PRINTER'S NO. 2123
No. 1525 Session of 2000
INTRODUCED BY COSTA, MELLOW, BODACK, O'PAKE, STAPLETON, FUMO,
MUSTO, STOUT, TARTAGLIONE, BELAN, BOSCOLA, HUGHES, KASUNIC,
KITCHEN, KUKOVICH, LAVALLE, SCHWARTZ, WAGNER, WILLIAMS AND
WOZNIAK, SEPTEMBER 25, 2000
REFERRED TO AGING AND YOUTH, SEPTEMBER 25, 2000
AN ACT
1 Amending the act of August 26, 1971 (P.L.351, No.91), entitled
2 "An act providing for a State Lottery and administration
3 thereof; authorizing the creation of a State Lottery
4 Commission; prescribing its powers and duties; disposition of
5 funds; violations and penalties therefor; exemption of prizes
6 from State and local taxation and making an appropriation,"
7 eliminating the PACENET program; providing for a single
8 pharmacy benefits manager for a Drug Utilization Review
9 Committee and its duties and for rebate agreements governing
10 reimbursement by certain public plans; and imposing powers
11 and duties on the Department of Aging.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. The definitions of "PACENET" and "program" in
15 section 502 of the act of August 26, 1971 (P.L.351, No.91),
16 known as the State Lottery Law, added November 21, 1996
17 (P.L.741, No.134), are amended to read:
18 Section 502. Definitions.
19 The following words and phrases when used in this chapter
20 shall have the meanings given to them in this section unless the
21 context clearly indicates otherwise:
1 * * *
2 ["PACENET." The Pharmaceutical Assistance Contract for the
3 Elderly Needs Enhancement Tier provided for in this chapter.]
4 * * *
5 "Program." The Pharmaceutical Assistance Contract for the
6 Elderly (PACE) [and the Pharmaceutical Assistance Contract for
7 the Elderly Needs Enhancement Tier (PACENET)] as established by
8 this chapter, unless otherwise specified.
9 * * *
10 Section 2. Sections 519 and 521(b) and (d) of the act, added
11 November 21, 1996 (P.L.741, No.134), are amended to read:
12 [Section 519. The Pharmaceutical Assistance Contract for the
13 Elderly Needs Enhancement Tier.
14 (a) Establishment.--There is hereby established within the
15 department a program to be known as the Pharmaceutical
16 Assistance Contract for the Elderly Needs Enhancement Tier
17 (PACENET).
18 (b) PACENET eligibility.--A claimant with an annual income
19 of not less than $14,000 and not more than $16,000 in the case
20 of a single person and of not less than $17,200 and not more
21 than $19,200 in the case of the combined income of persons
22 married to each other shall be eligible for enhanced
23 pharmaceutical assistance under this section. A person may, in
24 reporting income to the department, round the amount of each
25 source of income and the income total to the nearest whole
26 dollar, whereby any amount which is less than 50¢ is eliminated.
27 (c) Deductible.--Upon enrollment in PACENET, eligible
28 claimants in the income ranges set forth in subsection (b) shall
29 be required to meet an annual deductible in unreimbursed
30 prescription drug expenses of $500 per person. To qualify for
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1 the deductible set forth in this subsection the prescription
2 drug must be purchased for the use of the eligible claimant from
3 a provider as defined in this chapter. The department, after
4 consultation with the board, may approve an adjustment in the
5 deductible on an annual basis.
6 (d) Copayment.--For eligible claimants under this section,
7 the copayment schedule, which may be adjusted by the department
8 on an annual basis after consultation with the board, shall be:
9 (i) eight dollars for noninnovator multiple source
10 drugs as defined in section 702; or
11 (ii) fifteen dollars for single-source drugs and
12 innovator multiple-source drugs as defined in section
13 702.]
14 Section 521. Penalties.
15 * * *
16 (b) Civil penalty.--In addition to any appropriate criminal
17 penalty for prohibited acts under this chapter whether or not
18 that act constitutes a crime under 18 Pa.C.S. (relating to
19 crimes and offenses), a provider who violates this section may
20 be liable for a civil penalty in an amount not less than $500
21 and not more than $10,000 for each violation of this act which
22 shall be collected by the department. Each violation constitutes
23 a separate offense. If the department collects three or more
24 civil penalties against the same provider, the provider shall be
25 ineligible to participate in [either] PACE [or PACENET] for a
26 period of one year. If more than three civil penalties are
27 collected from any provider, the department may determine that
28 the provider is permanently ineligible to participate in PACE
29 [or PACENET].
