[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4846 Introduced in House (IH)]

<DOC>






118th CONGRESS
  1st Session
                                H. R. 4846

 To amend the Internal Revenue Code of 1986, title XXVII of the Public 
Health Service Act, and the Employee Retirement Income Security Act of 
  1974 to provide for oversight of pharmacy benefit manager services.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 25, 2023

Mr. Arrington introduced the following bill; which was referred to the 
Committee on Energy and Commerce, and in addition to the Committees on 
  Ways and Means, and Education and the Workforce, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986, title XXVII of the Public 
Health Service Act, and the Employee Retirement Income Security Act of 
  1974 to provide for oversight of pharmacy benefit manager services.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Better Deals and Lower Prices Act''.

SEC. 2. OVERSIGHT OF PHARMACY BENEFITS MANAGER SERVICES.

    (a) IRC.--
            (1) In general.--Subchapter B of chapter 100 of the 
        Internal Revenue Code of 1986 is amended by adding at the end 
        the following:

``SEC. 9826. OVERSIGHT OF PHARMACY BENEFITS MANAGER SERVICES.

    ``(a) In General.--For plan years beginning on or after the date 
that is 3 years after the date of enactment of this section, a group 
health plan, or an entity or subsidiary providing pharmacy benefits 
management services on behalf of such a plan, shall not enter into a 
contract with a drug manufacturer, distributor, wholesaler, 
subcontractor, rebate aggregator, or any associated third party that 
limits the disclosure of information to plan sponsors in such a manner 
that prevents the plan, or an entity or subsidiary providing pharmacy 
benefits management services on behalf of a plan, from making the 
report described in subsection (b).
    ``(b) Annual Report.--
            ``(1) In general.--With respect to plan years beginning on 
        or after the date that is 3 years after the date of enactment 
        of this section, for each such plan year, a group health plan, 
        or an entity providing pharmacy benefits management services on 
        behalf of such a plan, shall submit to the plan sponsor (as 
        defined in section 3(16)(B) of the Employee Retirement Income 
        Security Act of 1974) of such plan a report in a machine-
        readable format. Each such report shall include, with respect 
        to such plan provided for such plan year--
                    ``(A) to the extent feasible, information collected 
                from drug manufacturers (or an entity administering 
                copay assistance on behalf of such manufacturers) by 
                such plan on the total amount of copayment assistance 
                dollars paid, or copayment cards applied, that were 
                funded by the drug manufacturer with respect to the 
                participants and beneficiaries in such plan;
                    ``(B) a list of each drug covered by such plan that 
                was dispensed during the plan year, including, with 
                respect to each such drug during such plan year--
                            ``(i) the brand name, chemical entity, and 
                        National Drug Code;
                            ``(ii) the number of participants and 
                        beneficiaries for whom the drug was dispensed 
                        during the plan year, the total number of 
                        prescription claims for the drug (including 
                        original prescriptions and refills), and the 
                        total number of dosage units of the drug 
                        dispensed across the plan year, disaggregated 
                        by dispensing channel (such as retail, mail 
                        order, or specialty pharmacy);
                            ``(iii) the wholesale acquisition cost, 
                        listed as cost per days supply and cost per 
                        pill, or in the case of a drug in another form, 
                        per dosage unit;
                            ``(iv) the total out-of-pocket spending by 
                        participants and beneficiaries on such drug, 
                        including participant and beneficiary spending 
                        through copayments, coinsurance, and 
                        deductibles;
                            ``(v) for any drug for which gross spending 
                        of the group health plan exceeded $10,000 
                        during the plan year--
                                    ``(I) a list of all other drugs in 
                                the same therapeutic category or class, 
                                including brand name drugs and 
                                biological products and generic drugs 
                                or biosimilar biological products that 
                                are in the same therapeutic category or 
                                class as such drug; and
                                    ``(II) the rationale for the 
                                formulary placement of such drug in 
                                that therapeutic category or class, if 
                                applicable;
                            ``(vi) the amount received, or expected to 
                        be received, from drug manufacturers in 
                        rebates, fees, alternative discounts, or other 
                        remuneration for claims incurred for such drug 
                        during the plan year;
                            ``(vii) the total net spending, after 
                        deducting rebates, price concessions, 
                        alternative discounts or other remuneration 
                        from drug manufacturers, by the health plan on 
                        such drug; and
                            ``(viii) the net price per course of 
                        treatment or single fill, such as a 30-day 
                        supply or 90-day supply, incurred by the health 
                        plan and its participants and beneficiaries 
