SB335: Bill Text

Analysis by the Legislative Reference Bureau

This bill creates an entitlement program for prescription drug assistance for elderly persons in the department of health and family services (DHFS) and a sum sufficient appropriation of general purpose revenues for the program. Under the program, beginning January 1, 2001, state residents who are aged at least 65 years, who are ineligible for medical assistance and whose gross incomes, if single, are not more than $50,000 or, if married, are not more than $75,000 per couple, as annually indexed for inflation, may apply for assistance of up to $10,000 per year in paying for prescription drugs. Prescription drugs for which a program participant may receive coverage are those prescription drugs that are covered under the medical assistance program. Participants in the prescription drug assistance program must pay 25% of the cost of the prescription drug, at the rate under which pharmacists are reimbursed under the medical assistance program, plus copayments of $5 for each generic prescription drug and $10 for each brand-name drug. Under the program, DHFS is the payer of last resort for coverage for prescription drugs and must reimburse pharmacist providers at the rate under which pharmacists are reimbursed under the medical assistance program. DHFS must also maintain or contract for the maintenance of a toll-free telephone number to provide application information about the prescription drug assistance program. In order for drugs manufactured by a manufacturer doing business in this state to be included in the program, the manufacturer must enter with DHFS into a rebate agreement that is modeled on rebate agreements under federal medicaid law. The rebate agreement must provide that the manufacturer make payments to DHFS each calendar quarter or as scheduled by DHFS and that the rebate payment amounts be determined by the method specified in federal medicaid law. The bill appropriates $1,000,000 in general purpose revenues in fiscal year 1999-2000 to the general program supplementation appropriation account of the joint committee on finance (JCF) and requires DHFS to submit to JCF a plan for expenditure of these funds for administration of the prescription drug assistance program. If the cochairpersons of JCF do not notify the secretary of health and family services of the committee's intent to schedule a meeting to review the plan, JCF must supplement the DHFS general program operations appropriation account as provided in the DHFS plan. If the cochairpersons of JCF notify the secretary of health and family services that JCF intends to schedule a meeting to review the plan, the DHFS appropriation account may be supplemented only as approved by JCF.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB335, s. 1 Section 1. 20.435 (4) (bv) of the statutes is created to read:

SB335,2,3 20.435 (4) (bv) Prescription drug assistance for elderly; aids. A sum sufficient for the program for prescription drug assistance for elderly persons under s. 49.688.

SB335, s. 2 Section 2. 20.435 (4) (j) of the statutes is created to read:

SB335,2,7 20.435 (4) (j) Prescription drug assistance for elderly; manufacturer rebates. All moneys received from rebate payments by manufacturers under s. 49.688 (5), to be used for prescription drug assistance for elderly persons under s. 49.688.

SB335, s. 3 Section 3. 49.688 of the statutes is created to read:

SB335,2,10 49.688 Prescription drug assistance for elderly persons. (1) In this section:

SB335,2,11 (a) "Brand name" has the meaning given in s. 450.12 (1) (a).

SB335,2,12 (b) "Generic name" has the meaning given in s. 450.12 (1) (b).

SB335,3,2 (c) "Gross income" means all income, from whatever source derived and in whatever form realized, whether in money, property or services.

SB335,3,3 (d) "Prescription drug" has the meaning given in s. 450.01 (20).

SB335,3,15 (2) From the appropriations under s. 20.435 (4) (bv) and (j), beginning January 1, 2001, the department shall reimburse pharmacists for the provision of up to $10,000 per year of prescription drugs that correspond to those prescription drugs for which reimbursement is made under s. 49.46 (2) (b) 6. h. and for which the manufacturer has entered into a rebate agreement with the department under sub. (5), to a person who meets criteria for eligibility under sub. (3). The department is the payer of last resort for coverage for prescription drugs under this subsection. The payment rate for provider reimbursement shall be the allowable charges paid under s. 49.46 (2) (b) 6. h. for prescription drugs. The department shall maintain, or contract for the maintenance of, a toll-free telephone number at department headquarters to provide information about participation in the program under this subsection.

