(b) FINDINGS.—The Congress finds that—
(1) effective beginning in 1996, Federal retirees
enrolled in the Governmentwide service benefit plan
under chapter 89 of title 5, United States Code, are
subject to a copayment for prescription drugs ob-
tained from a retail pharmacy, but are exempt from
such copayment if they instead use a plan’s mail
order pharmacy;
(2) that difference in policy—
(A) increases out-of-pocket health care
costs for and imposes financial penalties on the
large majority of Federal retirees who use their
local pharmacies to have prescriptions filled;
(B) fails to recognize the integral role of
local pharmacies in contributing to the health of
their patrons, such as through face-to-face
counseling;
(C) unfairly discriminates in favor of out-
of-state mail order pharmacies at the expense of
local retail pharmacies;
(D) transfers millions of dollars in wages
and tax revenues out of State, and therefore
hurts local economies and small businesses; and
(E) reduces the accessibility of local phar-
macies for all individuals, particularly those liv-
ing in rural areas;
(3) in making this major change, it appears
that the Office of Personnel Management—
(A) did not determine the impact on the
quality of pharmacy care provided to Federal
retirees, who use a disproportionate share of
prescription medications, but instead focused
primarily on economic considerations;
(B) did not consider alternative cost con-
tainment options in the prescription drug pro-
gram, which has disproportionately focused its
cost containment approaches on retail phar-
macies;
(C) did not determine, and has not yet
demonstrated, whether the anticipated savings
result from lower costs of mail order drug prod-
ucts or because retirees are simply paying more
in copayments for their prescription at local
pharmacies;
(D) did not determine whether such
change was consistent with the structure of cur-
rent private market prescription drug programs,
which traditionally give retirees a fair economic
choice of using mail order pharmacies or retail
pharmacies;
(E) did not assess the ability of the con-
tractor to fulfill the terms of the contract for
mail order prescriptions, given that thousands
of retirees were inconvenienced when the mail
order pharmacies were unable to meet the de-
mand for prescriptions; and
(F) did not assess the impact of the
change on the overall health care marketplace,
given that the Office of Personnel Management
is a major payor of health care services and
products; and
(4) the Office of Personnel Management should
be held more accountable for major changes made in
Federal health care program benefit designs, and
should be required to justify the impact of such
changes in terms of cost savings, access, and quality
of care, before such changes are implemented.
SEC. 2. REPORTING REQUIREMENT.
(a) IN GENERAL.—Section 8910 of title 5, United
States Code, is amended by adding at the end the follow-
ing:
‘‘(e)(1) The Office shall prepare an annual report in
which it shall describe, to the extent practicable, any sub-
stantial changes in maximums, limitations, exclusions, or
other definitions of benefits that it intends to propose for
implementation in the upcoming contract year.
‘‘(2) Included in a report under this subsection shall
be, with respect to each such change—
‘‘(A) a statement of justification for the change;
‘‘(B) an analysis of the anticipated savings, to
the extent that the change would be justified on the
basis of cost savings, as well as any alternative op-
tions considered and the reasons why the proposed
change is considered preferable;
‘‘(C) a description of the anticipated impact of
the proposed change on access to and quality of
care, and on costs to enrollees likely to be affected;
‘‘(D) an assessment of the ability of carriers to
implement the proposed change in a manner that is
efficient and that promotes the interests referred to
in subparagraph (C); and
‘‘(E) an analysis of the anticipated economic
impact of the proposed change with respect to pro-
viders and enrollees, respectively.
‘‘(3) The Office shall have each report under this sub-
section published in the Federal Register, and shall submit
a copy of each such report to both Houses of Congress,
as early in the year as possible, consistent with the goal
of affording interested persons a meaningful opportunity
to comment.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply with respect to changes taking
effect in any contract year beginning later than 6 months
after the date of the enactment of this Act.
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