Download Zipped Amended WordPerfect HB0079S02.ZIP
[Introduced][Status][Bill Documents][Fiscal Note][Bills Directory]

Second Substitute H.B. 79

This document includes Senate 2nd Reading Floor Amendments incorporated into the bill on Wed, Feb 15, 2006 at 1:24 PM by rday. -->

Representative Bradley G. Last proposes the following substitute bill:




Chief Sponsor: Bradley G. Last

Senate Sponsor: Peter C. Knudson

             7      LONG TITLE
             8      General Description:
             9          This bill requires a legislative audit regarding prescription drug purchasing and
             10      pharmacy benefit manager contracting practices of state funded prescription drug
             11      programs.
             12      Highlighted Provisions:
             13          This bill:
             14          .    defines the state entities subject to the legislative audit;
             15          .    describes the purpose of the legislative audit; and
             16          .    provides protection of trade secrets and proprietary information regarding drug
             17      prices, discounts, and rebates.
             18      Monies Appropriated in this Bill:
             19          None
             20      Other Special Clauses:
             21          None
             22      Uncodified Material Affected:
             25      Be it enacted by the Legislature of the state of Utah:

             26          Section 1. Legislative Audit of State Funded Prescription Drug Purchases.
             27          (1) For purposes of the legislative audit required by this bill, "state entity":
             28          (a) includes:
             29          (i) an employer who participates in the Public Employees' Benefit and Insurance
             30      Program created in Title 49, Chapter 20, Public Employees' Benefit and Insurance Program
             31      Act ;
             32          (ii) state institutions of higher education;
             33          (iii) state institutions of public education;
             34          (iv) except to the extent federal Medicaid funding is involved as provided in
             35      Subsection (4)(b)(iii), the state:
             36          (A) Developmental Center;
             37          (B) psychiatric hospital; and
             38          (C) child welfare system;
             39          (v) the Department of Corrections;
             40          (vi) the state's Comprehensive Health Insurance Pool created in Title 31A, Chapter 29,
             41      Comprehensive Health Insurance Pool Act; and
             42          (vii) political subdivisions of the state which pay for or arrange for the payment of
             43      prescription drugs; and
             44          (b) does not include the state Medicaid program.
             45          (2) The Office of the Legislative Auditor General shall conduct an audit of prescription
             46      drug purchasing practices of state entities to determine if each state entity is:
             47          (a) following established best practices to obtain the best prices, discounts, and rebates
             48      for drug purchases funded by the state; and
             49          (b) appropriately using and reimbursing consultants and pharmacy benefit managers to
             50      negotiate prices, discounts and rebates and to track employee utilization for the state entity.
             51          (3) The audit shall assess and compare:
             52          (a) program savings methodologies;
             53          (b) all base, incentive, and administrative rebates and revenues received from drug
             54      manufacturers;
             55          (c) the basis for any administrative fees;
             56          (d) the scope of all services covered under administrative fees;

             57          (e) the methodology for calculating any discount off the average wholesale price for
             58      provider reimbursement; and
             59          (f) a comparison of 100 claims for brand and generic drugs based on:
             60          (i) the same date for the claim;
             61          (ii) the same package count for the drug; and
             62          (iii) similar benefit structure.
             63          (4) (a) The audit shall be S. [ completed by December 15, 2006, but shall be ] .S prioritized
             63a      by
             64      the Legislative Audit Subcommittee.
             65          (b) The Office of the Legislative Auditor General may hire an expert:
             66          (i) with experience in providing consultation to states on prescription drug purchasing
             67      best practices; and
             68          (ii) who has S. [ not served as a consultant for a state entity subject to the audit ] been
             68a      approved by the Legislative Audit Subcommittee .S .
             69          (5) Information that includes prescription drug prices and discounts or other proprietary
             70      information, trade secrets, or commercial information provided to the Legislative Auditor
             71      General under the provisions of this bill may be classified as protected records in accordance
             72      with Section 63-2-304 of the Government Records Access and Management Act.

[Bill Documents][Bills Directory]