                        after manufacturer rebates, fees, and other 
                        remuneration for such drug dispensed during the 
                        plan year;
                    ``(C) a list of each therapeutic category or class 
                of drugs that were dispensed under the health plan 
                during the plan year, and, with respect to each such 
                therapeutic category or class of drugs, during the plan 
                year--
                            ``(i) total gross spending by the plan, 
                        before manufacturer rebates, fees, or other 
                        manufacturer remuneration;
                            ``(ii) the number of participants and 
                        beneficiaries who were dispensed a drug covered 
                        by such plan in that category or class, broken 
                        down by each such drug (identified by National 
                        Drug Code);
                            ``(iii) if applicable to that category or 
                        class, a description of the formulary tiers and 
                        utilization management (such as prior 
                        authorization or step therapy) employed for 
                        drugs in that category or class; and
                            ``(iv) the total out-of-pocket spending by 
                        participants and beneficiaries, including 
                        participant and beneficiary spending through 
                        copayments, coinsurance, and deductibles;
                    ``(D) total gross spending on prescription drugs by 
                the plan during the plan year, before rebates and other 
                manufacturer fees or remuneration;
                    ``(E) total amount received, or expected to be 
                received, by the health plan in drug manufacturer 
                rebates, fees, alternative discounts, and all other 
                remuneration received from the manufacturer or any 
                third party, other than the plan sponsor, related to 
                utilization of drug or drug spending under that health 
                plan during the plan year;
                    ``(F) the total net spending on prescription drugs 
                by the health plan during the plan year; and
                    ``(G) amounts paid directly or indirectly in 
                rebates, fees, or any other type of remuneration to 
                brokers, consultants, advisors, or any other individual 
                or firm for the referral of the group health plan's 
                business to the pharmacy benefits manager.
            ``(2) Privacy requirements.--Entities providing pharmacy 
        benefits management services on behalf of a group health plan 
        shall provide information under paragraph (1) in a manner 
        consistent with the privacy, security, and breach notification 
        regulations promulgated under section 264(c) of the Health 
        Insurance Portability and Accountability Act of 1996, and shall 
        restrict the use and disclosure of such information according 
        to such privacy regulations.
            ``(3) Disclosure and redisclosure.--
                    ``(A) Limitation to business associates.--A group 
                health plan receiving a report under paragraph (1) may 
                disclose such information only to business associates 
                of such plan as defined in section 160.103 of title 45, 
                Code of Federal Regulations (or successor regulations).
                    ``(B) Clarification regarding public disclosure of 
                information.--Nothing in this section prevents an 
                entity providing pharmacy benefits management services 
                on behalf of a group health plan from placing 
                reasonable restrictions on the public disclosure of the 
                information contained in a report described in 
                paragraph (1), except that such entity may not restrict 
                disclosure of such report to the Department of Health 
                and Human Services, the Department of Labor, the 
                Department of the Treasury, the Comptroller General of 
                the United States, or applicable State agencies.
                    ``(C) Limited form of report.--The Secretary shall 
                define through rulemaking a limited form of the report 
                under paragraph (1) required of plan sponsors who are 
                drug manufacturers, drug wholesalers, or other direct 
                participants in the drug supply chain, in order to 
                prevent anti-competitive behavior.
            ``(4) Report to gao.--A group health plan, or an entity 
        providing pharmacy benefits management services on behalf of a 
        group health plan, shall submit to the Comptroller General of 
        the United States each of the first 4 reports submitted to a 
        plan sponsor under paragraph (1) with respect to such plan, and 
        other such reports as requested, in accordance with the privacy 
        requirements under paragraph (2), the disclosure and 
        redisclosure standards under paragraph (3), the standards 
        specified pursuant to paragraph (5), and such other information 
        that the Comptroller General determines necessary to carry out 
        the study under section 2(d) of the Better Deals and Lower 
        Prices Act.
            ``(5) Standard format.--Not later than 18 months after the 
        date of enactment of this section, the Secretary shall specify 
        through rulemaking standards for entities required to submit 
        reports under paragraph (4) to submit such reports in a 
        standard format.
    ``(c) Rule of Construction.--Nothing in this section shall be 
construed to permit a group health plan or other entity to restrict 
disclosure to, or otherwise limit the access of, the Secretary of the 
Treasury to a report described in subsection (b)(1) or information 
related to compliance with subsection (a) or (b) by such plan or other 
entity subject to such subsections.