30 * * *
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1 (d) Repayment of gain.--Any provider, recipient or other
2 person who is found guilty of a crime for violating this chapter
3 shall repay three times the value of the material gain received.
4 In addition to the civil penalty authorized pursuant to
5 subsection (b), the department may require the provider,
6 recipient or other person to repay up to three times the value
7 of any material gain to PACE [or PACENET].
8 Section 3. The definitions of "covered prescription drug,"
9 "PACENET" and "provider" in section 702 of the act, added
10 November 21, 1996 (P.L.741, No.134), are amended to read:
11 Section 702. Definitions.
12 The following words and phrases when used in this chapter
13 shall have the meanings given to them in this section unless the
14 context clearly indicates otherwise:
15 * * *
16 "Covered prescription drug." A legend drug, insulin, an
17 insulin syringe or an insulin needle eligible for payment by the
18 Commonwealth under PACE[, PACENET] or designated pharmaceutical
19 programs.
20 * * *
21 ["PACENET." The program established under section 519.]
22 * * *
23 "Provider." A licensed pharmacy or dispensing physician
24 enrolled as a provider in PACE[, PACENET] or designated
25 pharmaceutical programs.
26 * * *
27 Section 4. Sections 703, 704(b)(1), 705(a)(2) and (c),
28 706(b) and 709 of the act, added November 21, 1996 (P.L.741,
29 No.134), are amended to read:
30 Section 703. Rebate agreement.
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1 (a) Requirement.--PACE[, PACENET] and designated
2 pharmaceutical programs shall not reimburse for any covered
3 prescription drug without a rebate agreement between the
4 department and the manufacturer of the covered prescription
5 drug.
6 (b) Exception.--Subsection (a) shall not apply if the
7 availability of the drug is essential to the health of eligible
8 claimants as determined by the department.
9 (c) Agreements.--Manufacturers of prescription drugs
10 reimbursed under PACE[, PACENET] and designated pharmaceutical
11 programs must enter into a rebate agreement with the department
12 under this chapter to obtain such reimbursement. Nothing in this
13 chapter shall be deemed to affect or impair any agreement made
14 under the former provisions of Chapter 6 of the act of August
15 14, 1991 (P.L.342, No.36), known as the Lottery Fund
16 Preservation Act.
17 (d) Notice.--The department shall notify enrolled providers
18 of PACE[, PACENET] and designated pharmaceutical programs on an
19 annual basis and, as appropriate, of all manufacturers who have
20 entered into a rebate agreement.
21 (e) Drug formulary.--Except as provided in section 512,
22 there shall be no drug formulary, prior or retroactive approval
23 system or any similar restriction imposed on the coverage of
24 outpatient drugs made by manufacturers who have agreements in
25 effect with the Commonwealth to pay rebates for drugs utilized
26 in PACE [and PACENET], provided that such outpatient drugs were
27 approved for marketing by the Food and Drug Administration. This
28 subsection shall not apply to any act taken by the department
29 pursuant to its therapeutic drug utilization review program
30 under section 505.
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1 Section 704. Terms of rebate agreement.
2 * * *
3 (b) Information.--
4 (1) The department shall report to each manufacturer,
5 not later than 60 days after the end of each calendar
6 quarter, information by zip code of provider on the total
7 number of dosage units of each covered prescription drug
8 reimbursed under PACE[, PACENET] and designated
9 pharmaceutical programs during the quarter.
10 * * *
11 Section 705. Amount of rebate.
12 (a) Single-source drugs and innovator multiple-source
13 drugs.--With respect to single-source drugs and innovator
14 multiple-source drugs, each manufacturer shall remit a rebate to
15 the Commonwealth. Except as otherwise provided in this section,
16 the amount of the rebate to the Commonwealth per calendar
17 quarter with respect to each dosage form and strength of single-
18 source drugs and innovator multiple-source drugs shall be as
19 follows:
20 * * *
21 (2) For quarters beginning after December 31, 1996, the
22 product of the total number of units of each dosage form and
23 strength reimbursed by PACE[, PACENET] and designated
24 pharmaceutical programs in the quarter and the difference
25 between the average manufacturer price and 83% of that price,
26 after deducting customary prompt payment discounts.
