SECTIONS 130540-130544 - California Statutes

HEALTH AND SAFETY CODE

SECTION 130540-130544

130540. (a) Contracts, contract amendments, change orders, change
requests, and any project or systems development notices, entered
into for purposes of this division, shall be subject to the same
exemptions provided for in the Medi-Cal drug program and those
provided to the department in paragraph (4) of subdivision (c) of
Section 124977. In addition, contracts, contract amendments, change
orders, change requests, and any project or systems development
notices, entered into for purposes of this division, are specifically
exempt from:
(1) Part 2 (commencing with Section 10100) of Division 2 of the
Public Contract Code.
(2) The competitive bidding requirements of State Administrative
Manual Management Memo 03-10.
(3) The project authority requirements of State Administrative
Manual, Section 4800 et seq.
(4) Section 11.00 and Provision 6 of Item 4260-001-0001 of Section
2 of the Budget Act of 2006 and related Budget letters.
(b) Contracts with pharmacies and drug manufacturers may be
entered into on a bid or nonbid basis.
(c) Change orders entered into pursuant to this division shall not
require a contract amendment.
(d) To the extent that any exemption set forth in this section
conflicts with exemptions set forth in paragraph (4) of subdivision
(c) of Section 124977, the exemption in this section shall govern
over the conflicting provision in Section 124977.

130541. To implement the program, the department may contract with
a third-party vendor or utilize existing health care service provider
enrollment and payment mechanisms, including the Medi-Cal program's
fiscal intermediary. Drug discount agreements negotiated by a third
party shall be subject to review by the department. The department
may cancel a contract that it finds not in the best interests of the
state or program participants. Participating pharmacy contracts
entered into pursuant to Section 130505 shall be considered contracts
between the participating pharmacy and the department and shall not
be associated with, or leveraged against, other third-party
agreements.

130542. (a) The department shall deposit all payments the
department receives pursuant to this division into the California
Discount Prescription Drug Program Fund, which is hereby established
in the State Treasury.
(b) Notwithstanding Section 13340 of the Government Code, the fund
is hereby continuously appropriated to the department without regard
to fiscal year for the purpose of providing payment to participating
pharmacies pursuant to this division and for defraying the costs of
administering this division.
(c) Notwithstanding any other provision of law, no money in the
fund is available for expenditure for any other purpose or for
loaning or transferring to any other fund, including the General
Fund, except as provided in Section 130542.1. The fund shall also
contain any interest accrued on moneys in the fund.

130542.1. (a) It is the intent of the Legislature that the program
shall be self-financing and that General Fund moneys provided to the
fund shall be repaid within five years after implementation of the
program begins. The department shall provide the Legislature with a
five-year projection of program revenues and expenditures as part of
its annual budget request. The projection shall include a projected
General Fund repayment schedule.
(b) The department may use up to 25 percent of manufacturer rebate
revenues to administer the program, including the funding of a float
account to finance payments to participating pharmacies in advance
of the receipt of manufacturer rebates.

130543. (a) The director may adopt regulations as are necessary to
implement and administer this division.
(b) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the director
may implement this division, in whole or in part, by means of a
provider bulletin or other similar instructions, without taking
regulatory action, provided that no bulletin or other similar
instructions shall remain in effect after August 1, 2015. It is the
intent that regulations adopted pursuant to this section shall be
adopted on or before August 1, 2015.

130544. If any provision of this division, or the application
thereof, is for any reason, held invalid, ineffective, or
unconstitutional by a court of competent jurisdiction, the remainder
of this division, or the application of this provision, shall not be
affected thereby, and to this end the provisions of this division are
severable.