something the steering committee has told us that they determine as being eligible.

[Rep. Karen Lueders, Member]: And one more question. Should this become a thing? Would this be something that could be offered, like if they call me back and we're trying to get on some sort of insurance, would this be something that would be offered to, like, state it?

[Mike Pieciak, Vermont State Treasurer]: Right. Mean, would be great. I mean, just in terms of the partnership and the outreach and the marketing, we have different populations that we interact with regularly, like retired teachers and state employees and municipal workers and active workers and people that are in our Vermont SAGE program. And there's opportunities, I think, to cross collaborate with those groups. But I think there's a lot of opportunity to cross collaborate with groups that the administration regularly interacts with, including with Diva. So I think that would be a good opportunity for us.

[Rep. Karen Lueders, Member]: I think so too. I mean, we do offer that health keeper monitor. It's not default to absolutely nothing in the system. So this is actually a benefit. Yeah.

[Mike Pieciak, Vermont State Treasurer]: And I understand it's your birthday today too.

[Rep. Allen "Penny" Demar, Member]: Same criteria, date birth and address for these other five states?

[Mike Pieciak, Vermont State Treasurer]: Yeah. It's eligibility for everybody.

[Rep. Allen "Penny" Demar, Member]: Yeah. The other five states have the same criteria.

[Mike Pieciak, Vermont State Treasurer]: Yeah. Exactly. And that's why they're giving us they were the ones that giving us examples of somebody visiting the state for some period of time, somebody working in the state, living somewhere else.

[Rep. Karen Lueders, Member]: I love that. So in the bill, the bill

[Rep. Alyssa Black, Chair]: is largely kind of a fee section. And I'm still a little confused as so we're giving you the authority to set up a fund, and you can put money into the fund, and you can have a fee for users. Who would I'm confused as to who users are.

[Mike Pieciak, Vermont State Treasurer]: Users would be the account holders. So when you say that there's a fee, we don't charge them a direct fee. The language can get a little confusing. But there is that embedded discount fee that I mentioned that goes to RayRx.

[Rep. Alyssa Black, Chair]: Just built into the cost of what they're Okay.

[Mike Pieciak, Vermont State Treasurer]: Yeah, exactly right. So I think the thought was that language was required to be in there for that embedded discount to flow through to ArrayRx.

[Rep. Alyssa Black, Chair]: Okay. So would so the treasurer's office and your special fund, it would flow into your fund and then you would disperse that to ArrayRx.

[Mike Pieciak, Vermont State Treasurer]: So it actually goes directly to ArrayRx, but it's potential that they keep an accounting of which states are paying which fees through their cardholders. And then they apply that against administrative fees. And like I said, that is sort of how they fund their program. But there's the possibility, as I understand it, that they'll have excess fees for a particular state and then those would be distributed back to a participating state. So there's a possibility there that I think it's going to be very marginal because they don't charge a lot for the fee. They just want to run the program. But there's that possibility of additional revenue indirectly from ArrayRx.

[Rep. Alyssa Black, Chair]: I have a question regarding Okay, so as we know, drug manufacturer pricing, PBMs, it's an enigma thrown into a black hole, and the mechanism for payment. So I'm thinking about, if I let's say, and we know about the vertical integration in healthcare. The pharmacy is owned by PBM, which is owned by the insurance company. Let's say, for example, I have Optum. I have UnitedHealthcare as my insurance, my drug, my Rx policy is held by Optum. Optum makes me get my prescription drugs through OptumRx, a mail order, and then there's all the rebates that go here and there and who knows. Can I use, if I have a mail order and say I use OptumRx for certain prescriptions, can I choose not to use my OptumRx PBM to get my mail order drugs And can I use the discounted price from ArrayRx instead?

[Mike Pieciak, Vermont State Treasurer]: Yeah. So there are, I think I can partly answer the question, which is that there are mail order options through ArrayRx where you get their discount. But whether Optimum is requiring you to use their, I mean, you would still think you could still use the discount because you're not relying on insurance to buy the mail order discount because you're not relying on your insurance to buy the drug.

[Rep. Alyssa Black, Chair]: But you would have to use that mail order when maybe half your prescriptions are with one mail order, half with the other. Now you'd have to I mean, I can't imagine that OptumRx would allow you to use their Optum mail order pharmacy and not use OptumRx PDM through their insurance, which is owned by the same entity.

