Independent Pharmacy Protection Act of 2006

H.R. 5166, the Independent Pharmacy Protection Act of 2006, was designed to change how Medicare Part D prescription drug plans reimburse local pharmacies. The bill would have required insurance plans to pay pharmacies via direct deposit and speed up the payment timeline to within 10 days for certain providers.

To encourage the use of more affordable medications, the legislation would have mandated that pharmacies receive a higher "dispensing fee" for generic drugs—at least 50% more than the fee for brand-name equivalents—while capping that fee at $10. For citizens, these changes were intended to support the financial stability of independent pharmacies and potentially lower out-of-pocket costs by incentivizing the distribution of generic medications over more expensive brand-name drugs.