I 
109TH CONGRESS 
2D SESSION 
H. R. 5166 
To amend title XVIII of the Social Security Act to improve payments made 
by prescription drug plans and MA–PD plans to pharmacies for covered 
part D drugs dispensed through such pharmacies. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 6, 2006 
Mr. WICKER (for himself, Mr. LOBIONDO, Mr. PICKERING, Mr. BONNER, Mr. 
BROWN of Ohio, Mr. PETERSON of Pennsylvania, Mrs. CUBIN, Mr. EVER-
ETT, Mr. BACHUS, Mr. DAVIS of Kentucky, Mr. BOUSTANY, Mr. SODREL, 
Mr. CONAWAY, Mr. FORTENBERRY, Ms. HARRIS, Mr. WHITFIELD, Mr. 
BILIRAKIS, Mrs. EMERSON, Ms. PRYCE of Ohio, Mr. SCHWARZ of Michi-
gan, Mr. FOLEY, Mr. LEACH, Mr. GERLACH, Mr. WALDEN of Oregon, 
Mrs. JO ANN DAVIS of Virginia, Mr. SHERWOOD, Mr. BOOZMAN, Mr. 
OSBORNE, Mr. DOOLITTLE, Mr. TIAHRT, Mr. BURGESS, Mr. AKIN, Mr. 
ADERHOLT, Mr. BLUNT, Mr. MCHENRY, Ms. FOXX, Mr. PENCE, Mr. 
BISHOP of Utah, Mr. GARRETT of New Jersey, Mr. HOEKSTRA, Mr. 
FITZPATRICK of Pennsylvania, Ms. KAPTUR, Mr. GUTKNECHT, Ms. 
WASSERMAN SCHULTZ, and Mr. VAN HOLLEN) introduced the following 
bill; which was referred to the Committee on Ways and Means, and in 
addition to the Committee on Energy and Commerce, 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 con-
cerned 
A BILL 
To amend title XVIII of the Social Security Act to improve 
payments made by prescription drug plans and MA– 
PD plans to pharmacies for covered part D drugs dis-
pensed through such pharmacies. 
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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 ‘‘Independent Pharmacy 
Protection Act of 2006’’. 
SEC. 2. IMPROVING MEDICARE PRESCRIPTION DRUG PLAN 
PAYMENTS TO PHARMACIES. 
(a) IN GENERAL.—Section 1860D–12(b) of the So-
cial Security Act (42 U.S.C. 1395w–112(b)) is amended 
by adding at the end the following new paragraph: 
‘‘(4) PAYMENTS TO PHARMACIES.— 
‘‘(A) IN GENERAL.—Each contract entered 
into with a PDP sponsor under this section 
with respect to a prescription drug plan offered 
by such sponsor shall provide for the following: 
‘‘(i) AVAILABILITY
OF
DIRECT
DE-
POSIT
PAYMENTS.—The option for any 
participating pharmacy to elect for the 
plan to make payments by direct deposits 
to the pharmacy for covered part D drugs 
dispensed through the pharmacy. 
‘‘(ii) INCREASED
DISPENSING
FEE 
FOR
GENERIC
DRUGS.—The payment of 
dispensing fees by the plan to each partici-
pating pharmacy for covered part D drugs 
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dispensed through the participating phar-
macy, in accordance with subparagraph 
(B). 
‘‘(iii) PAYMENTS WITHIN 10 DAYS FOR 
CERTAIN PHARMACIES.—In the case of a 
participating pharmacy that is not part of 
a chain of pharmacies that consists of 
more than three pharmacies at different lo-
cations, payment with respect to any non- 
disputed claim (as defined in subparagraph 
(C)) for a covered part D drug dispensed 
through the pharmacy to be made by the 
plan to the pharmacy in full by a date that 
is not more than 10 days after the date on 
which the claim is received by the plan. 
‘‘(B) PAYMENT OF DISPENSING FEES TO 
ENCOURAGE USE OF GENERIC DRUGS.— 
‘‘(i) IN
GENERAL.—For purposes of 
subparagraph (A)(ii) and subject to clauses 
(ii) and (iii), with respect to a generic cov-
ered part D drug that is therapeutically 
equivalent and bioequivalent to a brand 
name drug that is a covered part D drug 
dispensed through a participating phar-
macy, the amount of the dispensing fee 
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paid to the pharmacy for the generic cov-
ered part D drug shall be an amount that 
is at least 50 percent greater than the 
amount of the dispensing fee for the brand 
name drug. 
‘‘(ii) CAP ON AMOUNT OF DISPENSING 
FEES FOR GENERIC DRUGS.—For purposes 
of subclause (i), the amount of the dis-
pensing fee paid to a participating phar-
macy for a generic covered part D drug 
shall not be more than $10. 
‘‘(iii) SAFE
HARBOR
FOR
BRAND 
NAME DRUG DISPENSING FEE AMOUNTS.— 
‘‘(I) IN GENERAL.—For purposes 
of clause (i) and subject to subclause 
(II), a prescription drug plan under 
this section shall not decrease the 
amount of the dispensing fee paid by 
the plan to a participating pharmacy 
for a brand name drug described in 
such clause to an amount that is less 
than the amount of the dispensing fee 
paid by such plan to such pharmacy 
for such drug on the date of the en-
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actment of the ‘Independent Phar-
macy Protection Act of 2006’. 
‘‘(II) 
EXCEPTION.—The 
Sec-
retary may waive the prohibition 
under subclause (I) with respect to a 
dispensing fee paid by a prescription 
drug plan for a brand name drug, as 
the Secretary determines appropriate. 
‘‘(C) NON-DISPUTED
CLAIM
DEFINED.— 
For purposes of subparagraph (A)(iii), a ‘non- 
disputed claim’ means a claim that has no de-
fect or impropriety or particular circumstance 
requiring special treatment that prevents timely 
payment from being made under this part.’’. 
(b) APPLICATION
TO
MA–PD PLANS.—Section 
1857(e) of such Act (42 U.S.C. 1395w–27(e)) is amended 
by adding at the end the following new paragraph: 
‘‘(4) INCORPORATION OF PRESCRIPTION DRUG 
PLAN
CONTRACT
REQUIREMENTS
FOR
PHARMACY 
PAYMENTS.—The provisions of section 1860D– 
12(b)(4) shall apply to contracts with a Medicare 
Advantage organization in the same manner as they 
apply to contracts with a PDP sponsor offering a 
prescription drug plan under part D.’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this Act shall apply to plan years beginning on or after 
the date of the enactment of this Act. 
Æ 
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