House File 2305 - Introduced
HOUSE FILE
BY MASCHER
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to the creation of a pharmaceutical purchasing
2 pool for small businesses and governmental entities.
3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
4 TLSB 6220HH 81
5 pf/gg/14
PAG LIN
1 1 Section 1. Section 135.132, Code 2005, is amended by
1 2 striking the section and inserting in lieu thereof the
1 3 following:
1 4 135.132 PHARMACEUTICALS PURCHASING POOL == COUNCIL.
1 5 1. A pharmaceuticals purchasing pool is created within the
1 6 Iowa department of public health to provide a conduit for
1 7 state and local governmental entities and small businesses to
1 8 combine purchasing capacity relating to pharmaceuticals. The
1 9 department of pharmaceutical care of the university of Iowa
1 10 hospitals and clinics shall act in an advisory capacity to the
1 11 department in creating and administering the pool.
1 12 2. a. A pharmaceuticals purchasing pool council is
1 13 created. The council shall be composed of the following
1 14 members:
1 15 (1) The director of public health, or the director's
1 16 designee.
1 17 (2) The director of human services, or the director's
1 18 designee.
1 19 (3) The director of the department of administrative
1 20 services, or the director's designee.
1 21 (4) A representative of the state board of regents.
1 22 (5) The director of the department of corrections, or the
1 23 director's designee.
1 24 (6) The director, or the director's designee, of any other
1 25 agency that purchases pharmaceuticals designated to be
1 26 included as a member by the director of public health.
1 27 (7) A representative of the Iowa state association of
1 28 counties.
1 29 (8) A representative of the Iowa league of cities.
1 30 (9) A representative of the Iowa association of business
1 31 and industry.
1 32 b. The council shall select a chairperson annually from
1 33 its membership. A majority of the members of the council
1 34 shall constitute a quorum.
1 35 c. The council shall do all of the following:
2 1 (1) Develop procedures that governmental entities and
2 2 small businesses that are members of the pool must follow in
2 3 purchasing pharmaceuticals. However, a member governmental
2 4 entity or small business may elect not to follow the council's
2 5 procedures if the governmental entity or small business is
2 6 able to purchase the pharmaceuticals for a lower price than
2 7 the price available through the council. A governmental
2 8 entity or small business that does not follow the council's
2 9 procedures shall report all of the following to the council:
2 10 (a) The purchase price for the pharmaceuticals.
2 11 (b) The name of the wholesaler, retailer, or manufacturer
2 12 selling the pharmaceuticals.
2 13 (2) Designate a member state governmental entity as the
2 14 central purchasing agency for purchasing of pharmaceuticals.
2 15 (3) Use existing distribution networks, including
2 16 wholesale and retail distributors, to distribute the
2 17 pharmaceuticals.
2 18 (4) Investigate options that maximize purchasing power,
2 19 including expanding purchasing under the medical assistance
2 20 program, qualifying for participation in purchasing programs
2 21 under 42 U.S.C. } 256b, as amended, and utilizing rebate
2 22 programs, hospital disproportionate share purchasing,
2 23 multistate purchasing alliances, and health department and
2 24 federally qualified health center purchasing.
2 25 (5) In collaboration with the department of pharmaceutical
2 26 care of the university of Iowa hospitals and clinics, make
2 27 recommendations to member governmental entities and small
2 28 businesses regarding drug utilization review, prior
2 29 authorization, the use of restrictive formularies, the use of
2 30 mail order programs, and copayment structures. This
2 31 subparagraph shall not apply to the medical assistance program
2 32 but only to the operations of the member governmental entities
2 33 and small businesses.
2 34 (6) Develop procedures under which the council may
2 35 disclose information relating to the prices manufacturers or
3 1 wholesalers charge for pharmaceuticals by category of
3 2 pharmaceutical. The procedure shall prohibit the council from
3 3 disclosing information that identifies a specific manufacturer
3 4 or wholesaler or the prices charged by a specific manufacturer
3 5 or wholesaler for a specific pharmaceutical.
3 6 3. The central purchasing agency shall enter into
3 7 agreements with member governmental entities and small
3 8 businesses to purchase pharmaceuticals.
3 9 4. For purposes of this section:
3 10 a. "Governmental entity" means a state agency as defined
3 11 in section 7D.34, except that it shall also include a
3 12 political subdivision of the state including but not limited
3 13 to a county, city, township, school district, or community
3 14 college.
3 15 b. "Small business" means small business as defined in
3 16 section 16.1, except that it shall also include the operation
3 17 of a farm.
3 18 EXPLANATION
3 19 This bill replaces the existing interagency pharmaceuticals
3 20 bulk purchasing council, which applied only to state and local
3 21 governments, with a pharmaceuticals purchasing pool which
3 22 applies to both state and local governmental entities and
3 23 small businesses. The bill creates the pharmaceuticals
3 24 purchasing pool within the Iowa department of public health to
3 25 provide a conduit for governmental entities and small
3 26 businesses to combine purchasing capacity relating to
3 27 pharmaceuticals.
3 28 The bill creates a pharmaceuticals purchasing pool council
3 29 composed of directors of specified agencies and of any other
3 30 agency that purchases pharmaceuticals, designated to be
3 31 included as a member by the director of public health. The
3 32 council also includes representatives from county, city, and
3 33 business organizations.
3 34 The duties of the council are to develop procedures that
3 35 member governmental entities and small businesses must follow
4 1 in purchasing pharmaceuticals; designate a member state
4 2 governmental entity as the central purchasing agency; use
4 3 existing distribution networks, including wholesale and retail
4 4 distributors, to distribute the pharmaceuticals; investigate
4 5 options that maximize purchasing power; make recommendations
4 6 to member governmental entities and small businesses regarding
4 7 drug utilization review, prior authorization, the use of
4 8 restrictive formularies, the use of mail order programs, and
4 9 copayment structures; and develop procedures under which the
4 10 council may disclose information relating to the prices
4 11 manufacturers or wholesalers charge for pharmaceuticals by
4 12 category of pharmaceutical. The designated purchasing agency
4 13 is directed to enter into agreements with member governmental
4 14 entities and small businesses to purchase pharmaceuticals.
4 15 LSB 6220HH 81
4 16 pf:nh/gg/14