Senate Public Health Committee
January 29, 2025
Senator Missy Irvin [00:00:02] Okay. Chair sees a quorum. Welcome, everybody, to Public Health Committee. We're going to get started right away. Just a quick note. Scope week of the scope bills that have been filed, the deadline, I think, was this week. So that will be February 17th through the 21st. So although I believe Senator Penzo is going to schedule a special order of business for SB 2. So he's not running that bill today.
Okay. With that, we'll go to SB 58. And Senator Penzo, I know that you're not running this bill, Senate Bill 2 today, is that correct? And do you want to schedule a special order of business for that? You just want to let me know the day? Perfect. Yes. Yes, sir. Okay. Senator Dismang, you're recognized to present SB 58. I believe we have an amendment. We'll pass that amendment out.
Senator Jonathan Dismang [00:01:00] And I am happy to. We can either take it line by line by the amendment. I think I have sent this to all the members. It was one minor change. I'll talk about that. It was technical in nature, does not change anything substantive in our conversations or what was previously given. This amendment has been given to all parties that were willing to accept it, to take a look at it. So they've had a chance to review at this point. So I'm assuming they'll have some comments later on. But again, I can talk about it as the bill or the amendment, depending on what order y'all want to go in.
Senator Missy Irvin [00:01:31] Motion to adopt the amendment. So moved. Second All in favor, say aye. And opposed. The ayes have it. The amendment is adopted. Present the bill as amended.
Senator Jonathan Dismang [00:01:39] All right, members. So the new bill is the amendment. So I'll go through that with you so you can completely understand the changes. As you're aware, I was pretty adamant and still believe that the cleanest thing for us to have done was to strike the prohibition and move forward to allow us to operate as any other states in regards to nonprofit tax exempt or governmentally funded hospitals.
In the spirit of compromise, I think I've done everything I can to accept all of the comments that I've heard, not even given directly to me. That may be with our members that are in the Senate, that are associated with the profession, or even just news stories that I've listened to about questions and concerns. And so, again, I've tried to incorporate everything.
Preemptively, I'll say the one thing that I did not address in this that was questions was steering. My understanding steering is taken on at a federal level. It's also in our statutes, and it would have created a clouded mess to try to incorporate that into this bill. I think it's covered otherwise and also is achieved with another provision I'll mention here in just a second. But we'll go through this amendment, which again is the bill.
The first thing that we're going to do is adopt a definition for a hospital campus. This was a definition that was agreed to in prior session. And so that should not be of any controversy to anyone. We're going to move to Section two, and this is where essentially we say in the retail pharmacy code that nonprofit tax exempt and governmentally funded hospitals can be granted a retail pharmacy permit. And then we're going to move in the stipulations and the parameters of how they can receive that permit and how many they can receive. And so the first thing is, again, a nonprofit, tax exempt, governmentally funded hospital can have a retail permit that is located within 250 yards of its campus.
They get one permit for the hospital pharmacy permit they have. So all nonprofit hospitals already have a hospital pharmacy permit that would require them to have a physical location in the state of Arkansas and a standing hospital in the state of Arkansas. In addition to that, they can have one additional retail permit per 100 beds in their census. There was some discussion, should that be tied to the daily census that they have or tied to the employees. Those are fluctuating numbers. What we're referring to here is something that is given to the Department of Health. It's a true number and essentially hits some of the same caps that were being presented before or suggested by those that were wanting to make adjustments to the bill.
And again, those retail permits still have to be within 250 yards of the campus. So if they have multiple permits, because of their size, they are still within 250 yards of the campus. And that is just purely for the convenience of those that are trying to utilize the retail pharmacies there. And it may be for a specialty pharmacy, retail pharmacy. So there are some options that they just have. But again, it's not like they're going to be able to go out and build offsite and start just directly competing with pharmacies that are currently in business. Second, a retail pharmacy permit-- let me move on.
And so now we go to Section two and there are some prohibitions that we would allow some exceptions to the cap. And that would be for fusion centers, for instance. There is no cap on the number of retail pharmacies that can be put in place or in conjunction with fusion centers. That was something that was widely discussed and accepted by those that were in opposition to the bill as it was previously written, and did not see that to be an issue. So I included that here.
