SEC. 3. INCLUDING DEFINITION FOR LONG-TERM CARE 
PHARMACY UNDER MEDICARE PART D. 
Section 1860D–41(a) of the Social Security Act (42 
U.S.C. 1395w–151(a)) is amended by adding at the end 
the following: 
‘‘(19) LONG-TERM CARE PHARMACY.—The term 
‘long-term care pharmacy’ means a pharmacy owned 
by or under contract with a long-term care facility 
to provide prescription drugs to residents of such fa-
cility.’’. 
SEC. 4. ENSURING MEDICARE BENEFICIARIES ACCESS TO 
ADEQUATE 
LONG-TERM 
CARE 
PHARMACY 
NETWORKS. 
(a) IN GENERAL.—Section 1860D–4(b)(1)(C) of the 
Social Security Act (42 U.S.C. 1395w–104(b)(1)(C)) is 
amended by striking clause (iv) and inserting the following 
clauses: 
‘‘(iv) ADEQUATE ACCESS FOR LONG- 
TERM
CARE
NETWORK
PHARMACIES.— 
Such rules shall require the PDP sponsor 
of the prescription drug plan to include in 
its network an adequate number of long- 
term care pharmacies with sufficient ca-
pacity and experience with long-term care 
facilities in a PDP region to service at 
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least 90 percent of the number of residen-
tial beds in such facilities in such region. 
‘‘(v) CONVENIENT
ACCESS
FOR
IN-
DIAN HEALTH SERVICES.—Such rules may 
include standards for pharmacies operated 
by the Indian Health Service, Indian tribes 
and tribal organizations, and urban Indian 
organizations (as defined in section 4 of 
the Indian Health Care Improvement 
Act).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to plan years beginning on or 
after January 1, 2009. 
SEC. 5. LONG-TERM CARE BENEFICIARY PROTECTION AR-
RANGEMENTS UNDER MEDICARE PART D. 
(a) IN GENERAL.—Section 1860D–4(c) of the Social 
Security Act (42 U.S.C. 1395w–104(c)) is amended— 
(1) in paragraph (1), by inserting after sub-
paragraph (D) the following new subparagraph: 
‘‘(E) A long-term care beneficiary protec-
tion arrangement described in paragraph (3).’’; 
and 
(2) by adding at the end the following new 
paragraph: 
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‘‘(3) LONG-TERM CARE BENEFICIARY PROTEC-
TION ARRANGEMENT.—A long-term care beneficiary 
protection arrangement described in this paragraph 
is, with respect to a PDP sponsor of a prescription 
drug plan, a policy that requires, at a minimum, 
each long-term care pharmacy that participates in 
the network of the plan and that is owned by or 
under contract with a long-term care facility to pro-
vide for the following: 
‘‘(A) COMPREHENSIVE
INVENTORY
AND 
INVENTORY CAPACITY.—A comprehensive inven-
tory (and inventory capacity) of covered part D 
drugs commonly used in the long-term care fa-
cility (including in the case of a prescription 
drug plan that uses a formulary, a comprehen-
sive inventory of all covered part D drugs in-
cluded in such formulary) and an appropriately 
secured area for physical storage of such drugs, 
including any necessary additional security for 
storing controlled substances, as required by 
Federal and State law, for routine storage and 
maintenance of such drugs in the business set-
ting of the pharmacy. 
