HF 2218

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to health; establishing a prescription drug 
  1.3             program; appropriating money; amending Minnesota 
  1.4             Statutes 1996, section 290.01, subdivision 19b; 
  1.5             proposing coding for new law in Minnesota Statutes, 
  1.6             chapters 151; and 256. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  [151.471] [BEST PRICE REPORTING REQUIREMENT.] 
  1.9      (a) As a condition of licensure under section 151.47, a 
  1.10  wholesale drug distributor, as defined in section 151.44, 
  1.11  paragraph (b), shall report to the commissioner of human 
  1.12  services, in the manner prescribed by that commissioner, the 
  1.13  best price for each prescription drug sold or distributed in 
  1.14  Minnesota.  For purposes of this requirement, "best price" means 
  1.15  the lowest price at which the wholesale drug distributor sells 
  1.16  or distributes the prescription drug to a retail pharmacy, 
  1.17  retail pharmacy chain, or retail pharmacy purchasing group.  
  1.18  When reporting the best price to the commissioner, a wholesale 
  1.19  drug distributor shall also include information on the quantity 
  1.20  of prescription drugs to which the best price applies, and 
  1.21  information on how a retail pharmacy, retail pharmacy chain, or 
  1.22  retail pharmacy purchasing group can purchase prescription drugs 
  1.23  at the best price. 
  1.24     (b) The board of pharmacy shall investigate violations of 
  1.25  paragraph (a).  The board shall assess a financial penalty 
  1.26  against a wholesale drug distributor, if the board determines 
  2.1   that the wholesale drug distributor has failed to provide to the 
  2.2   commissioner of human services the information required under 
  2.3   paragraph (a), or has provided fraudulent information. 
  2.4      Sec. 2.  [256.9773] [PRESCRIPTION DRUG PROGRAM FOR SENIOR 
  2.5   CITIZENS.] 
  2.6      Subdivision 1.  [PURPOSE.] The purpose of the program 
  2.7   established by this section is to provide retail pharmacies, 
  2.8   especially independent pharmacies with small profit margins on 
  2.9   prescription drugs, with the ability to provide prescription 
  2.10  drugs to eligible senior citizens at lower prices than they 
  2.11  would normally be able to charge, through the provision of 
  2.12  supplemental payments.  The intent of the program is to allow 
  2.13  each retail pharmacy to determine what level of price reduction 
  2.14  is appropriate, based upon their economic situation and market 
  2.15  competition. 
  2.16     Subd. 2.  [ESTABLISHMENT.] The commissioner of human 
  2.17  services, in consultation with county social services agencies, 
  2.18  shall establish a program to provide supplemental payments for 
  2.19  retail pharmacies located in Minnesota that sell prescription 
  2.20  drugs to eligible senior citizens.  The commissioner, through 
  2.21  county social services agencies, shall determine initial 
  2.22  eligibility for the program, issue eligible seniors a program 
  2.23  identification card, redetermine eligibility annually, and make 
  2.24  available to eligible senior citizens information on the best 
  2.25  price, as defined in section 151.471.  County social services 
  2.26  agencies shall charge senior citizens initially applying for the 
  2.27  program a $75 application fee, and shall charge senior citizens 
  2.28  an annual renewal fee of $25. 
  2.29     Subd. 3.  [ELIGIBLE SENIOR CITIZEN.] For purposes of this 
  2.30  section, an eligible senior citizen is a person who is age 65 or 
  2.31  older who: 
  2.32     (1) has a household income that does not exceed 200 percent 
  2.33  of the federal poverty guidelines; 
  2.34     (2) is not eligible for medical assistance or general 
  2.35  assistance medical care, without a spenddown, and is not 
  2.36  eligible for MinnesotaCare; 
  3.1      (3) is a resident of Minnesota, as determined using the 
  3.2   procedures in chapter 256B; and 
  3.3      (4) does not own assets in excess of $100,000, using the 
  3.4   method for determining assets in chapter 256B. 
