I 

111TH CONGRESS 

2D SESSION H. R. 5888 

To establish an America Rx program to establish fairer pricing for prescription drugs for individuals without access to prescription drugs at discounted prices. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 27, 2010 

Mr. MICHAUD (for himself, Ms. PINGREE of Maine, and Mr. GRIJALVA) introduced the following bill; which was referred to the Committee on Energy 

and Commerce 

A BILL 

To establish an America Rx program to establish fairer pricing for prescription drugs for individuals without access 

to prescription drugs at discounted prices. 

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; PURPOSE. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘America Rx Act of 2010’’. 

6 (b) PURPOSE.—The purpose of this Act is to estab7 lish an America Rx program that utilizes manufacturer 

8 rebates and pharmacy discounts to reduce prescription 


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1 drug prices to those residents who are without access to 

2 discounted prices for outpatient prescription drugs. 

3 SEC. 2. AMERICA RX PROGRAM. 

4 (a) ESTABLISHMENT.— 

5 (1) IN GENERAL.—Not later than 1 year after 

6 the date of the enactment of this Act, the Secretary 

7 of Health and Human Services shall establish a pro8 gram (in this section referred to as the ‘‘America Rx 

9 program’’) consistent with the provisions of this sec10 tion to provide qualified residents with access to dis11 counted prices for outpatient prescription drugs 

12 through rebate agreements that the Secretary has 

13 negotiated with prescription drug manufacturers. 

14 (2) OUTREACH.—The Secretary shall provide 

15 for— 

16 (A) outreach efforts to build public aware17 ness of the program and maximize enrollment 

18 of qualified residents; and 

19 (B) simplified eligibility procedures and 

20 uniform eligibility standards for qualified resi21 dents. 

22 (b) REBATE AGREEMENTS WITH MANUFACTUR23 ERS.— 

24 (1) IN GENERAL.—Under the America Rx pro25 gram the Secretary shall negotiate with manufacturVerDate Mar 15 2010 05:26 Jul 28, 2010 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H5888.IH H5888

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1 ers of outpatient prescription drugs rebate agree2 ments with respect to drugs offered under the pro3 gram to qualified residents. 

4 (2) MINIMUM AMOUNT OF REBATES.—In nego5 tiating the amount of such a rebate under paragraph 

6 (1), the Secretary shall take into consideration the 

7 amount of the rebate calculated under the Medicaid 

8 program, the average manufacturer price of pre9 scription drugs, and other information on prescrip10 tion drug prices and price discounts. The Secretary 

11 shall negotiate the amount of such rebates in a man12 ner so that the rebates on average are comparable 

13 to the average percentage rebate obtained in out14 patient prescription drugs provided under section 

15 1927(c) of the Social Security Act (42 U.S.C. 

16 1396r–8(c)). 

17 (3) DISCOUNTED PRICES.—The Secretary shall 

18 specify the method for computing and applying such 

19 discounts, including a method for computing and ap20 plying discounts on a uniform, average percentage 

21 basis. 

22 (4) PAYMENT.—Rebates under such agreements 

23 shall be payable to the Secretary according to a 

24 schedule (not less often than quarterly) negotiated 

25 with manufacturers and shall be paid, directly or 


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1 through States, to participating pharmacies that 

2 provide discounts to qualified residents. 

3 (5) INCENTIVE.—In order to induce manufac4 turers of outpatient prescription drugs to enter into 

5 such rebate agreements to carry out the purpose de6 scribed in section 1(b), the Secretary shall provide, 

7 in the case of a manufacturer that has not entered 

8 into such an agreement, for a denial of a deduction 

9 under chapter 1 of the Internal Revenue Code of 

10 1986 for the amount of expenses of the manufac11 turer for advertising and marketing of drugs of the 

12 manufacturer, other than expenses for free samples 

13 of drugs subject to section 503(b)(1) of the Federal 

14 Food Drug, and Cosmetic Act intended to be distrib15 uted to patients. 

16 (6) APPLICATION OF REBATES.—Amounts re17 ceived by the Secretary as rebates under this sub18 section shall be placed into an appropriate account 

19 in the Treasury and shall be available in advance of 

20 appropriations to the Secretary for the payment of 

21 discounts and other costs of participating phar22 macies in carrying out the America Rx program and 

23 for the payment of administrative costs in carrying 

24 out the program. Under the America Rx program, 

25 participating pharmacies shall be ensured reasonable 


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1 and timely payment of discounts they provide to 

2 qualified residents under the program. 

3 (c) ROLE OF STATES IN ADMINISTERING PRO4 GRAM.— 

5 (1) IN GENERAL.—Under the America Rx pro6 gram the Secretary may enter into appropriate ar7 rangements with States under which States provide 

8 for the administration of the program in return for 

9 payment of the reasonable administrative expenses 

10 associated with such administration. 

11 (2) ADMINISTRATIVE FUNCTIONS.—Such ad12 ministration functions may include— 

13 (A) determinations of eligibility of qualified 

14 residents; 

15 (B) arrangements with participating phar16 macies; and 

17 (C) such other functions as the Secretary 

18 determines appropriate. 