‘‘(B) PHARMACY
OPERATION
AND
PRE-
SCRIPTION ORDERS.—Sufficient pharmacy oper-
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ations and prescription orders capabilities, in-
cluding— 
‘‘(i) the services of a dispensing phar-
macist to meet the requirements of phar-
macy practice for dispensing covered part 
D drugs to residents of the long-term care 
facility and for the performance of drug 
utilization review for routine screenings for 
allergies to such drugs and interactions of 
such drugs, to identify potential adverse 
reactions to such drugs, to identify inap-
propriate usage of such drugs by residents 
of the long-term care facility, and to pro-
mote cost effective therapy in the long- 
term care facility; 
‘‘(ii) the use of pharmacy software 
and systems sufficient to meet the needs of 
ordering covered part D drugs for part D 
eligible individuals who are residents of the 
long-term care facility and distribution of 
such drugs to such facility; 
‘‘(iii) the availability of written copies 
of the pharmacy’s procedures manual at 
each nurses’ unit in the long-term care fa-
cility; 
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‘‘(iv) the provision of ongoing inserv-
ice training to assure that the staff of the 
long-term care facility is proficient in the 
long-term care pharmacy’s processes for 
ordering and receiving medications; and 
‘‘(v) following procedures specified by 
the State Board of Pharmacy for the State 
in which the long-term care pharmacy is 
located for the appropriate handling of un-
used covered part D drugs following dis-
continuance of such drug by an individual 
or the transfer, discharge, or death of such 
individual. 
‘‘(C) SPECIAL PACKAGING.—The capacity 
to provide covered part D drugs in packaging 
required by the long-term care facility (such as 
unit of use packaging, bingo cards, cassettes, 
unit doses, or other special packaging), includ-
ing access to, or arrangements with, a vendor 
to furnish supplies and equipment, including la-
bels, auxiliary labels, and packing machines, for 
furnishing covered part D drugs in such pack-
aging. 
‘‘(D) INTRAVENOUS
MEDICATIONS.—The 
capacity to provide intravenous covered part D 
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drugs to part D eligible individuals who are 
residents of the long-term care facility, includ-
ing access to specialized facilities for the prepa-
ration of such intravenous drugs and access to 
or arrangements with a vendor to furnish spe-
cial equipment and supplies as well as phar-
macists and technicians trained in admin-
istering such drugs intravenously. 
‘‘(E) COMPOUNDING
AND
ALTERNATIVE 
FORMS OF DRUG COMPOSITION.—The capacity 
to provide specialized formulations for the ad-
ministration of covered part D drugs as re-
quired for part D eligible individuals who are 
residents of the long-term care facility, includ-
ing such residents who are unable to swallow or 
ingest covered part D drugs through normal 
routes or who may require tablets to be split or 
crushed or provided in suspensions or gel forms 
to facilitate effective administration of the drug. 
‘‘(F) PHARMACIST ON-CALL SERVICE.—A 
pharmacist who is on-call 24 hours a day and 
7 days a week to conduct consultations by 
means of telephone or other similar electronic 
communication device and fill prescription re-
quests. 
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‘‘(G) DELIVERY SERVICE.—The provision 
of covered part D drugs to the long-term care 
facility, including— 
‘‘(i) regular delivery service seven 
days each week; 
‘‘(ii) emergency delivery service avail-
able 24 hours a day, 7 days a week; 
‘‘(iii) specific delivery arrangements 
established through agreements between 
the long-term care pharmacy and the long- 
term care facility; and 
‘‘(iv) safe and secure exchange sys-
tems for delivery of such drugs to the long- 
term care facility, including medication 
cassettes or other standard delivery sys-
tems that may be exchanged on a routine 
basis for automatic restocking. 
‘‘(H) EMERGENCY SUPPLIES.—Emergency 
supply of covered part D drugs as required by 
the long-term care facility in compliance with 
State requirements. 
‘‘(I) EMERGENCY LOG BOOKS.—A system 
for— 
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‘‘(i) logging covered part D drugs 
(and charges for such drugs) used from an 
emergency supply; and 
‘‘(ii) a comprehensive record of the 
covered part D drugs ordered for and ad-
ministered to each part D eligible indi-
vidual who is a resident of the long-term 
care facility. 
‘‘(J) MISCELLANEOUS
REPORTS, FORMS, 
AND PRESCRIPTION ORDERING SUPPLIES.—Re-
ports, forms, and prescription ordering supplies 
necessary for the delivery of quality pharmacy 
care in the long-term care facility, including 
provider order forms, monthly management re-
ports to assist the long-term care facility in 
managing orders, medication administration 
records, treatment administration records, in-
terim order forms for new prescription orders, 
and boxes or folders for order storage and rec-
onciliation in the facility. 
