(2) NEW
SECTION.—Title XIX is further 
amended—
(A) by redesignating section 1935 as sec-
tion 1936; and 
(B) by inserting after section 1934 the fol-
lowing new section: 
‘‘SPECIAL PROVISIONS RELATING TO MEDICARE PART D 
BENEFITS 
‘‘SEC. 1935. (a) REQUIREMENT FOR VERIFICATION 
OF ELIGIBILITY DETERMINATIONS FOR IMPROVED PART 
D BENEFITS.—As a condition of its State plan under this 
title under section 1902(a)(66) and receipt of any Federal 
financial assistance under section 1903(a), a State shall 
provide for verification of income statements in accordance 
with arrangements under section 1860D–4(d)(1). 
‘‘(b) PAYMENTS FOR ADDITIONAL ADMINISTRATIVE 
COSTS.—
‘‘(1) IN GENERAL.—The amounts expended by 
a State in carrying out subsection (a) are, subject to 
paragraph (2), expenditures reimbursable under the 
appropriate paragraph of section 1903(a); except 
that, notwithstanding any other provision of such 
section, the applicable Federal matching rates with 
respect to such expenditures under such section shall 
be increased as follows (but in no case shall the rate 
as so increased exceed 100 percent):
‘‘(A) For expenditures attributable to costs 
incurred during 2004, the otherwise applicable 
Federal matching rate shall be increased by 10 
percent of the percentage otherwise payable 
(but for this subsection) by the State. 
‘‘(B)(i) For expenditures attributable to 
costs incurred during 2005 and each subse-
quent year through 2011, the otherwise applica-
ble Federal matching rate shall be increased by 
the applicable percent (as defined in clause (ii)) 
of the percentage otherwise payable (but for 
this subsection) by the State. 
‘‘(ii) For purposes of clause (i), the ‘appli-
cable percent’ for—
‘‘(I) 2005 is 20 percent; or 
‘‘(II) a subsequent year is the applica-
ble percent under this clause for the pre-
vious year increased by 10 percentage 
points.
‘‘(C) For expenditures attributable to costs 
incurred after 2011, the otherwise applicable 
Federal matching rate shall be increased to 100 
percent. 
‘‘(2) COORDINATION.—The State shall provide 
the Secretary with such information as may be nec-
essary to properly allocate administrative expendi-
tures described in paragraph (1) that may otherwise 
be made for eligibility determinations.’’. 
(b) 
AMENDMENT
TO
BEST
PRICE.—Section 
1927(c)(1)(C)(i) (42 U.S.C. 1396r–8(c)(1)(C)(i)) is 
amended—
(1) by striking ‘‘and’’ at the end of subclause 
(III); 
(2) by striking the period at the end of sub-
clause (IV) and inserting ‘‘; and’’; and 
(3) by adding at the end the following new sub-
clause: 
‘‘(V) any prices charged which 
are negotiated by the Secretary under 
part D of title XVIII on behalf of eli-
gible beneficiaries enrolled under such 
part.’’. 
SEC. 5. IMPORTATION OF PRESCRIPTION DRUGS. 
