I 

109TH CONGRESS 

2D SESSION H. R. 5166 

To amend title XVIII of the Social Security Act to improve payments made 

by prescription drug plans and MA–PD plans to pharmacies for covered 

part D drugs dispensed through such pharmacies. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 6, 2006 

Mr. WICKER (for himself, Mr. LOBIONDO, Mr. PICKERING, Mr. BONNER, Mr. 

BROWN of Ohio, Mr. PETERSON of Pennsylvania, Mrs. CUBIN, Mr. EVERETT, Mr. BACHUS, Mr. DAVIS of Kentucky, Mr. BOUSTANY, Mr. SODREL, 

Mr. CONAWAY, Mr. FORTENBERRY, Ms. HARRIS, Mr. WHITFIELD, Mr. 

BILIRAKIS, Mrs. EMERSON, Ms. PRYCE of Ohio, Mr. SCHWARZ of Michigan, Mr. FOLEY, Mr. LEACH, Mr. GERLACH, Mr. WALDEN of Oregon, 

Mrs. JO ANN DAVIS of Virginia, Mr. SHERWOOD, Mr. BOOZMAN, Mr. 

OSBORNE, Mr. DOOLITTLE, Mr. TIAHRT, Mr. BURGESS, Mr. AKIN, Mr. 

ADERHOLT, Mr. BLUNT, Mr. MCHENRY, Ms. FOXX, Mr. PENCE, Mr. 

BISHOP of Utah, Mr. GARRETT of New Jersey, Mr. HOEKSTRA, Mr. 

FITZPATRICK of Pennsylvania, Ms. KAPTUR, Mr. GUTKNECHT, Ms. 

WASSERMAN SCHULTZ, and Mr. VAN HOLLEN) introduced the following 

bill; which was referred to the Committee on Ways and Means, and in 

addition to the Committee on Energy and Commerce, for a period to be 

subsequently determined by the Speaker, in each case for consideration 

of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend title XVIII of the Social Security Act to improve 

payments made by prescription drug plans and MA– 

PD plans to pharmacies for covered part D drugs dispensed through such pharmacies. 


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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Independent Pharmacy 

5 Protection Act of 2006’’. 

6 SEC. 2. IMPROVING MEDICARE PRESCRIPTION DRUG PLAN 

7 PAYMENTS TO PHARMACIES. 

8 (a) IN GENERAL.—Section 1860D–12(b) of the So9 cial Security Act (42 U.S.C. 1395w–112(b)) is amended 

10 by adding at the end the following new paragraph: 

11 ‘‘(4) PAYMENTS TO PHARMACIES.— 

12 ‘‘(A) IN GENERAL.—Each contract entered 

13 into with a PDP sponsor under this section 

14 with respect to a prescription drug plan offered 

15 by such sponsor shall provide for the following: 

16 ‘‘(i) AVAILABILITY OF DIRECT DE17 POSIT PAYMENTS.—The option for any 

18 participating pharmacy to elect for the 

19 plan to make payments by direct deposits 

20 to the pharmacy for covered part D drugs 

21 dispensed through the pharmacy. 

22 ‘‘(ii) INCREASED DISPENSING FEE

23 FOR GENERIC DRUGS.—The payment of 

24 dispensing fees by the plan to each partici25 pating pharmacy for covered part D drugs 


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1 dispensed through the participating phar2 macy, in accordance with subparagraph 

3 (B). 

4 ‘‘(iii) PAYMENTS WITHIN 10 DAYS FOR

5 CERTAIN PHARMACIES.—In the case of a 

6 participating pharmacy that is not part of 

7 a chain of pharmacies that consists of 

8 more than three pharmacies at different lo9 cations, payment with respect to any non10 disputed claim (as defined in subparagraph 

11 (C)) for a covered part D drug dispensed 

12 through the pharmacy to be made by the 

13 plan to the pharmacy in full by a date that 

14 is not more than 10 days after the date on 

15 which the claim is received by the plan. 

16 ‘‘(B) PAYMENT OF DISPENSING FEES TO

17 ENCOURAGE USE OF GENERIC DRUGS.— 

18 ‘‘(i) IN GENERAL.—For purposes of 

19 subparagraph (A)(ii) and subject to clauses 

20 (ii) and (iii), with respect to a generic cov21 ered part D drug that is therapeutically 

22 equivalent and bioequivalent to a brand 

23 name drug that is a covered part D drug 

24 dispensed through a participating phar25 macy, the amount of the dispensing fee 


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•HR 5166 IH 

1 paid to the pharmacy for the generic cov2 ered part D drug shall be an amount that 

3 is at least 50 percent greater than the 

4 amount of the dispensing fee for the brand 

5 name drug. 

6 ‘‘(ii) CAP ON AMOUNT OF DISPENSING

7 FEES FOR GENERIC DRUGS.—For purposes 

8 of subclause (i), the amount of the dis9 pensing fee paid to a participating phar10 macy for a generic covered part D drug 

11 shall not be more than $10. 

12 ‘‘(iii) SAFE HARBOR FOR BRAND

13 NAME DRUG DISPENSING FEE AMOUNTS.— 

14 ‘‘(I) IN GENERAL.—For purposes 

15 of clause (i) and subject to subclause 

16 (II), a prescription drug plan under 

17 this section shall not decrease the 

18 amount of the dispensing fee paid by 

19 the plan to a participating pharmacy 

20 for a brand name drug described in 

21 such clause to an amount that is less 

22 than the amount of the dispensing fee 

23 paid by such plan to such pharmacy 

24 for such drug on the date of the enVerDate Aug 31 2005 22:31 Apr 13, 2006 Jkt 049200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H5166.IH H5166

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1 actment of the ‘Independent Phar2 macy Protection Act of 2006’. 

3 ‘‘(II) EXCEPTION.—The Sec4 retary may waive the prohibition 

5 under subclause (I) with respect to a 

6 dispensing fee paid by a prescription 

7 drug plan for a brand name drug, as 

8 the Secretary determines appropriate. 

9 ‘‘(C) NON-DISPUTED CLAIM DEFINED.— 

10 For purposes of subparagraph (A)(iii), a ‘non11 disputed claim’ means a claim that has no de12 fect or impropriety or particular circumstance 

13 requiring special treatment that prevents timely 

14 payment from being made under this part.’’. 

15 (b) APPLICATION TO MA–PD PLANS.—Section 

16 1857(e) of such Act (42 U.S.C. 1395w–27(e)) is amended 

17 by adding at the end the following new paragraph: 

18 ‘‘(4) INCORPORATION OF PRESCRIPTION DRUG

19 PLAN CONTRACT REQUIREMENTS FOR PHARMACY

20 PAYMENTS.—The provisions of section 1860D– 

21 12(b)(4) shall apply to contracts with a Medicare 

22 Advantage organization in the same manner as they 

23 apply to contracts with a PDP sponsor offering a 

24 prescription drug plan under part D.’’. 


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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this Act shall apply to plan years beginning on or after 

3 the date of the enactment of this Act. 

Æ 


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