27 * * *
28 (c) Revised rebate for other drugs.--Beginning after
29 December 31, 1996:
30 (1) The amount of the rebate to the Commonwealth for a
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1 calendar quarter with respect to covered prescription drugs
2 which are noninnovator multiple-source drugs shall be the
3 greater of the product of:
4 (i) the applicable percentage of the average
5 manufacturer price, after deducting customary prompt
6 payment discounts, for each dosage form and strength of
7 such drugs for the quarter; and
8 (ii) the number of units of such form and dosage
9 reimbursed by PACE[, PACENET] and designated
10 pharmaceutical programs in the quarter.
11 (2) For purposes of paragraph (1), the applicable
12 percentage is 17%.
13 * * *
14 Section 706. Excessive pharmaceutical price inflation discount.
15 * * *
16 (b) Revised general rule.--A discount shall be provided to
17 the department for all covered prescription drugs. The discount
18 shall be calculated as follows:
19 (1) For each quarter for which a rebate under section
20 705(a) and (c) is to be paid after December 31, 1996, the
21 average manufacturer price for each dosage form and strength
22 of a covered prescription drug shall be compared to the
23 average manufacturer price for the same form and strength in
24 the previous calendar year and a percentage increase shall be
25 calculated.
26 (2) For each quarter under paragraph (1), the average
27 percentage increase in the Consumer Price Index-Urban over
28 the same quarter in the previous calendar year shall be
29 calculated.
30 (3) If the calculation under paragraph (1) is greater
20000S1525B2123 - 7 -
1 than the calculation under paragraph (2), the discount amount
2 for each quarter shall be equal to the product of:
3 (i) the difference between the calculations under
4 paragraphs (1) and (2); and
5 (ii) the total number of units of each dosage form
6 and strength reimbursed by PACE[, PACENET] and designated
7 pharmaceutical programs and the average manufacturer
8 price reported by the manufacturer under section
9 704(c)(1).
10 * * *
11 Section 709. Disposition of funds.
12 (a) PACE [and PACENET].--Money received under this chapter
13 in connection with PACE [and PACENET] shall be deposited in the
14 Pharmaceutical Assistance Contract for the Elderly Fund.
15 (b) Designated pharmaceutical programs.--Money received
16 under this chapter in connection with designated pharmaceutical
17 programs shall be treated as a refund of expenditures to the
18 appropriation which originally provided the funding for the
19 pharmaceutical purchase.
20 Section 5. The act is amended by adding a chapter to read:
21 CHAPTER 11
22 FAIR PRESCRIPTION DRUG PROVISIONS
23 Section 1101. Short title of chapter.
24 This chapter shall be known and may be cited as the Fair
25 Prescription Drug Act.
26 Section 1102. Definitions.
27 The following words and phrases when used in this chapter
28 shall have the meanings given to them in this section unless the
29 context clearly indicates otherwise:
30 "Best price." As defined under section 1927 of the Social
20000S1525B2123 - 8 -
1 Security Act (49 Stat. 620, 42 U.S.C. § 301 et seq.).
2 "Committee." The drug utilization review committee formed in
3 accordance with section 1105.
4 "Department." The Department of Aging of the Commonwealth.
5 "Medical Assistance Program." The program established
6 pursuant to Article IV, subarticle (f) of the act of June 13,
7 1967 (P.L.31, No.21), known as the Public Welfare Code.
8 "Medicare card." The identification card issued by the
9 Federal Government to all Medicare recipients.
10 "Medicare recipient." An individual residing in this
11 Commonwealth who receives benefits under Part A of Subchapter
12 XVIII of Chapter 7 of the Social Security Act (49 Stat. 620, 42
13 U.S.C. § 301 et seq.) or who is enrolled under Part B of such
14 subchapter.
15 "PACE." As defined under section 502.
16 "Pharmaceutical manufacturer." A manufacturer of
17 prescription drugs, insulin, insulin needles or insulin
18 syringes.
19 "Pharmacy." A pharmacy licensed by the Commonwealth.
20 "Pharmacy benefits manager" or "PBM." An entity under
21 contract with the Secretary of Aging to administer any
22 prescription program established by the Commonwealth or in which
23 a contribution by the Commonwealth is required.