  3.5      Subd. 4.  [SUPPLEMENTAL PAYMENTS.] The commissioner of 
  3.6   human services shall pay a supplemental payment to each retail 
  3.7   pharmacy registered under subdivision 5, for each legend drug 
  3.8   covered under medical assistance that is purchased from the 
  3.9   pharmacy by an eligible senior citizen who has satisfied the 
  3.10  applicable deductible specified in subdivision 6.  Supplemental 
  3.11  payments shall be available only for prescription drugs 
  3.12  purchased in quantities that do not exceed a 30-day supply or 
  3.13  the quantity necessary to complete a course of treatment, if 
  3.14  this is greater than a 30-day supply.  The supplemental payment 
  3.15  shall be equal to the best price for the prescription drug, as 
  3.16  defined in section 151.471, prorated for the quantity purchased 
  3.17  by the eligible senior citizen, plus a $4.50 dispensing fee for 
  3.18  each prescription, and minus the applicable copayment under 
  3.19  subdivision 6.  Supplemental payments shall be provided 
  3.20  beginning January 1, 1998. 
  3.21     Subd. 5.  [PHARMACY PARTICIPATION.] To participate in the 
  3.22  program and receive supplemental payments, a retail pharmacy 
  3.23  must: 
  3.24     (1) register annually with the commissioner of human 
  3.25  services using the forms and procedures prescribed by the 
  3.26  commissioner; 
  3.27     (2) charge each eligible senior citizen the same 
  3.28  pharmacy-specific price for each prescription drug, based upon 
  3.29  the price of each prescription drug as determined by each 
  3.30  pharmacy, plus a $4.50 dispensing fee and the applicable 
  3.31  copayment under subdivision 6; 
  3.32     (3) provide the commissioner with monthly information on 
  3.33  prescription drug purchases by eligible senior citizens, the 
  3.34  price charged by the pharmacy for the prescription drugs 
  3.35  purchased by eligible senior citizens, and any information the 
  3.36  commissioner determines is necessary to verify these purchases 
  4.1   and to evaluate the program as required under subdivision 7; and 
  4.2      (4) be located in Minnesota. 
  4.3      A retail pharmacy participating in the program may 
  4.4   establish a system of patient recall to ensure that eligible 
  4.5   senior citizens are refilling their prescriptions in a timely 
  4.6   manner and taking their prescription drugs appropriately. 
  4.7      Subd. 6.  [COST-SHARING REQUIREMENTS.] Eligible senior 
  4.8   citizens shall be responsible for the following deductibles and 
  4.9   copayments, based upon household income: 
  4.10     (1) an annual deductible of $200 per person and a copayment 
  4.11  of $2 per prescription, for eligible seniors with household 
  4.12  incomes not exceeding 125 percent of the federal poverty 
  4.13  guidelines; 
  4.14     (2) an annual deductible of $400 per person and a copayment 
  4.15  of $4 per prescription, for eligible seniors with household 
  4.16  incomes greater than 125 percent but not exceeding 150 percent 
  4.17  of the federal poverty guidelines; 
  4.18     (3) an annual deductible of $600 per person and a copayment 
  4.19  of $6 per prescription, for eligible seniors with household 
  4.20  incomes greater than 150 percent but not exceeding 175 percent 
  4.21  of the federal poverty guidelines; or 
  4.22     (4) an annual deductible of $800 per person and a copayment 
  4.23  of $8 per prescription, for eligible seniors with household 
  4.24  incomes greater than 175 percent but not exceeding 200 percent 
  4.25  of the federal poverty guidelines. 
  4.26     Subd. 7.  [REPORT.] The commissioner of human services 
  4.27  shall determine whether the program established by this section 
  4.28  results in a significant reduction in the price of prescription 
  4.29  drugs paid by eligible seniors and shall report to the 
  4.30  legislature by January 15, 1999. 