SB335,3,17 (3) (a) An individual is eligible for participation in the program under sub. (2) if the individual meets all of the following requirements:

SB335,3,20 1. The individual is at least 65 years of age, is a resident, as defined in s. 27.01 (10) (a), of this state and is ineligible for medical assistance under s. 49.46, 49.465, 49.468 or 49.47.

SB335,3,23 2. If single, the individual's gross income does not exceed $50,000 or, if married, the couple's gross income does not exceed $75,000. These limitations shall be annually adjusted as specified in sub. (4).

SB335,3,24 (b) Program participants shall pay all of the following:

SB335,4,2 1. Twenty-five percent of the allowable charge paid under s. 49.46 (2) (b) 6. h. for each prescription drug provided under the program.

SB335,4,4 2. A copayment of $5 for each prescription drug provided under the program that bears only a generic name.

SB335,4,6 3. A copayment of $10 for each prescription drug provided under the program that bears a brand name.

SB335,4,8 (c) No program participant may be required to demonstrate that he or she has no disability insurance policy, as defined in s. 632.895 (1) (a).

SB335,4,15 (4) Beginning by January 1, 2001, the department shall annually by January 1 increase the dollar amounts specified under sub. (3) (a) 2. by a percentage equal to the percentage change between the U.S. consumer price index for all urban consumers, U.S. city average, for the month of December of the previous year and the U.S. consumer price index for all urban consumers, U.S. city average,for the month of December of the year before the previous year, as determined by the federal department of labor.

SB335,4,20 (5) A drug manufacturer that sells drugs for prescribed use in this state shall, as a condition of inclusion of those drugs in the program under this section, enter with the department into a rebate agreement that is modeled on the rebate agreement specified under 42 USC 1396r-8. The rebate agreement shall include all of the following as requirements:

SB335,4,22 (a) That the manufacturer shall make rebate payments to the department each calendar quarter or according to a schedule established by the department.

SB335,4,24 (b) That the amount of the rebate payment shall be determined by the method specified in 42 USC 1396r-8 (c).

SB335, s. 4 Section 4. Nonstatutory provisions.

SB335,5,23 (1) Prescription drug assistance for elderly persons; administration. The department of health and family services may request the joint committee on finance to supplement, from the appropriation account under section 20.865 (4) (a) of the statutes, the appropriation account under section 20.435 (4) (a) of the statutes, to pay the costs of staffing and administration of the program of prescription drug assistance for elderly persons under section 49.688 of the statutes, as created by this act. If the department of health and family services requests supplementation of the appropriation account under section 20.435 (4) (a) of the statutes, the department shall submit a plan to the joint committee on finance to expend not more than $1,000,000 for fiscal year 1999-2000. The plan shall be based on a review by the department of health and family services of the pharmacy assistance programs of other states and the feasibility of contracting with the medical assistance fiscal agent for this state to administer the program under section 49.688 of the statutes, as created by this act. If the cochairpersons of the committee do not notify the secretary of the department within 14 working days after the date of the department's submittal that the committee intends to schedule a meeting to review the request, the appropriation account shall be supplemented as provided in the request. If, within 14 working days after the date of the department's submittal, the cochairpersons of the committee notify the secretary of the department that the committee intends to schedule a meeting to review the request, the appropriation account shall be supplemented only as approved by the committee. Notwithstanding section 13.101 (3) (a) 1. of the statutes, the committee is not required to find that an emergency exists.

SB335, s. 5 Section 5. Appropriation changes; joint committee on finance.

SB335,6,7 (1) Prescription drug assistance for elderly; administration. In the schedule under section 20.005 (3) of the statutes for the appropriation to the joint committee on finance under section 20.865 (4) (a) of the statutes, as affected by the acts of 1999, the dollar amount is increased by $1,000,000 for fiscal year 1999-00 and the dollar amount is increased by $1,000,000 for fiscal year 2000-01 to increase funding for administration of the prescription drug assistance for elderly program under section 49.688 of the statutes, as created by this act.

SB335,6,8 (End)