Nevada has been relatively active in the most recent legislative term on healthcare price transparency, costs, and markets. Nevada’s primary effort in healthcare transparency and cost containment in 2017 was the Nevada Care Plan, which would have allowed anyone without health insurance buy into the state’s Medicaid program. Because of Medicaid’s low reimbursement rates for doctors and other health-care providers, it may have provided an economical alternative to private insurance, though at the cost of narrower provider options. The bill creating this new Medicaid buy-in cleared the legislature, but was vetoed by Republican Governor Brian Sandoval.
Nevada also gained widespread attention as the first state to target medicines for a specific ailment, passing SB 539 which requires more transparency from drug makers over their pricing of diabetes medicines. The pharmaceutical industry pushed back with a lawsuit claiming the transparency law is “unprecedented and unconstitutional,” because it interferes with well-established patent law by robbing drug makers of their right to protect trade secrets. The case is outstanding in Nevada District Court.
Nevada’s latest legislative session ended on June 6, 2017. The Legislature is currently in the interim period between legislative sessions as there is no regular 2018 legislative session.
Recent Legislative Developments
|2017||SB 539||REVISES PROVISIONS RELATING TO PRESCRIPTION DRUGS requiring the Department of Health and Human Services to compile certain lists of certain prescription drugs that are used to treat diabetes; requiring the manufacturer of a drug included on such lists and a pharmacy benefit manager to provide certain information to the Department; requiring the Department to compile a report based on such information; requiring a manufacturer of prescription drugs to submit a list of each pharmaceutical sales representative who markets prescription drugs to certain persons in this State; prohibiting a pharmaceutical sales representative who is not included on such a list from marketing prescription drugs on behalf of a manufacturer; requiring each pharmaceutical sales representative included on such a list to report certain information to the Department; requiring certain nonprofit organizations to report to the Department certain information concerning certain contributions and benefits received from drug manufacturers, insurers and pharmacy benefit managers or trade and advocacy groups for such entities; requiring the Department to place certain information on its Internet website; authorizing the Department to impose an administrative penalty in certain circumstances; providing that certain information does not constitute a trade secret; imposing certain requirements on a pharmacy benefit manager; requiring a private school to allow a pupil to keep and self-administer certain drugs; requiring certain insurers to provide certain notice to insureds; providing penalties; and providing other matters properly relating thereto.||Passed – Signed by Governor on 6/15/17. Chapter 592.|
|SB 265||REVISES PROVISIONS RELATING TO PRESCRIPTION DRUGS requiring the Department of Health and Human Services to compile a list of prescription drugs essential for treating diabetes in this State; requiring the manufacturer of a prescription drug included on the list to report certain information to the Department; requiring a manufacturer to notify the Department in advance of planned price increases for such drugs; requiring a manufacturer of prescription drugs to submit a list of each pharmaceutical sales representative who markets prescription drugs to certain persons in this State; prohibiting a pharmaceutical sales representative who is not included on such a list from marketing prescription drugs on behalf of a manufacturer; requiring each pharmaceutical sales representative included on such a list to report certain information to the Department; requiring certain nonprofit organizations to report to the Department certain information concerning contributions received from drug manufacturers, insurers and pharmacy benefit managers or trade and advocacy groups for such entities; requiring the Department to place certain information on its Internet website; authorizing the Department to impose an administrative penalty in certain circumstances; requiring a private school to allow a pupil to keep and self-administer certain drugs; requiring certain insurers to provide certain notice to insureds; providing a penalty; and providing other matters properly relating thereto.||Inactive – Vetoed by Governor on 6/2/17.|
|2017||AB 382||CAPPING COSTS ON ER BILLS: requiring certain hospitals, independent centers for emergency medical care and physicians to accept certain rates as payment in full for the provision of emergency services and care to certain patients; providing an exception under certain circumstances; requiring the submission of certain reports relating to policies of health insurance and similar contractual agreements by certain third parties who issue those policies and agreements; requiring certain hospitals and independent centers for emergency medical care to submit reports to the Department of Health and Human Services concerning patient debt and rate increases; requiring the Governor’s Consumer Health Advocate to adopt certain regulations; requiring the Commissioner of Insurance to consider certain information when determining the adequacy of a network plan; and providing other matters properly relating thereto.||Inactive – Vetoed by Governor on 6/8/17.|
