HBA-MPM H.B. 1231 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1231 By: Maxey Public Health 3/1/2001 Introduced BACKGROUND AND PURPOSE According to a report from the Texas State Comptroller's Office, high pharmaceutical prices have adversely affected individuals age 65 and older. Medicare, the major insurer for this population, does not cover the cost of out-patient prescription medications. Insurers, HMOs, and Medicaid programs use their buying power to purchase prescription drugs at a reduced price, while those age 65 and older who do not have a prescription drug plan must pay retail prices for their drugs. The State of Texas could use its large volume purchasing power through the Medicaid vendor drug program to obtain a better deal on prescription drugs for seniors. According to the National Conference of State Legislatures, pharmaceutical assistance programs for seniors are currently in operation in 16 states. House Bill 1231 offers similar assistance to older Texans by requiring pharmacies participating in the Medicaid vendor drug program to sell prescription drugs to Medicare recipients at a Medicaid price. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 1231 amends the Human Resources Code to establish that a provider in the Medicaid vendor drug program (program) must provide any prescription drug available to a Medicaid recipient to a Medicare recipient at a price not greater than the sum of: _the amount of reimbursement the provider would have received under the program for providing the drug to a Medicaid recipient; and _an administrative fee in an amount determined by the Health and Human Services Commission (HHSC) not to exceed 15 percent of the reimbursement amount. The bill specifies that to receive the price required by these provisions from a provider, a Medicare recipient must provide a prescription for the drug that names the recipient and present a Medicare card. The bill requires HHSC to ensure that information concerning prices authorized to be charged is readily available to providers participating in the program. The bill also requires HHSC to monitor provider compliance, evaluate the effect of these provisions on the availability of prescription drugs to Medicare and Medicaid recipients, and to submit a report to the legislature no later than January 1 of each year. EFFECTIVE DATE September 1, 2001.