Print Friendly HOUSE BILL NO. 509
– Idaho Prescription Drug Program
HOUSE BILL NO. 509
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H0509.................................................by HEALTH AND WELFARE
PRESCRIPTION DRUG PROGRAM - Adds to existing law relating to prescription
drugs to provide a short title; to define terms; to create the Idaho
Prescription Drug Program; to provide a purpose; to provide for the
appointment of an administrator and to set forth duties; to provide for
program participants; to provide for terms of the program; to provide for
different reimbursement rates or prescription drug prices; to provide for
pharmacy enrollment in the program; to provide certain restrictions and
certain duties of the administrator; to provide for application and
participation in the program; to provide for program prescription drug
prices and identification cards; to provide for a best choice drug guide;
to create the Prescription Drug Purchasing Fund; to provide for
appropriations; to authorize the adoption of rules; and to provide for a
02/11 House intro - 1st rdg - to printing
02/12 Rpt prt - to Health/Wel
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-ninth Legislature Second Regular Session - 2008
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 509
BY HEALTH AND WELFARE COMMITTEE
1 AN ACT
2 RELATING TO PUBLIC ASSISTANCE AND THE IDAHO PRESCRIPTION DRUG PROGRAM; AMEND-
3 ING TITLE 56, IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 14, TITLE 56,
4 IDAHO CODE, TO PROVIDE A SHORT TITLE, TO DEFINE TERMS, TO CREATE THE IDAHO
5 PRESCRIPTION DRUG PROGRAM AND PROVIDE A PURPOSE, TO PROVIDE FOR THE
6 APPOINTMENT OF AN ADMINISTRATOR AND TO SET FORTH DUTIES, TO PROVIDE FOR
7 PROGRAM PARTICIPANTS, TO PROVIDE FOR TERMS OF THE PROGRAM, TO PROVIDE FOR
8 DIFFERENT REIMBURSEMENT RATES OR PRESCRIPTION DRUG PRICES, TO PROVIDE FOR
9 PHARMACY ENROLLMENT IN THE PROGRAM, TO PROVIDE CERTAIN RESTRICTIONS AND
10 CERTAIN DUTIES OF THE ADMINISTRATOR, TO PROVIDE FOR APPLICATION AND PAR-
11 TICIPATION IN THE PROGRAM, TO PROVIDE FOR PROGRAM PRESCRIPTION DRUG PRICES
12 AND IDENTIFICATION CARDS, TO PROVIDE FOR A BEST CHOICE DRUG GUIDE, TO CRE-
13 ATE THE PRESCRIPTION DRUG PURCHASING FUND, TO PROVIDE FOR APPROPRIATIONS,
14 TO AUTHORIZE THE ADOPTION OF RULES AND TO PROVIDE FOR A REPORT.
15 Be It Enacted by the Legislature of the State of Idaho:
16 SECTION 1. That Title 56, Idaho Code, be, and the same is hereby amended
17 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
18 ter 14, Title 56, Idaho Code, and to read as follows:
19 CHAPTER 14
20 IDAHO PRESCRIPTION DRUG PROGRAM
21 56-1401. SHORT TITLE. This chapter shall be known and may be cited as the
22 "Idaho Prescription Drug Program."
23 56-1402. DEFINITIONS. As used in this chapter:
24 (1) "Pharmacy benefit manager" means an entity that, in addition to being
25 a prescription drug claims processor, negotiates and executes contracts with
26 pharmacies, manages preferred drug lists, negotiates rebates with prescription
27 drug manufacturers and serves as an intermediary between the Idaho prescrip-
28 tion drug program, prescription drug manufacturers and pharmacies.
29 (2) "Prescription drug claims processor" means an entity that processes
30 and pays prescription drug claims, adjudicates pharmacy claims, transmits pre-
31 scription drug prices and claims data between pharmacies and the Idaho pre-
32 scription drug program and processes related payments to pharmacies.
33 (3) "Program price" means the reimbursement rates and prescription drug
34 prices established by the administrator of the Idaho prescription drug pro-
36 56-1403. PROGRAM CREATED -- PURPOSE. The Idaho prescription drug program
37 is hereby established in the Idaho department of health and welfare. The pur-
38 pose of the program is to:
39 (1) Purchase prescription drugs or reimburse pharmacies for prescription
40 drugs in order to receive discounted prices and rebates;
1 (2) Make prescription drugs available at the lowest possible cost to par-
2 ticipants in the program; and
3 (3) Maintain a list of prescription drugs recommended as the most effec-
4 tive prescription drugs available at the best possible prices.
5 56-1404. APPOINTMENT OF ADMINISTRATOR -- DUTIES. The director of the
6 department of health and welfare shall appoint an administrator of the Idaho
7 prescription drug program. The administrator shall:
8 (1) Negotiate price discounts and rebates on prescription drugs with pre-
9 scription drug manufacturers;
10 (2) Contract with a prescription drug claims processor or pharmacy bene-
11 fit manager to adjudicate pharmacy claims and transmit program prices to phar-
13 (3) Determine program prices and reimburse pharmacies for prescription
15 (4) Adopt and implement a best choice drug guide;
16 (5) Develop a system for allocating and distributing the operational
17 costs of the program and any rebates obtained to participants of the program;
19 (6) Cooperate with other states or regional consortia in the bulk pur-
20 chase of prescription drugs.
