SF 73

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to health care; creating the prescription drug discount program;
proposing coding for new law in Minnesota Statutes, chapter 256.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [256.9545] PRESCRIPTION DRUG DISCOUNT PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment; administration. new text end

new text begin The commissioner shall establish
and administer the prescription drug discount program.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner's authority. new text end

new text begin The commissioner shall administer a drug
rebate program for drugs purchased according to the prescription drug discount program.
The commissioner shall execute a rebate agreement from all manufacturers that choose to
participate in the program for those drugs covered under the medical assistance program.
For each drug, the amount of the rebate shall be equal to the rebate as defined for purposes
of the federal rebate program in United States Code, title 42, section 1396r-8. The
rebate program shall utilize the terms and conditions used for the federal rebate program
established according to section 1927 of title XIX of the federal Social Security Act.
new text end

new text begin Subd. 3. new text end

new text begin Definitions. new text end

new text begin For purposes of this section, the following terms have the
meanings given them.
new text end

new text begin (a) "Commissioner" means the commissioner of human services.
new text end

new text begin (b) "Covered prescription drug" means a prescription drug as defined in section
151.44, paragraph (d), that is covered under medical assistance as described in section
256B.0625, subdivision 13, and that is provided by a participating manufacturer that has a
fully executed rebate agreement with the commissioner under this section and complies
with that agreement.
new text end

new text begin (c) "Enrolled individual" means a person who is eligible for the program under
subdivision 4 and has enrolled in the program according to subdivision 5.
new text end

new text begin (d) "Health carrier" means an insurance company licensed under chapter 60A to offer,
sell, or issue an individual or group policy of accident and sickness insurance as defined in
section 62A.01; a nonprofit health service plan corporation operating under chapter 62C; a
health maintenance organization operating under chapter 62D; a joint self-insurance
employee health plan operating under chapter 62H; a community integrated service
network licensed under chapter 62N; a fraternal benefit society operating under chapter
64B; a city, county, school district, or other political subdivision providing self-insured
health coverage under sections 471.617 or 471.98 to 471.982; and a self-funded health
plan under the Employee Retirement Income Security Act of 1974, as amended.
new text end

new text begin (e) "Participating manufacturer" means a manufacturer as defined in section 151.44,
paragraph (c), that agrees to participate in the prescription drug discount program.
new text end

new text begin (f) "Participating pharmacy" means a pharmacy as defined in section 151.01,
subdivision 2, that agrees to participate in the prescription drug discount program.
new text end

new text begin Subd. 4. new text end

new text begin Eligibility. new text end

new text begin (a) To be eligible for the program, an applicant must:
new text end

new text begin (1) be a permanent resident of Minnesota as defined in section 256L.09, subdivision
4;
new text end

new text begin (2) not be enrolled in medical assistance, general assistance medical care, or
MinnesotaCare;
new text end

new text begin (3) not be enrolled in and have currently available prescription drug coverage under
a health plan offered by a health carrier or employer or under a pharmacy benefit program
offered by a pharmaceutical manufacturer; and
new text end

new text begin (4) not be enrolled in and have currently available prescription drug coverage
under a Medicare supplement policy, as defined in sections 62A.31 to 62A.44; or
policies, contracts, or certificates that supplement Medicare issued by health maintenance
organizations; or those policies, contracts, or certificates governed by section 1833 or
1876 of the federal Social Security Act, United States Code, title 42, section 1395, et
seq., as amended.
new text end

new text begin (b) Notwithstanding paragraph (a), clause (3), an individual who is enrolled in a
Medicare Part D prescription drug plan or Medicare Advantage plan is eligible for the
program but only for drugs that are not covered under the Medicare Part D plan or for
drugs that are covered under the plan, but according to the conditions of the plan, the
individual is responsible for 100 percent of the cost of the prescription drug.
new text end

new text begin Subd. 5. new text end

new text begin Application procedure. new text end

new text begin (a) Applications and information on the program
must be made available at county social services agencies, health care provider offices, and
agencies and organizations serving senior citizens. Individuals shall submit applications
and any information specified by the commissioner as being necessary to verify eligibility
directly to the commissioner. The commissioner shall determine an applicant's eligibility
for the program within 30 days from the date the application is received. Upon notice of
approval, the applicant must submit to the commissioner the enrollment fee specified in
subdivision 10. Eligibility begins the month after the enrollment fee is received by the
commissioner.
new text end

