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92_HB2393
LRB9205851SMpk
1 AN ACT concerning prescription drug benefits.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 1. Short title. This Act may be cited as the
5 Prescription Drugs Benefits Act.
6 Section 5. Definitions.
7 (a) In this Act:
8 "Department" means the Department on Aging.
9 "Director" means the Director of Aging.
10 "Disabled person" means a person unable to engage in any
11 substantial gainful activity by reason of a medically
12 determinable physical or mental impairment that can be
13 expected to result in death or has lasted or can be expected
14 to last for a continuous period of not less than 12 months.
15 "Eligible person" means a resident of this State who:
16 (1) is 65 years of age or older; or
17 (2) has a gross annual household income of not more
18 than 188% of the federal poverty level, does not work
19 more than 40 hours per month, and is a disabled person.
20 "Enrollee" means an eligible person who has applied and
21 enrolled in the program established by this Act.
22 "Mail service program" means a program to dispense
23 prescription drugs by postal delivery service designated and
24 administered by the Department, and any entity with which it
25 contracts, upon an enrollee's submission of a prescription
26 and the applicable co-payment.
27 "Maintenance drug" means a prescription drug prescribed
28 to an individual for a chronic condition, the use of which is
29 medically necessary for a consecutive period of 90 days or
30 longer.
31 "Pharmacy benefit manager" means an entity under contract
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1 with the Department, whether organized on a for-profit or a
2 not-for-profit basis, contracted to manage the program
3 established by this Act.
4 "Program" means the subsidized catastrophic prescription
5 drug insurance program.
6 "Review commission" means the prescription drug review
7 commission.
8 (b) The Department shall administer a subsidized
9 catastrophic prescription drug insurance program designed to
10 provide eligible persons with prescription drug coverage. The
11 program shall be actuarially sound. Enrollment in the program
12 shall be voluntary and shall be funded each fiscal year,
13 subject to appropriation, from the Tobacco Settlement
14 Recovery Fund.
15 (c) The Director, in conjunction with the Director of
16 Insurance, shall enter into a competitively procured contract
17 with one or more entities including, but not limited to, a
18 pharmacy benefit manager, to administer benefits under the
19 program. The Director shall take all necessary steps to
20 ensure that the program is structured in a way that maximizes
21 savings, efficiencies, affordability, benefits, and coverage.
22 No prescription drug shall be excluded from any formulary
23 established for the program unless another prescription drug
24 is available on the formulary that is therapeutically
25 equivalent to the excluded prescription drug. Not less than
26 90 days before procuring a contract with an existing pharmacy
27 benefit manager, the Department shall file a report with the
28 review commission detailing the cost savings associated with
29 the Department's decision to procure that existing pharmacy
30 benefit manager's services. The Department shall contract
31 with entities to perform marketing, enrollment, billing,
32 claims processing, claims management, or any other function
33 it deems necessary.
34 (d) Notwithstanding any law to the contrary, the
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1 Department shall, subject to appropriation, engage in
2 outreach marketing efforts to maximize enrollment in the
3 program for the purpose of spreading the risk of the program.
4 (e) Not later than 30 days before enrolling eligible
5 persons in the program, and annually thereafter, the
6 Department shall establish schedules of monthly premiums and
7 annual deductibles based on a sliding income scale payable by
8 enrollees whose gross annual household income is greater than
9 188% of the federal poverty level. The Department shall also
10 establish schedules of monthly premiums and deductibles based
11 on a sliding income scale payable by married applicants whose
12 gross annual household income is greater than 188% of the
13 federal poverty level. The State is liable for the cost of
14 the monthly premium and annual deductible established by the
15 schedule for all enrollees including, but not limited to,
16 married applicants, whose gross annual household income is
17 less than or equal to 188% of the federal poverty level. The
18 schedules shall provide for not less than 6 separate
19 categories of premiums and deductibles, on a sliding scale
20 basis, for all income levels above 188% of the federal
21 poverty level. During the first 12 months of the program, the
22 schedule shall provide for monthly premiums of (1) not more
23 than $15 for enrollees including, but not limited to, married
24 applicants whose gross annual household income is between
25 188% and 200% of the federal poverty level; and (2) not more
26 than $25 for enrollees including, but not limited to, married
27 applicants whose gross annual household income is between
28 200% and 225% of the federal poverty level; and (3) not more
29 than $82 for enrollees whose gross annual household income
30 exceeds 500% of the federal poverty level. Annual deductibles
31 shall range between $100 and $500. Eligibility for the
32 program shall be determined based on an enrollee's gross
33 annual household income. Each enrollee shall separately pay
34 the monthly premium and annual deductible applicable to the
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1 sliding scale income category for the household, as
2 determined by the Department.
