1.1    .................... moves to amend H. F. No. 297, the delete everything amendment
1.2(A07-0645), as follows:
1.3Page 64, after line 10 insert:

1.4    "Sec. 8. Minnesota Statutes 2006, section 256B.0625, subdivision 13e, is amended to
1.5read:
1.6    Subd. 13e. Payment rates. (a) The basis for determining the amount of payment
1.7shall be the lower of the actual acquisition costs of the drugs plus a fixed dispensing fee;
1.8the maximum allowable cost set by the federal government or by the commissioner plus
1.9the fixed dispensing fee; or the usual and customary price charged to the public. The
1.10amount of payment basis must be reduced to reflect all discount amounts applied to the
1.11charge by any provider/insurer agreement or contract for submitted charges to medical
1.12assistance programs. The net submitted charge may not be greater than the patient liability
1.13for the service. The pharmacy dispensing fee shall be $3.65 for single-source drugs and
1.14$12.92 for multiple-source generic drugs, subject to any adjustment by the commissioner
1.15as provided under section 24, except that the dispensing fee for intravenous solutions
1.16which must be compounded by the pharmacist shall be $8 per bag, $14 per bag for cancer
1.17chemotherapy products, and $30 per bag for total parenteral nutritional products dispensed
1.18in one liter quantities, or $44 per bag for total parenteral nutritional products dispensed in
1.19quantities greater than one liter. An inflation adjustment shall be made annually to the
1.20dispensing fee for multiple-source generic prescriptions based on the CPI-all items for
1.21urban consumers. Actual acquisition cost includes quantity and other special discounts
1.22except time and cash discounts. The actual acquisition cost of a drug shall be estimated by
1.23the commissioner, at average wholesale price minus 12 percent. The actual acquisition
1.24cost of antihemophilic factor drugs shall be estimated at the average wholesale price
1.25minus 30 percent. The maximum allowable cost of a multisource generic drug may be
1.26set by the commissioner and it shall be comparable to, but no higher than, the maximum
1.27amount paid by other third-party payors in this state who have maximum allowable cost
2.1programs lower than the price of the drug available to retail pharmacies for purchase from
2.2prescription drug wholesalers. Establishment of the amount of payment for drugs shall not
2.3be subject to the requirements of the Administrative Procedure Act.
2.4    (b) The commissioner may, within the limits of available appropriation, increase
2.5dispensing fees to pharmacists and pharmacies deemed by the commissioner to be critical
2.6access pharmacy providers. Reimbursement to a critical access pharmacy provider may be
2.7increased by not more than 50 percent above the dispensing fee that would otherwise be
2.8paid to the provider. In determining which pharmacists and pharmacies shall be deemed
2.9critical access pharmacy providers, the commissioner shall review:
2.10    (1) the utilization rate in the service area in which the pharmacist or pharmacy
2.11operates for pharmacy services to patients covered by medical assistance, general
2.12assistance medical care, or MinnesotaCare as their primary source of coverage;
2.13    (2) the level of services provided by the pharmacist or pharmacy to patients covered
2.14by medical assistance, general assistance medical care, or MinnesotaCare as their primary
2.15source of coverage; and
2.16    (3) whether the level of services provided by the pharmacist or pharmacy is critical
2.17to maintaining adequate levels of patient access within the service area.
2.18    (b) (c) An additional dispensing fee of $.30 may be added to the dispensing fee paid
2.19to pharmacists for legend drug prescriptions dispensed to residents of long-term care
2.20facilities when a unit dose blister card system, approved by the department, is used. Under
2.21this type of dispensing system, the pharmacist must dispense a 30-day supply of drug.
2.22The National Drug Code (NDC) from the drug container used to fill the blister card must
2.23be identified on the claim to the department. The unit dose blister card containing the
2.24drug must meet the packaging standards set forth in Minnesota Rules, part 6800.2700,
2.25that govern the return of unused drugs to the pharmacy for reuse. The pharmacy provider
2.26will be required to credit the department for the actual acquisition cost of all unused
2.27drugs that are eligible for reuse. Over-the-counter medications must be dispensed in the
2.28manufacturer's unopened package. The commissioner may permit the drug clozapine to be
2.29dispensed in a quantity that is less than a 30-day supply.
