I 

115TH CONGRESS 

2D SESSION H. R. 5808 

To amend title XIX of the Social Security Act to require States to operate 

drug management programs for at-risk beneficiaries, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 15, 2018 

Mr. BILIRAKIS (for himself and Mr. BEN RAY LUJA ́N of New Mexico) introduced the following bill; which was referred to the Committee on Energy 

and Commerce 

A BILL 

To amend title XIX of the Social Security Act to require 

States to operate drug management programs for atrisk beneficiaries, and for other purposes. 

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 ‘‘Medicaid Pharma5 ceutical Home Act of 2018’’. 


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1 SEC. 2. DRUG MANAGEMENT PROGRAM FOR AT-RISK BENE2 FICIARIES. 

3 (a) IN GENERAL.—Title XIX of the Social Security 

4 Act is amended by inserting after section 1927 (42 U.S.C. 

5 1396r–8) the following new section: 

6 ‘‘SEC. 1927A. DRUG MANAGEMENT PROGRAM FOR AT-RISK 

7 BENEFICIARIES. 

8 ‘‘(a) IN GENERAL.—Beginning January 1, 2020, a 

9 State shall operate a qualified drug management program 

10 under which a State may enroll certain at-risk bene11 ficiaries identified by the State under the program. 

12 ‘‘(b) QUALIFIED DRUG MANAGEMENT PROGRAM.— 

13 For purposes of this section, the term ‘qualified drug man14 agement program’ means, with respect to a State, a pro15 gram carried out by the State (including through a con16 tract with a pharmacy benefit manager) that provides at 

17 least for the following: 

18 ‘‘(1) IDENTIFICATION OF AT-RISK INDIVID19 UALS.—Under the program, the State identifies, in 

20 accordance with subsection (c), individuals enrolled 

21 under the State plan (or waiver of the State plan) 

22 who are at-risk beneficiaries. 

23 ‘‘(2) ELEMENTS OF PROGRAM.— 

24 ‘‘(A) IN GENERAL.—Under the program, 

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1 fied under paragraph (1) and enrolled under 

2 the program under paragraph (5)— 

3 ‘‘(i) subject to subparagraphs (B) and 

4 (C), selects at least one, but not more than 

5 three, health care providers and at least 

6 one, but not more than three, pharmacies 

7 for each such individual for purposes of 

8 clause (ii), in accordance with a selection 

9 process that takes into account reasonable 

10 factors such as the individual’s previous 

11 utilization of items and services from 

12 health care providers and pharmacies, geo13 graphic proximity of the individual to such 

14 health care providers and pharmacies, ac15 cess of the individual to health care, rea16 sonable travel time, information regarding 

17 housing status, and any known preference 

18 of the individual for a certain health care 

19 provider or pharmacy; and 

20 ‘‘(ii) requires that any controlled sub21 stance furnished to such individual during 

22 the period for which such individual is en23 rolled under the program be prescribed by 

24 a health care provider selected under 

25 clause (i) for such individual and dispensed 


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1 by a pharmacy selected under clause (i) for 

2 such individual in order for such controlled 

3 substance to be covered under the State 

4 plan (or waiver). 

5 ‘‘(B) BENEFICIARY PREFERENCE.—In the 

6 case of an individual receiving a notice under 

7 paragraph (3)(A) of being identified as poten8 tially being an at-risk beneficiary described in 

9 such paragraph, such individual may submit, 

10 during the 30-day period following receipt of 

11 such notice, preferences for which health care 

12 providers and pharmacies the individual would 

13 prefer the State to select under subparagraph 

14 (A). The State shall select or change the selec15 tion of health care providers and pharmacies 

16 under subparagraph (A) for the individuals 

17 based on such preferences, except that in the 

18 case that State determines that such selection 

19 (or change of selection) of a health care pro20 vider or pharmacy under subparagraph (A) is 

21 contributing or would contribute to prescription 

22 drug abuse or drug diversion by the individual, 

23 the State may select or change the selection of 

24 health care provider or pharmacy for the indi25 vidual without regard to the preferences of the 


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1 individual described in this subparagraph. If the 

2 State selects or changes the selection pursuant 

3 to the preceding sentence without regard to the 

4 preferences of the individual, the State shall 

5 provide the individual with at least 30 days 

6 written notice of the selection or change of se7 lection and a rationale for the selection or 

8 change. 