24 "Pharmacy services." Medically necessary prescription drugs
25 and other pharmacy services furnished directly to eligible
26 recipients by pharmacies.
27 "Prescription drug." A drug requiring a prescription in this
28 Commonwealth, insulin, insulin syringes and insulin needles. The
29 term does not include experimental drugs or drugs prescribed for
30 wrinkle removal or hair growth.
20000S1525B2123 - 9 -
1 "Provider." A pharmacy or licensed prescriber who provides
2 pharmacy services to a recipient of any prescription program
3 established by the Commonwealth or in which a contribution by
4 the Commonwealth is required.
5 "Public plan." The PACE program, the Medical Assistance
6 Program, the State Employees' Benefit Trust Fund, the State
7 Employees' Retirement System, the Public School Employees'
8 Retirement System and any other State agency or designated
9 pharmaceutical program that purchases or arranges for the
10 purchase of prescription medications.
11 "Public School Employees' Retirement System." The retirement
12 system established by 24 Pa.C.S. Part IV (relating to retirement
13 for school employees).
14 "Secretary." The Secretary of Aging of the Commonwealth.
15 "State agency." Any agency under the jurisdiction of the
16 Governor, the General Assembly or the Unified Court System that
17 purchases or provides coverage for prescription medications.
18 "State Employees' Benefit Trust Fund." The trust fund
19 established to purchase health insurance coverage, including
20 coverage for prescription medications, for State employees.
21 "State Employees' Retirement System." The retirement system
22 established under 71 Pa.C.S. Part XXV (relating to retirement
23 for State employees and officers).
24 Section 1103. Single pharmacy benefits manager.
25 The secretary shall administer a single pharmacy benefits
26 manager program as described in this chapter. No later than 90
27 days from the effective date of this chapter, the secretary
28 shall issue a request for proposal for a three-year contract
29 with a pharmacy benefits manager to administer pharmacy services
30 as required under this chapter. The proposal shall require the
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1 PBM to educate providers and public plan recipients of pharmacy
2 services. No person, partnership, corporation or entity which
3 holds a 5% or greater interest in one or more pharmacies, a
4 chain of pharmacies, a pharmacists association, an organization
5 of pharmacies, a drug wholesaler or drug manufacturer and no
6 person, partnership, corporation or entity in which one or more
7 pharmacies, a chain of pharmacies, a pharmacists association, an
8 organization of pharmacies, a drug wholesaler or drug
9 manufacturer has a 5% or greater interest shall be considered
10 eligible to bid. The contract shall be executed within six
11 months from the effective date of this chapter.
12 Section 1104. Pharmacy benefits manager functions.
13 (a) Requirements.--The secretary shall require the PBM to:
14 (1) Manage and implement the drug formulary for each
15 public plan and at a later date make a recommendation to the
16 secretary as to whether a uniform formulary for all public
17 plans under this chapter should exist, along with a sample
18 uniform formulary.
19 (2) Ensure that any pharmacy licensed in this
20 Commonwealth is eligible to provide pharmacy services
21 according to any regulations in effect on the effective date
22 of this chapter and that regulate pharmacy providers.
23 (3) Negotiate drug rebates with manufacturers.
24 (4) In accordance with the act of November 24, 1976
25 (P.L.1163, No.259), referred to as the Generic Equivalent
26 Drug Law, make provisions for generic substitutions and
27 require pharmacists to disclose any affiliation with a
28 generic manufacturer.
29 (5) Provide for prospective drug utilization review
30 which precludes overriding alerts without intervention.
20000S1525B2123 - 11 -
1 (6) Provide for prior authorization in accordance with
2 regulations of the secretary.
3 (7) Provide for prospective and concurrent and
4 retrospective drug utilization review to ensure that
5 prescriptions are appropriate, medically necessary and not
6 likely to result in adverse medical results and to educate
7 providers and recipients of pharmacy services through public
8 plans and to correct and report misutilization and abuse by
9 licensed prescribers and recipients and provide for fraud and
10 abuse audits, coordinating its activities with the secretary
11 to support compliance with applicable laws and regulations.
12 (8) Educate providers on disease and care management.
13 (9) Provide educational materials for public plan
14 recipients of pharmacy services on disease and care
15 management.