Section 804 of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 384) is amended—
(1) in subsection (a)—
(A) by striking ‘‘The Secretary’’ and in-
serting ‘‘Not later than 180 days after the date 
of the enactment of the Pharmaceutical Market 
Access Act of 2003, the Secretary’’; and
(B) by striking ‘‘pharmacists and whole-
salers’’ and inserting ‘‘pharmacists, wholesalers, 
and qualifying individuals’’; 
(2) in subsection (b)—
(A) by amending paragraph (1) to read as 
follows: 
‘‘(1) require that each covered product imported 
pursuant to such subsection complies with sections 
501, 502, and 505, and other applicable require-
ments of this Act; and’’; 
(B) in paragraph (2), by striking ‘‘, includ-
ing subsection (d); and’’ and inserting a period; 
and 
(C) by striking paragraph (3); 
(3) in subsection (c), by inserting ‘‘by phar-
macists and wholesalers (but not qualifying individ-
uals)’’ after ‘‘importation of covered products’’; 
(4) in subsection (d)—
(A) by striking paragraphs (3) and (10); 
(B) in paragraph (5), by striking ‘‘, includ-
ing the professional license number of the im-
porter, if any’’; 
(C) in paragraph (6)—
(i) in subparagraph (C), by inserting 
‘‘(if required under subsection (e))’’ before 
the period; 
(ii) in subparagraph (D), by inserting 
‘‘(if required under subsection (e))’’ before 
the period; and 
(iii) in subparagraph (E), by striking 
‘‘labeling’’; 
(D) in paragraph (7)—
(i) in subparagraph (A), by inserting 
‘‘(if required under subsection (e))’’ before 
the period; and 
(ii) by amending subparagraph (B) to 
read as follows: 
‘‘(B) Certification from the importer or 
manufacturer of such product that the product 
meets all requirements of this Act.’’; and 
(E) 
by 
redesignating 
paragraphs 
(4) 
through (9) as paragraphs (3) through (8), re-
spectively; 
(5) by amending subsection (e) to read as fol-
lows: 
‘‘(e) TESTING.—
‘‘(1) IN GENERAL.—Subject to paragraph (2), 
regulations under subsection (a) shall require that
testing referred to in paragraphs (5) through (7) of 
subsection (d) be conducted by the importer of the 
covered product, unless the covered product is a pre-
scription drug subject to the requirements of section 
505B for counterfeit-resistant technologies. 
‘‘(2) EXCEPTION.—The testing requirements of 
paragraphs (5) through (7) of subsection (d) shall 
not apply to an importer unless the importer is a 
wholesaler.’’; 
(6) in subsection (f), by striking ‘‘or designated 
by the Secretary, subject to such limitations as the 
Secretary determines to be appropriate to protect 
the public health’’; 
(7) in subsection (g)—
(A) by striking ‘‘counterfeit or’’; and 
(B) by striking ‘‘and the Secretary deter-
mines that the public is adequately protected 
from counterfeit and violative covered products 
being imported pursuant to subsection (a)’’; 
(8) in subsection (i)(1)—
(A) by amending subparagraph (A) to read 
as follows: 
‘‘(A) IN
GENERAL.—The Secretary shall 
conduct, or contract with an entity to conduct, 
a study on the imports permitted pursuant to
subsection (a), including consideration of the 
information received under subsection (d). In 
conducting such study, the Secretary or entity 
shall evaluate the compliance of importers with 
regulations under subsection (a), and the inci-
dence of shipments pursuant to such sub-
section, if any, that have been determined to be 
misbranded or adulterated, and determine how 
such compliance contrasts with the incidence of 
shipments of prescription drugs transported 
within the United States that have been deter-
mined to be misbranded or adulterated.’’; and 
(B) in subparagraph (B), by striking ‘‘Not 
later than 2 years after the effective date of 
final regulations under subsection (a),’’ and in-
serting ‘‘Not later than 18 months after the 
date of the enactment of the Pharmaceutical 
Market Access Act of 2003,’’; 
(9) in subsection (k)—
(A) in subparagraph (A) of paragraph 
(1)—
(i) by striking ‘‘or a biological’’ and 
inserting ‘‘, a biological’’; and 
(ii) by striking the period at the end 
and inserting ‘‘, or any drug or biological
product approved by the Secretary for use 
in connection with abortion, sex trans-
formation, sexual dysfunction, or sexual in-
adequacy.’’; and 
(B) in paragraph (2)—
(i) by redesignating subparagraphs 
(D) and (E) as subparagraphs (E) and 
(F), respectively; and 
(ii) by inserting after subparagraph 
(C) the following: 
‘‘(D) The term ‘qualifying individual’ 
means an individual who is not a pharmacist or 
a wholesaler. ’’; and 
(10) by striking subsections (l) and (m).
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