2.30    (c) (d) Whenever a generically equivalent product is available, payment shall be on
2.31the basis of the actual acquisition cost of federal upper limit set for the generic drug, or on
2.32the maximum allowable cost established by the commissioner.
2.33    (d) (e) The basis for determining the amount of payment for drugs administered in
2.34an outpatient setting shall be the lower of the usual and customary cost submitted by the
2.35provider or the amount established for Medicare by the United States Department of
3.1Health and Human Services pursuant to title XVIII, section 1847a of the federal Social
3.2Security Act.
3.3    (e) (f) The commissioner may negotiate lower reimbursement rates for specialty
3.4pharmacy products than the rates specified in paragraph (a). The commissioner may
3.5require individuals enrolled in the health care programs administered by the department
3.6to obtain specialty pharmacy products from providers with whom the commissioner has
3.7negotiated lower reimbursement rates. Specialty pharmacy products are defined as those
3.8used by a small number of recipients or recipients with complex and chronic diseases
3.9that require expensive and challenging drug regimens. Examples of these conditions
3.10include, but are not limited to: multiple sclerosis, HIV/AIDS, transplantation, hepatitis
3.11C, growth hormone deficiency, Crohn's Disease, rheumatoid arthritis, and certain forms
3.12of cancer. Specialty pharmaceutical products include injectable and infusion therapies,
3.13biotechnology drugs, high-cost therapies, and therapies that require complex care. The
3.14commissioner shall consult with the formulary committee to develop a list of specialty
3.15pharmacy products subject to this paragraph. In consulting with the formulary committee
3.16in developing this list, the commissioner shall take into consideration the population
3.17served by specialty pharmacy products, the current delivery system and standard of care in
3.18the state, and access to care issues. The commissioner shall have the discretion to adjust
3.19the reimbursement rate to prevent access to care issues.
3.20EFFECTIVE DATE.This section is effective upon implementation of changes to
3.21the federal upper reimbursement limit under title VI, chapter IV of the federal Deficit
3.22Reduction Act of 2005, United States Code, title 42, section 1396r-8(e)(5)."
3.23Page 83, after line 17 insert:

3.24    "Sec. 24. IMPLEMENTATION OF PHARMACY DISPENSING FEE
3.25INCREASE.
3.26    (a) The commissioner of human services shall fund the increase in the dispensing
3.27fee for multiple-source generic drugs under Minnesota Statutes, section 256B.0625,
3.28subdivision 13e, paragraph (a), using reductions in program costs for ingredient
3.29reimbursement resulting from changes to the federal upper reimbursement limit under title
3.30VI, chapter IV of the federal Deficit Reduction Act of 2005, United States Code, title 42,
3.31section 1396r-8(e)(5), and related regulations. The commissioner, after consulting with
3.32the pharmacy payment reform advisory committee established under Laws of Minnesota
3.332006, chapter 282, article 16, section 15, shall proportionally increase or decrease the
3.34dispensing fee for multiple-source generic drugs under Minnesota Statutes, section
4.1256B.0625, subdivision 13e, paragraph (a), to reflect the actual amount of reductions in
4.2program cost for ingredient reimbursement savings obtained.
4.3    (b) The pharmacy payment reform advisory committee shall analyze the savings
4.4resulting from changes to the federal upper reimbursement limit, and shall recommend
4.5to the commissioner of human services and the legislature, by December 15, 2008, the
4.6level of the dispensing fee for multiple-source generic drugs that should apply beginning
4.7July 1, 2010.
4.8EFFECTIVE DATE.This section is effective upon implementation of changes to
4.9the federal upper reimbursement limit under title VI, chapter IV of the federal Deficit
4.10Reduction Act of 2005, United States Code, title 42, section 1396r-8(e)(5)."
4.11Renumber the sections in sequence and correct the internal references
4.12Amend the title accordingly