Senate Calendar
friday, february 20, 2004
46th DAY OF ADJOURNED SESSION
TABLE OF CONTENTS
Page No.
Action Calendar
Consideration Postponed until Friday, February 20, 2004
Favorable with Proposal of Amendment
Second Reading
H. 471 Motor vehicles................................................................................. 398
Transportation Committee Report............................................ 398
Finance Committee Report...................................................... 403
Sen. Bloomer amendment........................................................ 404
New Business
Third Reading
S. 227 Risk assessment of sex offenders and community notification............ 404
Sen. Sears amendment............................................................. 404
H. 590 Open containers of an alcoholic beverage in a restaurant................... 404
Second Reading
Favorable
S. 190 Prudential committee of an incorporated school district vacancy........ 404
H. 519 Vermont student assistance corporation............................................ 405
Favorable with Recommendation of Amendment
S. 271 Notice of habitability........................................................................ 405
Judiciary Committee Report..................................................... 405
Concurrent Resolutions for Action
(For text, see Addendum to Calendar for February 19, 2004)
S.C.R. 42. Stuart Campo .............................................................................. 59
S.C.R. 43 Jeanne and John Bernek .............................................................. 60
S.C.R. 44 Olivia Miles.................................................................................. 61
H.C.R. 181 Jeremy Fitzgibbons Eagle Scout................................................... 62
H.C.R. 182 Richard Fleming, Jr...................................................................... 63
H.C.R. 183 Paul and Polly Sisters................................................................... 64
H.C.R. 184 Jonathan Klein Eagle Scout.......................................................... 65
H.C.R. 185 In memory of Bob “Captain Kangaroo” Keeshan......................... 66
H.C.R. 186 In memory of Captain Pierre Piche............................................... 67
H.C.R. 187 Commending members of Act 133 tech. advisory committee......... 69
H.C.R. 188 Addison Raap ............................................................................. 70
Notice Calendar
S. 288 State programs and policies on prescription drugs............................ 407
ACTION CALENDAR
Consideration Postponed Until Friday, February 20, 2004
Second Reading
Favorable with Proposal of Amendment
H. 471
An act relating to motor vehicles.
Reported favorably with recommendation of proposal of amendment by Senator Maynard for the Committee on Transportation.
The Committee recommends that the Senate propose to the House to amend the bill by striking out all after the enacting clause and inserting in lieu thereof the following:
Sec. 1. 23 V.S.A. § 304(d) is amended to read:
(d) Special number plates whether new or renewed shall be issued in any
combination or succession of numerals and letters provided the total of the
numbers and letters on any plate taken together does not exceed seven, and
further provided the requested combination of letters and numerals does not
duplicate or resemble a regular issue registration plate. The commissioner
may adopt rules for the issuance of special number plates to ensure that all
plates serve the primary purpose of vehicle identification. The
commissioner may refuse to honor any request that might be offensive or
confusing to the general public. The commissioner may revoke any special plate
that is found to be offensive or confusing to the general public. Revoke
any plate described in subdivisions (1) through (7) of this subsection and
shall not issue special number plates with the following combination of letters
or numbers:
(1) Combinations of letters or numbers with any connotation, in any language, that is vulgar, derogatory, profane, racial epithets, scatological or obscene.
(2) Combinations of letters, or numbers that connote, in any language, breast, genitalia, pubic area, or buttocks or relate to sexual or eliminatory functions. Additionally, “69” formats are prohibited unless used in combination with the vehicle make, for example, “69 CHEV.”
(3) Combinations of letters, or numbers that connote, in any language:
(A) any illicit drug, narcotic, intoxicant, or related paraphernalia;
(B) the sale, the user, or the purveyor of such substance;
(C) the physiological state produced by such a substance.
(4) Combinations of letters or numbers that refer, in any language, to a race, religion, color, deity, ethnic heritage, gender, sexual orientation, disability status, or political affiliation; provided, however, the commissioner shall not refuse a combination of letters or numbers that is a generally accepted reference to a race or ethnic heritage (for example, IRISH).
(5) Combinations of letters or numbers that suggest, in any language, a government or governmental agency.
(6) Combinations of letters or numbers that suggest, in any language, a privilege not given by law in this state.
(7) Combinations of letters or numbers that form, in any language, a slang term, abbreviation, phonetic spelling or mirror image of a word described in subdivisions (1) through (6) of this subsection.
Sec. 2. 23 V.S.A. § 603(b) and (c) are amended to read:
(b) Before
issuing an operator license, junior operator license or learner permit to a
first-time an applicant, the commissioner shall obtain driving
record information through the National Driver Register and from each state in
which the person has been licensed or has been issued a learner permit.
(c) An operator license, junior operator license or learner permit shall
not be issued to a first-time an applicant whose license or
learner permit is suspended, revoked or canceled in any jurisdiction.
Sec. 3. 23 V.S.A. § 673a(b) and (c) are amended to read:
(b) The
term “habitual violator” as used herein, shall mean any person who has been
convicted in any court in this state of eight or more moving violations each of
which would result in point assessments of 6 six or more points,
including violations of section 1201 of this title, arising out of different
incidents within a consecutive period of five years.
(c) Upon receipt of the notice of revocation, the The
person may within ten 15 days of the notice of revocation
request a hearing solely for the purpose of verifying the conviction record,
and the revocation shall not take effect until the hearing has been held in
accordance with the provisions of sections 105‑107 of this title and the
record has been verified.
Sec. 4. 23 V.S.A. § 711 is amended to read:
§ 711. PENALTIES
Any person who operates a driver training school or acts as an instructor
without a license thereforeshall be fined not more than $50.00 or
imprisoned for a term not exceeding 5 days, or both $500.00.
