- Introduced -

SB 1 - This act creates the Pharmaceutical Investment Program for Seniors (PIPS).

The current prescription drug tax credit (Section 135.095, RSMo) will sunset on December 31, 2001. The current prescription drug tax credit is contingently reenacted if PIPS is not fully operational, as defined in 208.550, by July 1, 2002. Section 135.094 maintains the $200 credit and defines "claimant" and "income" with the definition for Missouri's current circuit breaker law (Section 135.010, RSMo). The income limits remain at $15,000 and the phase-out is removed. Claimant couples must be Missouri residents and must apply for their own credit. No claimant who meets Medicaid eligibility requirements or who has pharmaceutical benefits through another policy may be eligible for the tax credit. However, if a person's pharmaceutical expenses exceed coverage limits, then the person may qualify for the credit for the additional expenses. A provision is added for each claim to be accompanied by proof of pharmaceutical expenses. The Department of Social Services must develop methods for verification. This credit may not be claimed after the 2002 tax year or any tax year during which an equivalent pharmaceutical benefits program is implemented.

The Medicaid income limit is increased to 100 percent of the federal poverty level and resource limits are increased to $1,500 for individuals and $2,500 for couples (Sections 208.010, 208.151).

The Commission for the Pharmaceutical Investment Program for Seniors is established, consisting of eleven members. The Commission will establish guidelines and procedures for PIPS (Sections 208.550 - 208.553).

The PIPS is established within the Division of Aging. The Commission must solicit requests for proposal from private contractors for administration of PIPS and for an insurance-based program to provide prescription drug coverage to eligible seniors. Eligible individuals must be:

- 65 or older without access to health insurance with a pharmacy benefit for at least six months prior to application;

- with household income at or below $17,000 for individuals and $23,000 for couples.

Medicaid participants are not eligible for this program. This program is a payer of last resort. If a senior carries coverage through another plan, then the senior may only receive certain benefits after meeting the deductible. Applicants must apply annually and prove age, residence, and household income. Certain deductibles and coinsurance amounts apply based on income level.

Income levels will be adjusted annually based on the cost-of-living adjustment to the federal poverty levels. Participants will also pay a forty percent coinsurance. Total expenditures for an enrollee may be up to $5,000. The Commission must submit quarterly reports including specific data. If program costs exceed funds, then the Commission may implement cost control measures. If a federal program is established, the state program will cover additional costs only (Section 208.556).

The Program must be fully operational by July 1, 2002. Open enrollment will be April 1 - May 30, 2002. As of 2004, open enrollment will be held November 1 through December 15. Other enrollment periods may apply for some (Section 208.559).

Generic drugs must be used when available, unless requested otherwise. Pharmacists in the Program will be reimbursed at specified levels based on whether the drug is generic or brand (Section 208.562).

Certificates will be issued to participating pharmacists. Participating pharmaceutical manufacturers may agree to provide rebates under PIPS. The Division will negotiate the amount annually with at least a fifteen percent rebate for brand and an eleven percent rebate for generic. Rebate payments must be made quarterly. All rebates will be used toward refunding the Program. A pharmaceutical manufacturer's refusal to participate will not affect its Medicaid status (Section 208.565).

The "Pharmaceutical Investment Program for Seniors Fund" is established to receive all moneys received by the PIPS (Section 208.568).

The "Joint Committee on Pharmaceutical Assistance for Seniors" is established to review the recommendations made by the Governor's Task Force and other prescription drug assistance issues, as needed. It will be composed of seven members each of the health and aging committees in the Senate and the House. It will be chaired jointly by the chairs of the health committees (Section 208.571).

This act contains an emergency clause and a contingent effective date for a certain section.

ERIN MOTLEY