3 (f) The Department or its designee shall verify income
4 for the program based on the submission of the most recently
5 required federal income tax return for the household or, if
6 an applicant is not required to file a return, the submission
7 of copies of monthly checks or other easily obtainable means
8 of income verification. Residency shall be verified by the
9 submission of such documentation as the Department deems
10 reasonable.
11 (g) Subject to this Section, the program shall pay the
12 costs of all prescription drugs for an enrollee whose
13 out-of-pocket expenditures on prescription drugs exceeds the
14 lesser of (1) 10% of such enrollee's gross annual household
15 income or (2) $2,000 in out-of-pocket expenditures made by an
16 enrollee for co-payments and deductibles in a fiscal year.
17 For purposes of this subsection, out-of-pocket expenditures
18 shall not include monthly premiums for which an enrollee
19 shall remain responsible. The program shall pay the costs of
20 any prescription drug in excess of the co-payment amount
21 applicable to the drug after the deductible established for
22 the enrollee has been reached.
23 (h) An enrollee whose gross annual household income is
24 greater than 200% of the federal poverty level shall be
25 responsible for a co-payment for each prescription of (1) $10
26 per prescription for a generic drug, (2) $25 per prescription
27 for a preferred drug, and (3) the greater of $25 or 50% of
28 the cost per prescription for a nonpreferred drug. The
29 co-payment for maintenance drugs shall be (1) $20 for each
30 90-day supply of a prescription for a generic drug, (2) $50
31 for each 90-day supply of a preferred drug, and (3) the
32 greater of $50 or 50% of the cost per prescription of a
33 nonpreferred drug.
34 (i) An enrollee whose gross annual household income is
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1 less than or equal to 200% of the federal poverty level shall
2 be responsible for a co-payment for each prescription of (1)
3 $5 per prescription for a generic drug, (2) $12 per
4 prescription for a preferred drug; and (3) the greater of $25
5 or 50% of the cost per prescription for a nonpreferred drug.
6 The co-payment for maintenance drugs shall be (1) $ 10 for
7 each 90-day supply of a prescription for a generic drug, (2)
8 $25 for each 90-day supply of a preferred drug, and (3) the
9 greater of $50 or 50% of the cost per prescription of a
10 nonpreferred drug.
11 (j) Subject to this Section, the Department may offer a
12 mail service program and may require the use of a mail
13 service program for maintenance drugs. No such mail order
14 program for maintenance drugs shall be required unless the
15 Director determines in writing that material savings will
16 result to the State or enrollees without compromising the
17 health or safety of enrollees. In making the determination,
18 the Director shall consider the impact of any mail order
19 program on the value of the retail pharmacy services in the
20 communities. Before making any determination, the Director
21 shall hold at least one public hearing in order to hear
22 testimony from members of the public. Any mail service
23 program shall be administered by the Department and the
24 contracted pharmacy benefit manager.
25 (k) In order to maintain the fiscal viability of the
26 program, after the first 12 months of the program, cost
27 sharing required of enrollees in the form of co-payments,
28 premiums and deductibles, or any combination thereof, shall
29 be adjusted annually by the Department to reflect price
30 trends for prescription drugs, as determined by the Director.
31 The review commission shall evaluate the actuarial
32 assumptions and the appropriateness of adjustments and make
33 an annual written determination whether the adjustments are
34 necessary for all or any combination of the cost sharing
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1 requirements. Not later than 90 days before making any
2 adjustments, the Director shall submit to the Governor, the
3 President of the Senate, and the Speaker of the House of
4 Representatives, the written determination made by the
5 commission and all actuarial assumptions and other supporting
6 materials upon which the adjustments are based.
7 (l) During the initial 12-month period the program is in
8 effect, an eligible person may enroll at any time, after
9 which, application to the program shall be made during an
10 open enrollment period established by the Department, but a
11 person shall be eligible to enroll in the program at any time
12 within the year of reaching age 65. The Department shall
13 establish a surcharge for any eligible person whose gross
14 annual household income is not less than 188% of the federal
15 poverty level and who fails to enroll within his or her first
16 year of eligibility.