16 (10) In accordance with the provisions of the Omnibus
17 Budget Reconciliation Act of 1990 (Public Law 101-508, 104
18 Stat. 1388), bill, recoup and relay to the secretary
19 manufacturers' drug rebates and excessive consumer price
20 inflation discounts and resolve disputes, as defined in the
21 Omnibus Budget Reconciliation Act of 1990.
22 (11) Adjudicate claims through a Statewide point-of-sale
23 electronic verification and claims processing system which
24 will allow for intervention upon receipt of a prospective
25 drug utilization review alert and will allow for an emergency
26 supply of prescribed medication in the event of equipment
27 failures.
28 (12) Create an audit and recoupment system for providers
29 and recipients, and third-party medical resources.
30 (13) Coordinate with all public plans the reimbursement
20000S1525B2123 - 12 -
1 to pharmacies on a fee-for-service basis.
2 (b) Conflict of interest.--In implementing the formulary,
3 the single PBM shall demonstrate how it will avoid a conflict of
4 interest with any pharmaceutical manufacturer, wholesaler or
5 drug store chain that holds a less-than-5% interest in the PBM
6 or in which the PBM has a less-than-5% interest and shall
7 indicate how it will prevent the sharing of nonpublic
8 information concerning other drug manufacturers' bids,
9 proposals, contracts, prices, rebates or discounts.
10 (c) Considerations.--In preparing and managing the
11 formulary, the PBM shall ensure that it will consider all
12 discounts, rebates or other concessions offered by
13 manufacturers, drug chains or wholesale drug companies.
14 Section 1105. Drug Utilization Review Committee.
15 (a) Formation.--The secretary shall require the PBM to form
16 a drug utilization review committee.
17 (b) Composition and number.--The committee shall be
18 comprised of 15 members, five of whom shall be actively
19 practicing physicians licensed in this Commonwealth, five of
20 whom shall be actively practicing pharmacists licensed in this
21 Commonwealth and five of whom shall be consumers who reside in
22 this Commonwealth. None of the members may hold a 5% or greater
23 interest in the PBM, its parent company or companies, or in a
24 company or companies owned by the PBM. The Governor, the
25 President pro tempore of the Senate, the Speaker of the House of
26 Representatives, the Minority Leader of the Senate and the
27 Minority Leader of the House of Representatives shall each
28 appoint one physician, pharmacist and consumer member. Of the
29 original members, each appointing authority shall designate one
30 member appointed by the authority to serve for an initial term
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1 of two years, one member to serve for an initial term of three
2 years and one member to serve for an initial term of four years.
3 Thereafter each appointment shall be for a term of four years. A
4 member shall serve until a successor is appointed. Vacancies
5 shall be filled in the same manner as the original appointments.
6 (c) Quality of care.--
7 (1) The committee shall develop a system that provides
8 prospective, concurrent and retrospective review of drug
9 utilization to ensure that pharmacy services provided are or
10 were appropriate and medically necessary and not likely to
11 result in adverse medical results. The review program shall
12 be designed to educate licensed prescribers and pharmacists
13 as provided in paragraph (4) on the proper utilization of
14 drugs in disease and care management. In reviewing drug
15 utilization, the committee shall assess data on drug use
16 against predetermined standards consistent with the American
17 Hospital Formulary Service Drug Information, the United
18 States Pharmacopeia-Drug Information, American Medical
19 Association Drug Evaluations or peer-reviewed medical
20 literature.
21 (2) The committee shall develop a system to utilize the
22 compendia and literature referred to in paragraph (1) as its
23 source of standards to screen for potential drug problems
24 before a prescription is filled or delivered to a recipient.
25 Prospective drug use review shall include consultation with
26 recipients by pharmacists.
27 (3) The secretary and the PBM shall provide data to the
28 committee, through mechanized drug claims processing and
29 retrieval systems, for the ongoing periodic examination of
30 claims data and other records in order to identify patterns
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1 of fraud, abuse, gross overuse or inappropriate or medically
2 unnecessary care among licensed prescribers, pharmacists and
3 recipients or associated with specific drugs or groups of
4 drugs. The committee shall, on an ongoing basis, assess data
5 on drug use against explicit predetermined standards using
6 the compendia and literature referred to in this subsection
7 and to introduce, as necessary, remedial strategies to
8 improve the quality of care and to conserve program funds or
9 patient expenditures.