And the second is, if there is a pharmacy desert-- and we define this in law. I think some of you may recall that being discussed when we discussed rule 128. But if there is an underserved area and there is not a pharmacy there, if a nonprofit pharmacy could choose to fill that void, I'm not sure that any will, but they would have the ability to serve an underserved area by the definition of underserved or network adequacy. And again, that's not something that I made up. I didn't want it to be controversial. And so I borrowed that straight from legislation that were passed by the Pharmacy Association or encouraged by the Pharmacy Association.
There were some requests for patient freedom of choice. This mirrors the language that we have for nursing homes and freedom of choice. And essentially, upon exit by a patient, they would have to be made aware that they had opportunity and could utilize essentially any pharmacy that they would like to utilize. Again, that mirrors as the request of what the burden that's currently placed on our nursing homes for freedom of choice.
Hospital reporting, this was a request by Senator Boyd. And I agree with that. We probably should have been doing it anyway. But this is just going to require a report to be submitted to ALC, so we track the number of openings, closures, requests for permits and all that sort of thing. That will let us have a better idea of what's happening and where the needs are here in the state. So I'm fully supportive of that change. And again, so that is the bill.
And the second part where you see the strikethrough language, that is striking at the prohibition. Again, we're moving that into the retail pharmacy section of the code and we're going to then put the restrictions in place. And some like to call that guardrails. I probably wouldn't term it that way, but there are guardrails in place that would dictate where and how those could open. With that, be happy to take any questions.
Senator Missy Irvin [00:07:21] Senator Love, you're recognized for a question.
Senator Fredrick Love [00:07:26] Thank you, Madam Chair and Senator Dismang. Thank you for really this bill. I didn't know that we were going to be started this early on the amendments. I like them. But one question I do have is because you put back on page two in section B, you said one retail pharmacy per 100 beds. Now, how does this impact the critical access units that we have, those smaller hospitals?
Senator Jonathan Dismang [00:08:00] There's a couple of thresholds. They would meet the first threshold, which they would have a hospital pharmacy permit. So that would allow them to have the retail pharmacy. So and I would make it up because I don't know how many beds they have, but if they have--.
Senator Fredrick Love [00:08:12] They have like 20, 25 or less.
Senator Jonathan Dismang [00:08:14] They would be entitled to one retail permit. Larger institutions, which are going to have generally a much larger campus, that's where you get into the beds and an additional retail permit.
Senator Fredrick Love [00:08:24] Okay. And then also, does this protect-- I know somebody mentioned out of state nonprofit hospitals. Does this bill exclude those hospitals?
Senator Jonathan Dismang [00:08:38] To be able to qualify, you would have to have a physical presence and you would have to have a hospital pharmacy permit. So, I mean, we have nonprofit entities that are located generally out of state operating in the state of Arkansas. And I don't think we want to prohibit that. They fill needed voids. Let's take Mercy, for instance.
Senator Fredrick Love [00:08:59] I don't mean that. I mean, out of state nonprofit hospitals that may want to come in and set up pharmacies. You're saying that they won't be able to.
Senator Jonathan Dismang [00:09:09] They would have to have a hospital pharmacy permit to be able to do that, which means they would have to have a physical presence here and providing an actual service beyond just opening of a pharmacy. You cannot just open up a pharmacy for the sake of opening up a pharmacy unless you have-- I mean, you just can't. That question was raised to me, and so I read it 50 different times last night thinking I missed something because it's all about the question that you were asked, that was posed to me.
If you'll flip to page three, that is that Section five where the entire section is being repealed. It does not mention in any way anything about out of state nonprofit tax exempt or government funded hospitals. I have changed that in no way. And the striking of that doesn't give or take away to that argument. So I still don't really understand.
Senator Fredrick Love [00:10:00] Well, yeah, that was proposed to me, so I just wanted to.
Senator Jonathan Dismang [00:10:03] No, I appreciate the question, but I think we've covered that adequately.
Senator Fredrick Love [00:10:07] All right. Thank you. Thank you, Madam Chair.
Senator Missy Irvin [00:10:09] Senator Payton, you're recognized.