19 (3) CONTRACTUAL AUTHORITY.—In carrying 

20 out responsibilities under this section, the Secretary 

21 and States may enter into agreements with phar22 macy benefit managers and other third parties. 

23 (d) PROGRAM ELIGIBILITY.— 


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1 (1) QUALIFIED RESIDENT DEFINED.—For pur2 poses of this section, the term ‘‘qualified resident’’ 

3 means an individual who— 

4 (A) is a citizen or national of the United 

5 States or is lawfully present in the United 

6 States (as determined in accordance with sec7 tion 1411 of the Patient Protection and Afford8 able Care Act); and 

9 (B) as determined under regulations of the 

10 Secretary, is not covered under any public or 

11 private program that provides substantial bene12 fits (which may be discounted prices) towards 

13 the purchase of outpatient prescription drugs. 

14 (2) SCREENING.— 

15 (A) FOR OTHER GOVERNMENTAL PRO16 GRAMS.—Individuals who apply for benefits 

17 under the America Rx program shall be 

18 screened for eligibility under the Medicaid pro19 gram and other applicable Governmental health 

20 care programs and, if found eligible, shall be 

21 enrolled in such program or programs. 

22 (B) SCREENING BY HEALTH INSURANCE

23 EXCHANGES.—In the case of individuals enroll24 ing in a qualified health plan through a Health 

25 Insurance Exchange under title I of the Patient 


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1 Protection and Affordable Care Act, the Ex2 change shall provide (at the time of enrollment) 

3 for a screening of the individual to determine if 

4 the individual is a qualified resident for pur5 poses of the America Rx program. 

6 (3) RELATION TO OTHER COVERAGE.—In order 

7 not to discourage employers and health insurance 

8 issuers from providing comprehensive prescription 

9 drug coverage through a group health plan or health 

10 insurance coverage, no such employer or issuer may 

11 participate in a Health Insurance Exchange if the 

12 Secretary determines that the prescription drug ben13 efits under the plan or coverage have been reduced 

14 as a result of the America Rx program. 

15 (4) PROTECTION OF THE LOW INCOME.—Noth16 ing in this section shall be construed as reducing the 

17 prescription drug benefits available to low-income in18 dividuals, as well as senior citizens and the disabled, 

19 under the Medicare or Medicaid programs as a re20 sult of the implementation of the America Rx pro21 gram. 

22 (e) ARRANGEMENTS WITH PARTICIPATING PHAR23 MACIES.— 

24 (1) IN GENERAL.—Under the America Rx pro25 gram arrangements are made with pharmacies for 


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1 the provision of prescription drugs at discounted 

2 prices to qualified residents in a reasonably acces3 sible manner. Such arrangements shall provide 

4 that— 

5 (A) each participating pharmacy shall— 

6 (i) provide discounts on prices for out7 patient prescription drugs for qualified 

8 residents in return for prompt reimburse9 ment of the amount of such discounts and 

10 a reasonable dispensing fee; 

11 (ii) not charge qualified residents 

12 more (before such discounts) for outpatient 

13 prescription drugs than the amount that 

14 individuals who are not qualified residents 

15 are charged for such drugs; and 

16 (iii) report to the Secretary (or the 

17 Secretary’s designee) information regard18 ing the discounts provided and fees in19 curred; and 

20 (B) the program shall— 

21 (i) ensure the reasonable and timely 

22 payment to a participating retail pharmacy 

23 on a prompt basis (no less promptly than 

24 as provided under the Medicare program) 

25 for discounted prices provided to qualified 


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1 residents under the program and for rea2 sonable dispensing fees; and 

3 (ii) not impose any additional fees on 

4 such pharmacies in connection with partici5 pation in the program. 

6 (2) DISCOUNTED PRICES.—The amount of the 

7 discount provided to enrolled qualifying residents 

8 shall reflect the amount of rebates obtained, reduced 

9 by expenses relating to administrative costs of the 

10 Federal and State governments and of participating 

11 pharmacies. 

12 (f) DEFINITIONS.—For purposes of this section: 

13 (1) The term ‘‘Health Insurance Exchange’’ 

14 means such an Exchange as established and oper15 ated under part 3 of subtitle D of title I of the Pa16 tient Protection and Affordable Care Act. 

17 (2) The term ‘‘manufacturer’’ has the meaning 

18 given such term in section 1927(k)(5) of the Social 

19 Security Act (42 U.S.C. 1396r–8(k)(5)). 

20 (3) The term ‘‘Medicaid program’’ means a 

21 State program under title XIX of the Social Security 

22 Act, including such a program operating under a 

23 Statewide waiver under section 1115 of such Act. 

24 (4) The term ‘‘outpatient prescription drug’’ 

25 has the meaning given the term ‘‘covered outpatient 


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1 drug’’ in section 1927(k)(2) of the Social Security 

2 Act (42 U.S.C. 1396r–8(k)(2)). 

3 (5) The term ‘‘Secretary’’ means the Secretary 

4 of Health and Human Services. 

5 (6) The term ‘‘State’’ has the meaning given 

6 such term for purposes of title XIX of the Social Se7 curity Act. 

Æ 


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