SB3155 93RD GENERAL ASSEMBLY

LRB093 19814 AMC 45557 b

93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
SB3155

Introduced 2/6/2004, by Ira I. Silverstein

SYNOPSIS AS INTRODUCED:

320 ILCS 55/25

Amends the Senior Citizens and Disabled Persons Prescription Drug Discount Program Act. Provides that the amount paid by eligible seniors and disabled persons enrolled in the program to authorized pharmacies for prescription drugs may not exceed prices agreed upon between the Department and program administrator. Removes language that requires the Department or program administrator to compensate authorized pharmacies for prescription drugs dispensed under the program. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning prescription drugs.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Senior Citizens and Disabled Persons Prescription Drug Discount Program Act is amended by changing Section 25 as follows:

(320 ILCS 55/25)

Sec. 25. Program administration.

(a) The Department is authorized under this Act to be the program administrator. If the Department is not the program administrator, 90 days after the effective date of this Act, the Department must issue a request for proposals for bidders interested in administering the program. Bidders must compete on the basis of the following minimum criteria:

(1) The Director shall solicit and accept proposals from entities to provide for administration of a program or programs in accordance with rules adopted under Section 45. Proposals must be submitted not later than a date established by the Director. The Director shall accept only those proposals that specify the following:

(A) The estimated amount of the discount based on the entity's previous experience and how the discount is to be achieved.

(B) The extent that discounts on prescription drugs are to be achieved through rebates, administrative fees, or other fees or discounts in prices that the entity negotiates with drug manufacturers. The proposals shall assure that rebates or discounts will be used to do the following:

(i) reduce costs to cardholders;

(ii) achieve discounts for cardholders; and

(iii) cover costs for administering the program.

(C) Any other benefits offered to cardholders.

(D) The estimated number and geographic distribution of participating pharmacies in the administrator's pharmacy network.

(E) The plan for pharmacy compensation, pursuant to subsection (e) of this Section.

(F) The method used for determining the prescription drugs to be covered by the program, including the criteria and process for establishing a preferred drug list, if applicable.

(G) How the entity proposes to improve medication management for cardholders, including any program of disease management.

(H) How cardholders and participating pharmacies will be informed of the discounted price negotiated by the entity.

(I) How the entity will handle complaints about the program's operation.

(J) The entity's previous experience in managing similar programs.

(K) Any additional information requested by the Director.

(2) The Director shall contract with one or more entities to administer a program or programs on the basis of the proposals submitted, but may require an administrator to modify its conduct of a program in accordance with rules adopted under Section 45.

The Director shall adopt rules specifying the period for which a contract will be in effect and may terminate a contract if an administrator fails to conduct a program in accordance with its proposal or with any modifications required by rule. When a contract period ends or a contract is terminated, the Director shall enter into a new contract in the manner specified in this Section for an original contract. Prior to making a new contract, the Director may modify the rules for administration of the program or programs.

(b) As used in this Section, "administrator" includes the administrator's parent company and any subsidiary of the parent company.

(1) No administrator shall sell any information concerning a person who holds a prescription drug discount card, other than aggregate information that does not identify the cardholder, without the cardholder's written consent.

(2) Unless an administrator has the cardholder's written consent, no administrator shall use any personally identifiable information that it obtains concerning a cardholder through the program to promote or sell a program or product offered by the administrator that is not related to the administration of the program. This subsection (b) does not prohibit an administrator from contacting cardholders concerning participation in or administration of the program, including, but not limited to, mailing a list of pharmacies participating in the program's network or participating in disease management programs.

(3) To the extent that a discount is achieved through rebates, administrative fees, or any other fees or discounts in prices that an administrator negotiates with drug manufacturers, an administrator shall use the rebates or discounts to do the following:

(A) reduce costs to cardholders;

(B) achieve discounts for cardholders; and

(C) cover any administrative costs of the program.

(4) The administrator shall not use any funds generated from rebates, discounts, administrative fees, or other fees to promote its mail order pharmacy operation or the mail order pharmacy operation of an affiliate. This subdivision (b)(4) does not, however, limit the participation of an Illinois-licensed pharmacy under this Act if that pharmacy provides prescription drugs by mail order.

(c) Beginning on January 1, 2004 and until the effective date of this amendatory Act of the 93rd General Assembly, the amount paid by eligible seniors and disabled persons enrolled in the program to authorized pharmacies for prescription drugs may not exceed prices established as a result of the rebate agreements under Section 30. The eligible seniors and disabled persons shall pay the price determined under Section 30 plus a dispensing fee of $3.50 per prescription for brand name drug products, single-source drug products, and, for a period of 6 months, newly released generic drug products and $4.25 per prescription for all other generic drug products, except that the total amount paid by the eligible senior or disabled person for each prescription drug under this program shall not exceed the usual and customary charge for such prescription.

(c-5) Beginning on the effective date of this amendatory Act of the 93rd General Assembly, the amount paid by eligible seniors and disabled persons enrolled in the program to authorized pharmacies for prescription drugs may not exceed prices agreed upon between the Department and program administrator. The eligible seniors and disabled persons shall pay the discounted price plus a negotiated dispensing fee.

(d) The contract between the Department and a pharmacy benefits manager must, at a minimum, meet the criteria of subsection (a). The contract must also require notification by the pharmacy benefits manager of any proposed or ongoing activity that involves, directly or indirectly, any conflict of interest on the part of the pharmacy benefits manager. The Department shall ensure that the pharmacy benefits manager complies with the contract and shall adopt all procedures necessary to enforce the contract.

(e) (Blank). The Department or program administrator shall, subject to the funds available under Section 30 of this Act, compensate authorized pharmacies for prescription drugs dispensed under the program for the difference between the amount paid by the eligible senior or disabled person for prescription drugs dispensed under the program and (i) the AWP minus 12% for brand name drug products, single-source generic drug products, and, for a period of 6 months, newly released generic drug products and (ii) the AWP minus 35% for all other generic drug products. The Department shall compensate a pharmacy under this subsection (e) only if the amount paid by the eligible senior or disabled person has been discounted to a price, including the dispensing fees stated in subsection (c) of this Section, that is less than (i) the AWP minus 12% for brand name drug products, single-source generic drug products, and, for a period of 6 months, newly released generic drug products and (ii) the AWP minus 35% for all other generic drug products.

(f) Beginning on January 1, 2004, the Department or program administrator shall reimburse pharmacies under this Section within 30 days after adjudication of the claim for claims made based on prescription drugs dispensed under the program before the effective date of this amendatory Act of the 93rd General Assembly..

(Source: P.A. 93-18, eff. 7-1-03.)

Section 99. Effective date. This Act takes effect upon becoming law.