Senator John Payton [00:10:11] Thank you, Madam Chair. Senator Dismang. I appreciate this a lot. I really just have a curiosity question. I don't know how it affects things. And that's why I'm asking, is when we define hospital campus, it appears to me that we're throwing every satellite location into one singular consideration as the hospital campus instead of saying campuses where they have other campuses. Is that intentional? Or it just doesn't seem-- it seemed weird to me.
Senator Jonathan Dismang [00:10:50] No. For instance, Baptist Stuttgart is its own hospital with its own hospital pharmacy permit.
Senator John Payton [00:10:57] So it would be its own campus.
Senator Jonathan Dismang [00:10:59] Spring Hill is its own hospital with its own hospital permit. The main campus is its own hospital with its own hospital permit. And so that's the restrictions. Now, I think if the concern is recounting in-patient centers-- I don't know what the word is. I'm not in this field. But a clinic, no, that's not part of the hospital campus. They do not have a, to my knowledge, they do not have a hospital pharmacy permit. So that's not an issue and that's where the limitation is created.
Senator John Payton [00:11:33] So when we say that they are not strictly contiguous to the main building, we're not talking about satellite campuses?
Senator Jonathan Dismang [00:11:39] No.
Senator John Payton [00:11:40] Okay.
Senator Jonathan Dismang [00:11:40] This is essentially, let's just take you UAMS, for example, or Baptist. I mean, that's a big area taking up lots of land, multiple buildings. What it's saying is whatever building, the outermost building, can go 250 yards from that. I will tell you that I don't like it. I think that it could lead to someone really altering the actual real estate value on open par parcels in a densely populated area if there was going to be an acquisition and construction or whatever for a retail pharmacy by a hospital. But I'll walk away from that argument because this is the exact language that has been previously agreed to and I did not want to meander from that.
Senator John Payton [00:12:21] Okay. Thank you. Thank you, Madam Chair.
Senator Missy Irvin [00:12:23] That's a good point. Senator Penzo, you're recognized.
Senator Clint Penzo [00:12:40] Sorry about that. You strike the section where it says it's unlawful for a hospital to hold a licensed pharmacy permit. And you just said that by striking that, it doesn't affect that. So where else are they prohibited from holding a--.
Senator Jonathan Dismang [00:12:57] Well, number one, we're removing the prohibition and putting guardrails in place in the retail pharmacy statute. So we are removing the restriction. And to me, when I look at the drafting of this bill, we could have referred in this section how we were lifting a restriction that then we referred to in this other section that we're putting the limitations in place. And that didn't make a whole lot of sense to me. And so striking this, but then putting in the new language puts in the limitations that we're talking about having. Yes. By its core, this strikes the complete banning of nonprofit tax exempt or governmental hospitals from having one. So that's why you strike the language.
Senator Clint Penzo [00:13:42] I didn't hear completely what you said, so I appreciate you repeating that.
Senator Jonathan Dismang [00:13:45] Thank you.
Senator Missy Irvin [00:13:46] Are there any other questions? Yes. Senator Payton.
Senator John Payton [00:13:49] Thank you. I hope this is real simple. Section two, it says the board shall provide. Is that consistent with the other parts of this code that where they provide permits that it's a shall instead of a may?
Senator Jonathan Dismang [00:14:04] Yes. Because you are going to have to meet the same provisions that anyone else that's trying to open up and be underneath the same rules of anyone else that's operating a retail pharmacy.
Senator John Payton [00:14:13] Okay. Thank you.
Senator Missy Irvin [00:14:15] Are there any other questions from members of the committee? All right. Seeing none, I do have two individuals that have signed up to speak against the bill, I believe. And for, Mr. Craig Berry. If Mr. Craig Berry is here, we are not going to hear Senate Bill 2 today. It will be listed on our calendar as a special order of business. So you can stick around, but we won't hear that bill today. So we have, I cannot pronounce this last name, so Simon with Highlands Oncology Group. You're recognized if you'll just state your name, please, for the record and who you're with.