new text begin (b) An enrollee's eligibility must be renewed every 12 months with the 12-month
period beginning in the month after the application is approved.
new text end

new text begin (c) The commissioner shall develop an application form that does not exceed one
page in length and requires information necessary to determine eligibility for the program.
new text end

new text begin Subd. 6. new text end

new text begin Participating pharmacy. new text end

new text begin (a) Upon implementation of the prescription
drug discount program, and until January 1, 2009, a participating pharmacy, with a
valid prescription, must sell a covered prescription drug to an enrolled individual at the
medical assistance rate.
new text end

new text begin (b) After January 1, 2009, a participating pharmacy, with a valid prescription, must
sell a covered prescription drug to an enrolled individual at the medical assistance rate,
minus an amount that is equal to the rebate amount described in subdivision 8, plus
the amount of any switch fee established by the commissioner under subdivision 10,
paragraph (b).
new text end

new text begin (c) Each participating pharmacy shall provide the commissioner with all information
necessary to administer the program, including, but not limited to, information on
prescription drug sales to enrolled individuals and usual and customary retail prices.
new text end

new text begin Subd. 7. new text end

new text begin Notification of rebate amount. new text end

new text begin The commissioner shall notify each
participating manufacturer of the amount of the rebate owed on the prescription drugs sold
by participating pharmacies to enrolled individuals each calendar quarter or according to a
schedule established by the commissioner.
new text end

new text begin Subd. 8. new text end

new text begin Provision of rebate. new text end

new text begin To the extent that a participating manufacturer's
prescription drugs are prescribed to a resident of this state, the manufacturer must provide
a rebate equal to the rebate provided under the medical assistance program for any
prescription drug distributed by the manufacturer that is purchased at a participating
pharmacy by an enrolled individual. The participating manufacturer must provide full
payment within 38 days of receipt of the state invoice for the rebate, or according to
a schedule to be established by the commissioner. The commissioner shall deposit all
rebates received into the Minnesota prescription drug dedicated fund established under
subdivision 11. The manufacturer must provide the commissioner with any information
necessary to verify the rebate determined per drug.
new text end

new text begin Subd. 9. new text end

new text begin Payment to pharmacies. new text end

new text begin Beginning January 1, 2009, the commissioner
shall distribute on a biweekly basis an amount that is equal to an amount collected under
subdivision 8 to each participating pharmacy based on the prescription drugs sold by that
pharmacy to enrolled individuals on or after January 1, 2009.
new text end

new text begin Subd. 10. new text end

new text begin Enrollment fee; switch fee. new text end

new text begin (a) The commissioner shall establish an
annual enrollment fee that covers the commissioner's expenses for enrollment, processing
claims, and distributing rebates under this program.
new text end

new text begin (b) The commissioner shall establish a reasonable switch fee that covers expenses
incurred by participating pharmacies in formatting for electronic submission claims for
prescription drugs sold to enrolled individuals.
new text end

new text begin Subd. 11. new text end

new text begin Dedicated fund; creation; use of fund. new text end

new text begin (a) The Minnesota prescription
drug dedicated fund is established as an account in the state treasury. The commissioner
of finance shall credit to the dedicated fund all rebates paid under subdivision 8, any
federal funds received for the program, all enrollment fees paid by the enrollees, and
any appropriations or allocations designated for the fund. The commissioner of finance
shall ensure that fund money is invested under section 11A.25. All money earned by the
fund must be credited to the fund. The fund shall earn a proportionate share of the total
state annual investment income.
new text end

new text begin (b) Money in the fund is appropriated to the commissioner to reimburse participating
pharmacies for prescription drugs provided to enrolled individuals under subdivision 6,
paragraph (b); to reimburse the commissioner for costs related to enrollment, processing
claims, and distributing rebates and for other reasonable administrative costs related to
administration of the prescription drug discount program; and to repay the appropriation
provided by law for this section. The commissioner must administer the program so that
the costs total no more than funds appropriated plus the drug rebate proceeds.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2007.
new text end