I

107TH CONGRESS

1ST SESSION H. R. 1387

To amend the Social Security Act to improve access to prescription drugs

for low-income Medicare beneficiaries, the Internal Revenue Code and

other Acts to improve access to health care coverage for seniors, the

self-employed, and children, and to amend the Federal Food, Drug,

and Cosmetic Act to improve meaningful access to reasonably priced

prescription drugs.

IN THE HOUSE OF REPRESENTATIVES

APRIL 4, 2001

Mr. GANSKE (for himself, Mrs. EMERSON, Mr. FRANK, Mr. WYNN, Mr.

HORN, Mr. GILCHREST, Mr. TRAFICANT, Mr. LEACH, Mr. JONES of

North Carolina, Mr. JOHNSON of Illinois, Mr. SANDERS, Mr. GUTKNECHT, and Mr. TERRY) 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 the Social Security Act to improve access to prescription drugs for low-income Medicare beneficiaries, the

Internal Revenue Code and other Acts to improve access

to health care coverage for seniors, the self-employed,

and children, and to amend the Federal Food, Drug,

and Cosmetic Act to improve meaningful access to reasonably priced prescription drugs.
2

•HR 1387 IH

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; TABLE OF CONTENTS.

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

5 ‘‘Drug Availability and Health Care Access Improvement

6 Act of 2001’’.

7 (b) TABLE OF CONTENTS.—The table of contents of

8 this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I—MEDICAID PRESCRIPTION DRUG COVERAGE FOR LOWINCOME MEDICARE BENEFICIARIES

Sec. 101. Medicaid prescription drug coverage for low-income medicare beneficiaries.

TITLE II—IMPROVED ACCESS OF MEDICARE BENEFICIARIES TO

MEDICARE+CHOICE PLANS

Sec. 201. Improved access to Medicare+Choice plans through an increase in

the minimum Medicare+Choice capitation rate.

TITLE III—IMPROVED ACCESS TO REASONABLY PRICED

PRESCRIPTION DRUGS

Sec. 301. Amendments to program for importation of certain prescription drugs

by pharmacists and wholesalers.

9 TITLE I—MEDICAID PRESCRIP10 TION DRUG COVERAGE FOR

11 LOW-INCOME MEDICARE

12 BENEFICIARIES

13 SEC. 101. MEDICAID PRESCRIPTION DRUG COVERAGE FOR

14 LOW-INCOME MEDICARE BENEFICIARIES.

15 (a) IN GENERAL.—Section 1902(a)(10) of the Social

16 Security Act (42 U.S.C. 1396a(a)(10)) is amended—
3

•HR 1387 IH

1 (1) by striking ‘‘and’’ at the end of subpara2 graph (F);

3 (2) by adding ‘‘and’’ at the end of subpara4 graph (G); and

5 (3) by inserting after subparagraph (G) the fol6 lowing new subparagraph:

7 ‘‘(H) for making medical assistance avail8 able for prescribed drugs (in the same amount,

9 duration, and scope as for individuals described

10 in subparagraph (A)) for qualified medicare

11 beneficiaries described in section 1905(p)(1)

12 and for individuals who would be such qualified

13 medicare beneficiaries but for the fact that

14 their income exceeds the income level estab15 lished by the State under section 1905(p)(2)

16 but is less than 175 percent of the official pov17 erty line (referred to in such section) for a fam18 ily of the size involved;’’.

19 (b) 100 PERCENT FEDERAL FINANCING OF ADDI20 TIONAL COSTS.—Section 1903(a) of such Act (42 U.S.C.

21 1396b(a)) is amended—

22 (1) by redesignating paragraph (7) as para23 graph (8); and

24 (2) by adding after paragraph (6) the following

25 new paragraph:
4

•HR 1387 IH

1 ‘‘(7) an amount equal to 100 percent of

2 amounts as expended as medical assistance for pre3 scribed drugs described in section 1902(a)(10)(H) to

4 individuals who are eligible for such assistance only

5 on the basis of such section; and’’.