Sec. 5. 23 V.S.A. § 1004 is amended to read:
§ 1004. INTERSTATE
HIGHWAY REGULATIONS RULES
(a) The
traffic committee has exclusive authority to make and publish, and from time to
time may alter, amend, or repeal, regulations rules pertaining to
vehicular, pedestrian and animal traffic, speed limits, and the public
safety on the national system of interstate and defense highways and other
limited access and controlled access highways within this state. The regulations
rules and any amendments or revisions may be made by the committee only after
a public hearing, notice of which shall be published at least twenty days before
the holding of the hearing in at least two newspapers of general circulation in
the state designated for that purpose by the committee. The committee shall
also mail notice of the hearings at least twenty days in advance to persons who
register with them with a request to be so notified. Notices may contain a
general statement of the contents of the regulations to be adopted, together
with information as to where the full text of the regulations may be obtained
in accordance with chapter 25 of Title 3. The regulations rules
shall be consistent with accepted motor vehicle codes or standards, shall be
consistent with law, and shall not be unreasonable or discriminatory in respect
to persons engaged in like, similar, or competitive activities. The regulations
rules are applicable only to the extent that they are not in conflict
with regulations or orders issued by any agency of the United States having
jurisdiction and shall be drawn with due consideration for the desirability of
uniformity of law of the several states of the United States. Regulations
and amendments, revisions or repeals shall, within five days of promulgation,
be submitted by the committee to the attorney general for his approval as to
their legality. Within ten days after approval the committee shall deposit two
copies in the office of the secretary of state, and they are effective sixty
days after the date deposited.
(b) Regulations
Rules authorized by this section are effective on interstate and other
limited access and controlled access highways only, taking precedence over
those then in force and future highway laws and regulations rules
applicable to highways generally; however, the general highway laws and regulations
rules are effective on interstate highways until properly authorized regulations
rules providing otherwise are made and published adopted.
(c) Regulations Rules, together with alterations and
amendments thereto of rules, made under this section have the
force of law, and violations thereof shall be penalized under section
2205(c) traffic violations under section 2302 of this title.
Sec. 6. 23 V.S.A. § 1209a(b) is amended to read:
(b)
Abstinence. Notwithstanding any other provision of this subchapter, a person
whose license has been suspended for three years or more under this subchapter
may apply to the driver rehabilitation school director and to the commissioner
for reinstatement of his or her driving privilege. In the case of a suspension
for three years, the person shall have completed two years of total abstinence
from consumption of alcohol or drugs, or both. In the case of a
suspension for life, the person shall have completed three years of total
abstinence from consumption of alcohol or drugs, or both. In both
cases, the beginning date for the period of abstinence shall be no sooner than
the effective date of the suspension from which the person is requesting
reinstatement and shall not include any period during which the person is
serving a sentence of incarceration to include furlough. If the commissioner,
or a medical review board convened by the commissioner, is satisfied by a
preponderance of the evidence that the applicant has abstained for the required
number of years immediately preceding the application and hearing, has
successfully completed a therapy program as required under this section and the
person appreciates that he or she cannot drink any amount of alcohol and drive
safely, the person’s license shall be reinstated immediately upon such
conditions as the commissioner may impose. If after notice and hearing the
commissioner later finds that the person was operating, attempting to operate
or in actual physical control of a vehicle while there was any amount of
the person’s alcohol in the blood concentration was 0.02 or
more following reinstatement under this subsection, the person’s operating
license or privilege to operate shall be immediately suspended for the period
of the original suspension. A person shall be eligible for reinstatement under
this section only once following a suspension for life.
Sec. 7. REPEAL
Sec. 13(b) of No. 139 of the Acts of the 2001 Adj. Sess. (2002) (agricultural service vehicles repealer) is repealed.
Sec. 8. 23 V.S.A. § 1400a(c) is amended to read:
(c)(1) The selectmen, trustees, or the mayor are authorized to accept for the municipality compensation commensurate with the extra wear or maintenance required on the highway traveled over or on any bridge by reason of the overweight allowed by any permit approved by them or any exemption provided under section 1400d of this title, which shall be used for the maintenance of highways and bridges within the town, village or city. The following factors, at a minimum, shall be taken into consideration when determining the amount of compensation due:
(1)(A) The amount of weight
allowed in excess of the normal limit.
(2)(B) The configuration and
number of axles of the vehicle involved.
(3)(C) The number and length
of trips the vehicle will be making.
(4)(D) The condition of the
highway before and after use by the vehicle, and costs associated with any
needed repair.
(2) If the agreement for the compensation to be paid is in writing, failure on the part of the applicant to pay the sum or sums agreed upon shall be sufficient cause for the selectmen, trustees or mayor to withdraw approval for the permit. A fee not in excess of $5.00 may be charged for the written approval of a municipality furnished under this section.
Sec. 9. 23 V.S.A. § 1400d is amended to read:
§ 1400d. AGRICULTURAL SERVICE VEHICLES
(a) An agricultural service vehicle, as defined in subdivision 4(71) of this title, shall be exempt from the provisions of sections 1400 and 1400a of this title if the gross weight does not exceed 60,000 pounds.
(b) Municipalities shall not be liable for injuries or damages to agricultural service vehicles or their operators that result from crossing a posted bridge with an agricultural service vehicle that weighs more than the posted weight limit.
Sec. 10. 23 V.S.A. § 1403 is amended to read:
§ 1403. –EXPIRATION OR REVOCATION
Blanket permits shall expire on May 1 next following the date of
issue, at the same time as the vehicle’s registration but may be
revoked for cause by the motor vehicle commissioner with or without hearing.
Sec. 11. 32 V.S.A. § 3109(e) is added to read:
(e) As used in this section, the word “commissioner” shall include the commissioner of motor vehicles.
Sec. 12. 32 V.S.A. § 8903(e) is amended to read:
(e)(1) Any person registering a pleasure car in this state subject to the tax imposed by subsection (d) must pay the tax imposed by subsection (a) or (b) upon demand of the commissioner if:
(1)(A) the vehicle is not
actually rented for at least less than 30 days in any
single year a continuous period of 365 days or for less than 60 days in
a continuous period of 730 days; or
(2)(B) the vehicle is no
longer used in short-term rentals; and
(3)(C) the vehicle has not
been stolen, converted or abandoned.