[Mike Pieciak, Vermont State Treasurer]: Is your question like, would they honor the discount card? Yeah. It may or may not. I mean, you could look, you can see online, is there agreement with them and like, are they a mail order pharmacy that provides the discount? There are mail order pharmacies that do, but not to suggest that Optum does. So I think that would be the decision point would be, do I go through my insurance or do I not? It's the same decision you're making sort of at the counter at the pharmacy. It's just through the mail order process.

[Rep. Alyssa Black, Chair]: My last question, to the point where it's all an enigma. So I understand that Vermonters, if you are uninsured, underinsured, you've lost your Medicare Part C and you couldn't afford Medicare Part D. Now you Or you're unaware. Or you're unaware, so you have no pharmacy coverage. I can understand all the people that are going to benefit from this. Who's going to hate it? Who stands to lose in all of this?

[Mike Pieciak, Vermont State Treasurer]: I mean, I think it's really a win win because you could say, well, what about the pharmacies? But they've negotiated these rates. And the question about the other pharmacy cards, those are for profit cards. They don't have the same motive to work with those pharmacies and ensure that they don't get undercut. So there is a better reimbursement rate. We think these

[Rep. Alyssa Black, Chair]: cards Private information.

[Mike Pieciak, Vermont State Treasurer]: They don't sell it. So it exists now, but I think there's a better deal all the way around. And the fact that it's a state backed card, I think gives it more credibility for users and that's more sustainable in terms of outreach and marketing and awareness. So that's why I think it's a better approach. So I see it as a win win across the board.

[Rep. Alyssa Black, Chair]: Are health insurers going to I mean, I'm thinking through the health insurers, their PBMs, are getting the rebates back. If people use these cards instead of going through their, if they use ArrayRx instead of going through their insurance, then the insurance company and PBM that administers the insurance's pharmaceutical benefit, they're losing their rebates.

[Mike Pieciak, Vermont State Treasurer]: Yeah, they also aren't absorbing the costs of the coverage. So I would think that as it stands now, insurance would see that this is potentially a cost reduction for them. It's to the representative's question earlier, like those programs could see reduced costs because they're not picking up the pharmaceutical costs. If it does, I guess the question you'd want to ask the insurers is this point about clarifying the language. If it does count toward a deductible, how do they feel about that? Because then it's not being picked up by them. You are paying out of pocket, but it is counting toward a deductible. I think even there, you are paying less for the drug. So it's a lesser amount going toward the deductible. And in most cases, people one way or the other find a way to get their medications. So I don't think I don't think it all of a sudden encourages more people to buy more medication. I think it's the medication that they need to buy.

[Rep. Alyssa Black, Chair]: I'm just trying to think through who

[Rep. Allen "Penny" Demar, Member]: I hate this.

[Mike Pieciak, Vermont State Treasurer]: But I would think the insurance I think talking to the insurance company about that other change would be

[Rep. Francis "Topper" McFaun, Vice Chair]: good.

[Rep. Alyssa Black, Chair]: I know that Daisy has her hand up, but I feel like as I was asking my questions, I saw other ants.

[Rep. Francis "Topper" McFaun, Vice Chair]: One to you, right.

[Rep. Alyssa Black, Chair]: Okay. I'm going to go topper, then I'm going to go Daisy, and I see Leslie.

[Rep. Francis "Topper" McFaun, Vice Chair]: You're up. You just made a statement, and I want to make sure I hear it. You said it was a state backed Tell me what that

[Mike Pieciak, Vermont State Treasurer]: means. So, you

[Rep. Francis "Topper" McFaun, Vice Chair]: know- The state of Vermont?

[Mike Pieciak, Vermont State Treasurer]: Right, so ArrayRx, it doesn't exist other than the states that participate in the collaboration. So it's state run, state owned, state facilitated. So when we're saying we're a member of ArrayRx, it's really the state of Vermont that's putting its infra mater on it and saying this is a state run card. Whether it's the state of Ohio that's doing the program administration or whether it's us that's doing the outreach and marketing, it's a state run card in that sense and not an independent for profit company.

[Rep. Francis "Topper" McFaun, Vice Chair]: With all due respect, that was why I asked you earlier what kind of coordination is there with the present administration? Right. That's what I asked.

[Mike Pieciak, Vermont State Treasurer]: Yeah, yeah.

