Amend CSSB 1188 (House committee printing) by adding the
following SECTIONS to the bill, appropriately numbered, and
renumbering subsequent SECTIONS accordingly:
SECTION __. STATE PHARMACY ASSISTANCE PROGRAM. Chapter
531, Government Code, is amended by adding Subchapter M to read as
follows:
SUBCHAPTER M. STATE PHARMACY ASSISTANCE PROGRAM
Sec. 531.501. STATE PHARMACY ASSISTANCE PROGRAM. (a) The
commission may develop and implement a state pharmacy assistance
program that provides prescription drug discounts to eligible
persons and is a state pharmacy assistance program for purposes of
42 U.S.C. Section 1396r-8(c)(1)(C).
(b) The state pharmacy assistance program may only be funded
with state general revenue funds or local funds. This subsection
applies only to the provision of prescription drug discounts under
the state pharmacy assistance program, and does not affect the
sources of funding permissible for other benefits provided to
eligible persons under programs described by Section 531.503.
(c) The commission may contract with a private entity to
negotiate on behalf of the commission for discounted prescription
drug acquisition prices with manufacturers and labelers, as those
terms are defined by Section 531.070.
(d) The commission may agree to pay a private contractor a
percentage of the gross purchases under the program. Any payment
shall be incorporated into the sales price.
Sec. 531.502. MAXIMUM PRICE. The price of a prescription
drug charged to an eligible person under the program may not exceed
the sum of:
(1) the discounted acquisition price under the
program; and
(2) a dispensing fee in an amount not to exceed 115
percent of the dispensing fee paid for providing the drug under the
vendor drug program.
Sec. 531.503. ELIGIBILITY. (a) A person is eligible for
prescription drug benefits under the state pharmacy assistance
program if the person is:
(1) qualified to receive services under Chapter 31 or
Subchapter B, Chapter 61, Health and Safety Code; or
(2) qualified to receive services from a community
mental health or mental retardation center established under
Subchapter A, Chapter 534, Health and Safety Code.
(b) The commissioner may expand eligibility for
prescription drug benefits under the state pharmacy assistance
program to persons who are qualified to receive services under a
program other than those listed in Subsection (a), provided that
the other program:
(1) is developed by the state specifically for the
benefit of disabled, indigent, low-income, elderly, or other
financially vulnerable persons;
(2) is funded using state funds and not federal funds;
(3) provides payments directly to service providers;
(4) provides only a pharmaceutical benefit or a
pharmaceutical benefit in conjunction with other medical benefits
or services;
(5) prohibits the diversion, resale, or transfer of
benefits reimbursed under the state pharmacy assistance program to
persons who are not beneficiaries of that program; and
(6) does not violate any applicable nondiscrimination
provisions under federal law.
Sec. 531.504. PARTICIPATING WHOLESALERS AND PHARMACIES.
(a) The commission or its contractor shall contract with each
wholesaler that:
(1) elects to participate in the state pharmacy
assistance program; and
(2) satisfies the commission's participation
requirements.
(b) A contract between the commission or its contractor and
a participating wholesaler must require the wholesaler to:
(1) provide prescription drugs available through the
program to pharmacies that voluntarily elect to participate in the
program at a price not to exceed the sum of:
(A) the discounted acquisition cost under the
program;
(B) a reasonable delivery fee in an amount
negotiated by the wholesaler and the commission or its contractor,
which fee may vary based on the monthly volume of prescription drugs
provided by the wholesaler and the number of required weekly
deliveries; and
(C) a reasonable percentage of the gross
purchases approved by the commission as provided by Section
531.501(d);
(2) meet service levels specified in the contract;
(3) provide next-day delivery service on all orders
under the program to participating pharmacies;
(4) provide software and data interface capacity to
participating pharmacies as necessary to enable participating
pharmacies to comply with Subsection (d); and
(5) participate in the program on an ongoing basis for
the period specified in the contract.
(c) The commission or its contractor shall collect
utilization information from each participating wholesaler as
necessary to administer the program, and shall protect the
confidentiality of any information obtained under this subsection
that is confidential under state or federal law, rule, or
regulation.
(d) The executive commissioner by rule shall require a
participating pharmacy to:
(1) maintain a separate inventory of prescription
drugs obtained by the pharmacy under the program or segregate those
drugs from the pharmacy's other prescription drug stock; and
(2) maintain separate records of acquisition and
disposition of prescription drugs obtained by the pharmacy under
the program, and ensure that all computer records regarding those
drugs are readily available on the request of the commission or its
contractor.
(e) A participating pharmacy or wholesaler may not resell or
otherwise transfer a prescription drug obtained under the program
to:
(1) a pharmacy that is not participating in the
program; or
(2) a person who is not an eligible program
participant.