Notwithstanding any other provision of law, nothing 
in this paragraph shall restrict a PDP sponsor and 
a long-term care pharmacy from entering into an 
agreement to provide additional protections as they 
deem appropriate and necessary for the protection of 
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part D eligible individuals residing in long-term care 
facilities.’’. 
(b) CONFORMING AMENDMENT.—Section 1860D– 
4(c) of the Social Security Act (42 U.S.C. 1395w–104(c)) 
is amended in the heading by adding at the end the fol-
lowing: ‘‘; LONG-TERM CARE BENEFICIARY PROTECTION 
POLICY’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning on or after 
January 1, 2009. 
SEC. 6. LONG-TERM CARE BENEFICIARY ACCESS AND AS-
SISTANCE. 
(a) IN GENERAL.—Section 1860D–42 of the Social 
Security Act (42 U.S.C. 1395w–152) is amended by add-
ing at the end the following new subsection: 
‘‘(c) ASSISTANCE FOR RESIDENTS OF LONG-TERM 
CARE FACILITIES.— 
‘‘(1) IN GENERAL.—Nothing in this part shall 
prohibit a part D eligible individual who is a resi-
dent of a long-term care facility, or an authorized 
representative of such individual, from seeking or re-
ceiving assistance from a health care professional or 
other appropriate individual who works at the facil-
ity or from the individual’s physician for purposes of 
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selecting, enrolling, disenrolling, or changing enroll-
ment in a prescription drug plan or MA–PD plan. 
‘‘(2) AUTHORITY TO ADVISE IN SELECTION OF 
AND
ENROLLMENT
IN
PLANS.—Any physician, 
health care professional, or other appropriate indi-
vidual who works at a long-term care facility may— 
‘‘(A) advise any part D eligible individual 
residing in the facility, or an authorized rep-
resentative of such individual, regarding the 
adequacy of the individual’s prescription drug 
coverage in meeting the individual’s prescription 
drug needs (including the individual’s antici-
pated prescription drug needs); and 
‘‘(B) make recommendations to such an in-
dividual, with respect to such coverage, includ-
ing a recommendation to change enrollment or 
enroll in a specific prescription drug plan or 
MA–PD plan that best meets the individual’s 
current and anticipated prescription drug 
needs. 
‘‘(3) AUTHORITY TO ASSIST CERTAIN AUTO-EN-
ROLLED
PART
D
ELIGIBLE
INDIVIDUALS
IN 
CHANGES OF ENROLLMENT.— 
‘‘(A) IN GENERAL.—In the case of a part 
D eligible individual who is enrolled in a pre-
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scription drug plan pursuant to section 1860D– 
1(b)(1)(C), if such individual— 
‘‘(i) resides in a long-term care facil-
ity, 
‘‘(ii) is incapable of changing such en-
rollment, or filing a grievance or coverage 
determination, redetermination, or appeal 
under section 1860D–4, and 
‘‘(iii) does not have an authorized rep-
resentative available to assist the indi-
vidual in changing such enrollment, or fil-
ing such a grievance or coverage deter-
mination, redetermination, or appeal, re-
spectively, 
the individual’s physician, health care profes-
sional, or other appropriate individual who 
works at the long-term care facility may act on 
the individual’s behalf to facilitate the change 
of enrollment of the individual to the most ap-
propriate prescription drug plan under this part 
for the individual or to file such a grievance or 
coverage determination, redetermination, or ap-
peal, respectively. 
‘‘(B) CLARIFICATION.—Nothing in this 
paragraph shall be construed as modifying or 
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altering the rights and responsibilities of des-
ignated representatives and authorized rep-
resentatives under State law. 