6 (c) PERMITTING CHARGING OF SLIDING SCALE PRE7 MIUMS FOR QUALIFYING INDIVIDUALS WITH INCOMES

8 ABOVE 135 PERCENT OF POVERTY LINE.—Section 1916

9 of such Act Social Security Act is amended—

10 (1) in subsection (b), by striking ‘‘or (E)’’ and

11 inserting ‘‘, (E), or (H)’’; and

12 (2) in subsection (d)—

13 (A) by inserting ‘‘(1)’’ after ‘‘(d)’’, and

14 (B) by adding at the end the following new

15 paragraph:

16 ‘‘(2)(A) With respect to an individual described in

17 section 1902(a)(10)(H) whose income (as determined

18 under section 1905(p)(1)(B)) exceeds 135 percent of the

19 official poverty line referred to in that section, the State

20 plan of a State shall provide for the charging of a premium

21 (expressed as a percentage of the average actuarial cost

22 of the benefits described in section 1902(a)(10)(H) pro23 vided with respect to individuals described in such section)

24 according to a sliding scale under which such percentage

25 increases from 0 percent to 100 percent, in reasonable in-
5

•HR 1387 IH

1 crements (as determined by the Secretary), as the individ2 ual’s income increases from 135 percent of such poverty

3 line to 175 percent of such poverty line.

4 ‘‘(B) A State shall not require prepayment of a pre5 mium imposed pursuant to subparagraph (A) and shall

6 not terminate eligibility of an individual for medical assist7 ance under this title on the basis of failure to pay any

8 such premium until such failure continues for a period of

9 not less than 60 days. The State may waive payment of

10 any such premium in any case where the State determines

11 that requiring such payment would create an undue hard12 ship.

13 ‘‘(C) A State may permit State or local funds avail14 able under other programs to be used for payment of a

15 premium imposed under subparagraph (A). Payment of

16 a premium with such funds shall not be counted as income

17 to the individual with respect to whom such payment is

18 made.’’.

19 (d) EFFECTIVE DATE.—The amendments made by

20 this section take effect on the first day of the first year

21 that begins more than 6 months after the date of the en22 actment of this Act.
6

•HR 1387 IH

1 TITLE II—IMPROVED ACCESS OF

2 MEDICARE BENEFICIARIES

3 TO MEDICARE+CHOICE

4 PLANS

5 SEC. 201. IMPROVED ACCESS TO MEDICARE+CHOICE PLANS

6 THROUGH AN INCREASE IN THE MINIMUM

7 MEDICARE+CHOICE CAPITATION RATE.

8 (a) IN GENERAL.—Section 1853(c)(1)(B) of the So9 cial Security Act (42 U.S.C. 1395w–23(c)(1)(B)), as

10 amended by section 601(a) of Medicare, Medicaid, and

11 SCHIP Benefits Improvement and Protection Act of 2000

12 (as enacted into law by section 1(a)(6) of Public Law 106–

13 554), is amended—

14 (1) by redesignating clause (iv) as clause (v);

15 (2) by inserting after clause (iii) the following

16 new clause:

17 ‘‘(iv) For 2002—

18 ‘‘(I) for any area in the 50

19 States and the District of Columbia,

20 $600; and

21 ‘‘(II) for any other area, the min22 imum amount specified in clause (iii)

23 for that area for 2001 increased by

24 the national per capita

25 Medicare+Choice growth percentage,
7

•HR 1387 IH

1 described in paragraph (6)(A) for

2 2002.’’; and

3 (3) in clause (v), as so redesignated—

4 (A) by striking ‘‘2002’’ and inserting

5 ‘‘2003’’; and

6 (B) by striking ‘‘or clause (iii)’’ and insert7 ing ‘‘or clause (iv)’’.

8 (b) EFFECTIVE DATE.—The amendments made by

9 subsection (a) apply to years beginning with 2002.

