[atlas:bill]

AN ACT Relating to the purchase of prescription drugs by public entities; creating a new section; and making an appropriation.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. (1) The Washington state health care authority, in consultation with the department of social and health services, shall contract with a qualified independent entity to conduct a study to determine the feasibility of aggregating the purchase and distribution of prescription drugs for all of the following:

(a) Participants in the medicaid program;

(b) Enrollees in the medicare program;

(c) Members and others who purchase health care services through the health benefits program of the public employees' benefits board;

(d) Any other individuals on whose behalf the state, county, or local government entity provides funds or subsidizes, in whole or in part, the purchase of prescription drugs or prescription drug benefits;

(e) Washington residents fifty-five years of age or older who have limited or no insurance coverage for prescription drugs; and

(f) Washington residents less than fifty-five years of age who have limited or no insurance coverage for prescription drugs.

(2) The study required by subsection (1) of this section must specifically and separately assess the feasibility of including in the aggregate large Washington private sector purchasers of prescription drugs. The study shall assess possible effects that the inclusion of these purchasers could have on the economy, specifically relating to prescription drug manufacturers, biotechnology firms, and pharmacies, and shall evaluate the extent to which inclusion of these purchasers would be marginally cost‑effective relative to the aggregate specified in subsection (1) of this section.

(3)(a) The study shall determine the impact that an aggregate purchasing program would have on the medicaid contract drug program, including the extent to which the purchasing program would increase or reduce the net cost of drugs in the medicaid program.

(b) The study shall recommend the optimal configuration, if any, of an aggregate purchasing program, based on the following factors:

(i) The state's funding capabilities;

(ii) The extent to which the program could be implemented in accordance with existing federal law; and

(iii) The extent to which the program would not reduce the scope of benefits, or access to medically necessary medications for program participants.

(c) If an alternative program is deemed feasible, the study shall identify the number of individuals who would be eligible or required to participate in the alternative program, and the specific steps that would be necessary to implement the alternative program, including any necessary changes to state law.

(4) Nothing in this section shall permit, or be construed to permit, a breach of the confidentiality of contracts or agreements between the medicaid program and pharmaceutical manufacturers.

(5) Upon the request of the Washington state health care authority, each entity set forth in subsection (1) of this section shall designate an individual to provide information regarding the entity's program, for purposes of completing the study.

(6) The Washington state health care authority, within eighteen months after securing full funding for the study, shall submit the results of the study to the legislature and the governor. If the results of the study indicate that the program is not feasible or would result in a reduction in the quality of care for program beneficiaries, that fact shall be clearly stated. A program proposed under this section to aggregate the purchase of prescription drugs by more than one of the entities set forth in subsection (1)(a) through (e) of this section shall not be implemented without the enactment of a statute.

(7) The Washington state health care authority and the department of social and health services may receive gifts, grants, or endowments from public or private sources that are made from time to time, in trust or otherwise, for the use and benefit of the purposes of this act, and spend gifts, grants, or endowments or income from the public or private sources according to their terms, unless receipt of the gifts, grants, or endowments violates RCW 42.17.710.

NEW SECTION. Sec. 2. The sum of . . . . . dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2002, from the general fund to the Washington state health care authority for the purposes of this act.