Fair Drug Prices for Kids Act
This bill allows states to apply the requirements of the Medicaid Drug Rebate Program to covered outpatient drugs under the Children's Health Insurance Program (CHIP).
To amend titles XIX and XXI of the Social Security Act to give States 
the option to extend the Medicaid drug rebate program to the Children's 
           Health Insurance Program, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Drug Prices for Kids Act''.

SEC. 2. REDUCING PRESCRIPTION DRUG COSTS FOR CHILDREN'S MEDICINE.

    (a) In General.--Section 1927(a) of the Social Security Act (42 
U.S.C. 1396r-8(a)) is amended by adding at the end the following new 
paragraph:
            ``(8) State option to apply rebate requirements to the 
        state child health plan.--
                    ``(A) In general.--A State may elect to apply the 
                requirements of this section and regulations 
                promulgated to carry out this section to covered 
                outpatient drugs for which payment is available under 
                the State child health plan under title XXI in the same 
                manner as such requirements apply to the State plan 
                under this title, subject to such guidance as the 
                Secretary shall establish.
                    ``(B) Application rules.--If a State makes an 
                election under subparagraph (A), then, in applying this 
                section with respect to that State--
                            ``(i) paragraph (1) of this subsection 
                        shall be applied as if `or section 2105 (if the 
                        State has elected to apply this section to the 
                        State child health plan under title XXI)' were 
                        inserted after `1903(a)';
                            ``(ii) paragraph (7)(A) of this subsection 
                        shall be applied--
                                    ``(I) as if `or section 2105 (if 
                                the State has elected to apply this 
                                section to the State child health plan 
                                under title XXI)' were inserted after 
                                `1903(a)'; and
                                    ``(II) as if `(or, if the State has 
                                elected to apply this section to the 
                                State child health plan under title 
                                XXI, on or after the date this section 
                                first applies to the State)' were 
                                inserted after `January 1, 2006';
                            ``(iii) paragraph (7)(B)(ii) of this 
                        subsection shall be applied--
                                    ``(I) as if `or section 2105 (if 
                                the State has elected to apply this 
                                section to the State child health plan 
                                under title XXI)' were inserted after 
                                `1903(a)'; and
                                    ``(II) as if `(or, if the State has 
                                elected to apply this section to the 
                                State child health plan under title 
                                XXI, on or after the date this section 
                                first applies to the State)' were 
                                inserted after `January 1, 2008';
                            ``(iv) subsection (b)(1)(A) shall be 
                        applied as if `(or, if the State has elected to 
                        apply this section to the State child health 
                        plan under title XXI, on or after the date this 
                        section first applies to the State, to each 
                        State child health plan for which payment was 
                        made under such State child health plan for 
                        such period)' were inserted after `such 
                        period';
                            ``(v) subsection (b)(1)(B) shall be applied 
                        as if `(or a reduction in the amount expended 
                        under the State child health plan in the 
                        quarter for child health assistance or 
                        pregnancy-related assistance for purposes of 
                        section 2105 if the State has elected to apply 
                        this section to the State child health plan 
                        under title XXI)' were inserted after 
                        `1903(a)(1)'; and
                            ``(vi) paragraphs (2)(A)(i) and (3)(A)(ii) 
                        of subsection (c) shall each be applied as if 
                        `(or, if the State has elected to apply this 
                        section to the State child health plan under 
                        title XXI, on or after the date this section 
                        first applies to the State)' were inserted 
                        after `December 31, 1990' each place it 
                        appears.''.
    (b) Conforming Amendments.--
            (1) Section 2107(e)(1) of the Social Security Act (42 
        U.S.C. 1397gg(e)(1)) is amended--
                    (A) by redesignating subparagraphs (D) through (S) 
                as subparagraphs (E) through (T), respectively; and
                    (B) by inserting after subparagraph (C) the 
                following new subparagraph:
                    ``(D) Section 1902(a)(54) (relating to compliance 
                with the requirements of section 1927 but only if the 
                State has elected to apply such requirements to the 
                State child health plan under this title).''.
            (2) Section 2110(a)(6) of the Social Security Act (42 
        U.S.C. 1397jj(a)(6)) is amended by inserting ``and, if the 
        State has elected to apply the requirements of section 1927 to 
        the State child health plan under this title, covered 
        outpatient drugs, as defined in section 1927(k)(2),'' after 
        ``Prescription drugs and biologicals''.
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Fair Drug Prices for Kids Act
A bill to amend titles XIX and XXI of the Social Security Act to give States the option to extend the Medicaid drug rebate program to the Children's Health Insurance Program, and for other purposes.
Fair Drug Prices for Kids Act
Sen. Warner, Mark R.