‘‘(4) REQUIREMENTS
FOR
ASSISTANCE.—Any 
individual who assists a Medicare part D eligible in-
dividual residing in a long-term care facility pursu-
ant to this subsection shall— 
‘‘(A) inform the resident or the authorized 
representative of the resident if such individual 
or the facility has a contractual or financial re-
lationship with a prescription drug plan under 
this part or an MA–PD plan under part C; 
‘‘(B) not receive any remuneration from 
the resident or the prescription drug plan or 
MA–PD plan involved, with respect to the en-
rollment of such resident in such plan; 
‘‘(C) in the case of a resident who is a full- 
benefit dual eligible individual (as defined in 
section 1935(c)(6)), recommend the resident 
enroll in or change enrollment to a prescription 
drug plan only if such plan has a monthly bene-
ficiary premium that does not exceed the pre-
mium 
assistance 
available 
under 
section 
1860D–14(a)(1)(A)); and 
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(or other designated person) to make such deci-
sions on behalf of the individual.’’. 
(b) IMMEDIATE
COVERAGE
UPON
ENTRY
INTO 
LONG-TERM
CARE
FACILITIES.—Section 
1860D– 
1(b)(1)(A) of the Social Security Act (42 U.S.C. 1395w– 
101(b)(1)(A)) is amended to read as follows: 
‘‘(A) IN
GENERAL.—The Secretary shall 
establish— 
‘‘(i) a process for the enrollment, 
disenrollment, termination, and change of 
enrollment of part D eligible individuals in 
prescription drug plans consistent with this 
subsection; and 
‘‘(ii) in the case of a part D eligible 
individual who becomes a resident of a 
long-term care facility, a process for the 
immediate enrollment of such individual in 
a prescription drug plan upon the estab-
lishment of such residency (and upon such 
enrollment, immediately effective coverage 
under such plan) or, in the case of a part 
D eligible individual who is a resident in a 
long-term care facility, who is enrolled in a 
prescription drug plan, and who changes 
such enrollment to a different prescription 
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drug plan, a process for the immediate en-
rollment of such individual in the different 
prescription drug plan (and upon such en-
rollment, immediately effective coverage 
under such plan).’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning on or after 
January 1, 2009. 
SEC. 7. LONG-TERM CARE FORMULARY STRUCTURE AND 
DESIGN FOR LONG-TERM CARE RESIDENTS. 
(a) IN GENERAL.—Section 1860D–4(b)(3) of the So-
cial Security Act (42 U.S.C. 1395w–104(b)(3)) is amend-
ed by adding at the end the following: 
‘‘(G) 
LONG-TERM
CARE
FORMULARY 
STRUCTURE AND DESIGN.— 
‘‘(i) FORMULARY
STRUCTURE.—The 
formulary must take into account the 
needs of part D eligible individuals who are 
residents of long-term care facilities by in-
cluding all covered part D drugs that are 
medically necessary to such residents at all 
levels of care, including alternative dosage 
forms, such as liquid that can be adminis-
trated through feeding tubes, intravenous 
medications, or intramuscular injections. 
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Access to necessary medications for long- 
term care residents may be provided 
through formulary inclusion, utilization 
management tools, or exceptions processes. 
The PDP sponsor shall consider the spe-
cial circumstances applicable to such indi-
viduals when making a coverage deter-
mination under subsection (g) and shall 
base such determination on the individual’s 
health condition, and the interrelationship 
between the long-term care facility in 
which the individual resides, the individ-
ual’s physician, and the individual’s long- 
term care pharmacy, as well as applicable 
laws and regulations governing the oper-
ation of, and care furnished by, the long- 
term care pharmacy. The formulary of the 
prescription drug plan may not discourage 
enrollment in such plan by part D eligible 
individuals residing in long-term care fa-
cilities. 
‘‘(ii) COVERAGE DURING EXCEPTIONS 
PROCESS.—The PDP sponsor shall provide 
a 31-day emergency supply of covered part 
D drugs not included in the formulary for 
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a part D eligible individual who is a resi-
dent of a long-term care facility for any 
period not included in the period described 
in clause (iii) during which an exception 
for such individual is being processed. 
