A bill to amend title XVIII of the Social Security Act to reduce the coverage gap in prescription drug coverage under part D of such title based on savings to the Medicare program resulting from the negotiation of prescription drug prices

2007·0.18 MB·English

by  United States. Congress. Senate

CC\2A-S07L-i1br3ary n
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110thcongress 2089
1stSession S.
To amend title XVIU ofthe Social Security Act to reduce the coverage
gap in prescription drug coverage under part D of such title based
on savings to the Medicareprogram resultingfrom the negotiation of
prescriptiondrugprices.
IN THE SENATE OF THE UNITED STATES
September25,2007
Mr.NelsonofFlorida(forhimself,Mr.WfflTEHOUSE,Ms.MiKULSKI,Ms.
Collins, Mr. Kohl, and Mr. Kerry) introduced the following bill;
whichwasreadtwiceandreferredtotheCommitteeonFinance
A
BILL
To amend title XVIII ofthe Social SecurityAct to reduce
the coverage gap in prescription drug coverage under
part D of such title based on savings to the Medicare
program resulting from the negotiation of prescription
drugprices.
1 BeitenactedbytheSenateandHouseofRepresenta-
2 tivesoftheUnitedStatesofAmericainCongressassembled,
3 SECTION1.SHORTTITLE.
4 ThisActmaybecitedasthe "MedicarePrescription
5 DrugGapReductionActof2007".
2
1 SEC.2.REDUCINGCOVERAGEGAP.
2 Section 1860D-2(b) ofthe Social SecurityAct (42
3 U.S.C.1395w-102(b))isamended—
4 (1)inparagraph(3)(A),bystriking"paragraph
5 (4)" andinserting"paragraph (4), subjecttothein-
6 creasedescribedinparagraph(7)";and
7 (2) by adding at the end the following new
8 paragraph:
9 "(7) Increase op initial coverage limit
10 BASED ON medicare SAVINGS DUE TO NEGOTL^-
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11 TION OF DRUG PRICES. For each year (beginning
12 with 2009), the Secretary shall increase the initial
13 coverageUmitfortheyearspecifiedinparagraph(3)
14 so that the aggregate amount ofincreased expendi-
15 tures fromthe Medicare Prescription DrugAccount
16 as aresultofsuchincreaseunderthisparagraphin
17 theyear (as estimatedbythe Office oftheActuary
18 ofthe Centers forMedicare &Medicaid Services) is
19 equal to the aggregate amount ofreduced expendi-
20 turesfromsuchAccountthattheOfficeoftheActu-
21 ary estimates will result in the year as a result of
22 the apphcation of the amendment made by section
23 3(a) ofthe Medicare PrescriptionDrugGapReduc-
24 tionActof2007.".
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1 SEC. 3. NEGOTIATING FAIR PRICES FORMEDICARE PRE-
2 SCRIPTIONDRUGS.
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3 (a) In GeneraIj. Section 1860D-11 ofthe Social
4 SecurityAct(42U.S.C. 1395\\^111)isamendedbystrik-
5 ingsubsection (i) (relatingtononinterference) andinsert-
6 ingthefollowing:
7 "(i)AuthorityToNegotiatePricesWithMan-
8 UFACTURERS.
—
9 "(1) In GENERAL. Subject to paragraph (4),
10 in order to ensure that beneficiaries enrolled under
11 prescription drug plans and MA-PD plans pay the
12 lowest possible price, the Secretary shall have au-
13 thority similartothatofotherFederal entitiesthat
14 purchaseprescriptiondrugsinbulktonegotiatecon-
15 tractswith manufacturers ofcovered part D drugs,
16 consistentwith the requirements and in furtherance
17 ofthegoalsofprovidingquaUtycare andcontaining
18 costsunderthispart.
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19 "(2) Mandatory responsibilities. The
20 Secretarv^shaUberequiredto
21 "(A) negotiate contractswith manufactur-
22 ers of covered part D drugs for each fallback
23 prescription drug plan under subsection (g);
24 and
25 "(B) participateinnegotiationofcontracts
26 ofanycoveredpartD drugupon requestofan
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4 3 amS LDE47 L
1 approved prescription drug plan or MA-PD
2 plan.
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3 "(3) Rule of construction. Nothing in
4 paragraph (2) shallbeconstruedtolimittheauthor-
5 ityoftheSecretaryunderparagraph(1)totheman-
6 datoryresponsibihtiesunderparagraph(2).
7 "(4) No PARTICULAR FORMULARY OR PRICE
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8 STRUCTURE. In order to promote competition
9 under this part and in carrjdng out tliis part, the
10 Secretar}^maynot require aparticularformularyor
11 institute a price structure for the reimbursement of
12 coveredpartDdrugs.
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13 "(5) Use of savings. The savings to the
14 Medicare Prescription Drug Account through the
15 use ofthe authority provided under this subsection
16 (including the mandator}^ responsibihties under
17 paragraph (2)) shall be used to increase the initial
18 coverage hmit for the year in accordance with sec-
19 tion 1860D-2(b)(7).".
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20 (b) Effectr^ Date. The amendment made by
21 subsection (a) shaU take effect onthe date ofenactment
22 ofthisAct.
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