‘‘(B) REDUCTION IN PAYMENTS TO PLANS 
AND REFUNDS TO INDIVIDUALS.—If the Sec-
retary determines under subparagraph (A) that 
an individual was overcharged, the Secretary 
shall— 
‘‘(i) reduce payments to the sponsor 
of the prescription drug plan under section 
1860D–15 or to the organization offering 
the MA–PD plan under section 1853 that 
inappropriately charged the individual by 
an amount equal to the inappropriate 
charges; and 
‘‘(ii) refund such amount to the indi-
vidual within 60 days of the determination 
that the individual was inappropriately 
charged. 
If the Secretary does not provide for the refund 
under clause (i) within the 60 days provided for 
under such clause, interest at the rate estab-
lished under section 6621(a)(1) of the Internal 
Revenue Code of 1986 shall be payable from 
the end of such 60-day period until the date of 
the refund. 
‘‘(2) REQUIREMENT.—The processes estab-
lished under paragraph (1) shall provide for the abil-
ity of an individual to notify the Secretary if the in-
dividual believes that they were inappropriately sub-
ject under the plan to a deductible or cost-sharing 
that is greater than is required under section 
1860D–14.’’. 
(b) REPORT TO CONGRESS.—Not later than January 
1, 2007, the Secretary of Health and Human Services 
shall submit a report to Congress on the implementation 
of the processes established under subsection (d) of section 
1860D–14 of the Social Security Act (42 U.S.C. 1395w– 
114), as added by subsection (a). 
SEC. 7. REIMBURSEMENT OF STATES FOR 2006 TRANSITION 
COSTS. 
(a) REIMBURSEMENT.— 
(1) IN
GENERAL.—Notwithstanding section 
1935(d) of the Social Security Act (42 U.S.C. 
1396u–5(d) or any other provision of law, the Sec-
retary of Health and Human Services shall reim-
burse States for 100 percent of the costs incurred by 
the State during 2006 for covered part D drugs (as 
defined in section 1860D–2(e) of such Act (42 
U.S.C. 1395w–102(e))) for part D eligible individ-
uals (as defined in section 1860D–1(a)(3)(A) of the 
Social 
Security 
Act 
(42 
U.S.C. 
1394w– 
101(a)(3)(A))) which the State reasonably expected
would have been covered under such part but were 
not because the individual was unable to access on 
a timely basis prescription drug benefits to which 
they were entitled under such part. Such payments 
shall be made from the Medicare Prescription Drug 
Account under section 1860D–16 of the Social Secu-
rity Act (42 U.S.C. 1395w–116) and shall be 
deemed to be payments from such Account under 
subsection (b) of such section. 
(2) RETROACTIVE APPLICATION TO BEGINNING 
OF 2006.—The costs incurred by a State which may 
be reimbursed under paragraph (1) shall include 
costs incurred during the period beginning on Janu-
ary 1, 2006, and before the date of enactment of 
this Act. 
(b) RECOVERY OF COSTS FROM PLANS BY SEC-
RETARY
NOT STATES.—The Secretary of Health and 
Human Services shall establish a process for recovering 
the costs described in subsection (a)(1) from prescription 
drug plans (as defined in section 1860D–1(a)(3)(C) of the 
Social Security Act (42 U.S.C. 1394w–101(a)(3)(C))) and 
MA–PD plans (as defined in section 1860D–41(a)(14) of 
such Act (42 U.S.C. 1395w–151(a)(14))) if the Secretary 
determines that such plans should have incurred such 
costs. Amounts recovered pursuant to the preceding sen-
tence shall be deposited in the Medicare Prescription Drug 
Account described in subsection (a)(1). 
(c) STATE.—For purposes of this section, the term 
‘‘State’’ includes the District of Columbia. 
SEC. 8. FACILITATION OF IDENTIFICATION AND ENROLL-
MENT THROUGH PHARMACIES OF FULL-BEN-
EFIT DUAL ELIGIBLE INDIVIDUALS IN THE 
MEDICARE PART D DRUG PROGRAM. 
(a) IN GENERAL.—The Secretary of Health and 
Human Services shall provide for outreach and education 
to every pharmacy that has participated in the Medicaid 
program under title XIX of the Social Security Act, par-
ticularly independent pharmacies, on the following: 
(1) The needs of full-benefit dual eligible indi-
viduals and the challenges of meeting those needs. 
(2) The processes for the transition from Med-
icaid prescription drug coverage to coverage under 
such part D for such individuals. 
(3) The processes established by the Secretary 
to facilitate, at point of sale, identification of drug 
plan assignment of such population or enrollment of 
previously unidentified or new full-benefit dual eligi-
ble individuals into Medicare part D prescription 
drug coverage, including how pharmacies can use 
such processes to help ensure that such population
makes a successful transition to Medicare part D 
without a lapse in prescription drug coverage. 
(b) HOLDING PHARMACIES HARMLESS FOR CERTAIN 
COSTS.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall provide for such payments to 
pharmacies as may be necessary to reimburse phar-
macies fully for— 
(A) transaction fees associated with the 
point-of-sale facilitated identification and enroll-
ment processes referred to in subsection (a)(3); 
and 
(B) costs associated with technology or 
software upgrades necessary to make any iden-
tification and enrollment inquiries as part of 
the processes under subsection (a)(3). 
(2) TIME.—Payments under paragraph (1) 
shall be made with respect to fees and costs incurred 
during the period beginning on December 1, 2005, 
and ending on June 1, 2006. 
(3) PAYMENTS
FROM
ACCOUNT.—Payments 
under paragraph (1) shall be made from the Medi-
care Prescription Drug Account under section 
1860D–16 of the Social Security Act (42 U.S.C. 
1395w–116) and shall be deemed to be payments