Senate Bill sb2098

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    Florida Senate - 2003                                  SB 2098

    By Senator Wasserman Schultz





    34-657-03                                           See HB 161

  1                      A bill to be entitled

  2         An act relating to prescription drugs; creating

  3         s. 409.960, F.S.; providing a popular name;

  4         creating s. 409.962, F.S.; creating "The

  5         LifeSaver Rx Program"; providing purpose of the

  6         program; creating s. 409.964, F.S.; providing

  7         definitions; creating s. 409.966, F.S.;

  8         providing that the Secretary of Health Care

  9         Administration shall operate the LifeSaver Rx

10         Program as a state pharmaceutical assistance

11         program to provide discounts to participants

12         for prescription drugs covered by a rebate

13         agreement; providing that the secretary shall

14         negotiate discount prices or rebates for

15         prescription drugs from manufacturers or

16         labelers; providing that the Agency for Health

17         Care Administration shall contract with

18         participating retail pharmacies to deliver

19         discounted prices to program participants;

20         providing factors to be considered in

21         negotiating discounts or rebates; providing for

22         quarterly calculation of discounts; creating s.

23         409.968, F.S.; providing for calculation of

24         payment by program participants and the agency;

25         requiring participating retail pharmacies in

26         the state to charge the rate allowable under

27         the Medicaid program for prescription drugs

28         sold to program participants; providing for

29         rate of reimbursement of participating retail

30         pharmacies; creating s. 409.970, F.S.;

31         providing requirements for program eligibility;

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1         requiring the Agency for Health Care

 2         Administration to establish enrollment

 3         procedures; providing for an annual enrollment

 4         fee; providing for use of enrollment fees and

 5         rebates from drug manufacturers; creating s.

 6         409.972, F.S.; providing for operation of the

 7         program; authorizing the Board of Pharmacy to

 8         adopt certain rules; creating s. 409.974, F.S.;

 9         providing procedure for resolution of

10         discrepancies in rebate amounts; creating s.

11         409.976, F.S.; requiring an annual report;

12         creating s. 409.978, F.S.; authorizing

13         coordination with other programs; creating s.

14         409.980, F.S.; authorizing the agency to adopt

15         rules; creating s. 409.982, F.S.; authorizing

16         the agency to seek certain waivers; providing a

17         specified contribution by the agency toward the

18         cost of prescription drugs purchased by program

19         participants; providing severability; providing

20         an appropriation; providing an effective date.

21  

22  Be It Enacted by the Legislature of the State of Florida:

23  

24         Section 1.  Section 409.960, Florida Statutes, is

25  created to read:

26         409.960  Popular name.--Sections 409.960-409.982 shall

27  be known by the popular name "LifeSaver Rx Program."

28         Section 2.  Section 409.962, Florida Statutes, is

29  created to read:

30         409.962  LifeSaver Rx Program established; findings;

31  purpose.--

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1         (1)  It is the finding of the Legislature that

 2  approximately one in four residents of Florida have no

 3  prescription drug insurance coverage or wholly inadequate

 4  prescription drug insurance coverage. These uninsured

 5  residents pay excessive prices for prescription drugs, far

 6  higher prices than are paid by managed care organizations,

 7  insurance companies, and the Federal Government for the same

 8  medicines and dosages. In many cases, these excessive drug

 9  prices have the effect of denying residents access to

10  medically necessary care, thereby threatening their health and

11  safety. Many Florida residents require repeated doctor or

12  medical clinic appointments, having become sicker because they

13  could not afford to purchase the prescription drugs prescribed

14  for them. Many residents are admitted to or treated at

15  hospitals each year because they cannot afford the

16  prescription drugs that could have prevented the need for

17  hospitalization. Many others enter expensive institutional

18  care settings because they cannot afford the necessary

19  prescription drugs that could have supported them outside of

20  an institution. In each of these circumstances, state medical

21  assistance programs, including the Medicaid program, literally

22  pay the price. One major reason uninsured residents pay such

23  high prices for prescription drugs is that, unlike insured

24  residents, they have no prescription benefits manager

25  negotiating a fair price with drug companies on their behalf.

26  State government currently provides prescription drugs and

27  acts as a prescription benefit manager through a variety of

28  health plans and assistance programs and, in 2001, the

29  Legislature expanded the state's role in negotiating better

30  prescription drug prices for Medicaid. State government is the

31  only agent that, as a practical matter, can play an effective

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1  role as a market participant on behalf of all residents who

 2  are uninsured or underinsured. The state can and should act as

 3  a prescription benefit manager, negotiating drug rebates and

 4  using these funds to reimburse retail pharmacies for offering

 5  lower drug prices.