    ``(d) Definition.--In this section, the term `wholesale acquisition 
cost' has the meaning given such term in section 1847A(c)(6)(B) of the 
Social Security Act.''.
            (2) Clerical amendment.--The table of sections for 
        subchapter B of chapter 100 of the Internal Revenue Code of 
        1986 is amended by adding at the end the following new item:

``Sec. 9826. Oversight of pharmacy benefits manager services.''.
    (b) PHSA.--Title XXVII of the Public Health Service Act (42 U.S.C. 
300gg et seq.) is amended--
            (1) in part D (42 U.S.C. 300gg-111 et seq.), by adding at 
        the end the following new section:

``SEC. 2799A-11. OVERSIGHT OF PHARMACY BENEFITS MANAGER SERVICES.

    ``(a) In General.--For plan years beginning on or after the date 
that is 3 years after the date of enactment of this section, a group 
health plan or health insurance issuer offering group health insurance 
coverage, or an entity or subsidiary providing pharmacy benefits 
management services on behalf of such a plan or issuer, shall not enter 
into a contract with a drug manufacturer, distributor, wholesaler, 
subcontractor, rebate aggregator, or any associated third party that 
limits the disclosure of information to plan sponsors in such a manner 
that prevents the plan or issuer, or an entity or subsidiary providing 
pharmacy benefits management services on behalf of a plan or issuer, 
from making the report described in subsection (b).
    ``(b) Annual Report.--
            ``(1) In general.--With respect to plan years beginning on 
        or after the date that is 3 years after the date of enactment 
        of this section, for each such plan year, a group health plan 
        or health insurance issuer offering group health insurance 
        coverage, or an entity providing pharmacy benefits management 
        services on behalf of such a plan or an issuer, shall submit to 
        the plan sponsor (as defined in section 3(16)(B) of the 
        Employee Retirement Income Security Act of 1974) of such plan 
        or coverage a report in a machine-readable format. Each such 
        report shall include, with respect to such plan or coverage 
        provided for such plan year--
                    ``(A) to the extent feasible, information collected 
                from drug manufacturers (or an entity administering 
                copay assistance on behalf of such manufacturers) by 
                such plan or issuer on the total amount of copayment 
                assistance dollars paid, or copayment cards applied, 
                that were funded by the drug manufacturer with respect 
                to the participants, beneficiaries, and enrollees in 
                such plan or coverage;
                    ``(B) a list of each drug covered by such plan or 
                coverage that was dispensed during the plan year, 
                including, with respect to each such drug during such 
                plan year--
                            ``(i) the brand name, chemical entity, and 
                        National Drug Code;
                            ``(ii) the number of participants, 
                        beneficiaries, and enrollees for whom the drug 
                        was dispensed during the plan year, the total 
                        number of prescription claims for the drug 
                        (including original prescriptions and refills), 
                        and the total number of dosage units of the 
                        drug dispensed across the plan year, 
                        disaggregated by dispensing channel (such as 
                        retail, mail order, or specialty pharmacy);
                            ``(iii) the wholesale acquisition cost, 
                        listed as cost per days supply and cost per 
                        pill, or in the case of a drug in another form, 
                        per dosage unit;
                            ``(iv) the total out-of-pocket spending by 
                        participants, beneficiaries, and enrollees on 
                        such drug, including participant, beneficiary, 
                        and enrollee spending through copayments, 
                        coinsurance, and deductibles;
                            ``(v) for any drug for which gross spending 
                        of the group health plan or health insurance 
                        coverage exceeded $10,000 during the plan 
                        year--
                                    ``(I) a list of all other drugs in 
                                the same therapeutic category or class, 
                                including brand name drugs and 
                                biological products and generic drugs 
                                or biosimilar biological products that 
                                are in the same therapeutic category or 
                                class as such drug; and
                                    ``(II) the rationale for the 
                                formulary placement of such drug in 
                                that therapeutic category or class, if 
                                applicable;
                            ``(vi) the amount received, or expected to 
                        be received, from drug manufacturers in 
                        rebates, fees, alternative discounts, or other 
                        remuneration for claims incurred for such drug 
                        during the plan year;
                            ``(vii) the total net spending, after 
                        deducting rebates, price concessions, 
                        alternative discounts or other remuneration 
                        from drug manufacturers, by the health plan or 
                        health insurance coverage on such drug; and
                            ``(viii) the net price per course of 
                        treatment or single fill, such as a 30-day 
                        supply or 90-day supply, incurred by the health 
                        plan or health insurance coverage and its 
