Medicare Chronic Disease Prescription Drug Benefit Act of 1999

Medicare Chronic Disease Prescription Drug Benefit Act of 1999 - Amends part B (Supplementary Medical Insurance) of title XVIII (Medicare) of the Social Security Act (SSA) to provide for Federal payments to a State non-Medicaid prescription drug benefit program on behalf of Medicare part B enrollees for certain prescription drugs (including insulin) and biological products for treatment of specified chronic conditions.

Provides for the selection through competitive bidding of eligible providers of such prescription drugs and biological products (covered outpatient drugs) in a particular coverage area. Requires an eligible beneficiary not enrolled in a Medicare+Choice plan under Medicare part C (Medicare+Choice) to enroll with an eligible entity under this Act to be eligible to receive covered outpatient drugs under Medicare part B. Mandates appropriate outreach activities by the Secretary of Health and Human Services.

Outlines cost-sharing requirements establishing an annual deductible of $250.00 and specified co-payments (with no co-payment for generic drugs). Allows the use of formularies, generic drug substitution, and other mechanisms to provide benefits economically.

Directs the Secretary to: (1) establish a model for comprehensive educational programs to assure appropriate prescribing, dispensing, and use of such covered drugs; and (2) enter into an arrangement with the Institute of Medicine of the National Academy of Sciences for analysis of such new benefit and annual reports to the Secretary and Congress on its effectiveness in reducing demand for acute medical services, as well as its annual cost and resulting savings. Provides for appropriate funding for such analyses.

Amends SSA title XIX (Medicaid) to provide for Medicaid coverage of the new Medicare part B prescription drug benefit cost-sharing for certain individuals who would be qualified Medicare beneficiaries but for their income which exceeds the level established by the State but is less than a certain percentage of the official poverty line for a family of the size involved.