[Rep. Francis "Topper" McFaun, Vice Chair]: Now, what if we decide in this room, and we've talked about this an awful lot, you get rid of PDMs. How does that affect us?

[Rep. Alyssa Black, Chair]: Can you tell me how we do that?

[Rep. Francis "Topper" McFaun, Vice Chair]: We've talked about it.

[Rep. Alyssa Black, Chair]: In our dreams.

[Rep. Francis "Topper" McFaun, Vice Chair]: It's more than a dream. I think it'd be nice to have an effort. Yeah. Because all they do is put money in their pocket.

[Mike Pieciak, Vermont State Treasurer]: Yeah, PBMs aren't created equal, right, in terms of who they are and what service they're trying to fulfill. And you can talk to the steering committee more. They have more relationship with this particular PBM. But from all we've heard, they are clear and transparent and sort of mission aligned with the states that are trying to deliver discount to the residents. They're going to do well? That's a question for Stephanie.

[Rep. Karen Lueders, Member]: While you were testifying, they're

[Rep. Alyssa Black, Chair]: actually half owned by Costco. Let's go with Daisy, and I'd like to try to move us forward a little bit. Can you talk a little bit about how widespread the pharmacies that accept this are and what impact this may or may not have on the pharmacy business locally?

[Mike Pieciak, Vermont State Treasurer]: Yeah, so like a lot of places, the independent versus retail pharmacy, it's more and more retail pharmacies, more Walgreens and CVS and less hotel pharmacies like where I went in Brattleboro. So that's sort of a growing trend. A lot of those national and regional pharmacies are already in the ArrayRx network. So 65,000 plus pharmacies. There are a lot of independent pharmacies as well. I don't have the number for Vermont, but Connecticut's at 80, sorry, 98% of pharmacies in Connecticut are covered by ArrayRx. So, I think we could expect a relatively similar number for our state. And then in terms of that benefit or that work with those pharmacies, like I said, Array sort of has a better reimbursement rate than other discount cards. So it's better than the current situation for many of those independent retail pharmacists. So, should be, we talked at length with the steering committee about this. Their goal is not particularly in rural areas where there might only be one pharmacy. Their goal is not to try to undercut that pharmacy. So they're losing money on all of the transactions because it's not to anybody's benefit. It's not to our citizens benefits for us to have a program that does that. So that was an important point for us to talk with them about. And understand.

[Rep. Alyssa Black, Chair]: Leslie, and then we need to move on to our

[Rep. Leslie Goldman, Member]: next question. Thank you for this, hopefully, moving forward. I just heard the word fees, and I'm about that because fees are loaded in this environment. But I don't see anything in here about fees. So I'm thinking, is there another word? Was how did that idea of fees come up? Can we

[Rep. Alyssa Black, Chair]: use a different word? Is it

[Mike Pieciak, Vermont State Treasurer]: Yeah. So I think the the fee you know, there's no fee that comes to Vermont. There's no fee that we charge for the card. But there is this cost that's the cost to run the program is embedded in the discount.

[Rep. Alyssa Black, Chair]: So

[Mike Pieciak, Vermont State Treasurer]: that's the fee that we're talking about is the embedded

[Rep. Alyssa Black, Chair]: It's not

[Rep. Leslie Goldman, Member]: a fee to us. A fee to ArrayRx. Yes. It's a fee elsewhere. So I just wanna be clear that it's not a fee to anyone in the state at all.

[Rep. Francis "Topper" McFaun, Vice Chair]: Right? Yes,

[Rep. Alyssa Black, Chair]: of course.

[Rep. Francis "Topper" McFaun, Vice Chair]: Except that in the price you're gonna pay for the drug, the fee is included. Right.

[Mike Pieciak, Vermont State Treasurer]: Yeah. And the way to think of that, right, is that the discount is always gonna be greater than the fee or you wouldn't use that card. And all of those other discount cards, that's sort of how they generally operate as well.

[Rep. Allen "Penny" Demar, Member]: Determined. Oh, I'm sorry.

[Rep. Alyssa Black, Chair]: Last question.

[Rep. Allen "Penny" Demar, Member]: Who determines the percentage of that feed?

[Mike Pieciak, Vermont State Treasurer]: Yeah. So that's Oregon and ArrayRx in the negotiation with the pharmacies in terms of like what

[Rep. Allen "Penny" Demar, Member]: We wouldn't have no control over that. We would in terms the

[Mike Pieciak, Vermont State Treasurer]: steering committee and like the governance structure, but it's not us as employees of our department making those independent negotiations.