                        participants, beneficiaries, and enrollees, 
                        after manufacturer rebates, fees, and other 
                        remuneration for such drug dispensed during the 
                        plan year;
                    ``(C) a list of each therapeutic category or class 
                of drugs that were dispensed under the health plan or 
                health insurance coverage during the plan year, and, 
                with respect to each such therapeutic category or class 
                of drugs, during the plan year--
                            ``(i) total gross spending by the plan or 
                        coverage, before manufacturer rebates, fees, or 
                        other manufacturer remuneration;
                            ``(ii) the number of participants, 
                        beneficiaries, and enrollees who were dispensed 
                        a drug covered by such plan or coverage in that 
                        category or class, broken down by each such 
                        drug (identified by National Drug Code);
                            ``(iii) if applicable to that category or 
                        class, a description of the formulary tiers and 
                        utilization management (such as prior 
                        authorization or step therapy) employed for 
                        drugs in that category or class; and
                            ``(iv) the total out-of-pocket spending by 
                        participants, beneficiaries, and enrollees, 
                        including participant, beneficiary, and 
                        enrollee spending through copayments, 
                        coinsurance, and deductibles;
                    ``(D) total gross spending on prescription drugs by 
                the plan or coverage during the plan year, before 
                rebates and other manufacturer fees or remuneration;
                    ``(E) total amount received, or expected to be 
                received, by the health plan or health insurance 
                coverage in drug manufacturer rebates, fees, 
                alternative discounts, and all other remuneration 
                received from the manufacturer or any third party, 
                other than the plan sponsor, related to utilization of 
                drug or drug spending under that health plan or health 
                insurance coverage during the plan year;
                    ``(F) the total net spending on prescription drugs 
                by the health plan or health insurance coverage during 
                the plan year; and
                    ``(G) amounts paid directly or indirectly in 
                rebates, fees, or any other type of remuneration to 
                brokers, consultants, advisors, or any other individual 
                or firm for the referral of the group health plan's or 
                health insurance issuer's business to the pharmacy 
                benefits manager.
            ``(2) Privacy requirements.--Health insurance issuers 
        offering group health insurance coverage and entities providing 
        pharmacy benefits management services on behalf of a group 
        health plan shall provide information under paragraph (1) in a 
        manner consistent with the privacy, security, and breach 
        notification regulations promulgated under section 264(c) of 
        the Health Insurance Portability and Accountability Act of 
        1996, and shall restrict the use and disclosure of such 
        information according to such privacy regulations.
            ``(3) Disclosure and redisclosure.--
                    ``(A) Limitation to business associates.--A group 
                health plan receiving a report under paragraph (1) may 
                disclose such information only to business associates 
                of such plan as defined in section 160.103 of title 45, 
                Code of Federal Regulations (or successor regulations).
                    ``(B) Clarification regarding public disclosure of 
                information.--Nothing in this section prevents a health 
                insurance issuer offering group health insurance 
                coverage or an entity providing pharmacy benefits 
                management services on behalf of a group health plan 
                from placing reasonable restrictions on the public 
                disclosure of the information contained in a report 
                described in paragraph (1), except that such issuer or 
                entity may not restrict disclosure of such report to 
                the Department of Health and Human Services, the 
                Department of Labor, the Department of the Treasury, 
                the Comptroller General of the United States, or 
                applicable State agencies.
                    ``(C) Limited form of report.--The Secretary shall 
                define through rulemaking a limited form of the report 
                under paragraph (1) required of plan sponsors who are 
                drug manufacturers, drug wholesalers, or other direct 
                participants in the drug supply chain, in order to 
                prevent anti-competitive behavior.
            ``(4) Report to gao.--A group health plan or health 
        insurance issuer offering group health insurance coverage, or 
        an entity providing pharmacy benefits management services on 
        behalf of a group health plan shall submit to the Comptroller 
        General of the United States each of the first 4 reports 
        submitted to a plan sponsor under paragraph (1) with respect to 
        such coverage or plan, and other such reports as requested, in 
        accordance with the privacy requirements under paragraph (2), 
        the disclosure and redisclosure standards under paragraph (3), 
        the standards specified pursuant to paragraph (5), and such 
        other information that the Comptroller General determines 
        necessary to carry out the study under section 2(d) of the 
        Better Deals and Lower Prices Act.