10 (4) The committee shall, using drug use data on common
11 therapy problems, develop active and ongoing educational
12 outreach programs to disseminate information to providers on
13 common drug therapy problems with the aim of improving
14 prescribing or dispensing practices. The educational programs
15 shall include interventions for providers targeting therapy
16 problems or individuals identified in the course of
17 retrospective drug reviews. The committee shall reevaluate
18 interventions from time to time to determine if the
19 interventions were successful in improving the quality of
20 drug therapy and shall make modifications as necessary.
21 Intervention programs shall include:
22 (i) Information dissemination sufficient to ensure
23 the ready availability to providers of information
24 concerning the committee's duties, powers and basis for
25 its standards.
26 (ii) Written, oral or electronic reminders
27 containing patient-specific and/or drug-specific
28 information and suggested changes in prescribing or
29 dispensing practices, communicated in a manner designed
30 to ensure the privacy of patient-related information.
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1 (iii) Use of face-to-face discussions between health
2 care professionals who are experts in rational drug
3 therapy and selected prescribers and pharmacists who have
4 been targeted for educational intervention, including
5 discussion of optimal prescribing, dispensing or pharmacy
6 care practices and follow-up face-to-face discussions.
7 (iv) Intensified review or monitoring of selected
8 prescribers or dispensers.
9 (d) Corrective actions.--Should licensed prescribers or
10 recipients continue to misutilize drugs or abuse the system, the
11 committee shall provide information to the secretary for
12 corrective action. In the case of prescribers, the committee
13 shall submit a report and recommendations to the secretary for
14 appropriate action. The secretary shall inform the PBM and the
15 appropriate Commonwealth licensing body of any final
16 administrative sanctions.
17 (e) Nonliability.--Any person rendering service as a member
18 of a utilization review committee for this program shall not be
19 liable for any civil damages as a result of any acts or
20 omissions in rendering the service as a member of any such
21 committee except any acts or omissions intentionally designed to
22 harm or any grossly negligent acts or omissions which result in
23 harm to the person receiving such service.
24 (f) Annual report.--The secretary shall require the
25 committee to provide an annual report describing the committee's
26 activities, including the nature and scope of the prospective,
27 concurrent and retrospective drug reviews, a summary of
28 interventions used, an assessment of the impact of these
29 educational interventions on quality of care and an estimate of
30 the cost savings generated as a result of the program.
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1 Section 1106. Reimbursement.
2 Each public plan shall reimburse pharmacies on a fee-for-
3 service basis, using formulas established by the plan.
4 Pharmacies reimbursed under this chapter shall be paid at fee-
5 for-service rates no less than the rates in effect on the
6 effective date of this chapter.
7 Section 1107. Rebate agreement.
8 (a) Required agreements.--A public plan shall not reimburse
9 participating pharmacies for any prescription drug unless the
10 department and the pharmaceutical manufacturer have entered into
11 a rebate agreement covering that prescription drug.
12 (b) Exceptions.--Subsection (a) shall not apply if the
13 availability of the drug is essential to the health of members
14 of the public plan as determined by the department.
15 (c) Contracts.--Pharmaceutical manufacturers must enter into
16 a rebate agreement with the department to obtain reimbursement
17 for prescription drugs included under this chapter. The rebate
18 agreement shall require the pharmaceutical manufacturer to
19 provide to the department a rebate each calendar quarter in an
20 amount to be determined. The PBM shall use its best efforts to
21 obtain the best price for prescription drugs under this rebate
22 plan. The rebate shall be paid by the manufacturer not later
23 than 30 days after the date of receipt of the information
24 necessary to calculate the amount of the rebate.
25 (d) Disposition of funds.--Moneys received under this
26 chapter in connection with public plans other than those
27 identified in section 709 and the medical assistance program
28 shall be deposited in the Pharmaceutical Assistance Contract for
29 the Elderly Fund for purposes of expanding eligibility in the
30 PACE program.
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1 Section 1108. Pharmacies and dispensing physicians.
2 (a) General rule.--Pharmacies and dispensing physicians
3 participating in the PACE program shall, as a condition of
4 participation in that program, agree to the conditions set forth
5 in this section.
6 (b) Medicare recipients.--Any pharmacy or dispensing
7 physician participating in the PACE program shall, as a
8 condition of participation in that program, agree to sell
9 prescription drugs to Medicare recipients at the PACE program
10 price. In no case shall a Medicare recipient be charged more
11 than the price of the drug at the particular pharmacy on the
12 date of the sale.