‘‘(iii) TRANSITION
PROCESSES.—The 
PDP sponsor shall establish and imple-
ment an appropriate transition process, 
with respect to receiving benefits under 
this part, for part D eligible individuals 
who are residents (or who are becoming 
residents) in a long-term care facility and 
who first enroll in the prescription drug 
plan and for part D eligible individuals en-
rolled in such plan when such individuals 
become residents of long-term care facili-
ties. Such transition process shall include 
the provision of appropriate temporary or 
emergency supplies of covered part D 
drugs included in the formulary, as well as 
of covered part D drugs not included in 
the formulary, for at least the 90-day pe-
riod, or 180-day period if clinically nec-
essary, immediately following the date of 
enrollment in the plan or the date on 
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which the individual first becomes a resi-
dent of the facility, as applicable.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to plan years beginning on or 
after January 1, 2009. 
SEC. 8. ELIMINATION OF PART D COST-SHARING FOR CER-
TAIN 
NON-INSTITUTIONALIZED 
FULL-BEN-
EFIT DUAL ELIGIBLE INDIVIDUALS. 
(a) IN GENERAL.—Section 1860D–14(a)(1)(D)(i) of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1395w– 
114(a)(1)(D)(i)) is amended— 
(1) in the heading, by striking ‘‘INSTITU-
TIONALIZED
INDIVIDUALS—In’’ 
and 
inserting 
‘‘ELIMINATION
OF
COST-SHARING
FOR
CERTAIN 
FULL-BENEFIT DUAL ELIGIBLE INDIVIDUALS—’’ 
‘‘(I) INSTITUTIONALIZED
INDI-
VIDUALS.—In’’; and 
(2) by adding at the end the following new sub-
clauses: 
‘‘(II) CERTAIN
OTHER
INDIVID-
UALS.—In the case of an individual 
who is a full-benefit dual eligible indi-
vidual and who is a resident of a facil-
ity described in subclause (III) or who 
is receiving home and community- 
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based services in a home setting pro-
vided under a home and community- 
based waiver approved for the State 
under section 1915 or 1115, the elimi-
nation of any beneficiary coinsurance 
described in section 1860D–2(b)(2) 
(for all amounts through the total 
amount of expenditures at which ben-
efits are available under section 
1860D–2(b)(4)). 
‘‘(III) FACILITY
DESCRIBED.— 
For purposes of subclause (II), a fa-
cility described in this subclause is an 
assisted living facility or a resident 
care program facility (as such terms 
are defined by the Secretary), a board 
and care facility (as defined in section 
1903(q)(4)(B)), or any other facility 
that is licensed or certified by the 
State involved and is determined ap-
propriate by the Secretary, such as a 
community mental health center that 
meets the requirements of section 
1913(c) of the Public Health Service 
Act, a psychiatric health facility, a 
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mental health rehabilitation center, 
and a mental retardation develop-
mental disability facility.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to drugs dispensed on or after 
the date of the enactment of this Act. 
SEC. 9. PROVISIONS RELATED TO IMPROPER ASSESSMENT 
OF 
BENEFICIARY 
COST-SHARING 
OBLIGA-
TIONS. 
(a) RESOLUTION OF INAPPROPRIATE ASSESSMENT 
OF LONG-TERM CARE BENEFICIARY COST-SHARING OB-
LIGATIONS.—Section 1860D–12(b) of the Social Security 
Act (42 U.S.C. 1395w–112(b)) is amended by adding at 
the end the following: 
‘‘(4) RESOLUTION OF INAPPROPRIATE ASSESS-
MENT
OF
LONG-TERM
CARE
BENEFICIARY
COST- 
SHARING OBLIGATIONS.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
not enter into a contract with a PDP sponsor 
for the offering of a prescription drug plan for 
a year unless the PDP sponsor provides assur-
ances to the satisfaction of the Secretary that— 
‘‘(i) to the extent the PDP sponsor, or 
information provided to the PDP sponsor 
by or on behalf of the Secretary, fails to 
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correctly identify a part D eligible indi-
vidual who is residing in a long-term care 
facility and who is receiving covered part D 
drugs from a long-term care pharmacy, as 
a full benefit dual eligible individual (as 
defined in section 1935(c)(6)) or as a sub-
sidy-eligible individual (as defined in sec-
tion 1860D–14(a)(3)), and any cost-shar-
ing 
obligation 
is 
incorrectly 
assessed 
against such individual, the PDP sponsor 
shall accept from the long-term care phar-
macy any applicable evidence described in 
subparagraph (B) and the attestation de-
scribed in subparagraph (C) to dem-
onstrate that the individual is eligible for 
an adjustment to (or exempt from) such 
cost-sharing; 
‘‘(ii) upon receipt of such evidence 
that demonstrates the individual is so eligi-
ble (or so exempt), the PDP sponsor shall 
make such adjustment to (or exempt the 
individual from) any such cost-sharing; 
and 
‘‘(iii) not later than 60 days after re-
ceipt of such evidence that demonstrates 
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such eligibility, the PDP sponsor will reim-
burse the individual any improperly as-
sessed cost-sharing or, in the case that the 
individual (or a representative of such indi-
vidual) has not paid the improperly as-
sessed cost-sharing amount, timely reim-
burse the long-term care pharmacy for 
such improperly assessed amount, but in 
no case may the PDP sponsor send pay-
ments under this clause directly to a full 
benefit dual eligible individual or a subsidy 
eligible individual residing in a long-term 
care facility unless the PDP sponsor has 
direct evidence that such individual has ac-
tually paid such cost-sharing amount. 