(f) If the commission, after notice and opportunity for a
hearing, determines that a participating pharmacy or wholesaler
violated Subsection (e), the pharmacy or wholesaler is liable to
the manufacturer of the prescription drugs for an amount equal to
the difference between:
(1) the retail price of the drug at the time of the
resale or transfer in violation of Subsection (e); and
(2) the price at which the drug was obtained by the
pharmacy or wholesaler under the program.
Sec. 531.505. ACCESS TO PROGRAM BENEFITS. (a) An eligible
person is entitled to obtain a prescription drug dispensed under
this subchapter from an entity designated by the executive
commissioner or from a pharmacy that voluntarily participates in
the program.
(b) The commission shall maintain an electronic database on
a website listing the names and addresses of all pharmacies or other
entities participating in the program.
(c) The commission or its contractor shall engage in
outreach activities to publicize the availability of discounted
prescription drug prices under the program and to maximize
enrollment in the program. The commission shall establish
simplified procedures for enrolling eligible persons.
Sec. 531.506. CERTAIN DISPUTES OR DISCREPANCIES. (a) A
dispute or discrepancy in the amount negotiated under Section
531.501 must be resolved using the process established by this
section.
(b) The commission may hire an independent auditor
acceptable to all affected parties to perform an audit at the
commission's expense if there is a dispute or discrepancy in favor
of a manufacturer or labeler relating to the amount of a discount
for a prescription drug provided by the manufacturer or labeler. If
the audit does not resolve the dispute or discrepancy, the
manufacturer or labeler shall:
(1) provide justification for the dispute or
discrepancy that is satisfactory to the commission; or
(2) pay the additional amount due.
(c) A manufacturer or labeler may hire an independent
auditor acceptable to all affected parties to perform an audit at
the expense of the manufacturer or labeler if there is a dispute or
discrepancy in favor of the state relating to the amount of the
discount for a prescription drug provided by the manufacturer or
labeler. If the audit does not resolve the dispute or discrepancy,
the commission shall:
(1) provide justification for the dispute or
discrepancy that is satisfactory to the manufacturer or labeler; or
(2) require participating entities to refund to the
manufacturer or labeler the amount due.
(d) A party that is not satisfied with the resolution of a
dispute or discrepancy under Subsection (b) or (c) may request in
writing a hearing before the State Office of Administrative
Hearings. The party must include supporting documentation with the
request for a hearing.
Sec. 531.507. RULEMAKING. The executive commissioner may
adopt rules as necessary to administer this subchapter.
Sec. 531.508. ANNUAL REPORT. Not later than January 1 of
each year, the commission shall submit a report to the legislature
on the commission's activities under this subchapter. The report
must include the number of persons enrolled in the state pharmacy
assistance program and information regarding the financial
condition of the program.
Sec. 531.509. IMPLEMENTATION OF PROGRAM. (a) The
commission shall fully implement this subchapter and make
discounted drug prices available to eligible persons in accordance
with the program described by this subchapter only if the
commission determines that adequate voluntary discounts negotiated
under Section 531.501 are available.
(b) If the commission does not fully implement this
subchapter, the commission may adopt preferred drug lists and
impose prior authorization requirements, as authorized by Sections
531.072 and 531.073, for programs that provide prescription drugs
to persons described by Section 531.503(a).
SECTION __. Sections 531.070(h) and (j), Government Code,
are amended to read as follows:
(h) Subject to Subsection (i), the commission shall
negotiate with manufacturers and labelers, including generic
manufacturers and labelers, to obtain supplemental rebates for
prescription drugs provided under:
(1) the Medicaid vendor drug program in excess of the
Medicaid rebates required by 42 U.S.C. Section 1396r-8 and its
subsequent amendments; and
(2) the child health plan program[; and
[(3) any other state program administered by the
commission or a health and human services agency, including
community mental health centers and state mental health hospitals].
(j) A manufacturer or labeler that sells prescription drugs
in this state may voluntarily negotiate with the commission and
enter into an agreement to provide supplemental rebates for
prescription drugs provided under:
(1) the Medicaid vendor drug program in excess of the
Medicaid rebates required by 42 U.S.C. Section 1396r-8 and its
subsequent amendments; and
(2) the child health plan program[; and
[(3) any other state program administered by the
commission or a health and human services agency, including
community mental health centers and state mental health hospitals].
SECTION __. Section 531.072, Government Code, is amended by
adding Subsection (g) to read as follows:
(g) Notwithstanding Subsection (a), the commission may
adopt preferred drug lists under this section for a program that
serves persons described by Section 531.503(a) only if the
commission cannot obtain adequate voluntary discounts under
Subchapter M, Chapter 531, to permit full implementation of that
subchapter.
SECTION __. Section 531.073, Government Code, is amended by
adding Subsection (g) to read as follows:
(g) Notwithstanding Subsection (a), the commission may
require prior authorization under this section for a program that
serves persons described by Section 531.503(a) only if the
commission cannot obtain adequate voluntary discounts under
Subchapter M, Chapter 531, to permit full implementation of that
subchapter.