[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 2339 Introduced in Senate (IS)]

  2nd Session
                                 S. 2339

 To amend part D of title XVIII of the Social Security Act to improve 
 the coordination of prescription drug coverage provided under retiree 
      plans and State pharmaceutical assistance programs with the 
prescription drug benefit provided under the medicare program, and for 
                            other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 22, 2004

    Mr. Corzine (for himself, Mr. Lautenberg, Ms. Stabenow, and Ms. 
   Mikulski) introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To amend part D of title XVIII of the Social Security Act to improve 
 the coordination of prescription drug coverage provided under retiree 
      plans and State pharmaceutical assistance programs with the 
prescription drug benefit provided under the medicare program, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Preserving Access to Affordable 
Drugs Act of 2004''.

SEC. 2. ELIMINATION OF DISCRIMINATORY TREATMENT OF EMPLOYER PLANS.

    (a) Elimination of True Out-of-Pocket Limitation.--Section 1860D-
2(b)(4)(C) of the Social Security Act, as added by section 101(a) of 
the Medicare Prescription Drug, Improvement, and Modernization Act of 
2003, is amended to read as follows:
                    ``(C) Application.--In applying subparagraph (A), 
                incurred costs shall only include costs incurred with 
                respect to covered part D drugs for the annual 
                deductible described in paragraph (1), for cost-sharing 
                described in paragraph (2), and for amounts for which 
                benefits are not provided because of the application of 
                the initial coverage limit described in paragraph 
                (3).''.
    (b) Equalization of Subsidies.--Notwithstanding any other provision 
of law, the Secretary of Health and Human Services shall provide for 
such increase in the special subsidy payment amounts under section 
1860D-22(a)(3) of the Social Security Act, as added by section 101(a) 
of the Medicare Prescription Drug, Improvement, and Modernization Act 
of 2003, as may be appropriate to provide for payments in the aggregate 
equivalent to the payments that would have been made under section 
1860D-15 of such Act if the individuals were not enrolled in a 
qualified retiree prescription drug plan. In making such computation, 
the Secretary shall not take into account the application of the 
amendments made by section 1202 of the Medicare Prescription Drug, 
Improvement, and Modernization Act of 2003.

SEC. 3. DIRECT SUBSIDY FOR CERTAIN STATE PHARMACEUTICAL ASSISTANCE 
              PROGRAMS.

    Part D of title XVIII of the Social Security Act (as so added) is 
amended by inserting after section 1860D-23 the following:

``direct subsidies for certain state pharmaceutical assistance programs

    ``Sec. 1860D-23A. (a) Direct Subsidy.--
            ``(1) In general.--The Secretary shall provide for the 
        payment to a State offering a State pharmaceutical assistance 
        program described in section 1860D-23(b)(1) for each individual 
        who is eligible for, but not enrolled in, a prescription drug 
        plan or MA-PD plan under this part, and who is enrolled in such 
        program for each month for which such individual is so 
        enrolled.
            ``(2) Amount of payment.--
                    ``(A) In general.--The amount of the payment under 
                paragraph (1) shall be an amount equal to the special 
                subsidy payment amount determined under section 1860D-
                22(a)(3) for a qualifying covered retiree for a 
                coverage year enrolled with the sponsor of a qualified 
                retiree prescription drug plan.
    ``(b) Additional Subsidy.--
            ``(1) In general.--The Secretary shall provide for the 
        payment to a State offering a State pharmaceutical assistance 
        program described in section 1860D-23(b)(1) for each applicable 
        low-income individual enrolled in the program for each month 
        for which such individual is so enrolled.
            ``(2) Amount of payment.--
                    ``(A) In general.--The amount of the payment under 
                paragraph (1) shall be the amount the Secretary 
                estimates would have been made to a prescription drug 
                plan or MA-PD plan under section 1860D-14 with respect 
                to the applicable low-income individual if such 
                individual was enrolled in such a plan.
                    ``(B) Maximum payments.--In no case may the amount 
                of the payment determined under subparagraph (A) with 
                respect to an applicable low-income individual exceed, 
                as estimated by the Secretary, the average amount paid 
                in a year under section 1860D-14 on behalf of a subsidy 
                eligible individual (as defined in section 1860D-
                14(a)(3)(A)) with income that is the same as the income 
                of the applicable low-income individual.
            ``(3) Applicable low-income individual.--For purposes of 
        this subsection, the term `applicable low-income individual' 
        means an individual who--
                    ``(A) is eligible for, but not enrolled in, a 
                prescription drug plan or MA-PD plan under this part, 
                and who is enrolled in a State pharmaceutical 
                assistance program described in section 1860D-23(b)(1); 
                and
                    ``(B) would be a subsidy eligible individual (as 
                defined in section 1860D-14(a)(3)(A)) if the individual 
                were enrolled in such a plan.
    ``(c) Payment Methods.--
            ``(1) In general.--Payments under this section shall be 
        based on such a method as the Secretary determines. The 
        Secretary may establish a payment method by which interim 
        payments of amounts under this section are made during a year 
        based on the Secretary's best estimate of amounts that will be 
        payable after obtaining all of the information.
            ``(2) Source of payments.--Payments under this section 
        shall be made from the Medicare Prescription Drug Account.
    ``(d) Construction.--Nothing in this section, section 1860D-23, or 
section 1860D-24 shall be construed as requiring a prescription drug 
plan or MA-PD plan to coordinate coverage provided under such plan with 
coverage provided under a State pharmaceutical assistance program 
described in section 1860D-23(b)(1) that is operated by a State which 
receives a payment under this section.''.

SEC. 4. FACILITATION OF COORDINATION.

    Section 1860D-24(c)(1) of the Social Security Act (as so added) is 
amended by striking ``all methods of operation'' and inserting ``its 
own methods of operation, except that a PDP sponsor or MA organization 
may not require a State Pharmaceutical Assistance Program or an RX plan 
described in subsection (b) to apply such tools when coordinating 
benefits''.

SEC. 5. ALLOWING MEDICAID WRAP.

    Section 1935(d) of the Social Security Act, as added by section 
103(c) of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003, is repealed.

SEC. 6. REPEAL OF COMPARATIVE COST ADJUSTMENT PROGRAM.

    Effective as if included in the enactment of the Medicare 
Prescription Drug, Improvement, and Modernization Act of 2003, subtitle 
E of title II of such Act is repealed and any provisions of law amended 
by such subtitle are restored as if such subtitle had not been enacted.

SEC. 7. PROVISION OF WRAP-AROUND PRESCRIPTION DRUG COVERAGE THROUGH 
              MEDIGAP.

    Section 1882(v) of the Social Security Act (42 U.S.C. 1395ss(v)), 
as added by section 104(a) of the Medicare Prescription Drug, 
Improvement, and Modernization Act of 2003, is amended as follows:
            (1) In paragraph (1)(A), by inserting ``, other than such a 
        policy that provides wrap-around prescription drug coverage 
        included within a range of such coverage approved under 
        subparagraph (D)(ii),'' after ``paragraph (6)(A))''.
            (2) Add at the end of paragraph (1) the following new 
        subparagraph:
                    ``(D) Wrap-around prescription drug coverage.--
                            ``(i) In general.--Notwithstanding any 
                        other provision of this subsection, a medigap 
                        Rx policy that provides wrap-around 
                        prescription drug coverage included within a 
                        range of such coverage approved by the 
                        Secretary under clause (ii) may be offered to 
                        part D enrollees.
                            ``(ii) Development of standards.--The 
                        Secretary shall approve a range of wrap-around 
                        prescription drug coverage that may be offered 
                        under this subparagraph to part D enrollees.''.

SEC. 8. EFFECTIVE DATE.

    The amendments made by this Act shall take effect as if included in 
the enactment of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003.
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