HF 1696

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to human services; establishing a
prescription drug discount program; appropriating
money; 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, effective July 1, 2005.
new text end

new text begin Subd. 2. new text end [COMMISSIONER'S AUTHORITY.] new text begin The commissioner
shall administer a drug rebate program for drugs purchased
according to the prescription drug discount program. The
commissioner shall require a rebate agreement from all
manufacturers of covered drugs as defined in section 256B.0625,
subdivision 13. 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 the purpose 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) "Manufacturer" means a manufacturer as defined in
section 151.44, paragraph (c).
new text end

new text begin (c) "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 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 (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
systems 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 section 471.617 or sections 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 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 (f) "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 Subd. 4. new text end

new text begin Eligible persons. new text end

new text begin 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 Medicare, medical assistance,
general assistance medical care, MinnesotaCare, or the
prescription drug program under section 256.955;
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 plan, 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 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 According to a valid
prescription, a participating pharmacy must sell a covered
prescription drug to an enrolled individual at the pharmacy's
usual and customary retail price, 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. 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 drug manufacturer, each calendar quarter or
according to a schedule to be established by the commissioner,
of the amount of the rebate owed on the prescription drugs sold
by participating pharmacies to enrolled individuals.
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
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 by an enrolled individual at a participating
pharmacy. The manufacturer must provide full payment within 30
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 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.
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 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 drug
discounts provided to enrolled individuals under this section;
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 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

Sec. 2. new text begin APPROPRIATION; PRESCRIPTION DRUG DISCOUNT
PROGRAM.
new text end

new text begin $....... is appropriated from the general fund to the
Minnesota prescription drug dedicated fund for fiscal year 2006.
new text end