2001 - 2002 LEGISLATURE
SENATE SUBSTITUTE AMENDMENT 1,
TO 2001 SENATE BILL 1
January 25, 2001 - Offered by
Committee onHealth, Utilities, Veterans and
1An Act to create
20.435 (4) (bv), 20.435 (4) (j), 20.435 (4) (jb) and 49.688 of the 2
statutes; relating to: requiring pharmacies and pharmacists, as a condition of
3medical assistance participation, to charge elderly persons for prescription
4drugs no more than specific amounts; specifying requirements for rebate
5agreements between the department of health and family services and drug
6manufacturers; requiring the exercise of rule-making authority; making
7appropriations; and providing penalties.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB1-SSA1, s. 1
20.435 (4) (bv) of the statutes is created to read:
(bv) Prescription drug assistance for elderly; aids.
A sum sufficient 10
for payment to pharmacies and pharmacists under s. 49.688 (7) for prescription drug 11
assistance for elderly persons.
SB1-SSA1, s. 2
20.435 (4) (j) of the statutes is created to read:
(j) Prescription drug assistance for elderly; manufacturer rebates. 2
All moneys received from rebate payments by manufacturers under s. 49.688 (6), to 3
be used for payment to pharmacies and pharmacists under s. 49.688 (7) for 4
prescription drug assistance for elderly persons.
SB1-SSA1, s. 3
20.435 (4) (jb) of the statutes is created to read:
(jb) Prescription drug assistance for elderly; enrollment fees.
moneys received from payment of enrollment fees under s. 49.688 (3), to be used for 8
administration of the program under s. 49.688.
1049.688 Prescription drug assistance for elderly persons. (1)
In this 11
(a) "Generic name" has the meaning given in s. 450.12 (1) (b).
(b) "Poverty line" means the nonfarm federal poverty line for the continental 14
United States, as defined by the federal department of labor under 42 USC 9902
(c) "Prescription drug" means a prescription drug, as defined in s. 450.01 (20), 16
that is included in the drugs specified under s. 49.46 (2) (b) 6. h. and that is 17
manufactured by a drug manufacturer that enters into a rebate agreement in force 18
under sub. (6).
(d) "Prescription order" has the meaning given in s. 450.01 (21).
(e) "Program payment rate" means the rate of payment made for the identical 21
drug specified under s. 49.46 (2) (b) 6. h., plus 5%.
(a) A person to whom all of the following applies is eligible to purchase a 23
prescription drug for the amounts specified in sub. (5) (a) 1. and 2.:
1. The person is a resident, as defined in s. 27.01 (10) (a), of this state.
2. The person is at least 65 years of age.
3. The person is not a recipient of medical assistance.
4. The person's annual household income, as determined by the department, 3
does not exceed 300% of the federal poverty line for a family the size of the person's 4
5. The person pays the program enrollment fee specified in sub. (3) (a).
(b) A person to whom par. (a) 1. to 3. and 5. applies, but whose annual household 7
income, as determined by the department, exceeds 300% of the federal poverty line 8
for a family the size of the persons' eligible family, is eligible to purchase a 9
prescription drug at the amounts specified in sub. (5) (a) 4. only during the remaining 10
amount of any 12-month period in which the person has first paid the annual 11
deductible specified in sub. (3) (b) 2. a. in purchasing prescription drugs at the retail 12
price and has then paid the annual deductible specified in sub. (3) (b) 2. b.
Program participants shall pay all of the following:
(a) For each 12-month benefit period, a program enrollment fee of $20.
(b) 1. For each 12-month benefit period, for a person specified in sub. (2) (a), 16
a deductible for prescription drugs of $500, except that a person whose annual 17
household income, as determined by the department, is 175% or less of the federal 18
poverty line for a family the size of the person's eligible family pays no deductible.
2. For each 12-month benefit period, for a person specified in sub. (2) (b), a 20
deductible for prescription drugs that equals all of the following:
a. The difference between the person's annual household income and 300% of 22
the federal poverty line for a family the size of the person's eligible family.
b. Five hundred dollars.
(c) After payment of any applicable deductible under par. (b), all of the 25
1. A copayment of $5 for each prescription drug that bears only a generic name.
2. A copayment of $10 for each prescription drug that does not bear only a 3
(d) Notwithstanding s. 49.002, if a person who is eligible under this section has 5
other available coverage for payment of a prescription drug, this section applies only 6
to costs for prescription drugs for the person that are not covered under the person's 7
other available coverage.
