Affordable Medicines Utilization Act of 2011 - Amends title XIX (Medicaid) of the Social Security Act (SSA), with respect to FY2012-FY2014, to require an increase in the quarterly Medicaid payment to a state by 50% of the generic drug utilization savings amount if the state's generic substitution rate for the most recent preceding fiscal year for which data is available is greater than its rate for the most recent second preceding fiscal year for which data is available.
Directs the Secretary of Health and Human Services (HHS) to determine the state's generic substitution rate for such fiscal years.
Defines "generic substitution rate" as the share of all drug units for which Medicaid payment is made to a state for the 20 most widely prescribed multiple source drugs under the state program that have a specific National Drug Code.
Directs the Secretary to provide for payments to eligible states for implementation of programs to achieve reductions in expenditures under Medicaid or under SSA title XVIII (Medicare) (innovative health care savings program).
[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3342 Introduced in House (IH)]
112th CONGRESS
1st Session
H. R. 3342
To amend title XIX of the Social Security Act to encourage States to
increase generic drug utilization under Medicaid.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
November 3, 2011
Mr. Bass of New Hampshire (for himself, Mrs. Emerson, and Mr. Welch)
introduced the following bill; which was referred to the Committee on
Energy and Commerce
_______________________________________________________________________
A BILL
To amend title XIX of the Social Security Act to encourage States to
increase generic drug utilization under Medicaid.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Affordable Medicines Utilization Act
of 2011''.
SEC. 2. SAVINGS REBATE FOR STATES THAT INCREASE GENERIC DRUG
UTILIZATION UNDER MEDICAID.
(a) In General.--Section 1903 of the Social Security Act (42 U.S.C.
1396b) is amended by inserting after subsection (g) the following:
``(h)(1) With respect to each of fiscal years 2012, 2013, and 2014,
if the generic substitution rate determined for the State under section
1927(l)(2) for the most recent preceding fiscal year for which data are
available is greater than the State's generic substitution rate (as so
determined) for the second most recent preceding fiscal year for which
data are available, the amount determined under subsection (a)(1) for
the State for each quarter of the fiscal year shall be increased by an
amount equal to 50 percent of the generic drug utilization savings
amount determined for the State and the quarter under paragraph (2).
``(2) The generic drug utilization savings amount determined under
this paragraph with respect to a State and a quarter is the product
of--
``(A) the difference between the--
``(i) total amount expended by the State for the
corresponding quarter of the preceding fiscal year for
providing medical assistance for multiple source drugs
(as defined in section 1927(k)(7)(A)(i)), as determined
after the application of section 1927(b)(1)(B); and
``(ii) total amount expended by the State for the
quarter involved for providing medical assistance for
such drugs (as so determined); and
``(B) the State percentage determined for the State under
section 1905(b).''.
(b) Annual Determination of State Generic Substitution Rates and
Performance Rankings.--Section 1927 of the Social Security Act (42
U.S.C. 1396r-8) is amended by adding at the end the following:
``(l) Annual Determination of State Generic Substitution Rates and
Performance Rankings.--
``(1) In general.--Not later than January 1, 2012, and
annually thereafter, the Secretary shall determine the generic
substitution rate (as defined in paragraph (2)) for each State
for the most recent preceding fiscal year and the second most
recent preceding fiscal year for which data are available. The
Secretary annually shall publish on the Internet Web site of
the Centers for Medicare & Medicaid Services the generic
substitution rates determined for each State for such preceding
fiscal years and, with respect to a State, the percentage
increase or decrease in such rates when compared with each
other. On the basis of such comparison, the Secretary shall
list the States in order of the States with the greatest
increase in the generic substitution rate.
``(2) Generic substitution rate.--In paragraph (1), the
term `generic substitution rate' means, with respect to a
State, the share of all drug units for which payment is made to
the State under this title for the 20 most widely prescribed
multiple source drugs under the State program under this title
that have a specific National Drug Code and meet the
requirements of subsection (k)(7)(A)(i).''.
(c) Evaluation and Report.--
(1) In general.--Not later than December 31, 2014, the
Secretary of Health and Human Services shall evaluate and
report to Congress on the effectiveness of the generic drug
utilization savings payments authorized under section 1903(h)
of the Social Security Act (42 U.S.C. 1396b(h)) (as added by
subsection (a)) in encouraging States to increase their
Medicaid generic substitution rate. The evaluation shall
include the following:
(A) An analysis of the amounts each State Medicaid
program saves through increased generic drug
substitution.
(B) An analysis of any indirect savings to State
Medicaid programs through increased medication
adherence due to increased accessibility and
affordability of prescriptions.
(C) An analysis of future estimated savings to
State Medicaid programs and the Federal Government
after termination of the generic drug utilization
savings payments authorized under such section.
(2) Medicaid generic substitution rate.--In paragraph (1),
the term ``Medicaid generic substitution rate'' has the meaning
given the term ``generic substitution rate'' under section
1927(l)(2) of the Social Security Act (42 U.S.C. 1396r-8(l)(2))
(as added by subsection (b)).
SEC. 3. INNOVATIVE HEALTH CARE SAVINGS PROGRAM.
(a) In General.--Section 1903 of the Social Security Act (42 U.S.C.
1396b) is amended by adding at the end the following:
``(aa) Innovative Health Care Savings Program.--
``(1) In general.--In addition to the payments provided
under subsection (a), subject to paragraph (5), the Secretary
shall provide for payments to eligible States for the
implementation of programs to achieve reductions in
expenditures under this title or under title XVIII.
``(2) Eligible state.--A State is eligible for a payment
under this subsection if the State achieves a generic
substitution rate (as determined under section 1927(l)(2)) of
at least 92 percent.
``(3) Use of funds.--A State may only use funds received
through a payment under this subsection to implement programs
to achieve reductions in expenditures under this title or title
XVIII (such as innovative approaches to cost savings and health
care delivery).
``(4) Application, terms, and conditions.--
``(A) Application.--No payments shall be made to a
State under this subsection unless the State applies to
the Secretary for such payments in a form, manner, and
time specified by the Secretary and such application is
approved by the Secretary.
``(B) Terms and conditions.--Payments made under
this subsection are made under such terms and
conditions consistent with this subsection as the
Secretary prescribes.
``(5) Funding.--
``(A) Limitation.--The total amount of payments
under this subsection for a quarter shall not exceed 5
percent of the sum of the generic drug utilization
savings amount (as determined under subsection (h)(2))
for all States for the quarter. This subsection
constitutes budget authority in advance of
appropriations Acts and represents the obligation of
the Secretary to provide for the payment of amounts
provided under this subsection.
``(B) Allocation of funds.--The Secretary shall
specify a method for allocating the funds made
available under this subsection among eligible States.
``(C) Form and manner of payment.--Payment to an
eligible State under this subsection shall be made in
the same manner as other payments under section
1903(a). There is no requirement for State matching
funds to receive payments under this subsection.''.
(b) Effective Date.--The amendment made by subsection (a) shall be
effective for quarters beginning on or after the date of enactment of
this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Energy and Commerce.
Referred to the Subcommittee on Health.
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