HBA-MPM H.B. 1231 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 1231
By: Maxey
Public Health
3/1/2001
Introduced



BACKGROUND AND PURPOSE 

According to a report from the Texas State Comptroller's Office, high
pharmaceutical prices have adversely affected individuals age 65 and older.
Medicare, the major insurer for this population, does not cover the cost of
out-patient prescription medications.  Insurers, HMOs, and Medicaid
programs use their buying power to purchase prescription drugs at a reduced
price, while those age 65 and older who do not have a prescription drug
plan must pay retail prices for their drugs.  The State of Texas could use
its large volume purchasing power through the Medicaid vendor drug program
to obtain a better deal on prescription drugs for seniors.  According to
the National Conference of State Legislatures, pharmaceutical assistance
programs for seniors are currently in operation in 16 states.  House Bill
1231 offers similar assistance to older Texans by requiring pharmacies
participating in the Medicaid vendor drug program to sell prescription
drugs to Medicare recipients at a Medicaid price. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

House Bill 1231 amends the Human Resources Code to establish that a
provider in the Medicaid vendor drug program (program) must provide any
prescription drug available to a Medicaid recipient to a Medicare recipient
at a price not greater than the sum of: 

_the amount of reimbursement the provider would have received under the
program for providing the drug to a Medicaid recipient; and 

_an administrative fee in an amount determined by the Health and Human
Services Commission (HHSC) not to exceed 15 percent of the reimbursement
amount. 

The bill specifies that to receive the price required by these provisions
from a provider, a Medicare recipient must provide a prescription for the
drug that names the recipient and present a Medicare card.  The bill
requires HHSC to ensure that information concerning prices authorized to be
charged is readily available to providers participating in the program. 

The bill also requires HHSC to monitor provider compliance, evaluate the
effect of these provisions on the availability of prescription drugs  to
Medicare and Medicaid recipients, and to submit a report to the legislature
no later than January 1 of each year. 

EFFECTIVE DATE

September 1, 2001.