SB476,1,10
1An Act to amend 49.47 (4) (b) 2m. b., 49.47 (4) (b) 2r., 49.47 (4) (b) 2w., 49.47 (4)
2(b) 3., 49.47 (4) (c) 1., 49.47 (4) (c) 3. and 49.47 (4) (i) 2. (intro.); and
to create
320.435 (4) (bv), 20.435 (4) (j), 20.435 (4) (jb), 49.45 (48), 49.47 (4) (aq) and 49.688
4of the statutes;
relating to: expanding medical assistance income eligibility
5requirements for elderly persons; requiring pharmacies and pharmacists, as a
6condition of medical assistance participation, to charge elderly, low-income
7persons for prescription drugs no more than specific amounts; authorizing the
8department of health and family services to enter into rebate agreements with
9drug manufacturers; limiting prior authorization requirements under medical
10assistance; and making appropriations.
Analysis by the Legislative Reference Bureau
Under current state law, pharmacies and pharmacists that are certified
providers of medical assistance services are reimbursed for the provision of certain
prescription drugs to medical assistance (MA) recipients at a rate established by the
department of health and family services (DHFS). Under current federal law,
persons entitled to coverage under part B of medicare do not receive coverage for
prescription drugs for outpatient care as a benefit. Also under current law, as
enacted in
1999 Wisconsin Act 9 (the biennial budget act), DHFS may not discount
the average wholesale price of pharmaceutical drugs provided to MA recipients if
DHFS reimburses for those drugs under a formula that takes into account the
average wholesale price, nor may DHFS reduce pharmacy dispensing fees.
Under current law, an individual who is 65 years of age or older is eligible to
receive MA if he or she meets certain income and asset requirements. Currently, to
satisfy the income requirements for MA eligibility, an individual who is 65 years of
age or older must have an income that does not exceed 133.33% of the maximum
payment amount under the former aid to families with dependent children (AFDC)
program.
Beginning January 1, 2001, this bill increases the maximum income level for
individuals 65 years of age or older to 100% of the federal poverty level.
The bill specifies that, beginning July 1, 2001, as a condition of participation
by a pharmacy or pharmacist in the MA program, the pharmacy or pharmacist may
not charge eligible persons an amount for certain prescription drugs for outpatient
care that exceeds the average wholesale price minus 5% or the maximum allowable
cost, as determined by DHFS, whichever is lower, for providing that drug, plus a
dispensing fee. Persons who are eligible for reduced charges are those who are at
least 65 years of age and ineligible for MA and who have incomes that do not exceed
185% of the federal poverty line. In order to purchase the drugs, eligible persons
must provide to pharmacies or pharmacists a card, issued by DHFS after a
determination of eligibility and payment of an annual enrollment fee of $25, and
must pay the pharmacy or pharmacist an annual deductible of $840 for drugs at the
reduced charge and a copayment of $10 for each generic drug and $20 for each drug
that is not a generic drug. Prescription drugs for which the reduced charges must
be made are those that are available as an MA benefit. DHFS must calculate and
transmit to pharmacies and pharmacists that participate in the MA program the
amounts that may be charged for providing the specified prescription drugs and
must periodically update this information and transmit the updated information to
pharmacies and pharmacists. DHFS must monitor compliance by pharmacies and
pharmacists with the requirement to charge low-income persons for the specified
prescription drugs at the reduced amounts and annually report to the legislature
concerning the compliance.
DHFS is authorized, under the bill, to enter with drug manufacturers into
rebate agreements, which are modeled on federal medicaid rebate agreements,
under which the manufacturer must make payments to the state treasurer for
deposit in the general fund for each of the manufacturer's drugs that is prescribed
under the program. The amount of the rebate payment under the agreement is
required to be determined by the method that is specified under the federal medicaid
rebate agreements. The amounts of the rebate payments must, in turn, together
with general purpose revenues, be paid by DHFS to pharmacies or pharmacists that
have reduced charges for prescription drugs for the eligible persons. In addition,
DHFS may not, after June 30, 2001, and before July 1, 2003, subject the prescription
drugs manufactured by manufacturers that enter into the rebate agreements to prior
authorization requirements for prescription drugs for the eligible persons or to any
expansion of prior authorization requirements under MA.