17 (m) Coverage shall be effective as of the date an
18 application for enrollment is approved by the Department. The
19 Director shall close the open enrollment period or modify
20 income eligibility levels upon a written determination by the
21 Director that program expenditures are projected to exceed
22 the amount appropriated for the program or, based on not less
23 than 9 months of claims and enrollment data for the current
24 fiscal year, expenditures in the subsequent fiscal year are
25 clearly projected to annualize beyond the expenditures
26 projected by the Department in the subsequent fiscal year. If
27 the projection is based on expenditures in the subsequent
28 fiscal year, the Director shall not modify income eligibility
29 levels or close open enrollment until not earlier than the
30 beginning of the subsequent fiscal year.
31 (n) The Department, and any entity with which it
32 contracts, shall inform enrollees in writing of the program's
33 scope, coverage, cost sharing requirements, and any
34 limitations on access to prescription drugs. The Department,
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1 and any entity with which it contracts, shall provide for a
2 clear and timely process by which enrollees can appeal a
3 decision by the Department or any contracted entity to deny
4 or limit coverage or benefits under this Act.
5 (o) The appeal process shall, at a minimum, provide
6 enrollees with the opportunity to (1) obtain a nonpreferred
7 drug at the co-payment level of a preferred drug, or to
8 obtain any prescription drug excluded by the program, upon a
9 separate written certification by the enrollee's physician,
10 satisfactory to the Department, that the nonpreferred or
11 excluded drug is medically necessary and there is no
12 therapeutically equivalent preferred drug available to the
13 enrollee; (2) appeal the exclusion of any prescription drug
14 from any formulary established for the program. An enrollee
15 may apply to be exempt from any mail service requirement of
16 the program upon a separate written certification by the
17 enrollee's physician, satisfactory to the Department, that
18 due to a disability or other significant limiting factor, the
19 use of a mail service program would be medically
20 inappropriate for the enrollee. A retail pharmacy shall not
21 be required to dispense a prescription upon the failure of an
22 enrollee to make the required co-payment.
23 (p) The Department must adopt rules that are necessary to
24 implement and administer the program.
25 Section 10. Prescription drug review commission.
26 (a) There shall be a prescription drug review commission
27 to oversee the program established by this Act. The
28 commission shall consist of the Speaker of the House of
29 Representatives or his or her designee, the President of the
30 Senate or his or her designee, the Director of Aging or his
31 or her designee, and 9 members to be appointed by the
32 Governor, including 2 representatives of senior citizens'
33 advocacy organizations, 2 representatives of disability
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1 advocacy organizations, a health care economist from a
2 university or college within the State, 2 representatives
3 from retail pharmacies, an individual who is a full-time
4 employee of a pharmaceutical manufacturer, and an individual
5 who is a full-time employee of a biotechnology manufacturer.
6 A representative of the contracted pharmacy benefit manager
7 shall also participate, but shall not be a voting member of
8 the commission.
9 (b) Members of the commission shall select a chair. The
10 commission shall adopt such rules and establish such
11 procedures as it deems necessary for the oversight of the
12 program established by this Act. No action of the commission
13 shall be considered approved unless it is endorsed by a
14 majority vote of the commission.
15 (c) The commission shall meet quarterly and shall, not
16 less than biannually, submit written recommendations to the
17 Governor and the General Assembly regarding changes to the
18 administration, management, eligibility criteria, benefits,
19 funding, or any other aspect of the program.
20 (d) To facilitate the commission's development of the
21 recommendations, the Department, and any entity with which it
22 contracts, shall review the operations of the program and,
23 not less than quarterly, prepare and submit the following
24 summary information to said commission:
25 (1) financial reports of the program, including
26 actual and projected costs and revenues and an analysis
27 of the adequacy of appropriated funding;
28 (2) enrollment information, including enrollee
29 demographics and benefit utilization data;
30 (3) specific problems associated with the program
31 and suggested strategies to resolve those problems;
32 (4) a review of the pharmacy benefit manager's
33 designated formulary for the program and any proposed
34 changes;
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1 (5) an analysis of current and future technological
2 advancements that may result in cost savings or otherwise
3 affect the program;
4 (6) an analysis of the program's cost sharing
5 requirements including, but not limited to, co-payments,
6 premiums, and deductibles, in relation to actual market
7 trends in prescription drug costs, prescription drug
8 inflation, and any proposed changes;
9 (7) an analysis of the disabled enrollees' drug
10 utilization pattern including, but not limited to, the
11 cost associated with that utilization and the
12 implications for expanding benefits to all disabled
13 individuals who reside in the State; and
14 (8) all other information requested by the
15 commission. In developing its recommendations, the
16 commission shall consult with representatives of parties
17 who may be affected by the commission's recommendations.