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Minnesota Legislature

Office of the Revisor of Statutes

SF 1879

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

KEY: stricken = removed, old language.
underscored = added, new language.
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A bill for an act
relating to human services; changing the pharmacy dispensing fee; requiring a
report on changes to pharmacy dispensing service fees; amending Minnesota
Statutes 2006, section 256B.0625, subdivision 13e; Laws 2006, chapter 282,
article 16, section 15, subdivision 6.

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

Section 1.

Minnesota Statutes 2006, section 256B.0625, subdivision 13e, is amended to
read:


Subd. 13e.

Payment rates.

(a) The basis for determining the amount of payment
shall be the lower of the actual acquisition costs of the drugs plus a fixed dispensing fee;
the maximum allowable cost set by the federal government or by the commissioner plus
the fixed dispensing fee; or the usual and customary price charged to the public. The
amount of payment basis must be reduced to reflect all discount amounts applied to the
charge by any provider/insurer agreement or contract for submitted charges to medical
assistance programs. The net submitted charge may not be greater than the patient liability
for the service. new text beginEffective July 1, 2007, new text endthe pharmacy dispensing fee shall be $3.65new text begin for
single-source drugs and $12.92 for multiple-source drugs
new text end, except that the dispensing fee
for intravenous solutions which must be compounded by the pharmacist shall be $8 per
bag, $14 per bag for cancer chemotherapy products, and $30 per bag for total parenteral
nutritional products dispensed in one liter quantities, or $44 per bag for total parenteral
nutritional products dispensed in quantities greater than one liter. new text beginAn inflation adjustment
shall be made annually to the dispensing fee for multiple-source prescriptions based on the
CPI-all items for urban consumers.
new text endActual acquisition cost includes quantity and other
special discounts except time and cash discounts. The actual acquisition cost of a drug
shall be estimated by the commissioner, at average wholesale price minus 12 percent. The
actual acquisition cost of antihemophilic factor drugs shall be estimated at the average
wholesale price minus 30 percent. The maximum allowable cost of a multisource drug
may be set by the commissioner and it shall be comparable to, but no deleted text beginhigher than, the
maximum amount paid by other third-party payors in this state who have maximum
allowable cost programs
deleted text endnew text begin lower than the price of the drug available to retail pharmacies for
purchase from prescription drug wholesalers
new text end. Establishment of the amount of payment for
drugs shall not be subject to the requirements of the Administrative Procedure Act.

new text begin (b) Effective for pharmacy services rendered on or after July 1, 2007, the
commissioner may, within the limits of available appropriation, increase dispensing
fees to pharmacists and pharmacies deemed by the commissioner to be critical access
pharmacy providers. Reimbursement to a critical access pharmacy provider may be
increased by not more than 50 percent above the dispensing fee that would otherwise
be paid to the provider. Payments to health plan companies shall be adjusted to reflect
increased reimbursements to critical access pharmacy providers as approved by the
commissioner. In determining which pharmacists and pharmacies shall be deemed critical
access pharmacy providers, the commissioner shall review:
new text end

new text begin (1) the utilization rate in the service area in which the pharmacist or pharmacy
operates for pharmacy services to patients covered by medical assistance, general
assistance medical care, or MinnesotaCare as their primary source of coverage;
new text end

new text begin (2) the level of services provided by the pharmacist or pharmacy to patients covered
by medical assistance, general assistance medical care, or MinnesotaCare as their primary
source of coverage; and
new text end

new text begin (3) whether the level of services provided by the pharmacist or pharmacy is critical
to maintaining adequate levels of patient access within the service area.
new text end

deleted text begin (b)deleted text end new text begin(c) new text endAn additional dispensing fee of $.30 may be added to the dispensing fee paid
to pharmacists for legend drug prescriptions dispensed to residents of long-term care
facilities when a unit dose blister card system, approved by the department, is used. Under
this type of dispensing system, the pharmacist must dispense a 30-day supply of drug.
The National Drug Code (NDC) from the drug container used to fill the blister card must
be identified on the claim to the department. The unit dose blister card containing the
drug must meet the packaging standards set forth in Minnesota Rules, part 6800.2700,
that govern the return of unused drugs to the pharmacy for reuse. The pharmacy provider
will be required to credit the department for the actual acquisition cost of all unused
drugs that are eligible for reuse. Over-the-counter medications must be dispensed in the
manufacturer's unopened package. The commissioner may permit the drug clozapine to be
dispensed in a quantity that is less than a 30-day supply.

