1 month ago

Bill pending in Senate would cost many Alabamians $1,000 per year or more in increased health insurance expenses

MONTGOMERY — The Alabama Senate Banking and Insurance Committee on Wednesday held a public hearing on SB 227, which is sponsored by Sen. Tom Butler (R-Madison).

While it has flown under the public radar thus far, the bill could potentially be one of the most costly pieces of legislation for hardworking Alabama families proposed in recent memory.

As explained during the public hearing, the measure would interfere with the ability of pharmacy benefit managers (PBMs) to negotiate lower prescription drug costs for Alabamians on group health insurance plans, including self-insured plans and other employer-based plans.

Butler, a pharmacist by trade, asserts that independent pharmacies are being hurt by PBMs. Opponents of the bill argue that PBMs save customers money, which is a good thing for the public at-large.

Justin Wright, executive vice president and chief financial officer of Abbeville’s Great Southern Wood Preserving, explained to the committee that the company utilizes a self-insured health care plan as a benefit for its employees; as such, the plan is covered between the company and the employees participating in the plan, which means that any increased costs fall on the company and the participating employees.

Voluntarily using two PBMs, Wright said that Great Southern Wood’s health care plan costs have gone down twice and stayed level twice over the past four years.

“If this bill were to pass [and] these PBMs are limited in their ability, we think it’s a cost of roughly $1.1 million (annually) to us,” Wright advised. “To put that into a per employee number, that is $1,079 (each) that would have to come out of our employees’ pockets.”

That per employee cost hike would represent an increase of between 50-130% on employees’ current payments, depending on the exact employee.

Wright subsequently outlined how, as the architect of their own plan, Great Southern Wood incentivizes its participating employees to patronize community pharmacies rather than big-box chains; this practice ends up saving the plan money while supporting locally owned businesses at the same time — and all while utilizing PBMs.

Another opponent of the bill on the day was Danny Rickert, chief policy officer for the University of South Alabama (USA) and USA Health. He underscored that USA is the largest employer in Mobile, with around 7,000 employees and 11,000 covered under USA’s self-insured health plan.

“Senate Bill 227, regarding PBMs, is going to be detrimental to the people who pay our premiums,” Rickert affirmed. “That’s both us — the university — as well as me — an employee — and all of our employees who cover the cost of our premiums.”

He added that SB 227 would essentially guarantee premium increases for those participating in USA’s employee health plan, which successfully utilizes a PBM on a voluntary basis.

Rickert stated that if the bill were to pass in its current form, the measure would cost USA employees between $4.6 million and $5.5 million annually. Per USA health plan contract holder, this would break down to between $940 and $1,100 per year.

David Cole, senior vice president for governmental affairs at the Business Council of Alabama (BCA), also spoke during the public hearing. BCA represents nearly one million working Alabamians through its member companies and local chambers of commerce, and Cole outlined that the huge cost increases projected by Great Southern Wood and USA are not unique to those two major employers under SB 227.

“The responses that we have gotten from businesses, our members from Main Street, are significant,” he shared. Cole said businesses of all sizes from the likes of Birmingham, Tuscaloosa, Fayette, Alabaster, Greensboro and Mobile had similarly expressed serious concerns with the legislation. Those that have already provided feedback to BCA with specific numbers projected annual per-employee cost increases of approximately $1,000, “in line with” Great Southern Wood’s and the University of South Alabama’s numbers. One employer, for example, estimated an increased annual cost of about $4.5 million on the business, as well as an increase of $950 for each employee per year.

He stressed that the bill would be “an increased cost burden on the backs of hardworking Alabama families.”

Cole also raised the point that SB 227, in addition to increasing costs, would decrease pharmaceutical options for Alabamians.

While some of the above numbers are certainly jarring, the most eye-opening remarks of the public hearing may have come from Diane Scott, the CFO for the Retirement Systems of Alabama, which oversees the Public Education Employees’ Health Insurance Plan (PEEHIP).

According to information provided to the committee, PEEHIP’s PBM saved the health plan an estimated $586 million in drug costs in 2020 alone.

PEEHIP is funded by both the state Education Trust Fund budget and the premiums paid by participants in the plan: mainly Alabama’s public school teachers.

While voluntarily utilizing a PBM to implement cost savings, PEEHIP has requested level funding from the legislature for six consecutive years, and its funding remains below 2008 levels. At the same time, PEEHIP has not increased member out-of-pocket costs since 2016.

Scott told the committee that SB 227 would carry an estimated cost increase of at least $159.7 million for PEEHIP through FY 2023, which would have to be passed onto public educators, the ETF budget (paid for by tax dollars) or a combination of the two.

She specified that the total shortfall facing PEEHIP in FY23, should SB 227 pass, would equate to a per-member rate increase from $800 to $972 per month from the ETF; alternatively, PEEHIP would have to raise premiums on public education employees by $1,283 annually ($106.92 monthly).