DHFS is authorized to enter into a contract with an entity to perform DHFS'
duties and exercise its powers under the prescription drug assistance program.
DHFS must report to the legislature if federal law is changed to provide
coverage for outpatient prescription drugs as a benefit under medicare. The bill
appropriates $2,000,000 in general purpose revenues in fiscal year 2000-01 to DHFS
for administration of the program.
For further information see the state 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:
SB476, s. 1
1Section
1. 20.435 (4) (bv) of the statutes is created to read:
SB476,3,42
20.435
(4) (bv)
Prescription drug assistance for elderly; aids. The amounts in
3the schedule for payment to pharmacies and pharmacists under s. 49.688 (8) for
4prescription drug assistance for elderly persons.
SB476, s. 2
5Section
2. 20.435 (4) (j) of the statutes is created to read:
SB476,3,96
20.435
(4) (j)
Prescription drug assistance for elderly; manufacturer rebates. 7All moneys received from rebate payments by manufacturers under s. 49.688 (7), to
8be used for payment to pharmacies and pharmacists under s. 49.688 (8) for
9prescription drug assistance for elderly persons.
SB476, s. 3
10Section
3. 20.435 (4) (jb) of the statutes is created to read:
SB476,3,1311
20.435
(4) (jb)
Prescription drug assistance for elderly; enrollment fees. All
12moneys received from payment of enrollment fees under s. 49.688 (2), to be used for
13administration of the program under s. 49.688.
SB476, s. 4
14Section
4. 49.45 (48) of the statutes is created to read:
SB476,4,315
49.45
(48) Prior authorization for legend drugs. After June 30, 2001, and
16before July 1, 2003, if a manufacturer enters into a rebate agreement under s. 49.688
17(7), the department may not expand the prior authorization requirements for
1prescription drugs manufactured by the manufacturer for which coverage is
2provided under s. 49.46 (2) (b) 6. h. beyond those prior authorization requirements
3that are in effect on July 1, 2001.
SB476, s. 5
4Section
5. 49.47 (4) (aq) of the statutes is created to read:
SB476,4,85
49.47
(4) (aq) 1. Subject to subd. 2., an individual who does not meet the
6limitation on income under par. (c) is eligible for medical assistance if the individual
7is 65 years of age or older and the individual's income does not exceed 100% of the
8federal poverty level.
SB476,4,129
2. If a federal waiver is necessary to provide medical assistance to individuals
10specified in subd. 1., the department shall request a waiver from the secretary of the
11federal department of health and human services before providing medical
12assistance under this paragraph.
SB476, s. 6
13Section
6. 49.47 (4) (b) 2m. b. of the statutes is amended to read:
SB476,4,1614
49.47
(4) (b) 2m. b. For persons who are eligible under par. (a)
3. or 4.
or (aq),
15motor vehicles are exempt from consideration as an asset to the same extent as
16provided under
42 USC 1381 to
1385.
SB476, s. 7
17Section
7. 49.47 (4) (b) 2r. of the statutes is amended to read:
SB476,4,2118
49.47
(4) (b) 2r. For a person who is eligible under par. (a)
3. or 4.
or (aq), the
19value of any burial space or agreement representing the purchase of a burial space
20held for the purpose of providing a place for the burial of the person or any member
21of his or her immediate family.
SB476, s. 8
22Section
8. 49.47 (4) (b) 2w. of the statutes is amended to read:
SB476,4,2523
49.47
(4) (b) 2w. For a person who is eligible under par. (a)
3. or 4.
or (aq), life
24insurance with cash surrender values if the total face value of all life insurance
25policies is not more than $1,500.
SB476, s. 9
1Section
9. 49.47 (4) (b) 3. of the statutes is amended to read:
SB476,5,62
49.47
(4) (b) 3. For a person who is eligible under par. (a)
3. or 4.
or (aq), funds
3set aside to meet the burial and related expenses of the person and his or her spouse
4in an amount not to exceed $1,500 each, minus the sum of the cash value of any life
5insurance excluded under subd. 2w. and the amount in any irrevocable burial trust
6under s. 445.125 (1) (a).
