By Uresti H.B. No. 2999
77R3345 MCK-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to creating a prescription drug purchasing program.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subtitle B, Title 2, Health and Safety Code, is
1-5 amended by adding Chapter 48 to read as follows:
1-6 CHAPTER 48. PRESCRIPTION DRUG PROGRAM
1-7 SUBCHAPTER A. GENERAL PROVISIONS
1-8 Sec. 48.001. DEFINITIONS. In this chapter:
1-9 (1) "Labeler" means an entity that:
1-10 (A) receives prescription drugs from a
1-11 manufacturer or wholesaler and repackages those drugs for later
1-12 retail sale; and
1-13 (B) has a labeler code from the federal Food and
1-14 Drug Administration under 21 C.F.R. Section 207.20.
1-15 (2) "Manufacturer" means a manufacturer of
1-16 prescription drugs, including a subsidiary or affiliate of a
1-17 manufacturer.
1-18 (3) "Participating retail pharmacy" means a retail
1-19 pharmacy or other business licensed to dispense prescription drugs
1-20 in this state that participates in the state Medicaid program or
1-21 voluntarily agrees to participate in the prescription drug program.
1-22 (Sections 48.002-48.050 reserved for expansion
1-23 SUBCHAPTER B. PRESCRIPTION DRUG PROGRAM
1-24 Sec. 48.051. PRESCRIPTION DRUG PROGRAM. The prescription
2-1 drug program is a program within the department designed to lower
2-2 prescription drug prices for uninsured and underinsured residents
2-3 of the state.
2-4 Sec. 48.052. REBATE AGREEMENT. A manufacturer or labeler
2-5 that sells prescription drugs in this state may voluntarily elect
2-6 to enter into a rebate agreement with the department.
2-7 Sec. 48.053. REBATE AMOUNT. The commissioner shall
2-8 negotiate the terms of the rebate from a manufacturer or labeler,
2-9 taking into consideration:
2-10 (1) the rebate calculated under the Medicaid Rebate
2-11 Program under 42 U.S.C. Section 1396r-8;
2-12 (2) the average wholesale price of prescription drugs;
2-13 and
2-14 (3) any other available information on prescription
2-15 drug prices and price discounts.
2-16 Sec. 48.054. FAILURE TO AGREE. (a) If the commissioner and
2-17 a manufacturer or labeler fail to reach an agreement on the terms
2-18 of a rebate, the commissioner shall determine whether to place the
2-19 manufacturer's or labeler's products on the prior authorization
2-20 list for the state Medicaid program or any other state-funded
2-21 prescription drug program.
2-22 (b) The commission by rule shall implement this section.
2-23 The names of manufacturers and labelers that do not enter into
2-24 rebate agreements are public information, and the department shall
2-25 publish the information on the department's Internet site.
2-26 (c) The department shall distribute to doctors, pharmacists,
2-27 and other health professionals information about the relative cost
3-1 of drugs produced by manufacturers and labelers that enter into
3-2 rebate agreements compared to manufacturers and labelers that do
3-3 not enter into rebate agreements.
3-4 Sec. 48.055. DISCOUNTED PRICES FOR PRESCRIPTION DRUG PROGRAM
3-5 PARTICIPANTS. (a) A participating retail pharmacy shall discount
3-6 the price of prescription drugs sold to prescription drug program
3-7 participants.
3-8 (b) The department shall establish discounted prices for
3-9 drugs covered by a rebate agreement and shall promote the use of
3-10 effective and reduced-cost drugs, taking into consideration reduced
3-11 prices for state and federally capped drug programs, differential
3-12 dispensing fees, administrative overhead, and incentive payments.
3-13 (c) A participating retail pharmacy shall offer prescription
3-14 drugs at or below the average wholesale price, minus six percent,
3-15 plus a dispensing fee designated by the department. The initial
3-16 price levels shall be calculated by the department, and the
3-17 dispensing fee may not be less than that provided under the state
3-18 Medicaid program. The average wholesale price is the wholesale
3-19 price charged on a specific commodity that is assigned by the drug
3-20 manufacturer and is listed in a nationally recognized drug pricing
3-21 file.
3-22 (d) A participating retail pharmacy shall offer prescription
3-23 drugs at or below the initial price levels specified under
3-24 Subsection (b) minus the amount of any rebate paid by the state to
3-25 the retail pharmacy. The discounted price levels shall be
3-26 calculated by the department. In determining the discounted price
3-27 levels, the department shall consider an average of all rebates
4-1 weighted by sales of drugs subject to the rebates over the most
4-2 recent 12-month period for which the information is available.
