I 111th CONGRESS 1st Session H. R. 1725 IN THE HOUSE OF REPRESENTATIVES March 25, 2009 Mr. Van Hollen (for himself, Ms. Pingree of Maine, Mr. Ruppersberger, Mr. Kratovil, and Mr. Rahall) introduced the following bill; which was referred to the Committee on Energy and Commerce A BILL To amend title XIX of the Social Security Act to require, at the option of a State, drug manufacturers to pay rebates to State prescription drug discount programs as a condition of participation in a rebate agreement for outpatient prescription drugs under the Medicaid Program.

1.

Short title

This Act may be cited as the Voluntary State Discount Prescription Drug Plan Act of 2009.

2.

Optional State prescription discount program

(a)

In general

Section 1927(a) of the Social Security Act (42 U.S.C. 1396r–8(a)) is amended by adding at the end the following: (8)

Requirements relating to agreements for drugs procured by individuals through optional State prescription drug discount programs

(A)

In general

A manufacturer meets the requirements of this paragraph if the manufacturer enters into an agreement with the State to make rebate payments for drugs covered by a State prescription drug discount program in the same amounts as are paid by the manufacturer to the State for such drugs under a rebate agreement described in subsection (b). The previous sentence shall only apply to a State that has elected to establish an optional State prescription drug discount program and to apply the provisions of such sentence. (B)

Optional State prescription drug discount program defined

(i)

In general

In this paragraph, the term optional State prescription drug discount program means a State program under which, with respect to a rebate period, not less than the amount equal to 95 percent of all the rebates paid to the State under agreements entered into under subparagraph (A) during such period are provided to eligible State residents in the form of discounted prices for the purchase of outpatient prescription drugs. (ii)

Eligible State resident

For purposes of clause (i), the term eligible State resident means an individual who is a State resident and whose income does not exceed a percentage (specified under the optional State prescription drug discount program, but not to exceed 300 percent) of the income official poverty line (as defined by the Office of Management and Budget, and revised annually in accordance with section 673(2) of the Omnibus Budget Reconciliation Act of 1981) applicable to a family of the size involved. (iii)

Additional subsidies

Nothing in this subparagraph shall be construed as— (I)requiring a State to expend State funds to carry out a State prescription drug discount program; or (II)prohibiting a State from electing to contribute State funds to a State prescription drug discount program to provide greater subsidies to eligible State residents for outpatient prescription drugs covered under the program. (iv)

No section 1115 waiver required to implement

Nothing in this subparagraph shall be construed as requiring a State to obtain a waiver under section 1115 or otherwise of any requirement of this title to implement an optional State prescription drug discount program. (C)

No offset against medical assistance

Amounts received by a State under an agreement entered into under subparagraph (A) in any quarter shall not be considered to be a reduction in the amount expended under the State plan in the quarter for medical assistance for purposes of section 1903(a)(1).. (b)

Conforming amendment

The first sentence of section 1927(a)(1) of such Act (42 U.S.C. 1396r–8(a)(1)) is amended, by striking and paragraph (6) and inserting , paragraph (6), and paragraph (8).