Indeed, PEEHIP would not be the only public-sector self-insured health insurance plan affected by the bill.

The fiscal note prepared for the bill confirms that SB 227 “would affect state, county or municipally-funded health insurance programs by an undetermined amount dependent upon several variables.”

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

12 hours ago

U.S. Rep. Mike Rogers: ‘Shameful’ Pelosi blocking Born-Alive Abortion Survivors Protection Act — ‘Simply supporting infanticide’

Congressman Mike Rogers (AL-03) on Wednesday released a scathing statement regarding House Democrats blocking consideration of the Born-Alive Abortion Survivors Protection Act.

Rogers announced that he has signed onto a discharge petition that would force Speaker Nancy Pelosi (D-CA) to bring this legislation — H.R. 619 — up for a vote in the House.

“As a father of three children and a Christian, this legislation is so important to me,” stated Rogers, the ranking member of the House Armed Services Committee.


All six Alabama Republicans in the U.S. House are cosponsors of H.R. 619, which was was introduced by Reps. Ann Wagner (R-MO) and Steve Scalise (R-LA) in January. The bill would ensure any baby born that survives an abortion would receive the same standard of medical care as a baby born under normal circumstances.

“I will never understand how any human would not support caring for a tiny, living baby that survives an attempted abortion,” he continued. “Anyone who is okay with not helping these babies is simply supporting infanticide. I will always stand up for the rights of the most innocent among us, and it’s shameful that Nancy Pelosi will not even bring this critical legislation up for a vote.”

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

13 hours ago

Alabama Senate passes bill banning biological males from competing in female sports

MONTGOMERY — The Alabama Senate on Thursday passed HB 391, which would would prohibit biological males from competing in public school female sports — and vice versa.

The legislation, which only applies to public K-12 schools, would prohibit competition by one gender against another, unless the event specifically is intended to include both genders.

HB 391 was carried in the Senate by Sen. Garlan Gudger (R-Cullman) and is sponsored by Rep. Scott Stadthagen (R-Hartselle).

“A public K-12 school may not allow a biological female to participate on a male team if there is a female team in a sport. A public K-12 school may never allow a biological male to participate on a female team,” says the amended version of the bill passed by the Senate.


In sports where there are not separate competitions for females and males, such as football, both genders would still be able to participate together.

“This bill is significantly important to protecting the integrity of women’s sports,” stated Gudger. “Our sisters, daughters and granddaughters deserve to compete in fairly organized sports without being put at a disadvantage. I appreciate Representative Stadthagen for having me carry this bill in the Senate, and I commend him for his diligent work on this critical issue.”

More than a dozen states are considering similar restrictions on high school athletes to prevent what they view as an unfair advantage in competition.

The Senate’s vote on HB 391 was on party lines, 25-5. This comes after two Democrats supported and one Democrat abstained in a committee vote on the bill just two weeks ago. View a tweet thread from Thursday’s Senate debate here.

HB 391 now heads back to the House for concurrence or nonconcurrence. It originally passed the lower chamber in a bipartisan 74-19 vote.

“It is unreasonable for biological males to compete against females in high school sports,” Stadthagen commented. “Allowing this to happen does not put female athletes on a fair and level playing field with their biological male counterparts, and that is what this bill aims to resolve. I was pleased to hear that my colleagues in the upper chamber value the integrity and justness of female sports, and I thank Senator Gudger for handling this bill in the Senate.”

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

14 hours ago

Senate passes Alabama Second Amendment Preservation Act

MONTGOMERY — The Alabama Senate on Thursday passed SB 358, which would create the Alabama Second Amendment Preservation Act.

Sponsored by Sen. Gerald Allen (R-Tuscaloosa), the bill would outlaw state and local governments — including law enforcement agencies thereof — from enforcing any federal firearms act, law, order, rule or regulation that becomes effective after January 1, 2021.

The party-line vote by the Senate was 22-5.


“I took an oath of office when sworn into this body to defend the Constitution of this country and this state,” stated Allen. “As an elected official, I will do everything in my power to preserve the rights of Alabamians, especially those granted by the Second Amendment, and I will always push back on any proposals that seek to limit the freedoms bestowed upon us.”

“The Alabama Second Amendment Preservation Act ensures the people of Alabama are protected from any unnecessary overreach by the federal government and is meant to be a check on proposals that infringe on our right to self-defense coming from the Biden Administration or the Democratic controlled Congress,” he continued. “SB358 is about safeguarding our God-given rights to protect our families and homes. The Second Amendment says the right to bear arms shall not be infringed upon, and with this piece of legislation, Alabamians can feel confident that their rights are being protected.”

Senate Minority Leader Bobby Singleton (D-Greensboro) and Sen. Rodger Smitherman (D-Birmingham) argued that SB 358 would violate the Supremacy Clause. The Democrats said the act, as a result, would ultimately be ruled unconstitutional by the judicial system after costing the State of Alabama significant money to defend it in court.

