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1 | AN ACT concerning health.
| ||||||||||||||||||||||||||||||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois,
| ||||||||||||||||||||||||||||||||||||||||||||||
3 | represented in the General Assembly:
| ||||||||||||||||||||||||||||||||||||||||||||||
4 | Section 5. The State Finance Act is amended by changing | ||||||||||||||||||||||||||||||||||||||||||||||
5 | Section 5.595 as follows:
| ||||||||||||||||||||||||||||||||||||||||||||||
6 | (30 ILCS 105/5.595)
| ||||||||||||||||||||||||||||||||||||||||||||||
7 | Sec. 5.595. The Illinois
Senior Citizens and Disabled | ||||||||||||||||||||||||||||||||||||||||||||||
8 | Persons Prescription Drug
Discount Program Fund.
| ||||||||||||||||||||||||||||||||||||||||||||||
9 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||||||||||||||||||||||||||||||||||||||||||
10 | Section 10. The Senior Citizens and Disabled Persons | ||||||||||||||||||||||||||||||||||||||||||||||
11 | Prescription Drug Discount
Program Act is amended by changing | ||||||||||||||||||||||||||||||||||||||||||||||
12 | the title of the Act and Sections 1, 5, 10, 15, 20, 25, 30, 35, | ||||||||||||||||||||||||||||||||||||||||||||||
13 | and 50 as follows:
| ||||||||||||||||||||||||||||||||||||||||||||||
14 | (320 ILCS 55/Act title)
| ||||||||||||||||||||||||||||||||||||||||||||||
15 | An Act concerning discount prescription drugs for Illinois
| ||||||||||||||||||||||||||||||||||||||||||||||
16 | senior citizens.
| ||||||||||||||||||||||||||||||||||||||||||||||
17 | (320 ILCS 55/1)
| ||||||||||||||||||||||||||||||||||||||||||||||
18 | Sec. 1. Short title. This Act may be cited as the Illinois
| ||||||||||||||||||||||||||||||||||||||||||||||
19 | Senior Citizens
and
Disabled
Persons Prescription Drug | ||||||||||||||||||||||||||||||||||||||||||||||
20 | Discount Program Act.
| ||||||||||||||||||||||||||||||||||||||||||||||
21 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||||||||||||||||||||||||||||||||||||||||||
22 | (320 ILCS 55/5)
| ||||||||||||||||||||||||||||||||||||||||||||||
23 | Sec. 5. Findings. The General Assembly finds that:
| ||||||||||||||||||||||||||||||||||||||||||||||
24 | (a) Although senior citizens represent 12% of the | ||||||||||||||||||||||||||||||||||||||||||||||
25 | population, they use on
average
37% of prescription drugs that | ||||||||||||||||||||||||||||||||||||||||||||||
26 | are dispensed.
| ||||||||||||||||||||||||||||||||||||||||||||||
27 | (b) Senior citizens in the United States without | ||||||||||||||||||||||||||||||||||||||||||||||
28 | prescription drug insurance
coverage pay the highest prices in |
| |||||||
|
|||||||
1 | the world for needed medications.
| ||||||
2 | (c) High prescription drug prices force many Illinois | ||||||
3 | residents
seniors to go without
proper
medication or other | ||||||
4 | necessities, thereby affecting their health and safety.
| ||||||
5 | (d) Prescription drug prices in the United States are the | ||||||
6 | world's highest,
averaging
32% higher than in Canada, 40% | ||||||
7 | higher than in Mexico, and 60% higher than in
Great
Britain.
| ||||||
8 | (e) Regardless of household income, seniors without | ||||||
9 | prescription drug
coverage
are often just one serious illness | ||||||
10 | away from poverty.
| ||||||
11 | (f) Reducing the price of prescription drugs would benefit | ||||||
12 | the health and
well-being of all Illinois senior citizens by | ||||||
13 | providing more affordable access
to needed drugs.
| ||||||
14 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||
15 | (320 ILCS 55/10)
| ||||||
16 | Sec. 10. Purpose. The purpose of this program is to require | ||||||
17 | the
Department
of
Central Management Services to establish and | ||||||
18 | administer a program that will
enable
eligible Illinois | ||||||
19 | residents
senior citizens and disabled persons to purchase | ||||||
20 | prescription drugs at
discounted
prices.
