Substitute House Bill No. 5040 seeks to implement the Governor's budget recommendations for health and human services, introducing significant changes to existing statutes effective July 1, 2026. The bill standardizes the monthly cash benefit for beneficiaries of the State Administered General Assistance (SAGA) program to $269, thereby eliminating the previous tiered payment structure that provided reduced benefits for transitional individuals. Additionally, it adds antiretroviral drugs to the Medicaid preferred drug list, allowing the state to negotiate supplemental rebates with drug manufacturers, which is expected to generate savings for the Medicaid program. The bill also establishes new benefit amounts for unemployable individuals and transitional recipients, setting monthly benefits at $262 for those deemed medically unemployable and $66 for transitional recipients who do not pay for shelter.

Moreover, the bill empowers the Commissioner of Social Services to periodically review the clinical effectiveness of certain outpatient prescription drugs covered under Medicaid, particularly those projected to exceed specified cost thresholds. This review will include an analysis of clinical efficacy, pricing, and therapeutic benefits, among other factors. The overall fiscal impact of the bill is projected to result in net savings for the Department of Social Services, amounting to $894,000 in FY 27 and $1,142,000 in FY 28, primarily due to the changes in drug pricing and assistance benefits. The bill modifies current law by removing the exemption for antiretroviral drugs from the preferred drug lists and prior authorization requirements, thereby enhancing the efficiency and effectiveness of Medicaid spending while ensuring critical medications remain accessible to those in need.

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Governor's Bill: