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COMMITTEE REPORT
April 9, 2003
H. 3586
Introduced by Reps. Clemmons, Harrison, Cato, W.D. Smith, Viers, Herbkersman, M.A. Pitts, E.H. Pitts, Altman, Barfield, Battle, Bingham, Branham, Ceips, Clark, Duncan, M. Hines, Keegan, Lourie, Miller, Owens, Skelton, Toole, Trotter, Umphlett, Whitmire, Witherspoon, Young, Hagood, Mahaffey, D.C. Smith, Haskins, Allen, Cobb-Hunter, Richardson, Jennings, Hayes, Merrill, Hinson, Delleney, G.M. Smith, Koon, Taylor, Martin, Bailey, McGee, Hamilton, J.R. Smith, Rhoad, Anthony, Freeman, Scarborough, J.E. Smith, Loftis, Coates, Rivers, Ott, J.H. Neal, Dantzler, Moody-Lawrence, Huggins, Limehouse, Tripp, Edge, Quinn, Wilkins, Clyburn, Kirsh, Neilson, Davenport and Gilham
S. Printed 4/9/03--H. [SEC 4/11/03 10:03 AM]
Read the first time February 12, 2003.
To whom was referred a Bill (H. 3586) to amend the Code of Laws of South Carolina, 1976, by adding Article 5 to Chapter 6, Title 44 so as to create the Interstate Bulk Prescription Drug Program, etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass with amendment:
Amend the bill, as and if amended, by striking all after the enacting words and inserting:
/ SECTION 1. Chapter 6, Title 44 of the 1976 Code is amended by adding:
Section 44-6-610. This article may be cited as the 'South Carolina Retirees and Individuals Pooling for Savings Act'.
Section 44-6-620. For purposes of this article:
(1) 'Department' means the Department of Health and Human Services.
(2) 'Prescription drugs' means outpatient prescription drugs, that have been approved as safe and effective by the United States Food and Drug Administration including insulin syringes, insulin needles, and insulin. 'Prescription drugs' do not include experimental drugs and over-the-counter pharmaceutical products.
(3) 'Program' means the South Carolina Retirees and Individuals Polling Together for Savings (SCRIPTS) program created pursuant to this article.
Section 44-6-630. There is created within the Department of Health and Human Services the South Carolina Retirees and Individuals Pooling Together for Savings (SCRIPTS) program. The program must combine the purchasing power of all South Carolina citizens sixty-five years of age and older who enroll in the program to reduce their prescription drug costs. Where possible, without violation of federal law, the department shall combine negotiating power for the program with negotiating power for pharmaceutical pricing and rebates which may exist now or in the future.
Section 44-6-640. (A) This program must be administered by the Department of Health and Human Services. The department may designate, or enter into contracts with, other entities including, but not limited to, other states, other governmental purchasing pools, and nonprofit organizations to assist in the administration of this program.
(B) By December 30, 2003, the department must submit a program implementation and administration plan for review by the State Budget and Control Board. The plan must include:
(1) procedures for program enrollment;
(2) requirements for program participation; and
(3) annual program enrollment fees that must be calculated to pay all additional costs incurred by the department in the administration of the program.
(C) Upon review of the State Budget and Control Board, the program may be implemented as soon as practicable.
(D) When requested by the department, other state agencies shall provide assistance or information necessary for the administration of this program.
Section 44-6-650. A person eligible to participate in this program must:
(1) have attained the age of sixty-five years;
(2) have resided in South Carolina at least six consecutive months before enrolling in the program; and
(3) not be eligible for Medicaid prescription benefits.
Section 44-6-660. (A) The department shall maintain data to allow evaluation of the cost effectiveness of the program.
(B) Beginning with the 2005 regular session of the General Assembly, no later than thirty days before the convening of each regular session, the department shall submit an annual report to the Governor, the chairman of the House Ways and Means Committee, and the Chairman of the Senate Finance Committee summarizing enrollment, financial information, and any other information needed to evaluate the costs and benefits of the program.
Section 44-6-670. (A) The department may seek waivers of any federal laws, regulations, or rules necessary to implement this program.
(B) The department may promulgate regulations necessary for the administration of this program.
Section 44-6-680. The program must be funded entirely from annual enrollment fees collected from program participants."
SECTION 2. This act takes effect upon approval by the Governor. /
Renumber sections to conform.
Amend title to conform.
ROBERT W. HARRELL, JR. for Committee.
REVENUE IMPACT 1/
The Board of Economic Advisors has reviewed the bill and has determined that there is no impact on state or local general fund revenue in FY2003-04.
Explanation
This bill would amend Section 44-6 of the Code of Laws of South Carolina to add Subsection 610 establishing the Interstate Prescription Drug Program. Under this program, the State would buy pharmaceuticals at reduced rates due to the State's large-scale purchasing power and would develop interstate agreements to combine South Carolina's purchasing power with other states'. The purpose of the bulk-purchasing of pharmaceuticals at reduced prices would be to lower the price of pharmaceuticals to South Carolinians disabled or 65 or over who have no prescription-drug health insurance coverage. There would not be any reduction in sales tax collection from a reduction in the cost of pharmaceuticals because sales of drugs are not subject to the sales tax. Accordingly, there would be no impact on state or local general fund revenue in FY2003-04.
Approved By:
William C. Gillespie
Board of Economic Advisors
1/ This statement meets the requirement of Section 2-7-71 for a state revenue impact, Section 2-7-76 for a local revenue impact, and Section 6-1-85(B) for an estimate of the shift in local property tax incidence.
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 5 TO CHAPTER 6, TITLE 44 SO AS TO CREATE THE INTERSTATE BULK PRESCRIPTION DRUG PROGRAM WITH NEIGHBORING STATES TO PROVIDE PRESCRIPTION DRUGS AT A REDUCED COST TO SENIOR AND DISABLED RESIDENTS WHO DO NOT HAVE PRESCRIPTION DRUG COVERAGE.
Whereas, tens of thousands of senior and disabled South Carolinians have no prescription drug insurance coverage and are unable to keep pace with the skyrocketing cost of prescription drugs which are rising at the rate of twenty percent, or more, annually; and
Whereas, many thousands of other senior and disabled South Carolinians are losing their employer-provided health insurance coverage as soon as they reach sixty-five years of age and become eligible for Medicare coverage; and
Whereas, still many hundreds of South Carolinians are seeing their deductibles double, and their health insurance premiums triple, mainly because of the rapidly increasing cost of prescription drugs; and
Whereas, joining with neighboring states to form a bulk buying program for prescription drugs would provide South Carolina's seniors and disabled residents without prescription coverage a resource for obtaining prescription drugs at a reduced cost. Now, therefore,
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 6, Title 44 of the 1976 Code is amended by adding:
Section 44-6-610. There is created the Interstate Bulk Prescription Drug Program to be implemented by the Department of Health and Human Services. This program shall provide prescription drugs at a reduced cost to residents age sixty-five or older or disabled who do not have prescription drug coverage. In implementing this program the department shall:
(1) negotiate with pharmaceutical companies to purchase prescription drugs in bulk at reduced costs;
(2) develop interstate agreements with neighboring states to participate in this program; and
(3) promulgate regulations to implement the provisions of this article including, but not limited to, eligibility requirements for program participation."
SECTION 2. This act takes effect upon approval by the Governor.
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