Simon Dobretsov [00:14:59] Senator Irvin and members of the committee, my name is Simon Dobretsov. I'm with Highlands Oncology Group. It's a physician led oncology group in northwest Arkansas. And I, unfortunately, did not get a copy of the amendments. But so I'm going to waive my objection right now based on what Senator Dismang described. I believe it addresses all of the concerns that we had, but I guess I'll read it later when it's available. Thank you very much.
Senator Missy Irvin [00:15:27] Thank you, sir. Appreciate you being here and for your testimony. Mr. John Vinson, if you'll come forward, please.
John Vinson [00:15:45] Thank you, Madam Chair. John Vinson, CEO of the Arkansas Pharmacists Association. I did sign up today to speak against the bill, but I would clarify that I did get the amendment last night. I want to thank Senator Dismang for listening to the concerns. I know some of the senators on the committee have met with interested parties and had interviews on the news that he was speaking to, and we do feel from reading the amendment that he is trying to incorporate the concerns. So we appreciate that. I do want to take it back to my board since I work for a board at the association, have them look at it and get instruction on what to do beyond this committee. But we appreciate some of the amendments, including the infusion center permit piece that he described, including serving underserved areas. We don't want citizens of Arkansas to not access care in underserved areas. We appreciate that and the location on the campus. We appreciate that as well. Freedom of choice. Appreciate that. The language. And then we can look at it and monitor it. And I know there's going to be presentations to ALC to look at that and see how that's working. So we really appreciate that. With that, I'll take any questions.
Senator Missy Irvin [00:16:57] Are there any questions for Mr. Vincent? Senator Love.
Senator Fredrick Love [00:17:02] Thank you, Madam Chair. Mr. Vincent, you know and we've talked we talked before, and one of my biggest concerns with the bill that was unamended was the fact I addressed the proliferation of clinics with this new amendment. Do you think that that kind of quells that issue right there?
John Vinson [00:17:24] I think yes. The only question we would have just on first glance is because it strikes direct and indirect interest that there might be a situation where there might be some company-- I don't think the bill sponsor intended to do this-- but if there was some creative way in a nonprofit with a separate corporation that wasn't a hospital because it doesn't prohibit indirect interest, there could be some loophole.
We did have our attorney, Kevin Crass with Friday firm look at it. He thinks that the way he's drafted it would prevent that. But if you wanted to make it even stronger, you could address the word indirect interest in the bill with an amendment.But we've just had it just a few hours, just like you've just had it for a few minutes. So I'd like to look at that further. But thank you for the question.
Senator Missy Irvin [00:18:15] All right. Are there any other questions from members of the committee? All right, seeing none, Thank you. You're recognized to close for your bill as amended.
Senator Jonathan Dismang [00:18:31] I mean, I think as I started my original presentation with the bill as originally filed, my main focus is increasing access and bettering outcomes. I think we're still able to achieve that with this version of the bill. And with that, I would appreciate a good vote.
Senator Missy Irvin [00:18:44] All right. Do I hear a motion? And a second? Second. All those in favor say aye. And opposed. Would you like to have discussion? I will yield to Senator Payton for discussion.
Senator John Payton [00:19:05] Well, I just wanted to say I really appreciate the working together to get the amendment and getting the language that we can support. I want to support this bill. I'm going to vote yes. I just wish that we had some assurance in it that somebody is actually going to improve access. I understand that we're just lifting the restriction and allowing them an opportunity to. But I would like to have gained some assurance that they actually are going to do that. But I appreciate that and I appreciate a good vote.
Representative
Senator Missy Irvin [00:19:37] Any other discussion from members of the committee? Okay. All those in favor say aye. And opposed. Ayes have it. Congratulations. You passed your bill as amended.
Senator Jonathan Dismang [00:19:47] Thank you, Madam Chair.
Senator Missy Irvin [00:19:48] Thank you, members. Just a reminder, we're not going to hear Senate Bill 2 today. Senator Penzo, we will have a special order of business for that because I'm sure there will be people that will have to take off work or reschedule patients or whatever to come on that bill. Scope week is going to be February 17th through the 21st. And again, reminder, if you're wanting to run your bill, please contact me. We'll get you scheduled. All right. With that, we are done for the day. Thank you so much. We're adjourned.