SB476, s. 10
7Section
10. 49.47 (4) (c) 1. of the statutes is amended to read:
SB476,5,188
49.47
(4) (c) 1. Except as provided in
par. pars. (am)
and (aq) and as limited by
9subd. 3., eligibility exists if income does not exceed 133 1/3% of the maximum aid to
10families with dependent children payment under s. 49.19 (11) for the applicant's
11family size or the combined benefit amount available under supplemental security
12income under
42 USC 1381 to
1383c and state supplemental aid under s. 49.77
13whichever is higher. In this subdivision "income" includes earned or unearned
14income that would be included in determining eligibility for the individual or family
15under s. 49.19 or 49.77, or for the aged, blind or disabled under
42 USC 1381 to
1385.
16"Income" does not include earned or unearned income which would be excluded in
17determining eligibility for the individual or family under s. 49.19 or 49.77, or for the
18aged, blind or disabled individual under
42 USC 1381 to
1385.
SB476, s. 11
19Section
11. 49.47 (4) (c) 3. of the statutes is amended to read:
SB476,5,2320
49.47
(4) (c) 3. Except as provided in
par. pars. (am)
and (aq), no person is
21eligible for medical assistance under this section if the person's income exceeds the
22maximum income levels that the U.S. department of health and human services sets
23for federal financial participation under
42 USC 1396b (f).
SB476, s. 12
24Section
12. 49.47 (4) (i) 2. (intro.) of the statutes is amended to read:
SB476,6,3
149.47
(4) (i) 2. (intro.) Notwithstanding par. (b) 2r. and 3., a person who is
2described in par. (a)
3. or 4.
or (aq) is not eligible for benefits under this section if any
3of the following criteria is met:
SB476, s. 13
4Section
13. 49.688 of the statutes is created to read:
SB476,6,6
549.688 Prescription drug assistance for low-income elderly persons.
6(1) In this section:
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(a) "Generic name" has the meaning given in s. 450.12 (1) (b).
SB476,6,118
(b) "Prescription drug" means a prescription drug, as defined in s. 450.01 (20),
9that is included in the drugs specified under s. 49.46 (2) (b) 6. h. and that is
10manufactured by a manufacturer that enters into a rebate agreement in force under
11sub. (7).
SB476,6,1212
(c) "Prescription order" has the meaning given in s. 450.01 (21).
SB476,6,20
13(2) A person who is a resident, as defined in s. 27.01 (10) (a), of this state, who
14is at least 65 years of age, who is ineligible for medical assistance, whose income does
15not exceed 185% of the poverty line and who pays the program enrollment fee
16specified in sub. (3) (a) is eligible to purchase a prescription drug at the amounts
17specified in sub. (6) (b). The person may apply to the department, on a form provided
18by the department together with program enrollment fee payment, for a
19determination of eligibility and issuance of a prescription drug card for purchase of
20prescription drugs under this section.
SB476,6,21
21(3) Program participants shall pay all of the following:
SB476,6,2222
(a) Annually, a program enrollment fee of $25.
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(b) Annually, a deductible of $840.
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(c) After payment of the deductible under par. (b), all of the following:
SB476,7,2
11. A copayment of $10 for each prescription drug that bears only a generic
2name.
SB476,7,43
2. A copayment of $20 for each prescription drug that does not bear only a
4generic name.
SB476,7,8
5(4) The department shall devise and distribute a form for application for the
6program under sub. (2), shall determine eligibility of applicants and shall issue to
7eligible persons a prescription drug card for use in purchasing prescription drugs, as
8specified in sub. (5).
SB476,7,14
9(5) Beginning July 1, 2001, as a condition of participation by a pharmacy or
10pharmacist in the program under ss. 49.45, 49.46 or 49.47, the pharmacy or
11pharmacist may not charge a person who presents a valid prescription order and a
12card indicating that he or she meets eligibility requirements under sub. (2) an
13amount for a prescription drug under the order that exceeds the amounts specified
14in sub. (6) (b).
SB476,7,17
15(6) (a) The charge for a prescription drug shall be calculated at the average
16wholesale price minus 5% or the maximum allowable cost, as determined by the
17department, whichever is less.