            ``(5) Standard format.--Not later than 18 months after the 
        date of enactment of this section, the Secretary shall specify 
        through rulemaking standards for health insurance issuers and 
        entities required to submit reports under paragraph (4) to 
        submit such reports in a standard format.
    ``(c) Enforcement.--
            ``(1) In general.--Notwithstanding section 2723, the 
        Secretary, in consultation with the Secretary of Labor and the 
        Secretary of the Treasury, shall enforce this section.
            ``(2) Failure to provide timely information.--A health 
        insurance issuer or an entity providing pharmacy benefits 
        management services that violates subsection (a) or fails to 
        provide information required under subsection (b) shall be 
        subject to a civil monetary penalty in the amount of $10,000 
        for each day during which such violation continues or such 
        information is not disclosed or reported.
            ``(3) False information.--A health insurance issuer or 
        entity providing pharmacy benefits management services that 
        knowingly provides false information under this section shall 
        be subject to a civil money penalty in an amount not to exceed 
        $100,000 for each item of false information. Such civil money 
        penalty shall be in addition to other penalties as may be 
        prescribed by law.
            ``(4) Procedure.--The provisions of section 1128A of the 
        Social Security Act, other than subsection (a) and (b) and the 
        first sentence of subsection (c)(1) of such section shall apply 
        to civil monetary penalties under this subsection in the same 
        manner as such provisions apply to a penalty or proceeding 
        under section 1128A of the Social Security Act.
            ``(5) Waivers.--The Secretary may waive penalties under 
        paragraph (2), or extend the period of time for compliance with 
        a requirement of this section, for an entity in violation of 
        this section that has made a good-faith effort to comply with 
        this section.
    ``(d) Rule of Construction.--Nothing in this section shall be 
construed to permit a health insurance issuer, group health plan, or 
other entity to restrict disclosure to, or otherwise limit the access 
of, the Secretary of Health and Human Services to a report described in 
subsection (b)(1) or information related to compliance with subsection 
(a) or (b) by such issuer, plan, or other entity subject to such 
subsections.
    ``(e) Definition.--In this section, the term `wholesale acquisition 
cost' has the meaning given such term in section 1847A(c)(6)(B) of the 
Social Security Act.''; and
            (2) in section 2723 (42 U.S.C. 300gg-22)--
                    (A) in subsection (a)--
                            (i) in paragraph (1), by inserting ``(other 
                        than subsections (a) and (b) of section 2799A-
                        11)'' after ``part D''; and
                            (ii) in paragraph (2), by inserting 
                        ``(other than subsections (a) and (b) of 
                        section 2799A-11)'' after ``part D''; and
                    (B) in subsection (b)--
                            (i) in paragraph (1), by inserting ``(other 
                        than subsections (a) and (b) of section 2799A-
                        11)'' after ``part D'';
                            (ii) in paragraph (2)(A), by inserting 
                        ``(other than subsections (a) and (b) of 
                        section 2799A-11)'' after ``part D''; and
                            (iii) in paragraph (2)(C)(ii), by inserting 
                        ``(other than subsections (a) and (b) of 
                        section 2799A-11)'' after ``part D''.
    (c) ERISA.--
            (1) In general.--Subtitle B of title I of the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 1021 et seq.) 
        is amended--
                    (A) in subpart B of part 7 (29 U.S.C. 1185 et 
                seq.), by adding at the end the following:

``SEC. 726. OVERSIGHT OF PHARMACY BENEFITS MANAGER SERVICES.

    ``(a) In General.--For plan years beginning on or after the date 
that is 3 years after the date of enactment of this section, a group 
health plan or health insurance issuer offering group health insurance 
coverage, or an entity or subsidiary providing pharmacy benefits 
management services on behalf of such a plan or issuer, shall not enter 
into a contract with a drug manufacturer, distributor, wholesaler, 
subcontractor, rebate aggregator, or any associated third party that 
limits the disclosure of information to plan sponsors in such a manner 
that prevents the plan or issuer, or an entity or subsidiary providing 
pharmacy benefits management services on behalf of a plan or issuer, 
from making the report described in subsection (b).
    ``(b) Annual Report.--
            ``(1) In general.--With respect to plan years beginning on 
        or after the date that is 3 years after the date of enactment 
        of this section, for each such plan year, a group health plan 
        or health insurance issuer offering group health insurance 
        coverage, or an entity providing pharmacy benefits management 
        services on behalf of such a plan or an issuer, shall submit to 
        the plan sponsor (as defined in section 3(16)(B)) of such plan 
        or coverage a report in a machine-readable format. Each such 
        report shall include, with respect to such plan or coverage 
        provided for such plan year--
                    ``(A) to the extent feasible, information collected 
                from drug manufacturers (or an entity administering 
                copay assistance on behalf of such manufacturers) by 
                such plan or issuer on the total amount of copayment 
                assistance dollars paid, or copayment cards applied, 
                that were funded by the drug manufacturer with respect 
                to the participants, beneficiaries, and enrollees in 
                such plan or coverage;
                    ``(B) a list of each drug covered by such plan or 
                coverage that was dispensed during the plan year, 
                including, with respect to each such drug during such 
                plan year--
                            ``(i) the brand name, chemical entity, and 
                        National Drug Code;
                            ``(ii) the number of participants, 
                        beneficiaries, and enrollees for whom the drug 
                        was dispensed during the plan year, the total 
                        number of prescription claims for the drug 
                        (including original prescriptions and refills), 
                        and the total number of dosage units of the 
                        drug dispensed across the plan year, 
                        disaggregated by dispensing channel (such as 
                        retail, mail order, or specialty pharmacy);
                            ``(iii) the wholesale acquisition cost, 
                        listed as cost per days supply and cost per 
                        pill, or in the case of a drug in another form, 
                        per dosage unit;
                            ``(iv) the total out-of-pocket spending by 
                        participants, beneficiaries, and enrollees on 
                        such drug, including participant, beneficiary, 
                        and enrollee spending through copayments, 
                        coinsurance, and deductibles;
                            ``(v) for any drug for which gross spending 
                        of the group health plan or health insurance 
                        coverage exceeded $10,000 during the plan 
                        year--
                                    ``(I) a list of all other drugs in 
                                the same therapeutic category or class, 
                                including brand name drugs and 
                                biological products and generic drugs 
                                or biosimilar biological products that 
                                are in the same therapeutic category or 
                                class as such drug; and
                                    ``(II) the rationale for the 
                                formulary placement of such drug in 
                                that therapeutic category or class, if 
                                applicable;
                            ``(vi) the amount received, or expected to 
                        be received, from drug manufacturers in 
                        rebates, fees, alternative discounts, or other 
                        remuneration for claims incurred for such drug 
                        during the plan year;
                            ``(vii) the total net spending, after 
                        deducting rebates, price concessions, 
                        alternative discounts or other remuneration 
                        from drug manufacturers, by the health plan or 
                        health insurance coverage on such drug; and
                            ``(viii) the net price per course of 
                        treatment or single fill, such as a 30-day 
                        supply or 90-day supply, incurred by the health 
                        plan or health insurance coverage and its 
                        participants, beneficiaries, and enrollees, 
                        after manufacturer rebates, fees, and other 
                        remuneration for such drug dispensed during the 
                        plan year;
                    ``(C) a list of each therapeutic category or class 
                of drugs that were dispensed under the health plan or 
                health insurance coverage during the plan year, and, 
                with respect to each such therapeutic category or class 
                of drugs, during the plan year--
                            ``(i) total gross spending by the plan or 
                        coverage, before manufacturer rebates, fees, or 
                        other manufacturer remuneration;
                            ``(ii) the number of participants, 
                        beneficiaries, and enrollees who were dispensed 
                        a drug covered by such plan or coverage in that 
                        category or class, broken down by each such 
                        drug (identified by National Drug Code);
                            ``(iii) if applicable to that category or 
                        class, a description of the formulary tiers and 
                        utilization management (such as prior 
                        authorization or step therapy) employed for 
                        drugs in that category or class; and
                            ``(iv) the total out-of-pocket spending by 
                        participants, beneficiaries, and enrollees, 
                        including participant, beneficiary, and 
                        enrollee spending through copayments, 
                        coinsurance, and deductibles;
                    ``(D) total gross spending on prescription drugs by 
                the plan or coverage during the plan year, before 
                rebates and other manufacturer fees or remuneration;
                    ``(E) total amount received, or expected to be 
                received, by the health plan or health insurance 
                coverage in drug manufacturer rebates, fees, 
                alternative discounts, and all other remuneration 
                received from the manufacturer or any third party, 
                other than the plan sponsor, related to utilization of 
                drug or drug spending under that health plan or health 
                insurance coverage during the plan year;
                    ``(F) the total net spending on prescription drugs 
                by the health plan or health insurance coverage during 
                the plan year; and
                    ``(G) amounts paid directly or indirectly in 
                rebates, fees, or any other type of remuneration to 
                brokers, consultants, advisors, or any other individual 
                or firm for the referral of the group health plan's or 
                health insurance issuer's business to the pharmacy 
                benefits manager.
            ``(2) Privacy requirements.--Health insurance issuers 
        offering group health insurance coverage and entities providing 
        pharmacy benefits management services on behalf of a group 
        health plan shall provide information under paragraph (1) in a 
        manner consistent with the privacy, security, and breach 
        notification regulations promulgated under section 264(c) of 
        the Health Insurance Portability and Accountability Act of 
        1996, and shall restrict the use and disclosure of such 
        information according to such privacy regulations.
            ``(3) Disclosure and redisclosure.--
                    ``(A) Limitation to business associates.--A group 
                health plan receiving a report under paragraph (1) may 
                disclose such information only to business associates 
                of such plan as defined in section 160.103 of title 45, 
                Code of Federal Regulations (or successor regulations).
                    ``(B) Clarification regarding public disclosure of 
                information.--Nothing in this section prevents a health 
                insurance issuer offering group health insurance 
                coverage or an entity providing pharmacy benefits 
                management services on behalf of a group health plan 
                from placing reasonable restrictions on the public 
                disclosure of the information contained in a report 
                described in paragraph (1), except that such issuer or 
                entity may not restrict disclosure of such report to 
                the Department of Health and Human Services, the 
                Department of Labor, the Department of the Treasury, 
                the Comptroller General of the United States, or 
                applicable State agencies.
                    ``(C) Limited form of report.--The Secretary shall 
                define through rulemaking a limited form of the report 
                under paragraph (1) required of plan sponsors who are 
                drug manufacturers, drug wholesalers, or other direct 
                participants in the drug supply chain, in order to 
                prevent anti-competitive behavior.
            ``(4) Report to gao.--A group health plan or health 
        insurance issuer offering group health insurance coverage, or 
        an entity providing pharmacy benefits management services on 
        behalf of a group health plan shall submit to the Comptroller 
        General of the United States each of the first 4 reports 
        submitted to a plan sponsor under paragraph (1) with respect to 
        such coverage or plan, and other such reports as requested, in 
        accordance with the privacy requirements under paragraph (2), 
        the disclosure and redisclosure standards under paragraph (3), 
        the standards specified pursuant to paragraph (5), and such 
        other information that the Comptroller General determines 
        necessary to carry out the study under section 2(d) of the 
        Better Deals and Lower Prices Act.
            ``(5) Standard format.--Not later than 18 months after the 
        date of enactment of this section, the Secretary shall specify 
        through rulemaking standards for health insurance issuers and 
        entities required to submit reports under paragraph (4) to 
        submit such reports in a standard format.
    ``(c) Enforcement.--
            ``(1) In general.--Notwithstanding section 502, the 
        Secretary, in consultation with the Secretary of Health and 
        Human Services and the Secretary of the Treasury, shall enforce 
        this section.
            ``(2) Failure to provide timely information.--A health 
        insurance issuer or an entity providing pharmacy benefits 
        management services that violates subsection (a) or fails to 
        provide information required under subsection (b) shall be 
        subject to a civil monetary penalty in the amount of $10,000 
        for each day during which such violation continues or such 
        information is not disclosed or reported.
            ``(3) False information.--A health insurance issuer or 
        entity providing pharmacy benefits management services that 
        knowingly provides false information under this section shall 
        be subject to a civil money penalty in an amount not to exceed 
        $100,000 for each item of false information. Such civil money 
        penalty shall be in addition to other penalties as may be 
        prescribed by law.
            ``(4) Procedure.--The provisions of section 1128A of the 
        Social Security Act, other than subsection (a) and (b) and the 
        first sentence of subsection (c)(1) of such section shall apply 
        to civil monetary penalties under this subsection in the same 
        manner as such provisions apply to a penalty or proceeding 
        under section 1128A of the Social Security Act.
            ``(5) Waivers.--The Secretary may waive penalties under 
        paragraph (2), or extend the period of time for compliance with 
        a requirement of this section, for an entity in violation of 
        this section that has made a good-faith effort to comply with 
        this section.
    ``(d) Rule of Construction.--Nothing in this section shall be 
construed to permit a health insurance issuer, group health plan, or 
other entity to restrict disclosure to, or otherwise limit the access 
of, the Secretary of Labor to a report described in subsection (b)(1) 
or information related to compliance with subsection (a) or (b) by such 
issuer, plan, or other entity subject to such subsections.