 6         (2)  Recognizing that the state already acts as a

 7  prescription benefit manager for a variety of health plans and

 8  assistance programs, including the Medicaid program, the

 9  LifeSaver Rx Program is established within the Agency for

10  Health Care Administration. The purpose of the program is to

11  expand Medicaid eligibility for prescription drug benefits

12  only, at a level that does not exceed available funding,

13  thereby providing prescription drug coverage to new

14  populations by expanding the state's role as a participant in

15  the prescription drug marketplace, negotiating rebates from

16  drug companies, and using the funds from such rebates to make

17  prescription drugs more affordable to Florida residents. Each

18  program participant shall receive a discount toward the

19  purchase of all prescription drugs that are covered by the

20  Florida Medicaid program. The Legislature finds that such a

21  program will improve public health and welfare, promote the

22  economic strength of our society, and substantially benefit

23  state health assistance programs, including the Medicaid

24  program.

25         Section 3.  Section 409.964, Florida Statutes, is

26  created to read:

27         409.964  Definitions.--As used in this act, unless the

28  context otherwise indicates, the term:

29         (1)  "Agency" means the Agency for Health Care

30  Administration.

31  

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1         (2)  "Labeler" means an entity or person that receives

 2  prescription drugs from a manufacturer or wholesaler and

 3  repackages those drugs for later retail sale and that has a

 4  labeler code from the federal Food and Drug Administration

 5  under 21 C.F.R. s. 207.20 (1999).

 6         (3)  "Manufacturer" means a manufacturer of

 7  prescription drugs and includes a subsidiary or affiliate of a

 8  manufacturer.

 9         (4)  "Participating retail pharmacy" means a retail

10  pharmacy or other business licensed to dispense prescription

11  drugs in this state that:

12         (a)  Participates in the state Medicaid program; or

13         (b)  Agrees to participate in the LifeSaver Rx Program.

14         (5)  "Program" means the LifeSaver Rx Program.

15         (6)  "Secretary" means the Secretary of Health Care

16  Administration or the secretary's designee.

17         (7)  "Qualified resident" means an uninsured resident

18  of the state who has obtained from the agency a LifeSaver Rx

19  Program enrollment card.

20         Section 4.  Section 409.966, Florida Statutes, is

21  created to read:

22         409.966  Prescription drug discounts; negotiation of

23  discounts or rebates; calculation of discounts.--The secretary

24  shall operate the program as a state pharmaceutical assistance

25  program under 42 U.S.C. s. 1396r-8(c)(1)(C)(i)(III) to provide

26  discounts to participants for prescription drugs covered by a

27  rebate agreement.

28         (1)  The secretary shall negotiate discount prices or

29  rebates for prescription drugs from drug manufacturers and

30  labelers for the program. Using sums from negotiated rebates,

31  

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1  the agency shall contract with participating retail pharmacies

 2  to deliver discounted prices to program participants.

 3         (2)  In negotiating discount or rebate terms, the

 4  secretary shall take into consideration:

 5         (a)  The rebate calculated under the Medicaid rebate

 6  program pursuant to 42 U.S.C. s. 1396r-8;

 7         (b)  The price provided to eligible entities under 42

 8  U.S.C. s. 256b; and

 9         (c)  Any other available information on prescription

10  drug prices, discounts, and rebates.

11         (3)  The secretary may consider any  supplemental

12  rebate negotiated pursuant to s. 409.912(38)(a)7.

13         (4)  The drug discounts received by program

14  participants shall be calculated by the secretary on a

15  quarterly basis.

16         Section 5.  Section 409.968, Florida Statutes, is

17  created to read:

18         409.968  Discounted prices for program participants.--

19         (1)  Each program participant's payment shall be equal

20  to the Medicaid allowable charge for the prescription minus

21  the payment made by the agency. The payment made by the agency

22  shall include the estimated manufacturer rebate plus the state

23  subsidy of 2 percent per prescription as provided under this

24  act and the federal matching share for the state general

25  revenue contribution.

26         (2)  A participating retail pharmacy shall charge the

27  Medicaid allowable rate for prescription drugs sold to

28  participants in the program.

29         (3)  The participating retail pharmacy shall be

30  reimbursed by the agency at the agency's manufacturer

31  estimated rebate amount.

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1         (4)  The program as established in s. 409.962 is not an

 2  entitlement.

 3         Section 6.  Section 409.970, Florida Statutes, is

 4  created to read:

 5         409.970  Program eligibility.--

 6         (1)  An individual is eligible to participate in the

 7  program if he or she:

 8         (a)  Is a resident of the state;

 9         (b)  Is 65 years of age or older and is a Medicare

10  participant;

11         (c)  Has a net family income at or below 300 percent of

12  the federal poverty level;

13         (d)  Has exhausted all third-party prescription

14  coverage; and

15         (e)  Requests to be enrolled in the program.

16         (2)  An individual is ineligible to participate in the

17  program if he or she is eligible for assistance under the

18  state's Medicaid program.