| ||||||
21 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||
22 | (320 ILCS 55/15)
| ||||||
23 | Sec. 15. Definitions. As used in this Act:
| ||||||
24 | "Authorized pharmacy" means any pharmacy registered in | ||||||
25 | this State under the
Pharmacy Practice Act of 1987 and approved | ||||||
26 | by the Department or its program
administrator.
| ||||||
27 | "AWP" or "average wholesale price" means the amount | ||||||
28 | determined from the
latest publication of the Red Book, a | ||||||
29 | universally subscribed pharmacist
reference guide
annually | ||||||
30 | published by the Hearst Corporation. "AWP" or "average | ||||||
31 | wholesale
price"
may also be derived electronically from the | ||||||
32 | drug pricing database synonymous
with the
latest publication of | ||||||
33 | the Red Book and furnished in the National Drug Data File
| ||||||
34 | (NDDF)
by First Data Bank (FDB), a service of the Hearst |
| |||||||
|
|||||||
1 | Corporation.
| ||||||
2 | "Department" means the Department of Central Management | ||||||
3 | Services.
| ||||||
4 | "Director" means the Director of Central Management | ||||||
5 | Services.
| ||||||
6 | "Disabled person" means a person unable to engage in any | ||||||
7 | substantial gainful
activity by reason of a medically | ||||||
8 | determinable physical or mental impairment
which can
be | ||||||
9 | expected to result in death or has lasted or can be expected to | ||||||
10 | last for a
continuous
period of not less than 12 months.
| ||||||
11 | "Drug manufacturer" means any entity (1) that is located | ||||||
12 | within or outside
Illinois
that is engaged in (i) the | ||||||
13 | production, preparation, propagation, compounding,
conversion,
| ||||||
14 | or processing of prescription drug products covered under the | ||||||
15 | program, either
directly or
indirectly by extraction from | ||||||
16 | substances of natural origin, independently by
means of
| ||||||
17 | chemical synthesis, or by a combination of extraction and | ||||||
18 | chemical synthesis or
(ii) the
packaging, repackaging, | ||||||
19 | leveling, labeling, or distribution of prescription
drug | ||||||
20 | products
covered under the program and (2) that elects to | ||||||
21 | provide prescription drugs
either directly
or under contract | ||||||
22 | with any entity providing prescription drug services on
behalf | ||||||
23 | of the
State of Illinois. "Drug manufacturer", however, does | ||||||
24 | not include a wholesale
distributor
of drugs or a retail | ||||||
25 | pharmacy licensed under Illinois law.
| ||||||
26 | "Eligible senior" means a person who is (i) a resident of | ||||||
27 | Illinois and (ii)
65 years of
age or older.
| ||||||
28 | "Prescription drug" means any prescribed drug that may be | ||||||
29 | legally dispensed
by
an authorized pharmacy.
| ||||||
30 | "Program" means the Illinois
Senior Citizens and Disabled | ||||||
31 | Persons Prescription Drug
Discount Program created
under this | ||||||
32 | Act.
| ||||||
33 | "Program administrator" means the entity that is chosen by | ||||||
34 | the Department to
administer the program. The program | ||||||
35 | administrator may, in this case, be the
Director or
a Pharmacy | ||||||
36 | Benefits Manager (PBM) chosen to subcontract with the Director.
|
| |||||||
|
|||||||
1 | "Rules" includes rules adopted and forms prescribed by the | ||||||
2 | Department.