[Unidentified Committee Member (female)]: Last statement. That question. As I think through this and so many questions, but it's typical of what we deal with in health insurance. Every plan is different. There's fees at every level. We have very little control of it around this table.

[Mike Pieciak, Vermont State Treasurer]: It's always complicated in health insurance.

[Rep. Alyssa Black, Chair]: All right, thank you.

[Mike Pieciak, Vermont State Treasurer]: Yeah, and please follow-up with any additional questions that you might have.

[Rep. Alyssa Black, Chair]: Thank

[Mike Pieciak, Vermont State Treasurer]: you. You for your time.

[Rep. Alyssa Black, Chair]: Thank you. And I think we have one more one more guest from Connecticut.

[Rep. Francis "Topper" McFaun, Vice Chair]: Oh, yeah.

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: Stephanie? Hi, everyone. How are you?

[Rep. Alyssa Black, Chair]: How are you? Thanks for joining Thank

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: you for having me. I appreciate it. You know, just appreciate Chairwoman Black and the members of your House Health Care Committee for really just allowing me to testify today and share a little bit in support of ArrayRx. You know, I also just, I know that you've heard some really great testimony already from Comptroller Scanlon. His leadership on drug affordability has been ground, really just been grounded here in Connecticut on policy expertise and real lived experience. So, just appreciate that he was able to join you all as well. For context, I'm actually testifying today in my role as Senior Advisor for Health Policy Initiatives here at the Connecticut Office of the State Comptroller, serving under Comptroller Sean Scanlon. I'm also the Program Director for ArrayRx Connecticut, and I represent Connecticut on the steering committee for ArrayRx. So, my perspective really just comes from overseeing the day to day implementation of the program, working directly with community partners and pharmacies, and collaborating with other states to really shape the direction of the consortium. So sharing with you today, I really just want to share the experience implementing ArrayRx, not just what the program is, but why it worked and what we've learned along the way, as well as really what we would do differently if we could start again. So just a little bit of context. I know Sean did a great job, but when Connecticut really began exploring prescription drug affordability solutions, our really focus in the short term was clear. We were looking for a program that could be implemented quickly, support as many people as possible, and make tangible difference in people's lives without creating new barriers. We wanted something simple, inclusive, and immediately useful, which is really what ultimately led us to ArrayRx. So as you've heard, ArrayRx is not a private discount card company. It is a state led consortium and is built and governed by public sector leaders who manage pharmacy benefits like me, Medicaid programs, resident facing health initiatives. Our states work together to really design pharmacy solutions that prioritize access, affordability, and transparency with public interest truly at the center. For Connecticut, that meant launching a program that's open to our 3,000,000 plus folks that are living in our state. There is no age, income, insurance, or immigration status restrictions tied to the ArrayRx Discount Card Program. If you live part or full time here in Connecticut, you are eligible to sign up for this free program and start seeing savings immediately. Every FDA approved medication is eligible for some sort of discount, and people are seeing savings of up to 80% both in front of and behind the pharmacy counter. At the most practical I'm so sorry. The joys of working from home, if you can hear my dogs. At the most practical level, anything with a national drug code or NDC level code qualifies for some sort of discount. And that includes prescription medications, vaccines, and many items that you don't always expect, so things like aspirin, cold and flu medications, and even diabetes testing supplies. That simplicity truly matters. When someone is standing at the pharmacy counter, the clarity and immediacy truly make a difference between filling a prescription and walking away from it. So as we evaluated the discount card options, one concern really rose to the top very quickly, and that was our pharmacies. I've heard a lot from your great committee today. The passion that you all have behind making sure that your independent pharmacies are protected and secure is truly exactly how we felt here in Connecticut. So we wanted a program that supported our independent pharmacies, not one that added stress or financial risk. Pharmacists want to help their patients save money, you know. But at the end of the day, if a program requires pharmacies to absorb fees or losses, it forces them into an impossible position, and ArrayRx does not do that. The ArrayRx model ensures that pharmacies are reimbursed both for the cost of the medication and the dispensing fee. That design choice was critical and intentional for us. It meant that pharmacies could confidently offer the program knowing that they're supporting patients and they're keeping their businesses viable. So, as we worked through that, we knew, you know, what it would take to bring a discount card program to Connecticut. We also really had to think carefully and consider the administration and sustainability. So, there is a small administrative fee that's included in the discounted price that members pay at the pharmacy counter. That fee exists to cover the real cost of operating the program and supporting shared infrastructure of the consortium. Those funds are actually held through Oregon in a statutorily protected prescription drug fund. Each year, the ERIC Steering Committee sets an operating budget. A portion of each state's collected administrative dollars is applied to that budget based solely on utilization. So, each state pays only for what it uses, no more and no less. Any remaining funds attributed to a particular state are returned annually to support program outreach, education, and growth. That structure gave Connecticut really the confidence to be able to scale responsibly without shifting costs onto pharmacies or onto residents. And over time, our experience with ArrayRx became much more than a short term success solution with the discount card. In the long term, joining the consortium has really given Connecticut a seat at the table with other states facing the same challenges and complexities in the pharmacy space. No single state can fix prescription drug affordability alone, But working together has given us, you know, some strength. We've learned, we've gained expertise and leverage, not just in operating programs, but also to explore broader policy opportunities, contracting strategies, and system improvements. So through the Steering Committee, Connecticut has really been able to shape the program for the discount card here in Connecticut, but we've also been able to contribute to solutions that benefit states across the country as part

