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The Alabama Senate today passed a bill that will help the state’s teacher insurance program avoid costly litigation and save the state hundreds of millions of dollars annually in prescription drug costs.
Senate Bill 571, sponsored by Senator Trip Pittman (R-Montrose), clarifies a section of current Alabama law to allow the state’s Public Employee Education Health Insurance Plan (PEEHIP) to negotiate favorable prescription drug rates, aligning the teacher’s insurance plan with other state health insurance programs like Medicaid and SEIB.
Without this clarification of the law, PEEHIP could be subjected to costly litigation and ultimately see an increase of at least $200-$300 million annually for prescription drug costs. If forced to incur these costs, PEEHIP would have no choice but to increase member premiums roughly $100-$200 a month for individual and family coverage.
“I'm pleased that we were able to catch this discrepancy in the law while we were in session, this situation is one that could easily have bankrupted PEEHIP or forced teachers to pay unbearable premiums,” Senate President Pro Tem Del Marsh said. “Thanks to Senator Pittman for bringing this bill, the teachers’ insurance board will now be able to continue negotiating reasonable rates and providing affordable coverage to our teachers.”
“This bill will help the state avoid costly and prolonged litigation to resolve an issue we can very easily resolve through legislation,” Senator Pittman said.
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