| ||||||
3 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||
4 | (320 ILCS 55/20)
| ||||||
5 | Sec. 20. The Illinois
Senior Citizens and Disabled Persons
| ||||||
6 | Prescription Drug
Discount
Program. The Illinois
Senior
| ||||||
7 | Citizens and Disabled Persons Prescription Drug Discount
| ||||||
8 | Program
is established to protect the health and safety of | ||||||
9 | Illinois residents
senior citizens and disabled
persons . The
| ||||||
10 | program shall be administered by the Department. The Department | ||||||
11 | or its program
administrator shall (i) enroll eligible Illinois | ||||||
12 | residents
seniors and disabled persons into the
program, as | ||||||
13 | provided in Section 35 of this Act, to
qualify them for a | ||||||
14 | discount on the purchase of prescription drugs at an
authorized
| ||||||
15 | pharmacy, (ii) enter into rebate agreements with drug | ||||||
16 | manufacturers, as
provided under Section 30 of this Act, and | ||||||
17 | (iii) subject to the provisions of
Section 47 of this Act,
| ||||||
18 | compensate pharmacies participating in the program
as provided | ||||||
19 | under Section 25 of this Act.
| ||||||
20 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||
21 | (320 ILCS 55/25)
| ||||||
22 | Sec. 25. Program administration.
| ||||||
23 | (a) The Department is authorized under this Act to be the | ||||||
24 | program
administrator. If the Department is not the program | ||||||
25 | administrator, 90 days
after the effective date of this Act, | ||||||
26 | the Department must
issue a
request for proposals for bidders | ||||||
27 | interested in administering the program.
Bidders must
compete | ||||||
28 | on the basis of the following minimum criteria:
| ||||||
29 | (1) The Director shall solicit and accept proposals | ||||||
30 | from entities
to provide for administration of a
program or | ||||||
31 | programs in accordance with rules adopted under Section 45.
| ||||||
32 | Proposals must be submitted not later than a date | ||||||
33 | established by the Director.
The
Director shall accept only | ||||||
34 | those proposals that specify the following:
|
| |||||||
|
|||||||
1 | (A) The estimated amount of the discount based on | ||||||
2 | the entity's
previous experience and how the discount | ||||||
3 | is to be achieved.
| ||||||
4 | (B) The extent that discounts on prescription | ||||||
5 | drugs are to be
achieved through rebates, | ||||||
6 | administrative fees, or other fees or discounts in
| ||||||
7 | prices that the entity negotiates
with drug | ||||||
8 | manufacturers.
The proposals shall assure that rebates | ||||||
9 | or discounts
will be
used to do the following:
| ||||||
10 | (i) reduce
costs to cardholders;
| ||||||
11 | (ii) achieve discounts for cardholders; and
| ||||||
12 | (iii) cover costs for administering the | ||||||
13 | program.
| ||||||
14 | (C) Any other benefits offered to cardholders.
| ||||||
15 | (D) The estimated number and geographic | ||||||
16 | distribution of
participating pharmacies in the | ||||||
17 | administrator's
pharmacy network.
| ||||||
18 | (E) The plan for pharmacy compensation, pursuant | ||||||
19 | to subsection (e) of
this Section.
| ||||||
20 | (F) The method used for determining the | ||||||
21 | prescription drugs to be covered
by the program, | ||||||
22 | including the criteria and process for establishing a | ||||||
23 | preferred
drug list, if
applicable.
| ||||||
24 | (G) How the entity proposes to improve medication | ||||||
25 | management
for cardholders, including any program of | ||||||
26 | disease management.
| ||||||
27 | (H) How cardholders and participating pharmacies | ||||||
28 | will be
informed of the discounted price negotiated by | ||||||
29 | the entity.
| ||||||
30 | (I) How the entity will handle complaints about the | ||||||
31 | program's
operation.
| ||||||
32 | (J) The entity's previous experience in managing | ||||||
33 | similar programs.
| ||||||
34 | (K) Any additional information requested by the | ||||||
35 | Director.
| ||||||
36 | (2) The Director shall contract with one or more |
| |||||||
|
|||||||
1 | entities to administer
a
program or programs on the basis | ||||||
2 | of the proposals submitted, but may require an
| ||||||
3 | administrator to modify its conduct of a program in | ||||||
4 | accordance with rules
adopted
under Section 45.