“We don’t need a ‘Second Amendment Preservation Act’ in the state of Alabama,” said Singleton. “The constitution does that already.”

He noted “the bill really does no harm,” before adding that he does not like the message it sends.

You can view a tweet thread on Senate debate regarding SB 358 here.

The Alabama Senate’s vote came after President Joe Biden last week began rolling out executive orders on gun control.

RELATED: Speaker Mac McCutcheon: As Biden attempts to roll back Second Amendment freedoms, Alabama House Republicans stand in the breach to protect them

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

16 hours ago

Tim Vines confirmed as newest Auburn University trustee

MONTGOMERY — The Alabama Senate on Thursday unanimously confirmed Blue Cross and Blue Shield of Alabama CEO Tim Vines as an at-large member of the Auburn University board of trustees.

He will complete the final three years of the unexpired term of Gen. Lloyd Austin, who resigned from Auburn’s board in January after he was confirmed as the nation’s secretary of defense.

Vines has worked at BCBS of Alabama since 1994. He rose through the management ranks at Blue Cross until he was elected to his present position in 2018. The LaFayette native graduated from Auburn’s Harbert College of Business in 1988 with a degree in finance. He was also a member of the Auburn baseball team.


“In addition to his business and management credentials, the Trustee Selection Committee nominated Tim Vines for the position because of his dedication to Auburn University and its students,” stated Wayne Smith, who serves as board president pro tem.

This dedication includes Vines giving an annual scholarship to the Harbert College of Business. He is an Auburn Alumni Association lifetime member, a member of the James E. Foy Loyalty Society and a member of the 1856 Society. The Birmingham Auburn Club awarded Vines its 2019 Distinguished Auburn Alumnus Award.

He also served as the 2018 Auburn University summer commencement speaker, where he encouraged graduates, “Serve well by serving others. In life or in your chosen profession, ask what you can do to help others. … Whatever you do, make sure you do it with excellence.”

Vines’ term will expire on February 8, 2024.

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

17 hours ago

Alabama State Parks launching historic corporate giving, improvement campaign

Alabama Governor Kay Ivey on Thursday joined the Alabama State Parks Foundation, local corporate leaders and other stakeholders at Oak Mountain State Park to announce unprecedented efforts aimed at investing millions of dollars into park improvements.

The governor spoke about an $80 million bond issue for park improvements that must be approved by voters through a constitutional amendment in the 2022 general election if the state legislature approves it this session. House Majority Leader Nathaniel Ledbetter (R-Rainsville) and Rep. Wes Kitchens (R-Arab) are sponsoring this legislation, which passed the House on Tuesday and now heads to the Senate for consideration.

“Alabamians love and cherish the State Parks, and we must make sure they are maintained and available for generations to come,” Ivey remarked. “I support the use of state bonds to make the needed enhancements throughout the state parks system.”

Additionally, the non-profit Alabama State Parks Foundation (ASPF) on Thursday announced the launch of its corporate giving campaign with a goal of raising an additional $14 million in the next five years for needed park improvements.


ASPF kicked off this campaign with pledges of $250,000 by Buffalo Rock Company and $100,000 from the Alabama Power Foundation.

“Since the creation of the Alabama State Parks Foundation in 2018, we have worked to improve and enhance our State Parks, and our corporate giving campaign is another significant and important step for our organization,” ASPF president Dr. Dan Hendricks stated. “I also applaud and thank Governor Ivey for her visionary leadership and support of the State Parks system.

“We believe this innovative public-private partnership will maximize our efforts to help the Alabama State Parks system maintain its place as one of the state’s true treasures,” he added.

The prospective bond issue and ASPF’s fundraising would fast-track projects to expand campgrounds, add cabins and improve internet connectivity, among other priorities.

A majority of funding for Alabama State Parks – 80-90% annually – is generated through user fees for rental, lodging, golf and other amenities in the parks. The system’s finances can also be impacted unexpectedly, such as the tornado that damaged Oak Mountain last month, Hurricane Sally damaging Gulf State Park in Gulf Shores last fall, and another tornado wreaking havoc on the campground and day-use areas at Joe Wheeler State Park in December 2019.

State parks attracted a record 6.27 million visitors in fiscal year 2020, and enhancing facilities or building additional ones should help that number continue to grow.

“Our state parks system is run as efficiently as ever, but there are plenty of needs in every one of the 21 parks — both the small and larger parks,” said Chris Blankenship, commissioner of the Alabama Department of Conservation. “What Governor Ivey and the Alabama State Parks Foundation have done is create a funding framework for how we can modernize and enhance an already dynamic State Parks system and make it better than ever.

“We plan to be good stewards of the taxpayers’ money, as well as funds so generously donated by the corporate community,” he concluded. “Our state parks offer so many amazing outdoors adventures for all Alabamians, and we appreciate so many people working so hard to help us continue that legacy.”

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn