H. B. 4577

(By Mr. Speaker, Mr. Kiss,

and Delegate Martin)

[Introduced February 17, 2000; Referred to

the Committee on Government Organization.]





A BILL to amend chapter twenty-nine of the code of West Virginia, one thousand nine hundred thirty-one, as amended, by adding thereto a new article, designated article twenty-six, relating to purchase of prescription drugs by the State of West Virginia; creating the prescription drug authority; specifying duties and responsibilities of the prescription drug authority; allowing for employees and clerical support; mandating that prescription drugs purchased by or through the division of workers' compensation, the public employees insurance agency and the state medicaid program be purchased through the prescription drug authority; mandating the prescription drug authority purchase prescription drugs from the source having the lowest cost regardless of the country the source is located in if the quality of the prescription drug is otherwise the same or superior to the same prescription drug purchased from a source in the United States of America; providing that there be no limitation on the kinds of prescription drugs available through the state medicaid program; setting forth exceptions; authorizing a prescription drug by mail program; specifying that the prescription drug authority make available the twenty most prescribed drugs through a mail program; setting forth definitions; allowing the prescription drug authority to update the list of the twenty most prescribed drugs every calendar quarter; setting forth legislative findings and intent; requiring patients of workers' compensation, public employees insurance agency and the state medicaid program to get prescription drugs through the prescription drug authority; requiring annual reports to the Legislature; designating the public employees insurance agency as primary contractor for filling mail order prescription drugs; permitting the prescription drug authority to enter into cooperative agreements with other states, nations and indian tribes specifying penalties or sanctions for failure to use the prescription drug program; and setting forth an effective date.

Be it enacted by the Legislature of West Virginia:
That chapter twenty-nine of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended by adding thereto a new article, designated article twenty-six, to read as follows:
ARTICLE 26. PRESCRIPTION DRUG AUTHORITY.
§29-26-1. Legislative findings and intent.
The Legislature finds and declares that the purpose of this article is to establish a prescription drug authority to purchase prescription drugs at the lowest possible cost from any source or sources in the world while assuring that the quality of those prescription drugs is equal to or superior to the same drugs purchased in the United States.
The Legislature finds and declares that there is a great disparity in the reported cost of prescription drugs and that residents of Canada and Mexico are able to purchase the same drugs that are purchased by citizens of our state at a mere fraction of the cost paid by our citizens for life saving prescription medication. The Legislature further finds and declares that it is in the best interest and welfare of our citizens to create a public agency or authority and enable it to purchase prescription drugs at the lowest possible cost consistent with maintaining the quality and integrity of the drugs.
The Legislature further finds and declares that assuring the health and welfare of the citizens of this state is of vital importance. The cost of providing healthcare to our sick and injured workers, employees and citizens without healthcare is a matter of utmost concern, and that it is in the best interests of the people of this state for the state to spend its dollars on healthcare in an efficient manner. Prescription drugs account for a great percentage of healthcare costs and that controlling these costs is paramount to the citizens of this state.
§29-26-2. Definitions.
(a) "Prescription drugs" includes all drugs which may only be acquired with a prescription from a medical doctor.
(b) "Prescription drug authority" or "authority" means the prescription drug authority created by this article.
§29-26-3. Prescription drug authority created; composition; qualifications; appointment; terms of office; member's removal; vacancies; compensation and expenses; quorum; oath and bond.
(a) Authority created. -- There is hereby created within the department of administration a prescription drug authority, which shall consist of five members, all residents and citizens of this state. One member shall be the commissioner of the division of workers' compensation; one member shall be the director of the public employees insurance agency; one member shall be the commissioner of the bureau of medical services; one member shall represent the bureau of public health; and one member shall be the executive director of the consolidated public employees retirement board.
(b) Chairperson. -- Annually, the authority shall elect a chairperson from its membership who shall serve during the fiscal year of this state.
(c) Compensation. -- The commission shall pay each member the same compensation as is paid to members of the Legislature for their interim duties as recommended by the citizens legislative compensation commission and authorized by law for each day or portion thereof engaged in the discharge of official duties and shall reimburse each member for actual and necessary expenses incurred in the discharge of official duties: Provided, That the per mile rate to be reimbursed shall be the same rate as authorized for members of the Legislature. All payments shall be made from funds appropriated by the Legislature for operation of the prescription drug authority.
(d) Meetings. -- The authority shall meet at least once each calendar month. Additional meetings may be held at the call of the chairman, executive director or majority of the authority members.
(e) Quorum. -- A majority of the members constitutes a quorum for the transaction of business, and all actions require a majority vote of the members present.
§29-26-4. Prescription drug authority; powers and duties.
(a) Purpose. -- The authority shall carry on a continuous study and investigation of the cost of prescription drugs throughout the world and advise and assist the executive director of the authority. The authority shall also generally oversee the purchase of prescription drugs for the workers' compensation commission, the public employees insurance agency and the state medicaid program.
(b) Powers and duties. -- The prescription drug authority has authority to:
(1) Promulgate rules in accordance with chapter twenty-nine-a it believes are reasonable and necessary to implement, explain, administer or enforce the provisions of this article;
(2) Oversee the purchase of prescription drugs for workers' compensation, public employees insurance agency and the state medicaid program;
(3) Adopt an official seal;
(4) Maintain a principal office;
(5) Prescribe a schedule of fees and charges;
(6) Sue and be sued;
(7) Lease, rent, acquire, purchase, own, hold, construct, equip, maintain, operate, sell, encumber and assign rights of any property, real or personal, consistent with the objectives of the commission as set forth in this article;
(8) Hold hearings on any matter of concern to the authority relating to the cost of prescription drugs, subpoena witnesses, administer oaths, take testimony, require the production of evidence and documentary evidence and designate hearing examiners and employees to so act; and
(9) Make and enter into all agreements and do all acts necessary or incidental to the performance of its duties and the exercise of its powers under this article.
§29-26-5. Duties, powers and responsibilities of the authority; mandate to obtain prescription drugs at most efficient cost to state.