| ||||||
5 | The Director shall adopt rules specifying the period | ||||||
6 | for which a contract
will be in effect and may terminate a | ||||||
7 | contract if an administrator fails to
conduct a
program in | ||||||
8 | accordance with its proposal or with any modifications | ||||||
9 | required by
rule. When a contract period ends or a contract | ||||||
10 | is terminated, the Director
shall
enter into a new contract | ||||||
11 | in the manner specified in this Section for an
original
| ||||||
12 | contract. Prior to making a new contract, the Director may | ||||||
13 | modify the rules for
administration of the program or | ||||||
14 | programs.
| ||||||
15 | (b) As used in this Section, "administrator" includes the | ||||||
16 | administrator's
parent
company and any subsidiary of the parent | ||||||
17 | company.
| ||||||
18 | (1) No administrator shall sell any information | ||||||
19 | concerning a person who
holds a prescription drug discount | ||||||
20 | card, other than aggregate information that
does not | ||||||
21 | identify the cardholder, without the cardholder's written | ||||||
22 | consent.
| ||||||
23 | (2) Unless an administrator has the cardholder's | ||||||
24 | written consent, no
administrator shall use any personally | ||||||
25 | identifiable information that it obtains
concerning a | ||||||
26 | cardholder through the program to promote or sell a program | ||||||
27 | or
product offered by the administrator that is not related | ||||||
28 | to the administration
of the
program. This subsection (b) | ||||||
29 | does not prohibit an administrator from
contacting | ||||||
30 | cardholders concerning participation in or administration | ||||||
31 | of the
program, including, but not limited to, mailing a | ||||||
32 | list of pharmacies
participating
in the program's network | ||||||
33 | or participating in disease management programs.
| ||||||
34 | (3) To the extent that a discount is achieved through | ||||||
35 | rebates,
administrative fees, or any other fees or
| ||||||
36 | discounts
in prices that an administrator negotiates with |
| |||||||
|
|||||||
1 | drug manufacturers, an
administrator shall use the rebates | ||||||
2 | or discounts to do the following:
| ||||||
3 | (A) reduce costs to cardholders;
| ||||||
4 | (B) achieve discounts for cardholders; and
| ||||||
5 | (C) cover any administrative costs of the program.
| ||||||
6 | (4) The administrator shall not use any funds
generated | ||||||
7 | from rebates, discounts, administrative fees, or other | ||||||
8 | fees to
promote its mail order pharmacy operation or the | ||||||
9 | mail order pharmacy operation
of an affiliate. This | ||||||
10 | subdivision (b)(4) does not, however, limit the
| ||||||
11 | participation of an
Illinois-licensed pharmacy under this | ||||||
12 | Act if that pharmacy provides
prescription drugs by
mail | ||||||
13 | order.
| ||||||
14 | (c) Beginning on January 1, 2005
2004 , the amount paid by | ||||||
15 | eligible Illinois residents
seniors and
disabled persons
| ||||||
16 | enrolled in the program to authorized pharmacies for
| ||||||
17 | prescription drugs
may not exceed prices established as a | ||||||
18 | result of the rebate agreements under
Section 30.
The eligible | ||||||
19 | Illinois residents
seniors and disabled persons shall pay the | ||||||
20 | price determined under
Section 30 plus
a dispensing fee of | ||||||
21 | $3.50 per prescription for brand name drug products,
| ||||||
22 | single-source drug products, and, for a period of 6 months, | ||||||
23 | newly released
generic drug products and
$4.25 per prescription | ||||||
24 | for all other generic drug products, except that the
total | ||||||
25 | amount
paid
by the
eligible Illinois resident
senior or | ||||||
26 | disabled person for each prescription
drug under
this program | ||||||
27 | shall not exceed the usual and customary charge for such
| ||||||
28 | prescription.
| ||||||
29 | (d) The contract between the Department and a pharmacy | ||||||
30 | benefits manager
must,
at a minimum, meet the criteria of | ||||||
31 | subsection (a). The contract must also
require
notification by | ||||||
32 | the pharmacy benefits manager of any proposed or ongoing
| ||||||
33 | activity that
involves, directly or indirectly, any conflict of | ||||||
34 | interest on the part of the
pharmacy
benefits manager. The | ||||||
35 | Department shall ensure that the pharmacy benefits
manager
| ||||||
36 | complies with the contract and shall adopt all procedures |
| |||||||
|
|||||||
1 | necessary to enforce
the
contract.