9 ‘‘(C) TREATMENT OF PHARMACY WITH

10 MULTIPLE LOCATIONS.—For purposes of sub11 paragraph (A)(i), in the case of a pharmacy 

12 that has multiple locations that share real-time 

13 electronic prescription data and the same chain 

14 identification number, all such locations of the 

15 pharmacy shall collectively be treated as one 

16 pharmacy. 

17 ‘‘(D) TREATMENT OF EXISTING FFS DRUG

18 MANAGEMENT PROGRAMS.—In the case of a pa19 tient review and restriction program (as identi20 fied in the annual report submitted to the Sec21 retary under section 1927(g)(3)(D)) operated 

22 by a State pursuant to section 1915(a)(2) be23 fore the date of the enactment of this section, 

24 such program shall be treated as a qualified 

25 drug management program. 


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1 ‘‘(E) REASONABLE ACCESS.—The program 

2 shall ensure, including through waiver of ele3 ments of the program (including under sub4 paragraph (A)(ii)), reasonable access to health 

5 care (including access to health care providers 

6 and pharmacies with respect to prescription 

7 drugs described in subparagraph (A)) in the 

8 case of individuals with multiple residences, in 

9 the case of natural disasters and similar situa10 tions, and in the case of the provision of emer11 gency services (as defined for purposes of sec12 tion 1860D–4(c)(5)(D)(ii)(II)). 

13 ‘‘(3) NOTIFICATION TO IDENTIFIED INDIVID14 UALS.—Under the program, the State provides each 

15 individual who is identified under paragraph (1), 

16 prior to enrolling such individual under the program, 

17 at least one notification of each of the following: 

18 ‘‘(A) Notice that the State has identified 

19 the individual as potentially being an at-risk 

20 beneficiary for abuse or misuse of a controlled 

21 substance. 

22 ‘‘(B) The name, address, and contact in23 formation of each health care provider and 

24 pharmacy that may be selected for the indi25 vidual under paragraph (2)(A). 


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1 ‘‘(C) Information describing all State and 

2 Federal public health resources that are de3 signed to address such abuse or misuse to 

4 which the individual has access, including men5 tal health services and other counseling serv6 ices. 

7 ‘‘(D) Notice of, and information about, the 

8 right of the individual to— 

9 ‘‘(i) submit preferences of the indi10 vidual for health care providers and phar11 macies to be selected under paragraph 

12 (2)(A), including as described in paragraph 

13 (2)(B); 

14 ‘‘(ii) appeal under paragraph (4)— 

15 ‘‘(I) such identification described 

16 in subparagraph (A); and 

17 ‘‘(II) the selection of health care 

18 providers and pharmacies under para19 graph (2)(A). 

20 ‘‘(E) An explanation of the meaning and 

21 consequences of the identification of the indi22 vidual as potentially being an at-risk beneficiary 

23 for abuse or misuse of a controlled substance, 

24 including an explanation of the program. 


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1 ‘‘(F) Information, including a contact list 

2 and clear instructions, that explain how the in3 dividual can contact the appropriate entities ad4 ministering the program in order to submit 

5 preferences described in paragraph (2)(B) and 

6 any other communications relating to the pro7 gram. 

8 ‘‘(4) APPEALS PROCESS.—Under the program, 

9 the State provides for an appeals process under 

10 which, with respect to an individual identified under 

11 paragraph (1)— 

12 ‘‘(A) such individual may appeal— 

13 ‘‘(i) such identification; and 

14 ‘‘(ii) the selection of a health care pro15 vider or pharmacy under paragraph (2)(A); 

16 ‘‘(B) in the case of an appeal described in 

17 subparagraph (A)(ii), the State shall accommo18 date the health care provider or pharmacy pre19 ferred by the individual for selection for pur20 poses of paragraph (2)(A), unless the State de21 termines that a change to the selection of 

22 health care provider or pharmacy under such 

23 paragraph is contributing or would contribute 

24 to prescription drug abuse or drug diversion by 

25 the individual; 


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1 ‘‘(C) such individual is provided a period of 

2 not less than 30 days following the date of re3 ceipt of the notice described in paragraph (3) to 

4 submit such appeal; and 

5 ‘‘(D) the State must make a determination 

6 with respect to an appeal described in subpara7 graph (A), and notify the individual of such de8 termination, prior to enrollment of such indi9 vidual in the program. 