4-3 Sec. 48.056. ELIGIBILITY OF INDIVIDUALS TO PARTICIPATE IN
4-4 PRESCRIPTION DRUG PROGRAM. All residents of the state are eligible
4-5 to participate in the prescription drug program. The department
4-6 shall establish simplified procedures for issuing prescription drug
4-7 program enrollment cards to eligible residents. The department
4-8 shall undertake outreach efforts to build public awareness of the
4-9 prescription drug program and maximize enrollment by eligible
4-10 residents.
4-11 Sec. 48.057. OPERATION OF PRESCRIPTION DRUG PROGRAM. (a)
4-12 The Texas State Board of Pharmacy shall adopt rules requiring
4-13 participating retail pharmacies to disclose to prescription drug
4-14 program participants the amount of savings provided as a result of
4-15 the prescription drug program. The rules must protect information
4-16 that is proprietary in nature.
4-17 (b) The department may not impose transaction charges on
4-18 participating retail pharmacies that submit claims or receive
4-19 payments under the prescription drug program.
4-20 (c) A participating retail pharmacy shall submit claims to
4-21 the department to verify the amount charged to prescription drug
4-22 program participants. On a weekly or biweekly basis, the
4-23 department shall reimburse a retail pharmacy for discounted prices
4-24 provided to prescription drug program participants and dispensing
4-25 fees set by the department.
4-26 (d) The department shall collect from the participating
4-27 retail pharmacies utilization data necessary to calculate the
5-1 amount of the rebate from the manufacturer or labeler. The
5-2 department shall protect the confidentiality of all information
5-3 subject to confidentiality protection under state or federal law,
5-4 rule, or regulation.
5-5 Sec. 48.058. DISCREPANCIES IN REBATE AMOUNTS. (a)
5-6 Discrepancies in rebate amounts must be resolved using the process
5-7 established in this section.
5-8 (b) If there is a discrepancy in the manufacturer's or
5-9 labeler's favor between the amount claimed by a participating
5-10 retail pharmacy and the amount rebated by the manufacturer or
5-11 labeler, the department, at the department's expense, may hire a
5-12 mutually agreed-on independent auditor. If a discrepancy still
5-13 exists following the audit, the manufacturer or labeler shall
5-14 justify the reason for the discrepancy or make payment to the
5-15 department for any additional amount due.
5-16 (c) If there is a discrepancy against the interest of the
5-17 manufacturer or labeler in the information provided by the
5-18 department to the manufacturer or labeler regarding the
5-19 manufacturer's or labeler's rebate, the manufacturer or labeler, at
5-20 the manufacturer's or labeler's expense, may hire a mutually
5-21 agreed-on independent auditor to verify the accuracy of the data
5-22 supplied to the department. If a discrepancy still exists
5-23 following the audit, the department shall justify the reason for
5-24 the discrepancy or refund to the manufacturer any excess payment
5-25 made by the manufacturer or labeler.
5-26 (d) After the results of an audit are received, the
5-27 department or the manufacturer or labeler may request a hearing by
6-1 filing a statement with the department requesting a hearing and
6-2 providing supporting documentation.
6-3 Sec. 48.059. DEDICATED ACCOUNT. (a) The prescription drug
6-4 program account is a dedicated account in the general revenue fund.
6-5 The account consists of money received from manufacturers and
6-6 labelers that pay rebates and any appropriations or allocations
6-7 designated for the fund.
6-8 (b) The legislature may appropriate money deposited to the
6-9 credit of the prescription drug program account only to the
6-10 department to reimburse:
6-11 (1) participating retail pharmacies for discounted
6-12 prices provided to prescription drug program participants; and
6-13 (2) the department for the costs of administering the
6-14 program, including costs of contracted services, computer costs,
6-15 professional fees paid to participating retail pharmacies, and
6-16 other reasonable program costs.
6-17 (c) Interest earned from the investment of the prescription
6-18 drug program account shall be deposited to the credit of the
6-19 account.
6-20 Sec. 48.060. ANNUAL REPORT. Not later than January 1 of
6-21 each year, the department shall report to the legislature the
6-22 enrollment and financial status of the prescription drug program.
6-23 Sec. 48.061. COORDINATION WITH OTHER PROGRAMS. If the
6-24 department determines that it is beneficial, the department may
6-25 combine drug pricing negotiations for the prescription drug program
6-26 and other state programs, including the Medicaid program, to
6-27 maximize drug rebates.
7-1 Sec. 48.062. RULES. The board may adopt rules necessary to
7-2 administer this chapter.
7-3 SECTION 2. If before implementing this Act a state agency
7-4 determines that a waiver or authorization from a federal agency is
7-5 necessary to implement a provision of this Act, the state agency
7-6 shall request the waiver or authorization and may delay
7-7 implementing the provision until the waiver or authorization is
7-8 granted.
7-9 SECTION 3. This Act takes effect September 1, 2001.