| ||||||
2 | (e) The Department or program administrator shall,
subject | ||||||
3 | to the funds available
under
Section 30 of this Act,
compensate | ||||||
4 | authorized
pharmacies for prescription drugs dispensed under | ||||||
5 | the program
for the difference between the amount paid by the | ||||||
6 | eligible Illinois resident
senior or disabled
person for
| ||||||
7 | prescription drugs
dispensed under the program and (i) the AWP | ||||||
8 | minus 12% for
brand name drug products, single-source generic
| ||||||
9 | drug products, and, for a period of 6 months,
newly released | ||||||
10 | generic drug products
and (ii) the AWP minus 35% for all
other | ||||||
11 | generic drug products.
The Department shall compensate a | ||||||
12 | pharmacy under this subsection (e) only if
the amount paid by | ||||||
13 | the eligible Illinois resident
senior or disabled person
has | ||||||
14 | been discounted to a price, including the dispensing fees | ||||||
15 | stated in
subsection (c) of this Section, that
is less than (i) | ||||||
16 | the
AWP
minus 12% for
brand name drug products, single-source | ||||||
17 | generic
drug products, and, for a period of 6 months, newly | ||||||
18 | released generic drug
products
and (ii) the AWP minus 35% for | ||||||
19 | all
other
generic drug products.
| ||||||
20 | (f) Beginning on January 1, 2004, the Department or program | ||||||
21 | administrator
shall
reimburse pharmacies under this Section | ||||||
22 | within 30 days after adjudication of
the
claim.
| ||||||
23 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||
24 | (320 ILCS 55/30)
| ||||||
25 | Sec. 30. Manufacturer rebate agreements.
| ||||||
26 | (a) Taking into consideration the extent to which the State | ||||||
27 | pays for
prescription
drugs under various State programs
and | ||||||
28 | the provision of assistance to disabled persons or eligible | ||||||
29 | seniors under
patient
assistance programs, prescription drug | ||||||
30 | discount programs, or other offers for
free or
reduced price | ||||||
31 | medicine, clinical research projects, limited supply | ||||||
32 | distribution
programs,
compassionate use programs, or programs | ||||||
33 | of research conducted by or for a drug
manufacturer, the | ||||||
34 | Department, its agent, or the program
administrator shall | ||||||
35 | negotiate and enter into rebate agreements with drug
|
| |||||||
|
|||||||
1 | manufacturers, as
defined in this Act, to effect prescription | ||||||
2 | drug price discounts.
The Department or program administrator | ||||||
3 | may establish a preferred drug list as
a
basis
for determining | ||||||
4 | the discounts, administrative fees, or other fees or rebates
| ||||||
5 | under this Section.
| ||||||
6 | (b) Rebate payment procedures. All rebates negotiated | ||||||
7 | under agreements
described in this Section shall be paid in | ||||||
8 | accordance with
procedures
prescribed by the Department or the | ||||||
9 | program administrator.
| ||||||
10 | (c) Receipts from rebates
shall be used
to provide | ||||||
11 | discounts for prescription drugs purchased by eligible | ||||||
12 | Illinois residents
seniors and
disabled persons and to cover | ||||||
13 | the cost of administering the program,
including compensation | ||||||
14 | to be paid to participating pharmacies by the Department
or | ||||||
15 | program administrator under subsection (e) of Section 25. Any | ||||||
16 | receipts to be
allocated to the Department shall be deposited | ||||||
17 | into the Illinois
Senior Citizens and
Disabled Persons
| ||||||
18 | Prescription Drug Discount Program Fund, a special fund hereby | ||||||
19 | created in the
State treasury.
| ||||||
20 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||
21 | (320 ILCS 55/35)
| ||||||
22 | Sec. 35. Program eligibility.
| ||||||
23 | (a) Any person may apply to the Department or its program | ||||||
24 | administrator for
participation in the program in the form and | ||||||
25 | manner required by the Department.
