PRINTER'S NO. 1805
No. 1540 Session of 1991
INTRODUCED BY ITKIN, E. Z. TAYLOR, RICHARDSON, THOMAS, JOSEPHS,
ROBINSON, STEELMAN, FLEAGLE, KING, STRITTMATTER, COHEN,
KUKOVICH, STEIGHNER, NOYE, MELIO, STABACK, OLASZ, FARGO,
LLOYD, CAPPABIANCA, VEON, TIGUE, SALOOM, GEIST, COY, TRICH,
McCALL, DALEY, BILLOW, HALUSKA, BOWLEY, FAJT, DERMODY,
M. N. WRIGHT, MUNDY, HARPER, PESCI, PRESTON, LAUGHLIN,
JOHNSON, REBER, JAROLIN, CLARK, WOZNIAK, PETRARCA, FREIND,
KOSINSKI, STISH, COLAFELLA, ALLEN, TRELLO, NAHILL, WILLIAMS,
HASAY AND CORRIGAN, JUNE 4, 1991
REFERRED TO COMMITTEE ON HEALTH AND WELFARE, JUNE 4, 1991
AN ACT
1 Providing for compensation of pharmaceutical providers for
2 certain losses; and conferring powers and duties upon the
3 Department of Public Welfare.
4 The General Assembly of the Commonwealth of Pennsylvania
5 hereby enacts as follows:
6 Section 1. Short title.
7 This act shall be known and may be cited as the
8 Pharmaceutical Providers Compensation Act.
9 Section 2. Declaration of policy.
10 The General Assembly finds and declares as follows:
11 (1) It is in the interest of the Commonwealth that
12 providers accept prescriptions from medical assistance
13 recipients.
14 (2) Providers that accept prescriptions from medical
15 assistance recipients should not suffer financial loss due to
1 the filling of those prescriptions. The Commonwealth,
2 therefore, has a duty to reasonably compensate providers for
3 this service.
4 (3) Although the Federal Government has found that the
5 department reimburses providers at what it has determined to
6 be a higher than acceptable product cost, the department has
7 one of the lowest dispensing fees and thus has kept its
8 overall reimbursement reasonable.
9 (4) The Federal Government has required the Commonwealth
10 to lower its product-cost reimbursement but cannot require
11 the Commonwealth to increase its dispensing fee.
12 (5) The pharmaceutical services regulations decrease
13 product-cost reimbursement but do not increase dispensing
14 fees. Because of this, providers will suffer a loss in
15 revenue.
16 (6) The loss referred to in paragraph (5) may result in
17 increased costs to consumers or discontinuation of service to
18 medical assistance recipients.
19 (7) The department should compensate providers for the
20 loss referred to in paragraph (5) in order to avoid the
21 results referred to in paragraph (6).
22 Section 3. Definitions.
23 The following words and phrases when used in this act shall
24 have the meanings given to them in this section unless the
25 context clearly indicates otherwise:
26 "Department." The Department of Public Welfare of the
27 Commonwealth.
28 "Pharmaceutical services regulations." The Department of
29 Public Welfare's regulations on pharmaceutical services
30 published at 20 Pa.B. 6167 (December 15, 1990).
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1 "Provider." Any physician, pharmacist, pharmacy or
2 corporation that:
3 (1) provides pharmaceutical services in this
4 Commonwealth; and
5 (2) receives reimbursement for those services from the
6 Department of Public Welfare.
7 Section 4. Compensation.
8 (a) Eligibility.--A provider who has lost revenue because of
9 the pharmaceutical services regulations is eligible for
10 compensation.
11 (b) Procedure.--
12 (1) The department, upon receipt of a claim from a
13 provider, shall determine the following:
14 (i) The amount of reimbursement which the provider
15 would have received from the department without the
16 application of the pharmaceutical regulations.
17 (ii) The actual reimbursement which the provider is
18 owed by the department.
19 (iii) The difference between the amount under
20 subparagraph (i) and the amount under subparagraph (ii).
21 (2) The department shall reimburse the provider, in the
22 form of a supplemental dispensing fee, in the amount
23 determined under paragraph (1)(iii). For reimbursement
24 periods beginning on or after the effective date of this act,
25 the fee under this paragraph shall be paid with the
26 reimbursement under paragraph (1)(ii).
27 (c) Administrative Agency Law.--Claims under this section
28 are subject to 2 Pa.C.S. Ch. 5 Subch. A (relating to practice
29 and procedure of Commonwealth agencies) and Ch. 7 Subch. A
30 (relating to judicial review of Commonwealth agency action).
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1 Section 5. Applicability.
2 This act shall apply to the fiscal year July 1, 1990, to June
3 30, 1991, and to each fiscal year thereafter.
4 Section 6. Effective date.
5 This act shall take effect immediately.
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