SB2027 HD1

Report Title:

Prescription Drugs; Special Fund; Drug Expansion Program

 

Description:

Establishes the Medicaid Prescription Rebate Special Fund to hold Medicaid prescription drug rebates. Expands Medicaid eligibility for prescription drugs to individuals at or below 300 per cent of the federal poverty level. Appropriates funds. (SB2027 HD1)

THE SENATE	S.B. NO.	2027
TWENTY-FIRST LEGISLATURE, 2002		S.D. 1
STATE OF HAWAII		H.D. 1

A BILL FOR AN ACT

 

RELATING TO PRESCRIPTION DRUGS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature recognizes that prescription drugs have become unaffordable, especially for the elderly and individuals on fixed incomes. Most drug companies offer low- or no-cost drugs for target groups. However, these programs are often inadequate in that they only offer certain drugs at minimal discount or require the individual to obtain reimbursement after spending full price for the drug.

The legislature is determined to provide some relief to the high cost of prescription drugs through rebates and general appropriations. This Act will make prescription drugs more affordable for those individuals who income is at or below three hundred per cent of the federal poverty level. Hawaii will follow the example of other states that have been successful in offering similar programs without exorbitant cost and without the high cost to the residents of this State.

SECTION 2. Chapter 346, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

"§346-    Medicaid prescription drug rebate special fund. (a) There is established within the state treasury the medicaid prescription drug rebate special fund, into which shall be deposited all moneys received by the State as rebates from pharmaceutical manufacturers for the prescription drug expansion program.

(b) The fund shall be used to expand medicaid prescription drug benefits and shall be administered by the department.

(c) Upon termination of the medicaid prescription drug expansion program, any moneys in the fund shall be paid into the general fund."

"§346-    Medicaid prescription drug expansion program. The department shall provide for an expansion of prescription drug benefits under the medicaid program, which shall offer discounted prescription drugs to qualified individuals, whose income is at or below three hundred per cent of the federal poverty level."

SECTION 3. There is appropriated out of the medicaid prescription drug rebate special fund the sum of $           or so much thereof as may be necessary for fiscal year 2002-2003 for the purpose of:

(1) Paying $1 for each prescription written for a qualified individual; provided that:

(A) The department of human services obtains a waiver from the federal government to provide prescription drugs at medicaid rates to qualified individuals; and

(B) "Qualified individual" means an individual whose income is at or below three hundred per cent of the federal poverty level;

and

(2) Paying for the administrative costs associated with the prescription drug expansion program. The funds for administrative costs shall be used for:

(A) Hiring eight employees and paying for their benefits; and

(B) Other administrative costs including but not be limited to rent, supplies, computers, workstations, consultants, and costs for the medicaid pharmacy fiscal agent.

The sum appropriated shall be expended by the department of human services for the purposes of this Act.

SECTION 4. The appropriation in section 3 shall be repaid to the general fund by the medicaid prescription drug expansion program by the end of fiscal year 2005 if the manufacturers rebates are sufficient.

SECTION 5. New statutory material is underscored.

SECTION 6. This Act shall take effect on July 1, 2002.