‘‘(B) EVIDENCE
DESCRIBED.—For pur-
poses of subparagraph (A), evidence described 
in this subparagraph is the following: 
‘‘(i) For purposes of determining the 
status of an individual as a full benefit 
dual eligible individual, a plan ID number 
to establish such individual has coverage 
for covered part D drugs under a prescrip-
tion drug plan or under an MA–PD plan 
and a Medicaid ID number to establish 
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such individual is determined eligible by 
the State involved for medical assistance 
for full benefits under title XIX. 
‘‘(ii) For purposes of determining in-
stitutionalized status of an individual, the 
date on which the individual entered a 
long-term care facility, or any medical in-
stitution for which payment is made under 
this title or title XIX, including inter-
mediate care facilities for the mentally re-
tarded, psychiatric hospitals, and assisted 
living facilities. 
‘‘(C) ATTESTATION.—For purposes of sub-
paragraph (A), the attestation described in this 
subparagraph, with respect to a pharmacy and 
a prescription drug plan is an attestation from 
the pharmacy, subject to audit, that the evi-
dence described in subparagraph (B) that is 
provided by such pharmacy to the plan is accu-
rate.’’. 
(b) IMMEDIATE REDUCTION IN COST-SHARING UPON 
ADMISSION
INTO
INSTITUTION.—Section 
1860D– 
14(a)(1)(D)(i) of the Social Security Act (42 U.S.C. 
1395w–114(a)(1)(D)(i)) is amended by inserting ‘‘upon 
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the admission of such individual or couple, respectively, 
to the institution,’’ before ‘‘the elimination of’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning on or after 
January 1, 2009. 
SEC. 10. REPORT TO CONGRESS. 
(a) IN GENERAL.—Section 1860D–4(b)(1) of the So-
cial Security Act (42 U.S.C. 1395w–104(b)(1)) is amend-
ed by adding at the end the following: 
‘‘(F) ANNUAL REPORT ON ACCESS TO COV-
ERED PART D DRUGS FOR LONG-TERM CARE 
RESIDENTS.—The Secretary shall submit to 
Congress an annual report on the adequacy of 
the access to covered part D drugs available to 
part D eligible individuals who are residents of 
long-term care facilities through long-term care 
pharmacies participating in networks of pre-
scription drug plans. Such a report shall in-
clude— 
‘‘(i) the extent to which part D long- 
term care performance and service stand-
ards governing the delivery of specialized 
long-term care services, as specified by the 
Secretary, to part D eligible individuals, 
including any guidance issued by the Sec-
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retary and industry best practices, are 
being met; 
‘‘(ii) the percentage of such residents 
who are enrolled in a prescription drug 
plan that meets the prescription drug 
needs of such residents; and 
‘‘(iii) the number of exceptions and 
prior authorization requests submitted by 
such residents and the number of such ex-
ceptions and requests that are approved by 
the prescription drug plans involved.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to plan years beginning on or 
after January 1, 2009. 
Æ 
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