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HB 42: "An Act relating to prescription drug discount pricing; placing requirements on pharmacies related to prescription drugs obtained through discount pricing; and requiring the Department of Health and Social Services to conduct a study pertaining to prescription drug discounts and report the results to the legislature."

00                              HOUSE BILL NO. 42                                                                          
01 "An Act relating to prescription drug discount pricing; placing requirements on                                         
02 pharmacies related to prescription drugs obtained through discount pricing; and                                         
03 requiring the Department of Health and Social Services to conduct a study pertaining to                                 
04 prescription drug discounts and report the results to the legislature."                                                 
05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
06    * Section 1. AS 08.80 is amended by adding a new section to read:                                                  
07            Sec. 08.80.168. Prescription drugs obtained through discount pricing. (a)                                  
08       A pharmacy shall segregate prescription drugs purchased through discount pricing                                  
09       under AS 17.20.095 from other drug stock by physical or electronic means and                                      
10       maintain records of the acquisition and disposition of the discounted drugs in a way                              
11       that is readily retrievable and separate from other records maintained by the pharmacy.                           
12            (b)  A pharmacy may only return prescription drugs obtained through discount                                 
13       pricing under AS 17.20.095 if the discounted drugs cannot be distributed because of a                             
14       change in circumstances approved by the Department of Health and Social Service. In                               
01       this subsection, "change in circumstances" includes the termination or expiration of                              
02       the contract under AS 17.20.095(c) between a pharmacy and an eligible covered                                     
03       entity, closure of the pharmacy, disciplinary action involving the pharmacy, and                                  
04       closure of an eligible covered entity that significantly affects the business of the                              
05       pharmacy.                                                                                                         
06    * Sec. 2. AS 17.20 is amended by adding a new section to read:                                                     
07            Sec. 17.20.095. Prescription drug discount pricing. (a) A covered entity may                               
08       not purchase a covered outpatient drug for a price that is higher than the average                                
09       manufacturer price for the drug established under 42 U.S.C. 1396 et seq. (Title XIX of                            
10       the Social Security Act) in the preceding calendar quarter, reduced by the rebate                                 
11       percentage described under 42 U.S.C. 256b (Title III, Part D, Subpart VII, sec. 340B                              
12       of the Social Security Act).                                                                                      
13            (b)  The commissioner shall notify all health care providers and facilities in the                           
14       state that are eligible to participate in prescription drug pricing under 42 U.S.C. 256b                          
15       of the availability of the discount pricing and of the requirement under (a) of this                              
16       section.                                                                                                          
17            (c)  An eligible covered entity may contract with a pharmacy to provide                                      
18       pharmacy services to the entity, including dispensing discount pricing for drugs                                  
19       obtained under 42 U.S.C. 256b.                                                                                    
20            (d)  Prescription drugs purchased through discount pricing under this section                                
21       and records pertaining to those drugs shall be maintained as required under                                       
22       AS 08.80.168.                                                                                                     
23            (e)  In this section, "covered entity" and "covered outpatient drug" have the                                
24       meanings given in 42 U.S.C. 256b and as further defined in regulations adopted by the                             
25       commissioner.                                                                                                     
26    * Sec. 3. The uncodified law of the State of Alaska is amended by adding a new section to                          
27 read:                                                                                                                   
28       PRESCRIPTION DRUG DISCOUNT PRICING STUDY AND REPORT. (a) The                                                      
29 Department of Health and Social Services shall conduct a study of the feasibility of providing                          
30 discounted prescription drug pricing to every person in the state who is not otherwise covered                          
31 by a prescription drug plan. In conducting the study, the department shall cooperate with other                         
01 state agencies and representatives of state employees, health care providers, and health care                           
02 facilities. The study must include                                                                                      
03            (1)  a description of health care providers and facilities in the state that meet                            
04 the definition of "covered entity" under 42 U.S.C. 256b (Social Security Act);                                          
05            (2)  a description of other health care providers and facilities in the state that                           
06 would benefit from prescription drug discount pricing;                                                                  
07            (3)  a list of potential benefits to public, private, and third-party payors of                              
08 prescription drug discount pricing;                                                                                     
09            (4)  a list of resources and an application process available for entities seeking                           
10 to be included as a covered entity for purposes of obtaining prescription drug discounts;                               
11            (5)  estimated cost savings for prescription drug discount pricing; and                                      
12            (6)  strategies, such as state bulk purchasing initiatives, state-funded managed                             
13 care plans, and sole source contracting, for obtaining the best prices on chronic use drugs.                            
14       (b)  The Department of Health and Social Services shall, after conducting the study                               
15 under (a) of this section, prepare a report summarizing the study and submit the report to the                          
16 legislature on or before January 1, 2012.