(2) For taxation purposes, the value of the vehicle shall be fixed in accordance with section 8907 of this title as of the time the event causing the imposition of the tax under subsection (a) or (b) of this section occurs.
Sec. 13. EFFECTIVE DATE
This act shall take effect on June 29, 2003.
(Committee Vote: 6-0-0)
Reported favorably with recommendation of proposal of amendment by Senator Ayer for the Committee on Finance.
The Committee recommends that the Senate propose to the House to amend the bill as recommended by the Committee on Transportation with the following amendments thereto:
First: By striking out Secs. 7, 8, and 9 in their entirety
Second: By adding a new section to read as follows:
Sec. 12a. CENTRALIZED PERMITTING; STUDY
The commissioners of motor vehicles and of information and innovation shall study the feasibility of a centralized permitting system located within the department of motor vehicles for the issuance of permits for use of town highways and bridges by commercial motor vehicles. The commissioners shall investigate centralized permitting system in other states which issue both state and local permits. The commissioners shall report study findings and recommendations to the chairs of the house and senate committees on agriculture and on transportation no later than November 1, 2004. Subjects addressed by the study shall include costs of a centralized system.
Third: In Sec. 13, by striking out the date “June 29, 2003” and inserting in lieu thereof the date “July 1, 2004”
(Committee Vote: 5-0-2)
(No House amendments.)
PROPOSAL OF AMENDMENT TO H. 471 TO BE OFFERED BY SENATOR BLOOMER
Senator Bloomer moves that the Senate propose to the House to amend the bill by adding a new Sec. 1 to read as follows:
Sec. 1. 23 V.S.A. § 304(c) is amended to read:
* * *
(4) A person holding a registration number between 101 and 9999 on a pleasure car may also have the same number on a truck, or vice versa.
And by renumbering the remaining sections to be numerically correct.
New Business
Third Reading
S. 227
An act relating to risk assessment of sex offenders and community notification.
AMENDMENT TO S. 227 TO BE OFFERED BY SENATOR SEARS BEFORE THIRD READING
Senator Sears moves to amend the bill as follows:
First: In Sec. 3, 13 V.S.A. §5404(b), by striking out the word “secondary” and inserting in lieu thereof the word postsecondary
Second: In Sec. 4, 13 V.S.A. §5407(a)(4), by striking out the word “secondary” and inserting in lieu thereof the word postsecondary
and that upon passage the title of the bill be amended to read “An act relating to sex offender registration and community notification.”
H. 590
An act relating to open containers of an alcoholic beverage in a restaurant.
Second Reading
Favorable
S. 190
An act relating to a vacancy on the prudential committee of an incorporated school district.
Reported favorably by Senator Shepard for the Committee on Government Operations.
(Committee vote: 6-0-0)
H. 519
An act relating to the Vermont student assistance corporation.
Reported favorably by Senator Condos for the Committee on Education.
(Committee vote: 5-0-0)
(For House amendments, see House Journal for January 29, 2004, page 141).
Favorable with Recommendation of Amendment
S. 271
An act relating to notice of habitability.
Reported favorably with recommendation of amendment by Senator Bloomer for the Committee on Judiciary.
The Committee recommends that the bill be amended in Sec. 1, 9 V.S.A. § 4458 by striking out subsection (b) in its entirety, and inserting in lieu thereof the following:
(b) If the landlord has knowledge of a condition of the leased premises that materially affects health, and notice of that condition has not been provided to the tenants, the tenants are relieved of the requirement of providing notice to the landlord as required by subsection (a) of this section and shall retain the remedies available to them under that section.
(Committee vote: 6-0-0)
CONSENT CALENDAR
Concurrent Resolutions for Adoption Under Joint Rule 16
The following concurrent resolutions will be adopted automatically unless a Senator or Representative requests floor consideration before the end of today’s legislative session. Requests for floor consideration in either chamber should be communicated to the Secretary’s office and/or the House Clerk’s office, respectively.
(For text of Resolutions, see Addendum to Senate and House Notice Calendar for Thursday, February 19, 2004)
S.C.R. 42
Senate concurrent resolution congratulating Stuart Campo on being named the 2004 Vermont high school distinguished finalist in the Prudential Spirit of Community Awards competition.
S.C.R. 43
Senate concurrent resolution congratulating Jeanne and John Bernek on their retirement as the proprietors of the Marshfield Village Store.
S.C.R. 44
Senate concurrent resolution congratulating Olivia Miles on winning the Vermont middle school 2004 Prudential Spirit of Community Award.
H.C.R. 181.
House concurrent resolution honoring Jeremy Fitzgibbons of Boy Scout Troop #211 in Cavendish on becoming an Eagle Scout
H.C.R. 182.
House concurrent resolution honoring Richard Fleming Jr. on his receipt of the Brattleboro Area Chamber of Commerce’s 2003 Person of the Year Award
H.C.R. 183.
House concurrent resolution honoring Paul and Polly Sisters for their 60 years of public service on behalf of the town of Ferrisburgh
H.C.R. 184.
House concurrent resolution congratulating Jonathan Klein of Troop #709 of Montpelier upon earning the rank of Eagle Scout
H.C.R. 185.
House concurrent resolution in memory of Bob “Captain Kangaroo” Keeshan of West Hartford
H.C.R. 186.
House concurrent resolution in memory of Captain Pierre Piché
H.C.R. 187.
House concurrent resolution commending the members of the Act 133 technical advisory committee
H.C.R. 188.
House concurrent resolution congratulating Addison Raap on being named a Vermont distinguished finalist in the Prudential Spirit of Community Awards competition
Notice Calendar
Favorable with Recommendation of Amendment
S. 288
An act relating to state programs and policies on prescription drugs.
Reported favorably with recommendation of amendment by Senator Leddy for the Committee on Health and Welfare.
The Committee recommends that the bill be amended by striking out all after the enacting clause and inserting in lieu thereof the following:
* * * Retail Drug Price Disclosure * * *
Sec. 1. 33 V.S.A. § 2007 is added to read:
§ 2007. RETAIL DRUG PRICE DISCLOSURE
With each prescription dispensed, the pharmacist shall disclose to the patient, in writing, the usual and customary retail price of the prescription and the cost of any payment toward the price required of the patient.
Sec. 2. EFFECTIVE DATE
Sec. 1 of this act shall take effect July 1, 2004 and apply to a pharmacy on the date thereafter on which the pharmacy updates its computer software program with regard to prescription drug price and patient payment, but in no event later than January 1, 2006.
* * * Over-the-Counter Drug Coverage * * *
Sec. 3. 33 V.S.A. § 1992a is added to read:
§ 1992a. OVER-THE-COUNTER DRUG COVERAGE
All public pharmaceutical assistance programs shall provide coverage for over-the-counter drugs on the preferred drug list developed under section 1998 of this title.
* * * PBM Licensing * * *
Sec. 4. 18 V.S.A. chapter 221, subchapter 9 is added to read:
Subchapter 9. Pharmacy Benefit Managers
§ 9471. DEFINITIONS
As used in this subchapter:
(1) “Beneficiary” means an individual who has been enrolled in a health insurance plan in which coverage of prescription drugs is administered by a pharmacy benefit manager.
(2) “Commissioner” means the commissioner of banking, insurance, securities, and health care administration.
(3) “Health insurance plan” means a health benefit plan offered, administered, or issued by a health insurer doing business in Vermont.
(4) “Health insurer” is defined by subdivision 9402(7) of this title. The term includes:
(A) The state of Vermont and any agent or instrumentality of the state that offers, administers, or provides financial support to state government employees.
(B) Medicaid, the Vermont health access plan, the VScript pharmaceutical assistance program, and any other public health care assistance program.
(C) To the extent permitted by federal law, any self-insured health benefit plan that offers health care coverage to Vermont beneficiaries.
(5) “Pharmacy benefit management plan” means an arrangement for the delivery of prescription services in which a pharmacy benefit manager undertakes to provide, arrange for, pay for, or reimburse any of the costs of prescription services for a beneficiary.
(6) “Pharmacy benefits manager” means a business that administers the prescription drug or device portion of health insurance plans through a pharmacy benefit management plan on behalf of a health insurance plan.
§ 9472. PHARMACY BENEFIT MANAGER; LICENSE REQUIRED
(a) No person shall act as a pharmacy benefit manager or administer a pharmacy benefit management plan in this state without obtaining an annual license from the commissioner.
(b) The commissioner may suspend or revoke any license issued to a pharmacy benefit manager under this subchapter or deny an application for a license if the commissioner finds that the pharmacy benefit manager or any officer, employee, or agent of the pharmacy benefit manager has failed to satisfy any of the following requirements. A pharmacy benefit manager shall:
(1) Fulfill its fiduciary obligations to health insurance plans and health insurance plan beneficiaries in accordance with the provisions of section 9473 of this title.
(2) File an annual disclosure statement and secure prior approval of contracts in accordance with the provisions of section 9474 of this title.
(3) Pay all fees, taxes, and charges required by law.
(4) File a financial statement or statements and any reports, certificates, or other documents the commissioner considers necessary to secure a full and accurate knowledge of its affairs and financial condition.
(5) Remain solvent, and its financial condition, method of operation, and manner of doing business shall remain such as to satisfy the commissioner that it can meet its obligations to health insurance plans and all beneficiaries.
(6) Comply with all the requirements of law, the provisions of this subchapter, and the rules adopted pursuant to this subchapter.
(c) A nonrefundable license application fee of $500.00 shall accompany each application for a license to transact business in this state. The fee shall be collected by the commissioner and paid directly into the pharmacy benefit management regulation special fund established and administered under subchapter 5 of chapter 7 of Title 32 for the purpose of defraying expenses for the regulation, supervision, and examination of all entities subject to regulation under this subchapter.
(d) The license required by this section shall be signed by the commissioner or a duly authorized agent of the commissioner and shall expire on the next June 30 after the date on which it becomes effective.
(e) All pharmacy benefit managers offering or providing pharmacy benefit management plans shall obtain an annual renewal of their license from the commissioner. The commissioner may refuse to renew the license of any pharmacy benefit manager or may renew the license, subject to any conditions or restrictions deemed by the commissioner to be needed to carry out the purposes of this subchapter, if the commissioner finds that the pharmacy benefit manager has violated any of the requirements for licensure established in subsection (b) of this section. The commissioner shall not fail to renew the license of any pharmacy benefit manager without giving the pharmacy benefit manager notice and an opportunity to be heard in accordance with the provisions of 3 V.S.A. chapter 25 (Administrative Procedure Act).
(f) The commissioner may adopt such rules as are necessary to carry out the purposes of this subchapter.
§ 9473. FIDUCIARY OBLIGATIONS OF PHARMACY BENEFIT MANAGERS
A pharmacy benefit manager shall at all times discharge its obligations to health insurance plans and health insurance plan beneficiaries in compliance with the standards of conduct applicable to a “fiduciary” under the Employee Retirement Income Security Act of 1974. In so doing, a pharmacy benefit manager shall:
(1) Discharge its duties with respect to health insurance plans and health insurance plan beneficiaries solely in the interest of such plans and beneficiaries, and for the exclusive purpose of providing benefits to such plans and beneficiaries and defraying reasonable expenses of administering health insurance plan and health insurance plan beneficiary benefits.
(2) Discharge its duties with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent fiduciary acting in like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims.
(3) Discharge its duties in accordance with the contract governing the health insurance plan prescription drug coverage, insofar as such contract is consistent with the provisions of this law and of the Employee Retirement Income Security Act of 1974.
(4) Provide any and all information requested by health insurance plans so as to ensure that such plans are able to ascertain all material activities being undertaken on their behalf or on behalf of health insurance plan beneficiaries.
(5) Notify health insurance plans in writing of any proposed or ongoing activity that involves, directly or indirectly, any conflict of interest as contemplated by the standards applicable to a “fiduciary” under the Employee Retirement Income Security Act of 1974.
§ 9474. ANNUAL STATEMENT; PRIOR APPROVAL OF CONTRACTS
(a) Each pharmacy benefit manager providing pharmacy benefit management plans in this state shall file a statement with each health insurance plan and with the commissioner annually by March 1. The statement shall be verified by at least two principal officers and shall cover the preceding calendar year. The annual statement shall be on forms prescribed by the commissioner, and shall include:
(1) A financial statement of the organization, including its balance sheet and income statement for the preceding year.
(2) The number of persons enrolled during the year, the number of enrollees as of the end of the year, and the number of enrollments terminated during the year.
(3) Any other information relating to the operations of the pharmacy benefit manager required by the commissioner pursuant to this subchapter.
(b) A pharmacy benefit manager shall not enter into a contract with a health insurance plan unless the commissioner first determines, upon application by the pharmacy benefit manager on a form and in a manner approved by the commissioner, that the pharmacy benefit manager has disclosed to the health insurance plan any of the following agreements and practices, and that the commissioner has determined that the contract and any such agreement and practice promotes the medical and financial interests of the health insurance plan and the beneficiaries of the health insurance plan. The pharmacy benefit manager shall disclose:
(1) Any agreement with a pharmaceutical manufacturer to favor the manufacturer’s products over a competitor’s products, or to place the manufacturer’s drug on the pharmacy benefit manager’s preferred list or formulary, or to switch the drug prescribed by the patient’s health care provider with a drug agreed to by the pharmacy benefit manager and the manufacturer.
(2) Any agreement with a pharmaceutical manufacturer to share manufacturer rebates and discounts with the pharmacy benefit manager, or to pay “soft money” or other economic benefits to the pharmacy benefit manager.
(3) Any agreement or practice to bill Vermont health benefit plans for prescription drugs at a cost higher than the pharmacy benefit manager pays the pharmacy.
(4) Any agreement to share revenue with a mail order or internet pharmacy company.
(5) Any agreement to sell prescription drug data concerning Vermont beneficiaries, or data concerning the prescribing practices of the health care providers of Vermont beneficiaries.
(6) Any corporate or other organizational or governing affiliation between the pharmacy benefit manager and a pharmaceutical manufacturer.
(7) Any other agreement of the pharmacy benefit manager with a pharmaceutical manufacturer, or with wholesale and retail pharmacies, affecting the cost of pharmacy benefits provided to Vermont beneficiaries.
(c) A contract filed under this section shall be deemed approved unless the commissioner disapproves such contract within 30 days after filing with the commissioner. Disapproval shall be in writing, stating the reasons thereforeand a copy thereof delivered to the pharmacy benefit manager.
§ 9475. ASSESSMENT
(a) The expenses of administering this subchapter, including the cost incurred by the commissioner, shall be assessed annually by the commissioner against all pharmacy benefit managers operating in this state. Before determining the assessment, the commissioner shall provide an estimate of all expenses for the regulation, supervision, and examination of all entities subject to regulation under this chapter. The assessment shall be in proportion to the business done in this state.
(b) All fees and assessments under this subchapter and paid to the commissioner shall be deposited in the pharmacy benefit management regulation special fund established and administered under subchapter 5 of chapter 7 of Title 32 for the purpose of defraying the expenses for the regulation, supervision, and examination of all entities subject to regulation under this subchapter.
(c) The commissioner shall give each pharmacy benefit manager notice of the assessment, which shall be paid to the department annually on or before March 1. Any pharmacy benefit manager that fails to pay the assessment on or before the date prescribed in this subsection shall be subject to a penalty imposed by the commissioner. The penalty shall be ten percent of the assessment and interest for the period between the due date and the date of full payment. If a payment is made in an amount later found to be in error, the commissioner shall:
(1) If an additional amount is due, notify the company of the additional amount and the company shall pay the additional amount within 14 days of the date of the notice.
(2) If an overpayment is made, order a refund.
(d) If an assessment made under this subchapter is not paid to the commissioner by the prescribed date, the amount of the assessment, penalty, and interest may be recovered from the defaulting company on motion of the commissioner made in the name and for the use of the state in the appropriate superior court after ten days’ notice to the company. The license of any defaulting pharmacy benefit manager to transact business in this state may be revoked or suspended by the commissioner until the manager has paid such assessment.
§ 9476. ENFORCEMENT
In addition to any other remedy provided by law, a health insurance plan or a plan beneficiary aggrieved by a violation of this subchapter or a rule adopted under this subchapter may file an action in superior court for injunctive relief and an award of compensatory and punitive damages. The superior court may award to the health insurance plan or plan beneficiary who prevails in an action under this section reasonable costs and attorney’s fees.
* * * Joint Purchasing within Vermont; OTC; Counterdetailing * * *
Sec. 5. 33 V.S.A. § 1998 is amended to read:
§ 1998. PHARMACY BEST PRACTICES AND COST CONTROL PROGRAM ESTABLISHED
(a) The commissioner of prevention, assistance, transition, and health access shall establish a pharmacy best practices and cost control program designed to reduce the cost of providing prescription drugs, while maintaining high quality in prescription drug therapies. The program shall include:
(1) A preferred list of covered prescription drugs that identifies preferred choices within therapeutic classes for particular diseases and conditions, including generic alternatives and over-the-counter drugs.
(A) The
commissioner, and the commissioner of banking, insurance, securities,
and health care administration shall implement the preferred drug list as a
uniform, statewide preferred drug list by encouraging all health benefit plans
in this state to participate in the program.
(B) The commissioner of personnel shall use the preferred drug list in the state employees health benefit plan only if participation in the program will provide economic and health benefits to the state employees health benefit plan and to beneficiaries of the plan, and only if agreed to through the bargaining process between the state of Vermont and the authorized representatives of the employees of the state of Vermont. The provisions of this subdivision do not authorize the actuarial pooling of the state employees health benefit plan with any other health benefit plan, unless otherwise agreed to through the bargaining process between the state of Vermont and the authorized representatives of the employees of the state of Vermont. No later than November 1, 2004, the commissioner of personnel shall report to the health access oversight committee and the senate and house committees on health and welfare on whether use of the preferred drug list in the state employees health benefit plan would, in his or her opinion, provide economic and health benefits to the state employees health benefit plan and to beneficiaries of the plan.
* * *
(4) Education programs,
including
With input from physicians, pharmacists, private insurers, hospitals,
pharmacy benefit managers, and the drug utilization review board, a
counterdetailing education program, designed to provide information and education
on the therapeutic and cost-effective utilization of prescription drugs to
physicians, pharmacists and other health care professionals authorized to
prescribe and dispense prescription drugs. Details of the program,
including the scope of the program and funding recommendations, shall be
contained in a report submitted to the health access oversight committee and
the senate and house committees on health and welfare no later than December
31, 2004;
* * *
* * * Expanding Use of 340B Programs * * *
Sec. 6. 33 V.S.A. § 2008 is added to read:
§ 2008. FEDERAL DISCOUNT PROGRAMS; STUDY
The commissioner shall study and by January 1, 2005 report to the governor, the senate and house committees on health and welfare, and the health access oversight committee on the feasibility of providing discounted prescription drugs to Vermont’s most vulnerable patient populations through the use of Section 340B of the federal Public Health Service Act, 42 United States Code § 256b (1999). The commissioner shall work with other state agencies, representatives of state employees, and representatives of health care providers and facilities in the state to provide the following information:
(1) A description of all health care providers and facilities in the state potentially eligible for designation as “covered entities” under Section 340B, including without limitation all hospitals eligible as disproportionate share hospitals; recipients of grants from the United States Public Health Service; federally qualified health centers; federally qualified look-alikes; state‑operated AIDS drug assistance programs; Ryan White CARE Act Title I, Title II, and Title III programs; tuberculosis, black lung, family planning, and sexually transmitted disease clinics; hemophilia treatment centers; public housing primary care clinics; and clinics for homeless people.
(2) A listing of potential applications of Section 340B and the potential benefits to public, private, and third-party payors for prescription drugs, including:
(A) application to inmates and employees in youth correctional facilities, county jails, and state prisons;
(B) maximizing the use of Section 340B within state-funded managed care plans;
(C) the inclusion of Section 340B providers in state bulk purchasing initiatives; and
(D) using sole source contracts with Section 340B providers to furnish high-cost chronic care drugs.
(3) Discounts available through Section 340B contracts, including estimated cost savings to the state as a result of retail mark-up avoidance, negotiated subceiling prices, and coordination with the Medicaid program in order to minimize costs to the program and to other purchasers of prescription drugs.
(4) The resources available to potential applicants for designation as covered entities for the application process, establishing a Section 340B program, restructuring the health care system, or other methods of lowering the cost of prescription drugs. The resources must include state and federal agencies and private philanthropic grants to be used for the purposes of this section.
* * * Study on Savings * * *
Sec. 7. REPORT ON PRESCRIPTION DRUG SAVINGS
The commissioner of prevention, assistance, transition, and health access shall conduct a study to demonstrate any savings achieved through the use of generic as an alternative to brand-name drugs in the state and, to the extent possible, private drug assistance plans. The findings of the study shall be reported to the health access oversight committee and the senate and house committees on health and welfare by January 1, 2005.
* * * Auditing PBM Contracts * * *
Sec. 8. AUDITING PBM CONTRACTS
The commissioner of prevention, assistance, transition, and health access and the commissioner of personnel, in consultation with the commissioner of banking, insurance, securities, and health care administration and the state auditor, shall develop a pharmacy benefits manager audit. The purpose of the audit plan is to ensure that pharmacy claims and rebates are being paid accurately and appropriately. Accordingly, the audit shall include a performance audit, contract compliance audit, rebate audit, and pharmacy claims analysis and audit. The audit plan shall include a cost estimate for hiring an independent auditor, options for keeping the cost of the audit down, for example, by partnering with other health benefit plans within or outside the state, as well as recommendations regarding possible revenue sources to cover the cost of implementing the audit plan. The audit plan shall be detailed in a report submitted to the health access oversight committee and the senate and house committees on health and welfare by September 1, 2004.
* * * Mental Health Drugs * * *
Sec. 9. SUNSET REPEAL
The sunset provision, Sec. 5 of No. 127 of the Acts of the 2001 Adj. Sess. (2002) (repealing the law exempting certain mental health drugs from the prior authorization process), is hereby repealed.
* * * Medicare Drug Benefit: Donut Hole, Impact on Vermont, and
Coordination with State Programs * * *
Sec. 10. PRESCRIPTION DRUG COVERAGE FOR MEDICARE BENEFICIARIES
(a) The department of prevention, assistance, transition, and health access shall amend Vermont prescription drug programs to conform with the provisions of the federal Medicare Prescription Drug, Improvement, and Modernization Act of 2003, P.L. 108-173, and, to the extent permissible under federal law, provide financial assistance to Medicare beneficiaries who otherwise would be required to pay 100 percent of the cost of drugs after the initial deductible.
(b) The department of prevention, assistance, transition, and health access shall analyze the financial impact on the state of Vermont caused by implementation of the federal Medicare Prescription Drug, Improvement, and Modernization Act of 2003, P.L. 108-173, and report its findings annually to the health access oversight committee and the senate and house health and welfare committees beginning November 1, 2004.
Sec. 11. PRESCRIPTION DRUG BENEFIT WORKING GROUP
The commissioner of aging and disabilities with representatives from the department of prevention, assistance, transition, and health access shall convene a working group of elderly and disabled consumers, advocates, and providers to:
(1) develop and implement a plan which at a minimum shall include outreach, education, and assistance to minimize confusion and duplication of coverage expected to be caused by the introduction of the new, federally mandated Medicare discount cards to Vermont Medicare beneficiaries, especially those who also are eligible for Medicaid, VHAP-Rx, VScript, VScript Expanded, or Healthy Vermonters; and
(2) plan for the implementation of Medicare Part D in the state beginning January 1, 2006. Such planning shall include both monitoring and advocacy on federal policy as it relates to Vermont state pharmaceutical assistance programs with a goal of minimizing any reduction of assistance to these beneficiaries. The plan shall analyze fully the potential gains and losses to Vermont and to its state pharmaceutical assistance beneficiaries resulting from Medicare Part D and the balance of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, P.L. 108-173, and shall provide ongoing cost projections and identify sources of funding for holding these beneficiaries harmless from pharmacy benefit cuts once Medicare Part D is implemented.
* * * Prior Authorization Exemption * * *
Sec. 12. 33 V.S.A. § 1999(f) is amended to read:
(f) The
program’s prior authorization process shall require that the prescriber, not
the pharmacy, request a prior authorization exception exemption to the
requirements of this section. The No later than December 31, 2004, the
commissioner shall create a pilot program may designed to exempt a prescriber
from the need to secure prior authorization for a specific drug category if the
program determines that the prescriber has written a minimum number of scripts
in that category, and the prescriber prescribes prescription drugs on the
preferred drug list at or above the minimum threshold for that category, as
determined by the commissioner after consultation with the drug utilization
review board.
* * * Reimportation * * *
Sec. 13. 8 V.S.A. § 4089i is added to read:
§ 4089i. PRESCRIPTION DRUG COVERAGE
A health insurance or other health benefit plan offered by a health insurer shall provide coverage for prescription drugs purchased outside this country on the same terms and conditions as prescription drugs purchased in this country. The plan may require certification by the North American Pharmatherapeutic Consultants Association for the purpose of safeguarding the quality of prescription drugs purchased by plan beneficiaries.
Sec. 14. 33 V.S.A. § 2007 is added to read:
§ 2007. CANADIAN PRESCRIPTION DRUG INFORMATION PROGRAM
(a) The department of prevention, assistance, transition, and health access shall establish a program to describe how Vermont residents are able to purchase prescription drugs from Canada. This program shall provide information about ordering prescription drugs through the mail or otherwise from a participating Canadian pharmacy.
(b) The department shall establish a website and written information regarding the program.
Sec. 15. APPLICABILITY; STATUTORY REVISION
The statutory revision commission is directed to recodify 8 V.S.A. §§ 4089i and 4089j (health care ombudsman) as 8 V.S.A. §§ 4089v and 4089w, respectively.
* * * Healthy Vermonters Expansion * * *
Sec. 16. 33 V.S.A. § 2003 is amended to read:
§ 2003. PHARMACY DISCOUNT PLAN
(a) On or before July 1, 2002, the The commissioner
shall implement a pharmacy discount plan, to be known as the “Healthy
Vermonters” program, for Vermonters without adequate coverage for prescription
drugs. The provisions of section 1992 of this title shall apply to the
commissioner’s authority to administer the pharmacy discount plan established
by this section. The
commissioner may establish an enrollment fee in such amount as is necessary to
support the administrative costs of the plan.
(b) The
pharmacy discount plan authorized by this section shall include a program
implemented as a Section 1115 Medicaid waiver, wherein the state makes a
payment toward the cost of the drugs dispensed to individuals enrolled in this
program of at least two percent of the cost of each prescription or refill,
consistent with the appropriation for the program established by this section offer enrolled
individuals an initial discounted cost for covered drugs and, upon approval by
the Centers for Medicare and Medicaid Services of a Section 1115 Medicaid
waiver program, a secondary discounted cost, which shall reflect a state
payment toward the cost of each dispensed drug as well as any rebate amount
negotiated by the commissioner. Upon implementation of the waiver program, the
commissioner may establish an enrollment fee in such amount as is necessary to
support the administrative costs of the program.
(c) The commissioner shall implement the pharmacy discount program authorized by this section without any financial contribution by the state otherwise required by subsection (b) of this section, and without federal waiver approval during such time as federal waiver approval has not been secured.
(d) As used in this section:
(1) “Eligible beneficiary” means any individual Vermont resident without adequate coverage:
(A) who is at least 65
years of age, or is disabled and is eligible for Medicare or Social Security
disability benefits, with household income equal to or less than 400 percent of
the federal poverty level,
as calculated under the rules of the Vermont health access plan, as amended,
and any other individual Vermont resident with;
(B)
whose
household income is equal to or less than 300 350 percent of
the federal poverty level,
as calculated under the rules of the Vermont health access plan, as amended;
and
(C) whose family incurs unreimbursed expenses for prescription drugs, including insurance premiums, that equal five percent or more of household income or whose total unreimbursed medical expenses, including insurance premiums, equal 15 percent or more of household income.
(2) “Initial discounted cost” means the price of the drug based on the Medicaid fee schedule.
(3) “Labeler” means an entity or person that receives prescription drugs from a manufacturer or wholesaler and repackages those drugs for later retail sale and that has a labeler code from the federal Food and Drug Administration under 21 Code of Federal Regulations, 207.20 (1999).
(4) “Participating retail pharmacy” means a retail pharmacy located in this state or another business licensed to dispense prescription drugs in this state that participates in the program according to rules established by the department and provides discounted prices to eligible beneficiaries of the program.
(5) “Rebate amount” means the rebate negotiated by the commissioner and required from a drug manufacturer or labeler under this section. In determining the appropriate rebate, the commissioner shall:
(A) take into consideration the rebate calculated under the Medicaid Rebate Program under section 1396r-8 of Title 42 of the United States Code, the average wholesale price of prescription drugs, and any other information on prescription drug prices and price discounts;
(B) use his or her best efforts to obtain an initial rebate amount equal to or greater than the rebate calculated under the Medicaid program under section 1396r-8 of Title 42 of the United States Code;
(C) use his or her best efforts to obtain an amount equal to or greater than the amount of any discount, rebate, or price reduction for prescription drugs provided to the federal government.
(6) “Secondary discounted cost” means the price of the drug based on the Medicaid fee schedule, less payment by the state of at least two percent of the Medicaid rate, less any rebate amount negotiated by the commissioner and paid for out of the healthy Vermonters dedicated fund established under subsection 2003(j).
(7) “Vermonter without Without adequate
coverage” includes eligible beneficiaries with no coverage for prescription
drugs or for certain types of prescription drugs, and eligible
beneficiaries whose annual maximum coverage limit under their health benefit
plan has been reached.
(e) Drugs covered by the Healthy Vermonters program shall include all drugs covered under the Medicaid program.
(f) Participating retail pharmacies shall offer beneficiaries the initial discounted price beginning July 1, 2004. Beginning October 1, 2005, a participating retail pharmacy shall offer beneficiaries the secondary discounted price, if available.
(g) The Vermont board of pharmacy shall adopt rules requiring disclosure by participating retail pharmacies to eligible beneficiaries of the amount of savings provided as a result of the program. The rules must consider and protect information that is proprietary in nature. The department may not impose transaction charges under this program on pharmacies that submit claims or receive payments under the program. Pharmacies shall submit claims to the department to verify the amount charged to eligible beneficiaries under the program. On a weekly or biweekly basis, the department must reimburse pharmacies for the difference between the initial discounted price and the secondary discounted price provided to eligible beneficiaries.
(h) The names of drug manufacturers and labelers who do and do not enter into rebate agreements under this program are public information. The department shall release this information to health care providers and the public on a regular basis and shall publicize participation by manufacturers and labelers. The department shall impose prior authorization requirements in the Medicaid program, as permitted by law, to the extent the department determines it is appropriate to do so in order to encourage manufacturer and labeler participation in the program and so long as the additional prior authorization requirements remain consistent with the goals of the Medicaid program and the requirements of Title XIX of the federal Social Security Act.
(i) The commissioner shall establish, by rule, a process to resolve discrepancies in rebate amounts claimed by manufacturers, labelers, pharmacies, and the department.
(j) The healthy Vermonters dedicated fund is established to receive revenue from manufacturers and labelers who pay rebates as provided in subdivision (d)(5) of this section and any appropriations or allocations designated for the fund. The purposes of the fund are to reimburse retail pharmacies for discounted prices provided to individuals enrolled in the healthy Vermonters program; and to reimburse the department for contracted services including pharmacy claims processing fees, administrative and associated computer costs, and other reasonable program costs. The fund is a nonlapsing dedicated fund. Interest on fund balances accrues to the fund. Surplus funds in the fund must be used for the benefit of the program.
(k) Annually, the department shall report the enrollment and financial status of the program to the health access oversight committee by September 1, and to the general assembly by January 1.
(l) The department shall undertake outreach efforts to build public awareness of the program and maximize enrollment. Outreach efforts shall include steps to educate retail pharmacists on the purposes of the healthy Vermonters dedicated fund, in particular as it relates to pharmacy reimbursements for discounted prices provided to program enrollees. The department may adjust the requirements and terms of the program to accommodate any new federally funded prescription drug programs.
(m) The department may contract with a third party or third parties to administer any or all components of the program, including outreach, eligibility, claims, administration, and rebate recovery and redistribution.
(n) The department shall administer the program and other medical and pharmaceutical assistance programs under this title in a manner advantageous to the programs and enrollees. In implementing this section, the department may coordinate the other programs and this program and may take actions to enhance efficiency, reduce the cost of prescription drugs, and maximize benefits to the programs and enrollees, including providing the benefits of this program to enrollees in other programs.
(o) The department may adopt rules to implement the provisions of this section.
(p) The department may seek any waivers of federal law, rule, or regulation necessary to implement the provisions of this section.
Sec. 17. EFFECTIVE DATE
This act shall take effect July 1, 2004, except that subsection 2003(h) of Title 33, requiring public disclosure of manufacturers and labelers entering into rebate agreements and certain prior authorization requirements under Medicaid, shall take effect when the waiver program authorized under subsection 2003(b) takes effect.
(Committee vote: 6-0-0)
CONFIRMATIONS
The following appointment will be considered by the Senate, as a group, under suspension of the Rules, as moved by the President pro tempore, for confirmation together and without debate, by consent thereby given by the Senate. However, upon request of any senator, any appointment may be singled out and acted upon separately by the Senate, with consideration given to the report of the Committee to which the appointment was referred, and with full debate; and further, all appointments for the positions of Secretaries of Agencies, Commissioners of Departments, Judges, Magistrates, and members of the Public Service Board shall be fully and separately acted upon.
James Postma of Burlington – Member of the Valuation Appeals Board – By Senator Ayer for the Committee on Finance. (2/17)
PUBLIC HEARINGS
Friday, February 20, 2004 – Room 11 – Noon-1:30 P.M. – Presentation by Human Services Secretary Charles Smith Re: Agency of Human Services Reorganization.
Thursday, February 26, 2004 – House Chamber – 7:00 P.M. – End of Life Care: Choices and Challenges – Senate and House Committees on Health and Welfare.
REPORTS ON FILE
Pursuant to the provisions of 2 V.S.A. §20(c), one (1) copy of the following reports is on file in the office of the Secretary of the Senate:
95. Park and Ride Study. (Agency of Transportation). (February 2004).
96. Vermont State Housing Authority 2003 Annual Report. (February 2004).
97. Protection of Highways; Flow Design. (Agency of Transportation, Program Development Division). (February 2004).
98. Financial integrity of the State employees’ and teachers’ retirement systems. (Dept. of Finance and Management). (February 2004).
99. Joint housing committee 2003-2004 report. (Legislative Council). (February 2004).