10 ‘‘(5) ENROLLMENT.—Under the program, the 

11 State initially enrolls individuals who are identified 

12 under paragraph (1) in the program for a 12-month 

13 period— 

14 ‘‘(A) in the case of such an individual who 

15 does not submit an appeal under paragraph (4) 

16 within the period applied by the State pursuant 

17 to subparagraph (C) of such paragraph, begin18 ning on the day after the last day of such pe19 riod; and 

20 ‘‘(B) in the case of such an individual who 

21 does submit an appeal under paragraph (4) 

22 within the period applied by the State pursuant 

23 to subparagraph (C) of such paragraph but 

24 such appeal is denied, beginning not later than 

25 30 days after the date of such denial. 


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1 ‘‘(6) NOTIFICATION OF HEALTH CARE PRO2 VIDERS AND PHARMACIES.—Under the program, the 

3 State provides to each health care provider and 

4 pharmacy selected for an individual under paragraph 

5 (2)— 

6 ‘‘(A) notification that the individual is an 

7 at-risk beneficiary enrolled under the program 

8 and that the provider or pharmacy has been se9 lected for the individual under paragraph (2); 

10 ‘‘(B) information on such program and the 

11 role of being so selected; and 

12 ‘‘(C) a process through which the provider 

13 or pharmacy can submit a concern or complaint 

14 with respect to being so selected and refuse to 

15 be a provider or pharmacy so selected. 

16 ‘‘(7) CONTINUATION OF ENROLLMENT.—Under 

17 the program, the State, with respect to an individual 

18 enrolled under the program, provides for a process 

19 to— 

20 ‘‘(A) not later than 30 days before the end 

21 of the 12-month period for which the individual 

22 is so enrolled pursuant to paragraph (5)— 

23 ‘‘(i) assess, in accordance with pub24 licly available evidence-based guidelines, 

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1 tinue to be enrolled under the program; 

2 and 

3 ‘‘(ii) notify such individual of the re4 sults of the assessment under clause (i); 

5 ‘‘(B) continue, subject to subparagraph 

6 (C), enrollment of such individual if such as7 sessment recommends such continuation; and 

8 ‘‘(C) appeal the continuation of enrollment 

9 in accordance with the appeals process de10 scribed in paragraph (4). 

11 ‘‘(c) AT-RISK BENEFICIARY.— 

12 ‘‘(1) IDENTIFICATION.—For purposes of this 

13 section, a State shall identify an individual enrolled 

14 under the State plan (or waiver of the State plan) 

15 as an at-risk beneficiary if the individual is not an 

16 exempted individual described in paragraph (2) 

17 and— 

18 ‘‘(A) is identified as such an at-risk bene19 ficiary through the use of publicly available evi20 dence-based guidelines that indicate misuse or 

21 abuse of a controlled substance; or 

22 ‘‘(B) the State received notification from a 

23 PDP sponsor or Medicare Advantage organiza24 tion that such individual was identified as being 

25 an at-risk beneficiary for prescription drug 


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1 abuse for enrollment in a drug management 

2 program established by the sponsor or organiza3 tion pursuant to section 1860D–4(c)(5) and 

4 such identification has not been terminated 

5 under subparagraph (F) of such section. 

6 ‘‘(2) EXEMPTED INDIVIDUAL DESCRIBED.—For 

7 purposes of paragraph (1), an exempted individual 

8 described in this paragraph is an individual who— 

9 ‘‘(A) is receiving— 

10 ‘‘(i) hospice or palliative care; or 

11 ‘‘(ii) treatment for cancer; 

12 ‘‘(B) is a resident of a long-term care facil13 ity, of a facility described in section 1905(d), or 

14 of another facility for which frequently abused 

15 drugs are dispensed for residents through a 

16 contract with a single pharmacy; or 

17 ‘‘(C) the State elects to treat as an ex18 empted individual for purposes of paragraph 

19 (1). 

20 ‘‘(d) APPLICATION OF PRIVACY RULES CLARIFICA21 TION.—The Secretary shall clarify privacy requirements, 

22 including requirements under the regulations promulgated 

23 pursuant to section 264(c) of the Health Insurance Port24 ability and Accountability Act of 1996 (42 U.S.C. 1320d– 

25 2 note), related to the sharing of data under subsection 


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1 (b)(6) in the same manner as the Secretary is required 

2 under subparagraph (J) of section 1860D–4(c)(5) to clar3 ify privacy requirements related to the sharing of data de4 scribed in such subparagraph. 

5 ‘‘(e) REPORTS.— 

6 ‘‘(1) ANNUAL REPORTS.—A State operating a 

7 qualified drug management program shall include in 

8 the annual report submitted to the Secretary under 

9 section 1927(g)(3)(D), beginning with such reports 

10 submitted for 2021, the following information: 

11 ‘‘(A) The number of individuals enrolled 

12 under the State plan (or waiver of the State 

13 plan) who are enrolled under the program and 

14 the percentage of individuals enrolled under the 

15 State plan (or waiver) who are enrolled under 

16 such program. 