|AB 175||PRESCRIBING CERTAIN REQUIREMENTS FOR HEALTH BENEFITS: Removes all language raising the state’s minimum wage and instead requires employers who pay a $7.25 minimum wage to provide a minimum insurance standard equivalent to a Bronze plan under the Affordable Care Act. The state’s Supreme Court has ruled that employers need to only offer, not enroll, their employees in a health insurance plan to qualify for the lower wage.||Inactive – Vetoed by Governor on 6/9/17.|
|SB 539||REVISES PROVISIONS RELATING TO PRESCRIPTION DRUGS: Requires drug makers to report pricing histories, disclose costs, notify state officials and insurers in advance of price hikes above inflation, and report rebates paid to pharmacy benefit managers, the middlemen that negotiate favorable insurance coverage. The bill also requires diabetes advocacy groups operating in-state to disclose all contributions they receive from the pharmaceutical industry to discourage that sort of conflict.||Passed.|
REQUIRES THE DEPARTMENT OF HEALTH AND HUMAN SERVICES TO ESTABLISH A HEALTH CARE PLAN WITHIN MEDICAID FOR PURCHASE BY PERSONS WHO ARE NOT OTHERWISE ELIGIBLE FOR MEDICAID: Allows anyone without health insurance to buy into the state’s Medicaid program, which would sell under the name Nevada Care Plan. This includes people who qualify for Obamacare tax credits. State residents can use their tax credits to buy Medicaid coverage. This massive health insurance expansion would give the state’s 2.8 million residents access to public health insurance.
The Bill leaves the pricing of the buy-in and the possibility of the cost sharing measures like co-pays or deductibles to future state regulation. The buy-in coverage is pretty much identical to the coverage traditional Medicare provides, although it does not cover emergency medical transportation.
|Passed – Reintroduced as SB 539.|
We compile state statutes relate to healthcare price and competition, including healthcare transparency, markets, and costs. For a complete listing of all health related statutes visit the State Health Practice Database for Research.
Transparency in Healthcare
- NRS 439A.220 requires that the Department of Health and Human Services establish a program to increase public awareness of health care information concerning hospitals in order to assist customers in comparing facilities on care and price. The program must include, among other data-points, the following information gathered from hospitals:
- “The total number of patients discharged from the hospital and the total number of potentially preventable readmissions, which must be expressed as a total number and a rate of occurrence of potentially preventable readmissions, and the average length of stay and the average billed charges for those potentially preventable readmissions;”
- “To the extent that money is available for that purpose, for each hospital, the name of each physician who performed a surgical procedure in the hospital and the total number of surgical procedures performed by the physician, reported by diagnosis-related group if the information is available and by principal diagnosis, principal surgical procedure and secondary surgical procedure;” and
- Any other information that is useful to consumers, nationally recognized, and reported in a standard and reliable manner.
- NRS 439A.240 directs the Department of Health and Human Services to establish a program to increase public awareness of health care information concerning surgical centers for ambulatory patients in order to assist patients in comparing the facilities on quality and charges for care. The program shall contain information relating to charges imposed on outpatients for care and “the total number of patients discharged and the average billed charges, reported for 50 medical treatments for outpatients that the Department determines are most useful for consumers,” among other quality measures.
- NRS 439A.260 mandates that the Department of Health and Human Services make available a summary of the information collected pursuant to the health care information programs relating to hospitals and surgical centers for ambulatory patients (see above) for consumers, providers, representatives of the health insurance industry and the general public.
- NRS 439A.270 creates a website under the Department of Health and Human Services to publish the health care information relating to hospitals and surgical centers for ambulatory patients in such a manner that allows a person to compare facilities by geographic location, type of medical diagnosis, and type of medical treatment. The website, implemented as Nevada Compare Care, is available here.