[Rep. Francis "Topper" McFaun, Vice Chair]: of the

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: consortium. And then there's the outreach. And that's truly the part of the work that ultimately determines whether a program is successful or it fails. In Connecticut, the heart of our work has truly been community outreach, as Sean has mentioned. And that outreach has been deeply relational. Much of our success has come from supporting the people who are already trusted messengers in our communities. The community health workers helping someone navigate a new diagnosis, the staff at community health centers working with patients who are choosing between groceries and prescription medications, the care teams and the health systems that are trying to make sure a discharge plan actually works when someone gets home. So our role is to really equip those partners with simple tools and clear information so that they can support the people that they serve. I always say nobody's going to trust Stephanie from the comptroller's office that they don't know, but they will trust their pharmacist and their friends and their doctors. This is truly something that they can use today at the pharmacy, or, you know, our navigators can clearly say that, right? Or when a clinic can hand someone a card instead of another referral, those barriers really just fall away. And that's really how the program shows up in real life. So not just as a policy, but as a solution in our state. We've shown up, you know, we've shown up alongside those partners. That has been something that's also been really important to us. Jake and I are out there in the community with Comptroller Scanlon answering questions, listening to feedback, and adapting how we communicate based on what we're hearing in the field. And that has driven enrollment and trust in Connecticut. But at the same time, our biggest limitation has been very clear. We do not have a dedicated marketing budget for this program. When Sean says that he truly, the marketing budget is him, Jake, and I going door to door, that's what it really means right now. Digital outreach and the few dollars that we've had behind it has helped amplify our efforts, but we know in Connecticut we could be doing more. Awareness is access and funding that awareness really does matter. That's definitely the lesson that we would offer Vermont as you take away and think about how this could work for your own state. You all already do really strong people centered work in your communities. So if you pair that with intentional investment in digital marketing strategies and that outreach enforces what trusted partners are already saying. So you could reach people earlier, more consistently, and at a greater scale than we've been able to do thus far. AuroraRx has worked in Connecticut because it's built by states, it's governed by states, and it's accountable to the public. It met our short term need for immediate access and our long term goal of collaborative, sustainable policy change. Vermont really does have the opportunity to build on our experience, learn from our constraints, and design a program that really does deliver true value to your residents while strengthening your state's approach to prescription drug affordability. I'm happy to answer any technical questions about, to the best of my abilities, the ArrayRx Consortium, and also to share more about my experience. So, I'm happy to take any questions. And just want to thank you again for allowing me to share the support for you all joining. We'd love to have you as our Northeast buddy.

[Rep. Alyssa Black, Chair]: Great. Thank you, Stephanie, and thanks for the perspective of somebody who's already implemented this. Really appreciate that. Are there any questions?

[Rep. Karen Lueders, Member]: Chopper,

[Rep. Francis "Topper" McFaun, Vice Chair]: Bob? Thank you, Madam Chair. I listened very carefully to what you said, but I still can make mistakes. I thought I heard you say that the people that are eligible in Connecticut are the people that live full time there.

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: Part or full time.