17 ‘‘(B) The number of prescriptions for con18 trolled substances that were dispensed per 

19 month during each such year per individual en20 rolled under the program, including the dosage 

21 and pill count for each such prescription. 

22 ‘‘(C) The number of pharmacies filling pre23 scriptions for controlled substances for individ24 uals enrolled under such program. 


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1 ‘‘(D) The number of health care providers 

2 writing prescriptions for controlled substances 

3 (other than prescriptions for a refill) for indi4 viduals enrolled under such program. 

5 ‘‘(E) Any other data that the Secretary 

6 may require. 

7 ‘‘(F) Any report submitted by a managed 

8 care entity under subsection (e)(2) with respect 

9 to years. 

10 For each such report for a year after 2021, the in11 formation described in this paragraph shall be pro12 vided in a manner that compares such information 

13 with respect to the prior calendar year to such infor14 mation with respect to the second prior calendar 

15 year. 

16 ‘‘(2) MACPAC REPORTS AND REVIEW.—Not 

17 later than two years after the date of the enactment 

18 of this section, the Medicaid and CHIP Payment 

19 and Access Commission (in this section referred to 

20 as ‘MACPAC’), in consultation with the National 

21 Association of Medicaid Directors, pharmacy benefit 

22 managers, managed care organizations, health care 

23 providers (including pharmacists), beneficiary advo24 cates, and other stakeholders, shall publish a report 

25 that includes— 


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1 ‘‘(A) best practices for operating drug 

2 management programs, based on a review of a 

3 representative sample of States administering 

4 such a program; 

5 ‘‘(B) a summary of the experience of the 

6 appeals process under drug management pro7 grams operated by several States, such as the 

8 frequency at which individuals appealed the 

9 identification of being an at-risk individual, the 

10 frequency at which individuals appealed the se11 lection of a health care provider or pharmacy 

12 under such a program, the timeframes for such 

13 appeals, a summary of the reasons for such ap14 peals, and the design of such appeals processes; 

15 ‘‘(C) a summary of trends and the effec16 tiveness of qualified drug management pro17 grams operated under this section; and 

18 ‘‘(D) recommendations to States on how 

19 improvements can be made with respect to the 

20 operation of such programs. 

21 In reporting on State practices, the MACPAC shall 

22 consider how such programs have been implemented 

23 in rural areas, under fee-for-service as well as man24 aged care arrangements, and the extent to which 

25 such programs have resulted in increased efficiencies 


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1 to such States or to the Federal Government under 

2 this title. 

3 ‘‘(3) REPORT ON PLAN FOR COORDINATED

4 CARE.—Not later than January 1, 2021, each State 

5 operating a qualified drug management program 

6 shall submit to the Administrator of the Centers for 

7 Medicare & Medicaid Services a report on how such 

8 State plans to provide coordinated care for individ9 uals enrolled under the State plan (or waiver of the 

10 State plan) and— 

11 ‘‘(A) who are enrolled under the program; 

12 or 

13 ‘‘(B) who are enrolled with a managed care 

14 entity and enrolled under such a qualified drug 

15 management program operated by such entity. 

16 ‘‘(f) APPLICABILITY TO MANAGED CARE ENTI17 TIES.— 

18 ‘‘(1) IN GENERAL.—With respect to any con19 tract that a State enters into on or after January 

20 1, 2020, with a managed care entity (as defined in 

21 section 1932(a)(1)(B)) pursuant to section 1903(m), 

22 the State shall, as a condition of the contract, re23 quire the managed care entity— 

24 ‘‘(A) to operate a qualified drug manage25 ment program (as defined in subsection (b)) for 


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1 at-risk beneficiaries who are enrolled with such 

2 entity and identified by the managed care entity 

3 by means of application of paragraph (2); 

4 ‘‘(B) to submit to the State an annual re5 port on the matters described in subparagraphs 

6 (A) through (E) of subsection (e)(1); and 

7 ‘‘(C) to submit to the State a list (and as 

8 necessary update such list) of individuals en9 rolled with such entity under the qualified drug 

10 management program operated by such entity 

11 under subparagraph (A) for purposes of allow12 ing State plans for which medical assistance is 

13 paid on a fee-for-service basis to have access to 

14 such information. 

