C.__For the catastrophic program, the commissioner shall establish annual limits on the costs incurred by recipients for drugs and medications covered under the program on or prior to May 31, 2001.__After the limit is reached, the program shall pay 80% of the cost of each drug and medication covered by the supplemental component of the program on May 31, 2001 minus $2.__Any remaining amount is paid by the recipient.__The limits must be set by the commissioner by rule as necessary to operate the program within the program budget;

Sec. 2. 22 MRSA §3174-R, as enacted by PL 1997, c. 643, Pt. RR, §5, is amended to read:

§3174-R. Medicaid drug rebate program

The department shall enter into a drug rebate agreement with each manufacturer of prescription drugs under the Medicaid program in accordance with Section 1927 of the federal Social Security Act, as long as the agreements are consistent with state and federal law, are approved by the federal Health Care Finance Administration and result in a net increase in rebate revenue available to the Maine Medicaid Program. Individual rebate agreements may vary. The department shall seek to achieve an aggregate rebate amount from all agreements that is at least 6 percentage points higher than the percentage of the total Medicaid drug expenditures that the rebates would otherwise be under Section 1927 of the federal Social Security Act. Any increase in revenue from the Medicaid drug rebate program over accepted estimates as of the effective date of this section that results in a higher percentage of the total Medicaid drug rebates must be reserved to provide coverage pursuant to section 3174-G, subsection 1-A. In the event that the department is not able to achieve the rebate amount required by this section without compromising the best interest of Medicaid recipients and the Medicaid drug rebate program, the department shall report to the joint standing committee of the Legislature having jurisdiction over health and human services matters and the joint standing committee of the Legislature having jurisdiction over appropriations and financial affairs in the next regular session of the 119th Legislature.