117 STAT. 2126
PUBLIC LAW 108–173—DEC. 8, 2003 ‘‘(C) PROVISION
OF DISCLOSURE REGARDING PRESCRIPTION DRUG COVERAGE.—The sponsor of the plan shall pro-
vide for disclosure of information regarding prescription drug coverage in accordance with section 1860D– 13(b)(6)(B). ‘‘(3) EMPLOYER AND UNION SPECIAL SUBSIDY AMOUNTS.— ‘‘(A) IN GENERAL.—For purposes of this subsection, the special subsidy payment amount under this paragraph for a qualifying covered retiree for a coverage year enrolled with the sponsor of a qualified retiree prescription drug plan is, for the portion of the retiree’s gross covered retiree plan-related prescription drug costs (as defined in subparagraph (C)(ii)) for such year that exceeds the cost threshold amount specified in subparagraph (B) and does not exceed the cost limit under such subparagraph, an amount equal to 28 percent of the allowable retiree costs (as defined in subparagraph (C)(i)) attributable to such gross covered prescription drug costs. ‘‘(B) COST THRESHOLD AND COST LIMIT APPLICABLE.— ‘‘(i) IN GENERAL.—Subject to clause (ii)— ‘‘(I) the cost threshold under this subparagraph is equal to $250 for plan years that end in 2006; and ‘‘(II) the cost limit under this subparagraph is equal to $5,000 for plan years that end in 2006. ‘‘(ii) INDEXING.—The cost threshold and cost limit amounts specified in subclauses (I) and (II) of clause (i) for a plan year that ends after 2006 shall be adjusted in the same manner as the annual deductible and the annual out-of-pocket threshold, respectively, are annually adjusted under paragraphs (1) and (4)(B) of section 1860D–2(b). ‘‘(C) DEFINITIONS.—For purposes of this paragraph: ‘‘(i) ALLOWABLE RETIREE COSTS.—The term ‘allowable retiree costs’ means, with respect to gross covered prescription drug costs under a qualified retiree prescription drug plan by a plan sponsor, the part of such costs that are actually paid (net of discounts, chargebacks, and average percentage rebates) by the sponsor or by or on behalf of a qualifying covered retiree under the plan. ‘‘(ii) GROSS COVERED RETIREE PLAN-RELATED PRESCRIPTION DRUG COSTS.—For purposes of this section, the term ‘gross covered retiree plan-related prescription drug costs’ means, with respect to a qualifying covered retiree enrolled in a qualified retiree prescription drug plan during a coverage year, the costs incurred under the plan, not including administrative costs, but including costs directly related to the dispensing of covered part D drugs during the year. Such costs shall be determined whether they are paid by the retiree or under the plan. ‘‘(iii) COVERAGE YEAR.—The term ‘coverage year’ has the meaning given such term in section 1860D–15(b)(4). ‘‘(4) QUALIFYING COVERED RETIREE DEFINED.—For purposes of this subsection, the term ‘qualifying covered retiree’ means a part D eligible individual who is not enrolled in a prescription
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