19         (3)  The agency shall establish simple procedures for

20  enrolling program participants. Such procedures shall include

21  the assessment of an annual enrollment fee of up to $50 per

22  enrollee. The agency shall undertake outreach efforts to build

23  public awareness of the program and maximize enrollment by

24  eligible residents. Revenues generated from program enrollment

25  fees and rebates from drug manufacturers shall be used for,

26  but not be limited to, offsetting state costs to administer

27  the program, the purchase of prescription drugs, and any

28  public awareness campaigns.

29         Section 7.  Section 409.972, Florida Statutes, is

30  created to read:

31         409.972  Program operation.--

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1         (1)  The Board of Pharmacy, as created by s. 465.004,

 2  in consultation with the agency, is authorized to adopt rules

 3  pursuant to ss. 120.536(1) and 120.54 requiring disclosure by

 4  participating retail pharmacies to program participants of the

 5  amount of savings provided as a result of the program. Such

 6  rules must protect information that is proprietary in nature.

 7         (2)  Participating retail pharmacies shall be paid in

 8  advance for program discounts or shall be reimbursed by the

 9  agency on a weekly or biweekly basis, in accordance with

10  contracts between the agency and such businesses.

11         (3)  The agency shall collect from the participating

12  retail pharmacies utilization data necessary to calculate the

13  amount of the rebate from the manufacturer or labeler. The

14  agency shall protect the confidentiality of all information

15  subject to confidentiality protection under the laws of this

16  state or federal laws, rules, or regulations.

17         Section 8.  Section 409.974, Florida Statutes, is

18  created to read:

19         409.974  Discrepancies in rebate

20  amounts.--Discrepancies in rebate amounts must be resolved

21  using the process established in this section.

22         (1)  If there is a discrepancy in the manufacturer's or

23  labeler's favor between the amount claimed by a participating

24  retail pharmacy and the amount rebated by the manufacturer or

25  labeler, the agency, at the agency's expense, may hire a

26  mutually agreed-upon independent auditor. If a discrepancy

27  still exists following the audit, the manufacturer or labeler

28  shall justify the reason for the discrepancy or make payment

29  to the agency for any additional amount due.

30         (2)  If there is a discrepancy against the interest of

31  the manufacturer or labeler in the information provided by the

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1  agency to the manufacturer or labeler regarding the

 2  manufacturer's or labeler's rebate, the manufacturer or

 3  labeler, at the manufacturer's or labeler's expense, may hire

 4  a mutually agreed-upon independent auditor to verify the

 5  accuracy of the data supplied to the agency. If a discrepancy

 6  still exists following the audit, the agency shall justify the

 7  reason for the discrepancy or refund the manufacturer or

 8  labeler.

 9         (3)  Following the completion of procedures established

10  in subsection (1) or subsection (2), the agency, the

11  manufacturer, or the labeler may request a hearing. Hearings

12  shall be conducted pursuant to ss. 120.569 and 120.57.

13  Supporting documentation must accompany the request for a

14  hearing.

15         Section 9.  Section 409.976, Florida Statutes, is

16  created to read:

17         409.976  Report.--The agency shall provide a report on

18  the enrollment and financial status of the program to the

19  Governor, the President of the Senate, and the Speaker of the

20  House of Representatives by the second week in January each

21  year.

22         Section 10.  Section 409.978, Florida Statutes, is

23  created to read:

24         409.978  Coordination with other programs.--The

25  secretary shall combine drug pricing negotiations to maximize

26  drug rebates when the secretary determines that the

27  combination of such negotiations is beneficial to both the

28  LifeSaver Rx Program and another state program, including the

29  state Medicaid program.

30         Section 11.  Section 409.980, Florida Statutes, is

31  created to read:

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    Florida Senate - 2003                                  SB 2098
    34-657-03                                           See HB 161




 1         409.980  Rulemaking.--The agency is authorized to adopt

 2  rules pursuant to ss. 120.536(1) and 120.54 to implement the

 3  provisions of this act. Such rules shall include eligibility

 4  requirements, limits on participation, benefit limitations, a

 5  requirement for generic drug substitution, and other program

 6  parameters comparable to those of the Medicaid program.

 7         Section 12.  Section 409.982, Florida Statutes, is

 8  created to read:

 9         409.982  Waivers.--The agency shall seek any waivers of

10  federal law, rule, or regulation necessary to implement the

11  provisions of this act.

12         Section 13.  The agency shall contribute 2 percent

13  toward the cost of each prescription purchased by the program

14  participant.

15         Section 14.  The Legislature shall appropriate from the

16  General Revenue Fund to the Agency for Health Care

17  Administration an amount that is sufficient to implement the

18  provisions of this act.

19         Section 15.  If any provision of this act or the

20  application thereof to any person or circumstance is held

21  invalid, the invalidity shall not affect other provisions or

22  applications of the act which can be given effect without the

23  invalid provision or application, and to this end the

24  provisions of this act are declared severable.

25         Section 16.  This act shall take effect upon becoming a

26  law.

27  

28  

29  

30  

31  

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