SB476,7,1918
(b) The amounts that a pharmacy or pharmacist may charge a person specified
19in sub. (2) in a calendar year period for a prescription drug are the following:
SB476,7,2320
1. If applicable, a deductible, as specified in sub. (3) (b), for a prescription drug
21that is charged at the rate specified in par. (a), plus a dispensing fee that is equal to
22the dispensing fee permitted to be charged for prescription drugs for which coverage
23is provided under s. 49.46 (2) (b) 6. h.
SB476,7,2524
2. After the deductible under subd. 1. is charged, the copayment, as applicable,
25that is specified in sub. (3) (c) 1. or 2.
SB476,8,4
1(c) The department shall calculate and transmit to pharmacies and
2pharmacists that are certified providers of medical assistance amounts that may be
3used in calculating charges under par. (a). The department shall periodically update
4this information and transmit the updated amounts to pharmacies and pharmacists.
SB476,8,9
5(7) The department or an entity with which the department contracts may
6enter into a rebate agreement that is modeled on the rebate agreement specified
7under
42 USC 1396r-8 with a drug manufacturer that sells drugs for prescribed use
8in this state. The rebate agreement, if negotiated, shall include all of the following
9as requirements:
SB476,8,1310
(a) That the manufacturer shall make rebate payments for each prescription
11drug of the manufacturer that is prescribed for persons who are eligible under sub.
12(2), to the state treasurer to be credited to the appropriation under s. 20.435 (4) (j),
13each calendar quarter or according to a schedule established by the department.
SB476,8,1514
(b) That the amount of the rebate payment shall be determined by a method
15specified in
42 USC 1396r-8 (c).
SB476,8,24
16(8) From the appropriation accounts under s. 20.435 (4) (bv) and (j), beginning
17July 1, 2001, the department shall provide to pharmacies and pharmacists
18payments, under a schedule that is identical to that used by the department for
19payment of pharmacy provider claims under medical assistance, that correspond to
20the amounts charged by the pharmacies and pharmacists to persons who meet
21criteria for eligibility under sub. (2) for a prescription drug at the rate specified in
22sub. (6) (a), minus the amount of a copayment charged under sub. (6) (b) 2., plus a
23dispensing fee, as specified in sub. (6) (b) 1. The department shall devise and
24distribute a form for reports by pharmacies and pharmacists under this subsection.
SB476,9,6
1(9) The department shall monitor compliance by pharmacies and pharmacists
2that are certified providers of medical assistance with the requirements of sub. (5)
3and shall annually report to the legislature under s. 13.172 (2) concerning the
4compliance. The report shall include information on any pharmacies or pharmacists
5that discontinue participation as certified providers of medical assistance and the
6reasons given for the discontinuance.
SB476,9,10
7(10) If federal law is amended to provide coverage for prescription drugs for
8outpatient care as a benefit under medicare or to provide similar coverage under
9another program, the department shall submit a report concerning this fact to
10appropriate standing committees of the legislature under s. 13.172 (3).
SB476,9,14
11(11) After June 30, 2001, and before July 1, 2003, the department may not
12under sub. (4) subject a manufacturer that enters into a rebate agreement under sub.
13(7) to prior authorization requirements for a prescription drug for outpatient care for
14treatment of a chronic condition.
SB476,9,17
15(12) Except as provided in subs. (9) to (11), the department may enter into a
16contract with an entity to perform the duties and exercise the powers of the
17department under this section.
SB476,9,2419
(1)
Prescription drug assistance for elderly; administration. In the schedule
20under section 20.005 (3) of the statutes for the appropriation to the joint committee
21on finance under section 20.865 (4) (a) of the statutes, as affected by the acts of 1999,
22the dollar amount is increased by $2,000,000 for fiscal year 2000-01 to increase
23funding for administration of the prescription drug assistance for elderly program
24under section 49.688 of the statutes, as created by this act.
SB476,10,3
1(1) The treatment of section 49.47 (4) (aq), (b) 2m. b., 2r., 2w. and 3., (c) 1. and
23. and (i) (2) (intro.) of the statutes first applies to eligibility determinations made
3for medical assistance on July 1, 2001.
SB476, s. 16
4Section
16.
Effective dates; health and family services. This act takes
5effect on the day after publication, except as follows:
SB476,10,76
(1)
Prescription drug assistance for elderly. The treatment of section 20.435
7(4) (bv) of the statutes takes effect on July 1, 2001.
