I 

109TH CONGRESS 

1ST SESSION H. R. 2200

To amend part D of title XVIII of the Social Security Act to provide 

to the Secretary of Health and Human Services authority similar to 

the authority of the Secretary of Veterans Affairs to negotiate the lowest 

possible prices for outpatient prescription drugs, to include in the determination of best price for covered outpatient drugs under the Medicaid 

Program prices charged by manufacturers to certain Federal agencies, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 5, 2005

Mr. RUPPERSBERGER introduced the following bill; which was referred to the 

Committee on Energy and Commerce, and in addition to the Committee 

on Ways and Means, 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 part D of title XVIII of the Social Security 

Act to provide to the Secretary of Health and Human 

Services authority similar to the authority of the Secretary of Veterans Affairs to negotiate the lowest possible 

prices for outpatient prescription drugs, to include in 

the determination of best price for covered outpatient 

drugs under the Medicaid Program prices charged by 

manufacturers to certain Federal agencies, and for other 

purposes.
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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 ‘‘Prescription Drug 

5 Price Fairness Act’’. 

6 SEC. 2. NEGOTIATION OF LOWEST POSSIBLE PRICES FOR 

7 PRESCRIPTION DRUGS UNDER MEDICARE. 

8 Section 1860D–11 of the Social Security Act (42 

9 U.S.C. 1395w–111) is amended by striking subsection (i) 

10 (relating to noninterference) and by inserting the fol11 lowing: 

12 ‘‘(i) REQUIREMENT TO NEGOTIATE FOR LOWEST

13 PRICES.—In order to ensure that beneficiaries enrolled 

14 under prescription drug plans and MA–PD plans pay the 

15 lowest possible price for covered part D drugs, the Sec16 retary shall have and exercise authority similar to that of 

17 the Secretary of Veterans Affairs to purchase prescription 

18 drugs in bulk and to negotiate contracts with manufactur19 ers of covered part D drugs, consistent with the require20 ments and in furtherance of the goals of providing quality 

21 care and containing costs under this part. In exercising 

22 such authority, the Secretary shall negotiate the best pos23 sible prices for such drugs.’’. 
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1 SEC. 3. INCLUSION OF PRICES CHARGED FOR COVERED 

2 OUTPATIENT DRUGS TO CERTAIN FEDERAL 

3 AGENCIES IN THE DETERMINATION OF BEST 

4 PRICE FOR SUCH DRUGS UNDER THE MED5 ICAID PROGRAM. 

6 (a) IN GENERAL.—Clause (i) of section 

7 1927(c)(1)(C) of the Social Security Act (42 U.S.C. 

8 1396r–8(c)(1)(C)) is amended by striking ‘‘, excluding—

9 ’’ and all that follows and inserting a period. 

10 (b) CONFORMING AMENDMENTS.—(1) Such section 

11 is further amended by striking clause (iii). 

12 (2) Section 1847A(c)(2) of the Social Security Act 

13 (42 U.S.C. 1395w–3a(c)(2)) is amended by striking sub14 paragraph (A) and redesignating the succeeding provision 

15 accordingly. 

16 (3) Section 1860D–2(d)(1) of such Act (42 U.S.C. 

17 1395w–102(d)(1)) is amended by striking subparagraph 

18 (C). 

19 (4) Section 1860D–31(e)(1) of such Act (42 U.S.C. 

20 1395w–131(e)(1)) is amended by striking subparagraph 

21 (D). 

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

23 this section shall apply with respect to payments for cov24 ered outpatient drugs furnished on or after January 1, 

25 2006. 
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1 SEC. 4. CLARIFICATION OF AUTHORITY FOR STATES TO NE2 GOTIATE TOGETHER TO ACHIEVE GREATER 

3 DISCOUNTS FROM MANUFACTURERS OF COV4 ERED OUTPATIENT DRUGS. 

5 Section 1927(a) of the Social Security Act (42 U.S.C. 

6 1396r–8(a)) is amended by adding at the end the fol7 lowing new paragraph: 

8 ‘‘(7) AUTHORITY FOR STATES TO FORM POOLS

9 TO NEGOTIATE PRICE CONCESSIONS.—In entering 

10 into agreements with manufacturers under this sec11 tion, States may form pools to negotiate price con12 cessions from the manufacturers for covered out13 patients drugs.’’.

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