  4.31     Sec. 3.  Minnesota Statutes 1996, section 290.01, 
  4.32  subdivision 19b, is amended to read: 
  4.33     Subd. 19b.  [SUBTRACTIONS FROM FEDERAL TAXABLE INCOME.] For 
  4.34  individuals, estates, and trusts, there shall be subtracted from 
  4.35  federal taxable income: 
  4.36     (1) interest income on obligations of any authority, 
  5.1   commission, or instrumentality of the United States to the 
  5.2   extent includable in taxable income for federal income tax 
  5.3   purposes but exempt from state income tax under the laws of the 
  5.4   United States; 
  5.5      (2) if included in federal taxable income, the amount of 
  5.6   any overpayment of income tax to Minnesota or to any other 
  5.7   state, for any previous taxable year, whether the amount is 
  5.8   received as a refund or as a credit to another taxable year's 
  5.9   income tax liability; 
  5.10     (3) the amount paid to others not to exceed $650 for each 
  5.11  dependent in grades kindergarten to 6 and $1,000 for each 
  5.12  dependent in grades 7 to 12, for tuition, textbooks, and 
  5.13  transportation of each dependent in attending an elementary or 
  5.14  secondary school situated in Minnesota, North Dakota, South 
  5.15  Dakota, Iowa, or Wisconsin, wherein a resident of this state may 
  5.16  legally fulfill the state's compulsory attendance laws, which is 
  5.17  not operated for profit, and which adheres to the provisions of 
  5.18  the Civil Rights Act of 1964 and chapter 363.  As used in this 
  5.19  clause, "textbooks" includes books and other instructional 
  5.20  materials and equipment used in elementary and secondary schools 
  5.21  in teaching only those subjects legally and commonly taught in 
  5.22  public elementary and secondary schools in this state.  
  5.23  "Textbooks" does not include instructional books and materials 
  5.24  used in the teaching of religious tenets, doctrines, or worship, 
  5.25  the purpose of which is to instill such tenets, doctrines, or 
  5.26  worship, nor does it include books or materials for, or 
  5.27  transportation to, extracurricular activities including sporting 
  5.28  events, musical or dramatic events, speech activities, driver's 
  5.29  education, or similar programs.  In order to qualify for the 
  5.30  subtraction under this clause the taxpayer must elect to itemize 
  5.31  deductions under section 63(e) of the Internal Revenue Code; 
  5.32     (4) to the extent included in federal taxable income, 
  5.33  distributions from a qualified governmental pension plan, an 
  5.34  individual retirement account, simplified employee pension, or 
  5.35  qualified plan covering a self-employed person that represent a 
  5.36  return of contributions that were included in Minnesota gross 
  6.1   income in the taxable year for which the contributions were made 
  6.2   but were deducted or were not included in the computation of 
  6.3   federal adjusted gross income.  The distribution shall be 
  6.4   allocated first to return of contributions until the 
  6.5   contributions included in Minnesota gross income have been 
  6.6   exhausted.  This subtraction applies only to contributions made 
  6.7   in a taxable year prior to 1985; 
  6.8      (5) income as provided under section 290.0802; 
  6.9      (6) the amount of unrecovered accelerated cost recovery 
  6.10  system deductions allowed under subdivision 19g; 
  6.11     (7) to the extent included in federal adjusted gross 
  6.12  income, income realized on disposition of property exempt from 
  6.13  tax under section 290.491; 
  6.14     (8) to the extent not deducted in determining federal 
  6.15  taxable income, the amount paid for health insurance of 
  6.16  self-employed individuals as determined under section 162(l) of 
  6.17  the Internal Revenue Code, except that the 25 percent limit does 
  6.18  not apply.  If the taxpayer deducted insurance payments under 
  6.19  section 213 of the Internal Revenue Code of 1986, the 