- NRS 449B.200 creates a Legislative Committee on Health Care with the powers to, among other things, review and compare costs of medical care among communities in Nevada against other similar states, examine business trends in insurance, and examine hospitals to increase cooperation among hospitals and to increase the use of regional medical centers.
- R.S. 439B.400 mandates that each hospital in the state must maintain and use a uniform list of billed charges for that hospitals services or goods provided to inpatients. The hospital may not use a billed charge for an inpatient that is different than the billed charge used for another patient for the same procedure; however, a hospital or other person may still negotiate or contract a discounted rate from the hospital’s billed charges.
- NRS 449.500 states that the Director of Health and Human Services shall carry out analyses and studies relating to the cost of health care in Nevada and other states.
- NRS 695G.430 regulates contracts between managed care organization and providers of health care, requiring that a managed care organization shall not contract with a provider unless the organization uses a form approved by the Commissioner of the State Board of Health, for the purposes of obtaining information related to the credentials of the provider.
- R.S. 439.915 directs the Department of Human Health and safety to create a website to publish the usual and customary price that each pharmacy charges for each prescription drug stocked by licensed pharmacies.
- R.S. 689C.435 prohibits a carrier serving small employers or a voluntary purchasing group from charging a provider a fee to include the name of the provider on a list of providers of health care given by the carrier to its insureds.
- NRS 439B.260, under the chapter entitled “Restraining Costs of Health Care,” requires that a major hospital (200 or more approved beds) reduce or discount the total billed charge by at least 30 percent for hospital services provided to an inpatient who has no health insurance for the charge, is not eligible for state or federal public assistance for the charge, and makes timely and reasonable arrangements to pay the hospital bill.
- NRS 439A.100 prohibits health care providers from acquiring, replacing, or adding to their facilities and equipment, except in specified circumstances, without the prior approval of the Department of Health and Human Services through the state’s Certificate of Need process. A Certificate of Need regime aims to reduce healthcare overheard by reducing unnecessary or duplicative services, but can be anticompetitive by increasing regulatory barriers for new entrants.
- Rev. Stat. §§ 687B.120 no health insurance policy, plan, or contract shall be issued or delivered in Nevada unless the form has been filed with and approved by the Commissioner.
- NRS 687B.490 carriers offering coverage on the group or individual market must demonstrate their capacity to adequately deliver services to the Commissioner before issuing a network plan.
Nevada operates on a biennial budget cycle. Nevada’s fiscal year begins on July 1 and ends on June 30. Nevada enacted its 2018-2019 Budget during the regular legislative session. To view Nevada’s Department of Health and Human Services spending plan, click here.
- In September 2017, just three months after Nevada passed its insulin transparency law (SB 539), two drug lobbying groups, the Pharmaceutical Research and Manufacturers of America (PhRMA) and the Biotechnology Innovation Organization (BIO), filed a lawsuit asking the U.S. District Court to declare that federal law preempts several provisions of the transparency law. They claimed that the new law is unconstitutional because it interferes with well-established patent law by robbing drug makers of their right to protect trade secrets. Documents related to the case can be found here.
- In 2012, Renown Health settled with the FTC on charges resulting from its acquisition of multiple cardiology practices in Reno, NV. The FTC announced that, under the settlement order, Renown Health, the largest provider of acute care hospital services in northern Nevada, would release its cardiologist employees from non-compete contract clauses, allowing up to 10 of them to join competing cardiology practices in the Reno area. These changes to the contractual terms between the provider and physicians allowed Renown to avoid divestitures as a competitive solution. Find the FTC’s case summary and related documents here.
- Nevada was recently one of 16 states to file an amicus brief in the Ninth Circuit case Luke’s Health Care Sys. v. FTC, No. 14-35173 (March 7, 2014), explaining that the acceleration of health care costs due to the growth of large health care provider systems has become a matter of grave concern for the States.