deleted text begin (c)deleted text end new text begin(d) new text endWhenever a generically equivalent product is available, payment shall be on
the basis of the deleted text beginactual acquisition cost ofdeleted text end new text beginfederal upper limit set for new text endthe generic drug, or on
the maximum allowable cost established by the commissioner.

deleted text begin (d)deleted text end new text begin(e) new text endThe basis for determining the amount of payment for drugs administered in
an outpatient setting shall be the lower of the usual and customary cost submitted by the
provider or the amount established for Medicare by the United States Department of
Health and Human Services pursuant to title XVIII, section 1847a of the federal Social
Security Act.

deleted text begin (e)deleted text end new text begin(f) new text endThe commissioner may negotiate lower reimbursement rates for specialty
pharmacy products than the rates specified in paragraph (a). The commissioner may
require individuals enrolled in the health care programs administered by the department
to obtain specialty pharmacy products from providers with whom the commissioner has
negotiated lower reimbursement rates. Specialty pharmacy products are defined as those
used by a small number of recipients or recipients with complex and chronic diseases
that require expensive and challenging drug regimens. Examples of these conditions
include, but are not limited to: multiple sclerosis, HIV/AIDS, transplantation, hepatitis
C, growth hormone deficiency, Crohn's Disease, rheumatoid arthritis, and certain forms
of cancer. Specialty pharmaceutical products include injectable and infusion therapies,
biotechnology drugs, high-cost therapies, and therapies that require complex care. The
commissioner shall consult with the formulary committee to develop a list of specialty
pharmacy products subject to this paragraph. In consulting with the formulary committee
in developing this list, the commissioner shall take into consideration the population
served by specialty pharmacy products, the current delivery system and standard of care in
the state, and access to care issues. The commissioner shall have the discretion to adjust
the reimbursement rate to prevent access to care issues.

Sec. 2.

Laws 2006, chapter 282, article 16, section 15, subdivision 6, is amended to
read:


Subd. 6.

Recommendations.

new text begin(a) new text endThe advisory committee shall use the information
from the cost of dispensing study and make recommendations to the commissioner on
implementation of pharmacy reforms contained in title VI, chapter IV, of the Deficit
Reduction Act of 2005. The commissioner shall report the findings of the study and the
recommendations of the advisory committee to the legislature by February 1, 2007. The
commissioner, in consultation with the advisory committee, shall make recommendations
to the legislature on how to adequately adjust Medicaid reimbursement rates to pharmacies
to cover the costs of dispensing and additional costs to pharmacies. Reports shall include
the current level of dispensing fees paid to providers for dispensing Medicaid prescription
drugs and an estimate of revenues required to adequately adjust reimbursement to cover
the cost to pharmacies for dispensing Medicaid prescription drugs to ensure that:

(1) reimbursement is sufficient to enlist an adequate number of participating
pharmacy providers so that pharmacy services are as available for Medicaid recipients
under the program as for the state's general population;

(2) Medicaid dispensing fees are adequate to reimburse pharmacy providers for the
costs of dispensing prescriptions under the Medicaid program;

(3) Medicaid pharmacy reimbursement for multiple-source drugs included on the
federal upper reimbursement limit is set at the level established by the federal government
under United States Code, title 42, section 1396r-8(e)(5); and

(4) the new payment system does not create disincentives for pharmacists to
dispense generic drugs.

new text begin (b) The Pharmacy Payment Reform Advisory Committee shall monitor the impact
of the Deficit Reduction Act reforms and changes made to pharmacy-dispensing service
fees, and shall report back to the legislature by December 31, 2008, their findings on:
new text end

new text begin (1) the impact of the reforms on pharmacies with more than ten percent of annual
prescription volume from Medicaid, and those pharmacies in rural areas or areas with a
significant Medicaid population;
new text end

new text begin (2) whether changes to pharmacy reimbursement for multiple-source prescriptions
allowed for payment sufficient to cover the actual pharmacy costs for acquiring the drug
product, and the cost of dispensing the prescription;
new text end

new text begin (3) the impact of changes in pharmacy reimbursement for multiple-source drugs on
patient access to pharmacy services; and
new text end

new text begin (4) the impact of changes in pharmacy reimbursement for multiple-source drugs on
generic dispensing rates.
new text end

new text begin (c) The advisory committee shall review the current method of reimbursement for
single-source drugs, and develop recommendations to the legislature for the creation of a
transparent reimbursement model for single-source drugs that would adequately reimburse
pharmacies for drug product costs and pharmacy dispensing services. The commissioner
shall report the findings of the impact study and the advisory committee's recommendations
on reimbursement for single-source drugs to the legislature by December 31, 2008.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end