I 
109TH CONGRESS 
1ST SESSION H. R. 2200
To amend part D of title XVIII of the Social Security Act to provide 
to the Secretary of Health and Human Services authority similar to 
the authority of the Secretary of Veterans Affairs to negotiate the lowest 
possible prices for outpatient prescription drugs, to include in the deter-
mination of best price for covered outpatient drugs under the Medicaid 
Program prices charged by manufacturers to certain Federal agencies, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 5, 2005
Mr. RUPPERSBERGER 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 part D of title XVIII of the Social Security 
Act to provide to the Secretary of Health and Human 
Services authority similar to the authority of the Sec-
retary of Veterans Affairs to negotiate the lowest possible 
prices for outpatient prescription drugs, to include in 
the determination of best price for covered outpatient 
drugs under the Medicaid Program prices charged by 
manufacturers to certain Federal agencies, and for other 
purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Prescription Drug 
Price Fairness Act’’. 
SEC. 2. NEGOTIATION OF LOWEST POSSIBLE PRICES FOR 
PRESCRIPTION DRUGS UNDER MEDICARE. 
Section 1860D–11 of the Social Security Act (42 
U.S.C. 1395w–111) is amended by striking subsection (i) 
(relating to noninterference) and by inserting the fol-
lowing: 
‘‘(i) REQUIREMENT
TO NEGOTIATE
FOR LOWEST 
PRICES.—In order to ensure that beneficiaries enrolled 
under prescription drug plans and MA–PD plans pay the 
lowest possible price for covered part D drugs, the Sec-
retary shall have and exercise authority similar to that of 
the Secretary of Veterans Affairs to purchase prescription 
drugs in bulk and to negotiate contracts with manufactur-
ers of covered part D drugs, consistent with the require-
ments and in furtherance of the goals of providing quality 
care and containing costs under this part. In exercising 
such authority, the Secretary shall negotiate the best pos-
sible prices for such drugs.’’.
SEC. 3. INCLUSION OF PRICES CHARGED FOR COVERED 
OUTPATIENT DRUGS TO CERTAIN FEDERAL 
AGENCIES IN THE DETERMINATION OF BEST 
PRICE FOR SUCH DRUGS UNDER THE MED-
ICAID PROGRAM. 
(a) 
IN
GENERAL.—Clause 
(i) 
of 
section 
1927(c)(1)(C) of the Social Security Act (42 U.S.C. 
1396r–8(c)(1)(C)) is amended by striking ‘‘, excluding—
’’ and all that follows and inserting a period. 
(b) CONFORMING AMENDMENTS.—(1) Such section 
is further amended by striking clause (iii). 
(2) Section 1847A(c)(2) of the Social Security Act 
(42 U.S.C. 1395w–3a(c)(2)) is amended by striking sub-
paragraph (A) and redesignating the succeeding provision 
accordingly. 
(3) Section 1860D–2(d)(1) of such Act (42 U.S.C. 
1395w–102(d)(1)) is amended by striking subparagraph 
(C). 
(4) Section 1860D–31(e)(1) of such Act (42 U.S.C. 
1395w–131(e)(1)) is amended by striking subparagraph 
(D). 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply with respect to payments for cov-
ered outpatient drugs furnished on or after January 1, 
2006.
SEC. 4. CLARIFICATION OF AUTHORITY FOR STATES TO NE-
GOTIATE TOGETHER TO ACHIEVE GREATER 
DISCOUNTS FROM MANUFACTURERS OF COV-
ERED OUTPATIENT DRUGS. 
Section 1927(a) of the Social Security Act (42 U.S.C. 
1396r–8(a)) is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(7) AUTHORITY FOR STATES TO FORM POOLS 
TO
NEGOTIATE
PRICE
CONCESSIONS.—In entering 
into agreements with manufacturers under this sec-
tion, States may form pools to negotiate price con-
cessions from the manufacturers for covered out-
patients drugs.’’.
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