21 56-1405. PARTICIPANTS. The following individuals or entities may partici-
22 pate in the program:
23 (1) Any city government or county government of this state;
24 (2) State agencies that directly or indirectly purchase prescription
25 drugs, including agencies that dispense prescription drugs directly to persons
26 in state operated facilities;
27 (3) Residents of this state who are either uninsured or underinsured for
28 prescription drug coverage;
29 (4) Private entities;
30 (5) The state program that receives federal medicaid funds and is respon-
31 sible for implementing the state's medical assistance program may not partici-
32 pate in the program;
33 (6) Notwithstanding the provisions of subsection (3) of this section,
34 individuals who are eligible for medicare part D prescription drug coverage
35 may participate in the program.
36 56-1406. TERMS OF THE PROGRAM. (1) The administrator may establish dif-
37 ferent reimbursement rates or prescription drug prices for pharmacies in rural
38 areas to maintain statewide access to the program.
39 (2) The administrator shall establish the terms and conditions for a
40 pharmacy to enroll in the program. A licensed pharmacy that is willing to
41 accept the terms and conditions established by the administrator may apply to
42 enroll in the program.
43 (3) Except as provided in subsection (4) of this section, the administra-
44 tor may not:
45 (a) Establish a state managed wholesale or retail drug distribution or
46 dispensing system; or
47 (b) Require pharmacies to maintain or allocate separate inventories for
48 prescription drugs dispensed through the program.
49 (4) The administrator shall contract with one (1) or more entities to
50 provide the functions of a prescription drug claims processor. The administra-
51 tor may also contract with one (1) or more of such entities or a pharmacy ben-
52 efit manager to negotiate with prescription drug manufacturers on behalf of
1 the administrator.
2 56-1407. APPLICATION AND PARTICIPATION IN IDAHO PRESCRIPTION DRUG PROGRAM
3 -- PRESCRIPTION DRUG CHARGES. (1) An individual or entity described in section
4 56-1405, Idaho Code, may apply to participate in the Idaho prescription drug
5 program. Participants shall apply on an application provided by the department
6 of health and welfare. Such application may be provided either electronically
7 through the department's internet website, via telephone or on a paper appli-
8 cation. The department may charge participants a nominal fee to participate in
9 the program. The department shall issue a prescription drug identification
10 card to participants of the program.
11 (2) The department of health and welfare shall provide a mechanism to
12 calculate and transmit the program prices for prescription drugs to a phar-
13 macy. The pharmacy shall charge the participant the program price for a pre-
14 scription drug.
15 (3) Prescription drug identification cards issued under this section must
16 contain the information necessary for proper claims adjudication or transmis-
17 sion of price data.
18 56-1408. BEST CHOICE DRUG GUIDE. The Idaho department of health and wel-
19 fare shall develop and recommend a best choice drug guide that identifies
20 choices of prescription drugs within therapeutic classes for particular dis-
21 eases and conditions, including generic alternatives, for use in the Idaho
22 prescription drug program. Recommendations will be based on evidence-based
23 evaluations on the effectiveness and safety of similar prescription drugs and
24 will include public testimony.
25 56-1409. PRESCRIPTION DRUG PURCHASING FUND. The prescription drug pur-
26 chasing fund is hereby established in the state treasury. The prescription
27 drug purchasing fund shall consist of moneys appropriated to the fund by the
28 legislature, moneys received by the department of health and welfare for the
29 purposes established in this section in the form of gifts, grants, bequests,
30 endowments or donations or as otherwise provided by law. The moneys in the
31 prescription drug purchasing fund are continuously appropriated to the depart-
32 ment of health and welfare and shall be used to purchase prescription drugs
33 and reimburse the department for the costs of administering the Idaho pre-
34 scription drug program, including contracted services costs, computer costs,
35 professional dispensing fees paid to retail pharmacies and other reasonable
36 program costs. Moneys in the fund shall be invested by the state treasurer in
37 the same manner as provided under section 67-1210, Idaho Code, with respect to
38 other surplus or idle moneys in the state treasury. Interest earned on the
39 investments shall be credited to the fund.
40 56-1410. RULES. The department of health and welfare shall promulgate
41 rules to implement and administer this chapter. The rules shall include, but
42 are not limited to, establishing procedures for:
43 (1) Issuing prescription drug identification cards to individuals and
44 entities that participate in the Idaho prescription drug program; and
45 (2) Enrolling pharmacies in the program.
46 56-1411. REPORT. (1) Not later than October 30, 2008, the department of
47 health and welfare shall report to the joint finance-appropriations committee
48 during the 2008 legislative interim regarding the department's preparations to
49 implement the Idaho prescription drug program. Such report shall include, but
50 not be limited to:
1 (a) The number of individuals and entities that the department expects to
2 enroll in the program and the number of persons for whom the department
3 expects to purchase prescription drugs;
4 (b) How the department expects the program to affect prescription drug
5 prices for participants;
6 (c) The rules proposed or adopted by the department to implement the pro-
8 (d) The feasibility and advisability of expanding the program; and
9 (e) A plan to expand the program if the department determines that expan-
10 sion is feasible and advisable.
11 (2) Subject to available funding for the program, not later than November
12 1, 2008, the department shall begin implementation of the program.
STATEMENT OF PURPOSE
This Act will establish the Idaho Prescription Drug Program
within the Idaho Department of Health and Welfare. Its purpose is
to provide those uninsured and underinsured with rates not
available to them but available to those in group plans to
purchase medications. This program is expected to save an
average of 40-60 percent.
We estimate that this program would cost $150,000 to pay for one
FTP and marketing. Funding would be from the recovery of monies
received from the Medicaid Fraud Unit specifically recovered from
pharmaceutical company charges found to be fraudulent.
Name: Representative Sue Chew
Representative Margaret Henbest
STATEMENT OF PURPOSE/FISCAL NOTE H 509