15 ‘‘(2) APPLICATION.—For purposes of applying, 

16 with respect to a managed care entity— 

17 ‘‘(A) under paragraph (1)(A)— 

18 ‘‘(i) the definition of the term ‘quali19 fied drug management program’ under 

20 subsection (b), other than paragraph 

21 (2)(D) of such subsection; and 

22 ‘‘(ii) the provisions of paragraphs (1) 

23 and (2) of subsection (c); and 


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1 ‘‘(B) under paragraph (1)(B), the report 

2 requirements described in subparagraphs (A) 

3 through (E) of subsection (e)(1); 

4 each reference in such subsection (b) and para5 graphs of subsection (c) to ‘a State’ or ‘the State’ 

6 (other than to ‘a State plan’ or ‘the State plan’) 

7 shall be deemed a reference to the managed care en8 tity, each reference under such subsection, para9 graphs, or subparagraphs to individuals enrolled 

10 under the State plan (or waiver of the State plan) 

11 shall be deemed a reference to individuals enrolled 

12 with such entity, and each reference under such sub13 section, paragraphs, or subparagraphs to individuals 

14 enrolled under the qualified drug management pro15 gram operated by the State shall be deemed a ref16 erence to individuals enrolled under the qualified 

17 drug management program operated by the man18 aged care entity. 

19 ‘‘(g) CONTROLLED SUBSTANCE DEFINED.—For pur20 poses of this section, the term ‘controlled substance’ 

21 means a drug that is included in schedule II, III, or IV 

22 of section 202(c) of the Controlled Substances Act, or any 

23 combination thereof, as specified by the State.’’. 

24 (b) GUIDANCE ON AT-RISK POPULATION

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1 AGED CARE.—Not later than October 1, 2019, the Sec2 retary of Health and Human Services shall issue guidance 

3 for State Medicaid programs, with respect to individuals 

4 who are enrolled under a State plan (or waiver of such 

5 plan) under title XIX of the Social Security Act and under 

6 a drug management program, for purposes of providing 

7 best practices— 

8 (1) for transitioning, as applicable, such indi9 viduals from fee-for-service Medicaid (and such a 

10 program operated by the State) to receiving medical 

11 assistance under such title through a managed care 

12 entity (as defined in section 1932(a)(1)(B) of the 

13 Social Security Act) with a contract that with the 

14 State pursuant to section 1903(m) of such Act (and 

15 such a program operated by such entity); and 

16 (2) for transitioning, as applicable, such indi17 viduals from receiving medical assistance under such 

18 title through a managed care entity (as defined in 

19 section 1932(a)(1)(B) of the Social Security Act) 

20 with a contract that with the State pursuant to sec21 tion 1903(m) of such Act (and such a program oper22 ated by such entity) to fee-for-service Medicaid (and 

23 such a program operated by the State). 

24 (c) GUIDANCE ON AT-RISK POPULATION

25 TRANSITIONING TO MEDICARE.— 


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1 (1) IN GENERAL.—Not later than January 1, 

2 2020, the Secretary of Health and Human Services, 

3 after consultation with the Federal Coordinated 

4 Health Care Office established under section 2602 

5 of the Patient Protection and Affordable Care Act 

6 (42 U.S.C. 1315b), shall issue guidance for State 

7 Medicaid programs, with respect to transitioning in8 dividuals, providing for— 

9 (A) notification to be submitted by the 

10 State to the Centers for Medicare & Medicaid 

11 Services and such individuals of the status of 

12 such individuals as transitioning individuals; 

13 (B) notification to such individuals about 

14 enrollment under a prescription drug plan 

15 under part D of such title or under a MA–PD 

16 plan under part C of such title; 

17 (C) best practices for transitioning such in18 dividuals to such a plan; and 

19 (D) best practices for coordination between 

20 the qualified drug management program (as de21 scribed in section 1927A(b) of the Social Secu22 rity Act, as added by subsection (a)) carried out 

23 by the State and a drug management program 

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1 tion 1860D–4(c)(5) of the Social Security Act 

2 (42 U.S.C. 1395w–10(c)(5)). 

3 (2) TRANSITIONING INDIVIDUALS.—For pur4 poses of paragraph (1), a transitioning individual is 

5 an individual who, with respect to a month— 

6 (A) is enrolled under the State plan (or 

7 waiver of the State plan) and under the quali8 fied drug management program (as described in 

9 section 1927A(b) of the Social Security Act, as 

10 added by subsection (a)) carried out by the 

11 State; and 

12 (B) is expected to become eligible for the 

13 Medicare program under title XVIII of such 

14 Act during the subsequent 12-month period. 

Æ 


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