The
Department or its | ||||||
26 | program administrator shall determine the eligibility of each
| ||||||
27 | applicant
for the program within 30 days after the date of | ||||||
28 | application. To participate in
the program
an eligible Illinois | ||||||
29 | resident
senior or disabled person whose application has been | ||||||
30 | approved must
pay $25
upon enrollment and annually thereafter | ||||||
31 | and shall receive a program
identification card.
The card may | ||||||
32 | be presented to an authorized pharmacy to assist the pharmacy | ||||||
33 | in
verifying
eligibility under the program. The Department | ||||||
34 | shall deposit the enrollment fees
collected
into the Illinois
| ||||||
35 | Senior Citizens and Disabled Persons Prescription Drug |
| |||||||
|
|||||||
1 | Discount
Program Fund.
The moneys collected by the Department | ||||||
2 | for enrollment fees and deposited into
the Illinois
Senior
| ||||||
3 | Citizens and Disabled Persons Prescription Drug Discount | ||||||
4 | Program Fund must be
separately accounted for by the | ||||||
5 | Department. If 2 or more persons are eligible
for any
benefit | ||||||
6 | under this Act and are members of the same household, each
| ||||||
7 | participating
household member shall apply to the Department | ||||||
8 | and pay the fee required for the
purpose
of obtaining an | ||||||
9 | identification card.
| ||||||
10 | (b) Proceeds from annual enrollment fees shall be
used
by | ||||||
11 | the Department to offset the administrative cost of this Act. | ||||||
12 | The Department
may
reduce the annual enrollment fee by rule if | ||||||
13 | the revenue from the enrollment
fees is in
excess of the costs | ||||||
14 | to carry out the program.
| ||||||
15 | (c) Any person who is eligible for pharmaceutical | ||||||
16 | assistance under the
Senior
Citizens and Disabled Persons | ||||||
17 | Property Tax Relief and Pharmaceutical Assistance
Act is
| ||||||
18 | presumed to be eligible for this program. The enrollment fee | ||||||
19 | under this Act is
not required for such persons. That person | ||||||
20 | may purchase prescription
drugs
under this program that are not | ||||||
21 | covered by the pharmaceutical assistance
program under
the | ||||||
22 | Senior Citizens and Disabled Persons Property Tax Relief and | ||||||
23 | Pharmaceutical
Assistance Act by using the identification card | ||||||
24 | issued under the pharmaceutical
assistance
program.
| ||||||
25 | (Source: P.A. 93-18, eff. 7-1-03.)
| ||||||
26 | (320 ILCS 55/50)
| ||||||
27 | Sec. 50. Report on administration of program. The | ||||||
28 | Department shall
report
to
the Governor and the General | ||||||
29 | Assembly by March 1st of each year on the
administration
of the | ||||||
30 | program under this Act.
The report shall include but not be | ||||||
31 | limited to the following:
| ||||||
32 | (1) the number of disabled persons and seniors eligible | ||||||
33 | and enrolled in
the
program, by county;
| ||||||
34 | (2) the activities undertaken by the State to inform | ||||||
35 | Illinois residents
disabled persons
and
seniors about the |
| |||||||
|
|||||||
1 | program;
| ||||||
2 | (3) the number of prescriptions filled under the | ||||||
3 | program for enrollees,
and
the estimated savings for | ||||||
4 | enrollees;
| ||||||
5 | (4) a listing of the manufacturers and pharmacies | ||||||
6 | participating in the
program;
| ||||||
7 | (5) the amount of enrollment fees and rebates collected | ||||||
8 | under the
program, and any additional funds or resources | ||||||
9 | made available to cover the cost
of the program;
| ||||||
10 | (6) the itemized annual cost of administering the | ||||||
11 | program; and
| ||||||
12 | (7) findings and recommendations regarding problems | ||||||
13 | and solutions
related to the program, together with | ||||||
14 | proposals for changes in the rules,
regulations,
or laws | ||||||
15 | necessary to improve the administration of the program.
| ||||||
16 | (Source: P.A. 93-18, eff. 7-1-03.)
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17 | (320 ILCS 55/17 rep.)
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18 | Section 11. The Senior Citizens and Disabled Persons | ||||||
19 | Prescription Drug Discount
Program Act is amended by repealing | ||||||
20 | Section 17.
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