[Rep. Francis "Topper" McFaun, Vice Chair]: Wait a minute,

[Rep. Alyssa Black, Chair]: now. Part or full time, she said.

[Rep. Francis "Topper" McFaun, Vice Chair]: Part time, if they live there part time too.

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: Yes, Yeah. We have really broad, you know, as your treasurer mentioned, we have really broad program eligibility requirements for the discount card. For example, I have a gentleman who is in my office here in Hartford. He lives in the state of New York, but he works here in Connecticut. He's able to sign up for the card because he spends so much time here. He's able to use our address, 165 Capitol Ave. He can sign up for the card and utilize the benefits as well.

[Rep. Alyssa Black, Chair]: So you just have to have an address in a participating state. Yes. Was that all correct? Oh, Brian?

[Rep. Brian Cina, Member]: Can I use your address to sign up for the card?

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: Come on down, friend. My toddler uses it. I use it. My husband uses it. You just got to do what you got to do to save a buck. I get it.

[Rep. Brian Cina, Member]: So you really could. So my brother lives in Ohio. If they join, I could potentially reside with my brother.

[Rep. Francis "Topper" McFaun, Vice Chair]: Or you can visit.

[Rep. Brian Cina, Member]: Yeah, but I could also reside technically. Mean, you have to be visible.

[Rep. Alyssa Black, Chair]: Did you have any other questions? Well,

[Rep. Brian Cina, Member]: the question was, is it really that I mean, I framed it as a joke, but the question really was, is really that flexible, it sounds like?

[Rep. Francis "Topper" McFaun, Vice Chair]: There's not a

[Rep. Brian Cina, Member]: lot of accountability. Don't want to use it as a negative thing because it could be, but except that there's no harm to anyone, but there's not a lot of checking. No one's looking at your papers. No one's doing background checks and deeply searching to make sure that you are Perfect.

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: Yeah. And that's intentional, right? Because we know that ultimately when folks have access to affordable medications, they take those affordable medications, they stay on their current therapies. I'm a public health professional, so this for me is Public Health 101. When folks are on their medications and can actually stay in that continuum of care, it is going to ultimately benefit everyone. There's less people going to the emergency rooms. There's less people going to their doctors. That means that we're saving healthcare costs overall. We're making sure that we're not putting additional stress on the system that doesn't need to be there. So I consider it a positive that anyone can sign up for this program. And personally, when I'm sharing about this program, I share those great points because it's important. Ultimately, people just need what they need so that they can stay healthy.

[Rep. Brian Cina, Member]: So that brings up a

[Rep. Alyssa Black, Chair]: I'm to start wrapping this up because we are way over in time and we need a break. We're going to be going into lunch probably a half an hour at this point. Is that okay? I'm going to ask for two last questions and then we need to absolutely finish here.

[Rep. Karen Lueders, Member]: If we could get her testimony, that would

[Rep. Alyssa Black, Chair]: be great. If you could submit your written testimony, I'd appreciate that. Cal, did you have? Thank you. Thank you. So I'm new, I have a lot to

[Unidentified Committee Member (new)]: learn, and I can't write that fast. I have part of a sentence, and you said the state pays for what they use. Can you expand on that?

[Stephanie, Senior Advisor for Health Policy Initiatives, CT Office of the State Comptroller; Program Director, ArrayRx Connecticut]: Yeah, so the administrative fees that are collected at the point of sale, those funds collectively are held by the state of Oregon. So as we develop the ArrayRx budget yearly, each all of those collected funds are each we can tell who you know, what's been collected from what state. And ultimately your utilization is what the percentage of your funds go into that overall arrear ex administrative budget. Meaning if, you know, the state of Vermont had only 10% utilization of, you know, compared to the total consortium, only 10% of that total administrative fee that was collected would go towards that budget and the remaining would go back to the state of Vermont.

[Rep. Karen Lueders, Member]: Allen?

[Rep. Allen "Penny" Demar, Member]: Allen, never mind. Thank you. I'm also

[Rep. Francis "Topper" McFaun, Vice Chair]: Thank gonna go

[Rep. Alyssa Black, Chair]: you so much, Stephanie. We really appreciate you joining us. And as you can tell, we have lots of questions and I'm sorry to end. So, we're going to take a short break. Maybe I'd like everyone back here at 11:10. So, that's a seven minute break and we can go off of live. Who