The department shall devise and distribute a form for application for the 9
program under sub. (2), shall determine eligibility for each 12-month benefit period 10
of applicants and shall issue to eligible persons a prescription drug card for use in 11
purchasing prescription drugs, as specified in sub. (5). The department shall 12
promulgate rules that specify the criteria to be used to determine household income 13
under sub. (2) (a) 4. and (b) and (3) (b) 1.
(a) Beginning March 1, 2002, as a condition of participation by a pharmacy 15
or pharmacist in the program under s. 49.45, 49.46, or 49.47, the pharmacy or 16
pharmacist may not charge a person who presents a valid prescription order and a 17
card indicating that he or she meets eligibility requirements under sub. (2) an 18
amount for a prescription drug under the order that exceeds the following:
1. For a deductible, as specified in sub. (3) (b) 1. and 2. b., the program payment 20
rate, plus a dispensing fee that is equal to the dispensing fee permitted to be charged 21
for prescription drugs for which coverage is provided under s. 49.46 (2) (b) 6. h.
2. After any applicable deductible under subd. 1. is charged, the copayment, as 23
applicable, that is specified in sub. (3) (c) 1. or 2. No dispensing fee, as specified under 24
subd. 1., may be charged to a person under this subdivision.
3. For a deductible, as specified in sub. (3) (b) 2. a., the retail price.
4. After the deductible under subd. 3. is charged, the copayment, as applicable, 2
that is specified in sub. (3) (c) 1. or 2. No dispensing fee, as specified under subd. 1., 3
may be charged to a person under this subdivision.
(b) The department shall calculate and transmit to pharmacies and 5
pharmacists that are certified providers of medical assistance amounts that may be 6
used in calculating charges under par. (a). The department shall periodically update 7
this information and transmit the updated amounts to pharmacies and pharmacists.
The department or an entity with which the department contracts shall 9
provide to a drug manufacturer that sells drugs for prescribed use in this state 10
material designed for use by the manufacturer in entering into a rebate agreement 11
with the department or entity that is modeled on the rebate agreement specified 12
under 42 USC 1396r-8
. A rebate agreement under this subsection shall include all 13
of the following as requirements:
(a) That the manufacturer shall make rebate payments for each prescription 15
drug of the manufacturer that is prescribed for and purchased by persons who meet 16
criteria under sub. (2) (a) and persons who meet criteria under sub. (2) (b) and have 17
paid the deductible under sub. (3) (b) 2. a., to the state treasurer to be credited to the 18
appropriation under s. 20.435 (4) (j), each calendar quarter or according to a schedule 19
established by the department.
(b) That the amount of the rebate payment shall be determined by a method 21
specified in 42 USC 1396r-8
From the appropriation accounts under s. 20.435 (4) (bv) and (j), beginning 23
March 1, 2002, the department shall, under a schedule that is identical to that used 24
by the department for payment of pharmacy provider claims under medical 25
assistance, provide to pharmacies and pharmacists payments for prescription drugs
sold by the pharmacies or pharmacists to persons eligible under sub. (2) who have 2
paid the deductible specified under sub. (3) (b) 1. or 2. or who, under sub. (3) (b) 1., 3
are not required to pay a deductible. The payment for each prescription drug under 4
this subsection shall be at the program payment rate, minus any copayment paid by 5
the person under sub. (5) (a) 2. or 4., plus a dispensing fee, as specified under sub. 6
(5) (a) 1., and plus, if applicable, incentive payments that are similar to those 7
provided under s. 49.45 (8v). The department shall devise and distribute a claim 8
form for use by pharmacies and pharmacists under this subsection and may limit 9
payment under this subsection to those prescription drugs for which payment claims 10
are submitted by pharmacists or pharmacies directly to the department. The 11
department may apply to the program under this section the same utilization and 12
cost control procedures that apply under rules promulgated by the department to 13
medical assistance under subch. IV of ch. 49.
The department shall, under methods promulgated by the department by 15
rule, monitor compliance by pharmacies and pharmacists that are certified providers 16
of medical assistance with the requirements of sub. (5) and shall annually report to 17
the legislature under s. 13.172 (2) concerning the compliance. The report shall 18
include information on any pharmacies or pharmacists that discontinue 19
participation as certified providers of medical assistance and the reasons given for 20
(a) The department shall promulgate rules relating to prohibitions on fraud 22
that are substantially similar to applicable provisions under s. 49.49 (1) (a).
(b) A person who is convicted of violating a rule promulgated by the department 24
under par. (a) in connection with that person's furnishing of prescription drugs under
this section may be fined not more than $25,000, or imprisoned for not more than 7 2
years and 6 months, or both.