  6.20  subtraction under this clause must be reduced by the lesser of: 
  6.21     (i) the total itemized deductions allowed under section 
  6.22  63(d) of the Internal Revenue Code, less state, local, and 
  6.23  foreign income taxes deductible under section 164 of the 
  6.24  Internal Revenue Code and the standard deduction under section 
  6.25  63(c) of the Internal Revenue Code; or 
  6.26     (ii) the lesser of (A) the amount of insurance qualifying 
  6.27  as "medical care" under section 213(d) of the Internal Revenue 
  6.28  Code to the extent not deducted under section 162(1) of the 
  6.29  Internal Revenue Code or excluded from income or (B) the total 
  6.30  amount deductible for medical care under section 213(a); and 
  6.31     (9) the exemption amount allowed under Laws 1995, chapter 
  6.32  255, article 3, section 2, subdivision 3.; and 
  6.33     (10) to the extent not deducted in determining federal 
  6.34  taxable income, the amount paid by an eligible senior citizen 
  6.35  for prescription drugs covered under the prescription drug 
  6.36  program for senior citizens established in section 256.9773.  If 
  7.1   the taxpayer deducted amounts paid for the prescription drugs 
  7.2   under section 213 of the Internal Revenue Code of 1986, the 
  7.3   subtraction under this clause must be reduced by the lesser of: 
  7.4      (i) the total itemized deductions allowed under section 
  7.5   63(d) of the Internal Revenue Code, less state, local, and 
  7.6   foreign income taxes deductible under section 164 of the 
  7.7   Internal Revenue Code, and the standard deduction under section 
  7.8   63(c) of the Internal Revenue Code; or 
  7.9      (ii) the lesser of (A) the amount paid for prescription 
  7.10  drugs covered under the prescription drug program for senior 
  7.11  citizens or (B) the total amount deductible for medical care 
  7.12  under section 213(a) of the Internal Revenue Code reduced by the 
  7.13  deduction under clause (8). 
  7.14     Sec. 4.  [PRESCRIPTION DRUG INSURANCE PROGRAM.] 
  7.15     The commissioner of commerce shall study an insurance 
  7.16  program to provide prescription drugs to Minnesotans who are 65 
  7.17  and older.  The program shall be administered by the board of 
  7.18  the Minnesota comprehensive health association, but shall be 
  7.19  separate from the health coverage programs operated by the board 
  7.20  under Minnesota Statutes, chapter 62E.  In designing the 
  7.21  program, the commissioner of commerce shall incorporate, to the 
  7.22  extent feasible, the administrative procedures and health care 
  7.23  delivery methods used by the board of the Minnesota 
  7.24  comprehensive health association under Minnesota Statutes, 
  7.25  chapter 62E.  The commissioner of commerce shall develop the 
  7.26  program based upon independent actuarial analysis, and shall 
  7.27  present program recommendations and draft legislation to the 
  7.28  legislature by December 15, 1997. 
  7.29     Sec. 5.  [ADEQUACY OF FUNDING.] 
  7.30     The commissioner of human services, in consultation with 
  7.31  the commissioner of revenue, shall evaluate whether the expected 
  7.32  annual cost of the prescription drug program established under 
  7.33  Minnesota Statutes, section 256.9773, will exceed the total 
  7.34  annual amount of MinnesotaCare taxes paid by pharmacists and 
  7.35  wholesale drug distributors.  The commissioner shall present the 
  7.36  results of this evaluation to the legislature by January 15, 
  8.1   1999. 
  8.2      Sec. 6.  [APPROPRIATION.] 
  8.3      (a) $....... is appropriated from the health care access 
  8.4   fund to the commissioner of human services for the biennium 
  8.5   ending June 30, 1999, to implement section 2. 
  8.6      (b) $....... is appropriated from the health care access 
  8.7   fund to the commissioner of commerce for the fiscal year ending 
  8.8   June 30, 1998, to implement section 4.