SENATE BILL 425

48th legislature - STATE OF NEW MEXICO - second session, 2008

INTRODUCED BY

Linda M. Lopez

AN ACT

RELATING TO MEDICAID REIMBURSEMENT RATES; REQUIRING PERIODIC RATE ADJUSTMENTS OF DISPENSING FEES FOR MEDICAID PHARMACISTS BASED ON CURRENT OPERATIONAL COSTS; DECLARING AN EMERGENCY.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     Section 1. SHORT TITLE.--This act may be cited as the "Prescription Drug Reimbursement Act".

     Section 2. DEFINITIONS.--As used in the Prescription Drug Reimbursement Act:

          A. "department" means the human services department;

          B. "division" means the medical assistance division of the department;

          C. "medicaid pharmacy" means a pharmacy that accepts medicaid reimbursement, among other payment sources, for pharmacy purchases;

          D. "operational costs" means the costs that a pharmacy or pharmacist incurs in ensuring that the appropriate covered outpatient drug is transferred to the patient and in allowing for a reasonable profit. "Operational costs" includes costs incurred:

                (1) in preparing, compounding, dispensing and delivering a prescription drug in compliance with state and federal laws and rules;

                (2) in verifying medicaid coverage, prescription packaging and labeling;

                (3) in overhead expenses, including staffing, professional salaries, pharmacist continuing education and training and pharmacy equipment maintenance; and

                (4) in assuring a client's proper use of a prescription drug through utilization review, preferred drug list compliance, counseling the client, consulting with the client's physician and providing medication therapy management to the client;

          E. "reasonable dispensing fee" means a dispensing fee that is consistent with the local economy, is efficient and is designed to approximate a pharmacy's actual dispensing costs plus a reasonable profit; and

          F. "secretary" means the secretary of human services.

     Section 3. REVIEW OF DISPENSING FEE ESTABLISHED--INCENTIVES ENCOURAGED.--

          A. The secretary shall review and adjust the dispensing fee for a pharmacy or pharmacist who participates in the medicaid program in even-numbered years, beginning April 1, 2010, and shall provide by rule for the adjustment, documenting the statewide average pharmacy cost of dispensing a medication using data on pharmacy operational costs. Documentation used to establish a reasonable dispensing fee shall be submitted to the federal centers for medicare and medicaid services with any other state plan amendment submitted to the federal centers for medicare and medicaid services for approval.

          B. The division may create incentives designed to encourage utilization of lower-cost multiple source prescription drugs.

     Section 4. TEMPORARY PROVISIONS.--

          A. The human services department shall complete a review of the federal mandated average-manufacturer-price-based upper limits on medicaid payments for multiple source drugs within one week of the effective date of this act.

          B. The human services department shall promulgate emergency rules within three weeks after the effective date of this act, adopting an appropriate increase to ensure that a reasonable dispensing fee is paid to medicaid pharmacies. The increase shall be set at a level designed to ensure medicaid beneficiary access to pharmacy services and care at a level approximating that available to the nonmedicaid population of the state.

     Section 5. EMERGENCY.--It is necessary for the public peace, health and safety that this act take effect immediately.

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