- SB 354 Could Save State $100 Million
SANTA FE – Legislation to save taxpayers millions of dollars by requiring the State to negotiate with drug companies for lower prices has passed the Senate Public Affairs Committee by a bipartisan, unanimous vote.
Senate Bill 354, ‘Interagency Pharmaceutical Purchasing Council’, would require that all state agencies and state benefit providers who purchase prescription drugs negotiate for bulk purchasing discounts. In fiscal year 2016 the combined state agencies spent over $670 million on prescription drugs, a staggering 54 percent increase in just two years.
“At a time when budgets for classrooms and other key public services are being slashed, and proposals are being pushed to force tens of thousands of public employees to pay more for their retirement and benefits, negotiating for lower drug prices is just common sense, and urgent. By doing so, we could literally save the state millions of dollars every year,” Sen. Steinborn said.
“This bill, if implemented, could save New Mexico $100 million per year in prescription drug costs,” said Dr. Martin Hickey of New Mexico Health Connections, the state’s non-profit health plan established by the Affordable Care Act.
New Mexico is negotiating prescription drug costs on a limited basis only. SB 354 would bring more agencies into cost containment efforts by state government, expanding its purchasing power. SB 354 creates new transparency and public oversight of the negotiating Council, resulting in more aggressive and successful drug cost savings for the state.
SB 354 would require the Council to evaluate a broader range of cost containment strategies, including partnering with other states who already conduct bulk purchasing that realize billions in savings for state budgets.
Steinborn’s bill would leverage taxpayer-funded health agencies in New Mexico including the Departments of Health, Human Services, Corrections, Medicaid, retired State government workers’ benefits, UNM, and other organizations, to negotiate lower drug prices.