(a) The authority shall determine the twenty most prescribed prescription drugs in connection with workers' compensation, the public employees insurance agency and the state medicaid program. The authority shall make this determination on a quarterly basis and shall investigate the cost of these prescription drugs throughout the world. The authority shall determine from its investigation the lowest cost of these drugs and the location where these drugs may be purchased. If this location is outside the borders of the United States and if the quality of the prescription drugs from this location is equal to or greater than the same drug sold in the United States, the authority shall purchase prescription drugs from the location having the lowest cost.
(b) The authority shall investigate whether a substantial cost savings is available by entering into a cooperative prescription drug purchasing agreement with another state, other states or american indian tribal nations. If the authority determines that substantial savings are available as a result of entering ento such cooperative agreement, the authority shall enter into such cooperative agreement. If legislation is necessary to enter into any such agreement, the authority shall propose the necessary legislation in its annual report to the Legislature.
§29-26-6. Authority to make prescriptions available by mail; program to be administered by public employees insurance agency.

The authority shall purchase the twenty most prescribed drugs by workers' compensation, public employees insurance agency and the state medicaid program as determined on a quarterly basis from the source with the lowest cost consistent with maintaining the quality of the prescription drugs. The authority shall make these prescription drugs available to persons having been prescribed the drugs through workers' compensation, public employees insurance agency and the state medicaid program through a prescription mail plan. This prescription mail plan shall be administered through the public employees insurance agency or its pharmacy benefits program.
§29-26-7. Mandate to purchase drugs through authority; penalty.
Any person on workers' compensation, public employees insurance agency or the state medicaid program shall obtain his or her prescription drugs through the authority's mail order plan, if such drugs have been purchased by and are available through the prescription drug authority: Provided, That any such person may obtain a thirty day supply of the prescribed drug outside of the mail order program. If any person on workers compensation, public employees insurance or the state medicaid program does not obtain his or her prescription drugs as required herein, such person shall be solely responsible for the entire cost of his or her prescription drugs. All drug co-payments shall remain unchanged and remain as set by the program agencies.
§29-26-8. Application to state medicaid program.
Nothing contained in this article may be construed to limit in any way the kinds of prescription drugs available through the state medicaid program. The kinds of prescription drugs available through the medicaid program shall remain unaffected by the provisions of this article.
§29-26-9. Severability.
If, for any reason, any section, sentence, clause, phrase or provision of this article or the application thereof to any person or circumstance is held unconstitutional or invalid, the unconstitutionality or invalidity shall not affect other sections, sentences, clauses, phrases or provisions or their application to any other person or circumstance, and to this end each and every article, section, sentence, clause, phrase or provision of this article is hereby declared to be severable.
§29-26-10. Effective date.
The provisions of this article shall take effect on the first day of July, two thousand.

NOTE: The purpose of this bill is to mandate the State of West Virginia obtain prescription drugs for Workers' Compensation, Public Employees Insurance Agency and the State Medicaid Program from the source having the lowest cost. The bill creates the Prescription Drug Authority and mandates that it purchase drugs from sources outside this country if the cost of these drugs are lower and if the quality is otherwise the same.


This article is new; therefore strike-throughs and underling have been omitted.