13 (c) Limitation on participation.--Any pharmacist, pharmacy
14 or dispensing physician that is precluded or excluded for cause
15 from the Medical Assistance Program shall be precluded or
16 excluded from participation under this chapter.
17 Section 1109. Medicare recipients.
18 (a) General rule.--Medicare recipients shall be eligible to
19 purchase prescription drugs at the PACE price established
20 pursuant to Chapter 5.
21 (b) Procedure.--In order to receive the PACE price under
22 subsection (a), a Medicare recipient shall present the
23 recipient's Medicare card to the participating provider at the
24 time of purchase of the recipient's prescription drugs.
25 (c) Information to be made available.--A pharmacist,
26 pharmacy or dispensing physician shall inform the Medicare
27 recipient whether using the Medicare card will result in the
28 Medicare recipient receiving the prescription drug at the lowest
29 price available to the Medicare recipient.
30 Section 1110. Expansion of PACE program.
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1 Within 18 months of the effective date of this chapter, the
2 pharmacy benefits manager, in conjunction with the Drug
3 Utilization Review Committee established under section 1105,
4 shall provide to the secretary recommendations concerning the
5 expansion of the PACE program. The recommendations shall also be
6 submitted to the President pro tempore of the Senate and the
7 Speaker of the House of Representatives.
8 Section 1111. Administration of contract.
9 The secretary shall administer the contract with the PBM and
10 shall promulgate rules and regulations, as necessary, to carry
11 out the provisions of this chapter.
12 Section 1112. Applicability.
13 This chapter shall apply to the provision of all pharmacy
14 services under any prescription program established by the
15 Commonwealth or in which a contribution by the Commonwealth is
16 required by any managed health care plan, pharmaceutical
17 manufacturer, licensed pharmacy, chain of pharmacies or
18 wholesaler. This shall include the Medical Assistance Program
19 unless the secretary, in consultation with the Department of
20 Public Welfare, determines that such inclusion is a violation of
21 Federal law or any existing contractual agreement.
22 Section 1113. Prohibited activities.
23 It shall be unlawful for any individual, partnership or
24 corporation to solicit, receive, offer or pay any kickback,
25 bribe or rebate in cash or in kind from or to any person in
26 connection with the furnishing of services under this chapter.
27 Section 6. Section 2102 of the act, added November 21, 1996
28 (P.L.741, No.134), is amended to read:
29 Section 2102. Annual report to General Assembly.
30 (a) Submission of report.--The department shall submit a
20000S1525B2123 - 19 -
1 report no later than April 1 of each year to the chairman and
2 minority chairman of the Aging and Youth Committee of the
3 Senate, the chairman and minority chairman of the Aging and
4 Youth Committee of the House of Representatives and the
5 Pharmaceutical Assistance Review Board.
6 (b) Collection of data.--The department shall maintain
7 monthly statistical records on PACE [and PACENET], including the
8 level of participation and any patterns of unusual drug usage
9 for purposes of formulating the annual report.
10 (c) Information for inclusion in annual report.--The annual
11 report shall contain, but not be limited to, all information
12 relating to:
13 (1) The number of persons served by PACE [and PACENET]
14 and their counties of residence.
15 (2) A breakdown of the numbers and kinds of
16 pharmaceuticals used.
17 (3) The cost of prescriptions.
18 (4) An estimate of actual expenses incurred by
19 pharmacists participating in the program.
20 (5) The results obtained by the drug education program
21 under section 522.
22 (6) Information regarding the operation of the
23 therapeutic drug utilization review system for the prior
24 calendar year, which shall include, at a minimum:
25 (i) The scope of physician and pharmacist
26 participation in the system.
27 (ii) A description of claimant response to the
28 system.
29 (iii) Data for each month of the covered period
30 regarding the number of prescription revisions based on
20000S1525B2123 - 20 -
1 utilization review, including drug information, cost
2 savings and the policy used by the department to make
3 utilization review decisions.
4 (7) Information on the existence and scope of fraudulent
5 activity and violations of this act by providers
6 participating in PACE [and PACENET].
7 (8) Information regarding the financial status of PACE
8 [and PACENET], including, but not limited to, the adequacy of
9 any applicable deductible and copayment levels, based upon
10 the financial experience and projections of PACE [and
11 PACENET].
12 Section 7. This act shall take effect in 60 days.
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