10 TITLE III—IMPROVED ACCESS

11 TO REASONABLY PRICED

12 PRESCRIPTION DRUGS

13 SEC. 301. AMENDMENTS TO PROGRAM FOR IMPORTATION

14 OF CERTAIN PRESCRIPTION DRUGS BY PHAR15 MACISTS AND WHOLESALERS.

16 Section 804 of the Federal Food, Drug, and Cosmetic

17 Act (as added by section 745(c)(2) of Public Law 106–

18 387) is amended—

19 (1) by striking subsections (e) and (f) and in20 serting the following subsections:

21 ‘‘(e) TESTING; APPROVED LABELING.—

22 ‘‘(1) TESTING.—Regulations under subsection

23 (a)—

24 ‘‘(A) shall require that testing referred to

25 in paragraphs (6) through (8) of subsection (d)
8

•HR 1387 IH

1 be conducted by the importer of the covered

2 product pursuant to subsection (a), or the man3 ufacturer of the product;

4 ‘‘(B) shall require that, if such tests are

5 conducted by the importer, information needed

6 to authenticate the product being tested be sup7 plied by the manufacturer of such product to

8 the importer; and

9 ‘‘(C) shall provide for the protection of any

10 information supplied by the manufacturer

11 under subparagraph (B) that is a trade secret

12 or commercial or financial information that is

13 privileged or confidential.

14 ‘‘(2) APPROVED LABELING.—For purposes of

15 importing a covered product pursuant to subsection

16 (a), the importer involved may use the labeling ap17 proved for the product under section 505, notwith18 standing any other provision of law.

19 ‘‘(f) DISCRETION OF SECRETARY REGARDING TEST20 ING.—The Secretary may waive or modify testing require21 ments described in subsection (d) if, with respect to spe22 cific countries or specific distribution chains, the Secretary

23 has entered into agreements or otherwise approved ar24 rangements that the Secretary determines ensure that the
9

•HR 1387 IH

1 covered products involved are not adulterated or in viola2 tion of section 505.’’;

3 (2) by striking subsections (h) and (i) and in4 serting the following subsections:

5 ‘‘(h) PROHIBITED AGREEMENTS; NONDISCRIMINA6 TION.—

7 ‘‘(1) PROHIBITED AGREEMENTS.—No manufac8 turer of a covered product may enter into a contract

9 or agreement that includes a provision to prevent

10 the sale or distribution of covered products imported

11 pursuant to subsection (a).

12 ‘‘(2) NONDISCRIMINATION.—No manufacturer

13 of a covered product may take actions that discrimi14 nate against, or cause other persons to discriminate

15 against, United States pharmacists, wholesalers, or

16 consumers regarding the sale or distribution of cov17 ered products.

18 ‘‘(i) STUDY AND REPORT.—

19 ‘‘(1) STUDY.—The Comptroller General of the

20 United States shall conduct a study on the imports

21 permitted under this section, taking into consider22 ation the information received under subsection (a).

23 In conducting such study, the Comptroller General

24 shall—
10

•HR 1387 IH

1 ‘‘(A) evaluate importers’ compliance with

2 regulations, determine the number of ship3 ments, if any, permitted under this section that

4 have been determined to be counterfeit, mis5 branded, or adulterated; and

6 ‘‘(B) consult with the United States Trade

7 Representative and United States Patent and

8 Trademark Office to evaluate the effect of im9 portations permitted under this section on trade

10 and patent rights under Federal law.

11 ‘‘(2) REPORT.—Not later than 5 years after the

12 effective date of final regulations issued pursuant to

13 this section, the Comptroller General of the United

14 States shall prepare and submit to Congress a re15 port containing the study described in paragraph

16 (1).’’;

17 (3) in subsection (k)(2)—

18 (A) by redesignating subparagraphs (A)

19 through (E) as subparagraphs (B) through (F),

20 respectively; and

21 (B) by inserting before subparagraph (B)

22 (as so redesignated) the following subpara23 graph:

24 ‘‘(A) The term ‘discrimination’ includes a

25 contract provision, a limitation on supply, or
11

•HR 1387 IH

1 other measure which has the effect of providing

2 United States pharmacists, wholesalers, or con3 sumers access to covered products on terms or

4 conditions that are less favorable than the

5 terms or conditions provided to any foreign pur6 chaser of such products.’’;

7 (4) by striking subsection (m); and

8 (5) by inserting after subsection (l) the fol9 lowing subsection:

10 ‘‘(m) FUNDING.—For the purpose of carrying out

11 this section, there are authorized to be appropriated such

12 sums as may be necessary for fiscal year 2002 and each

13 subsequent fiscal year.’’.

Æ