    ``(e) Definition.--In this section, the term `wholesale acquisition 
cost' has the meaning given such term in section 1847A(c)(6)(B) of the 
Social Security Act.''; and
                    (B) in section 502 (29 U.S.C. 1132)--
                            (i) in subsection (a)--
                                    (I) in paragraph (6), by striking 
                                ``or (9)'' and inserting ``(9), or 
                                (13)'';
                                    (II) in paragraph (10), by striking 
                                at the end ``or'';
                                    (III) in paragraph (11), at the end 
                                by striking the period and inserting 
                                ``; or''; and
                                    (IV) by adding at the end the 
                                following new paragraph:
            ``(12) by the Secretary, in consultation with the Secretary 
        of Health and Human Services, and the Secretary of the 
        Treasury, to enforce section 726.'';
                            (ii) in subsection (b)(3), by inserting 
                        ``and subsections (a)(12) and (c)(13)'' before 
                        ``, the Secretary is not''; and
                            (iii) in subsection (c), by adding at the 
                        end the following new paragraph:
            ``(13) Secretarial enforcement authority relating to 
        oversight of pharmacy benefits manager services.--
                    ``(A) Failure to provide timely information.--The 
                Secretary, in consultation with the Secretary of Health 
                and Human Services and the Secretary of the Treasury, 
                may impose a penalty against any health insurance 
                issuer or entity providing pharmacy benefits management 
                services that violates section 726(a) or fails to 
                provide information required under section 726(b) in 
                the amount of $10,000 for each day during which such 
                violation continues or such information is not 
                disclosed or reported.
                    ``(B) False information.--The Secretary, in 
                consultation with the Secretary of Health and Human 
                Services and the Secretary of the Treasury, may impose 
                a penalty against a health insurance issuer or entity 
                providing pharmacy benefits management services that 
                knowingly provides false information under section 726 
                in an amount not to exceed $100,000 for each item of 
                false information. Such penalty shall be in addition to 
                other penalties as may be prescribed by law.
                    ``(C) Waivers.--The Secretary may waive penalties 
                under subparagraph (A), or extend the period of time 
                for compliance with a requirement of section 726, for 
                an entity in violation of such section that has made a 
                good-faith effort to comply with such section.''.
            (2) Clerical amendment.--The table of contents in section 1 
        of the Employee Retirement Income Security Act of 1974 (29 
        U.S.C. 1001 et seq.) is amended by inserting after the item 
        relating to section 725 the following new item:

``Sec. 726. Oversight of pharmacy benefits manager services.''.
    (d) GAO Study.--
            (1) In general.--Not later than 3 years after the date of 
        enactment of this Act, the Comptroller General of the United 
        States shall submit to Congress a report on--
                    (A) pharmacy networks of group health plans, health 
                insurance issuers, and entities providing pharmacy 
                benefits management services under such group health 
                plan or group or individual health insurance coverage, 
                including networks that have pharmacies that are under 
                common ownership (in whole or part) with group health 
                plans, health insurance issuers, or entities providing 
                pharmacy benefits management services or pharmacy 
                benefits administrative services under group health 
                plan or group or individual health insurance coverage;
                    (B) as it relates to pharmacy networks that include 
                pharmacies under common ownership described in 
                subparagraph (A)--
                            (i) whether such networks are designed to 
                        encourage enrollees of a plan or coverage to 
                        use such pharmacies over other network 
                        pharmacies for specific services or drugs, and 
                        if so, the reasons the networks give for 
                        encouraging use of such pharmacies; and
                            (ii) whether such pharmacies are used by 
                        enrollees disproportionately more in the 
                        aggregate or for specific services or drugs 
                        compared to other network pharmacies;
                    (C) whether group health plans and health insurance 
                issuers offering group or individual health insurance 
                coverage have options to elect different network 
                pricing arrangements in the marketplace with entities 
                that provide pharmacy benefits management services, the 
                prevalence of electing such different network pricing 
                arrangements;
                    (D) pharmacy network design parameters that 
                encourage enrollees in the plan or coverage to fill 
                prescriptions at mail order, specialty, or retail 
                pharmacies that are wholly or partially-owned by that 
                issuer or entity; and
                    (E) the degree to which mail order, specialty, or 
                retail pharmacies that dispense prescription drugs to 
                an enrollee in a group health plan or health insurance 
                coverage that are under common ownership (in whole or 
                part) with group health plans, health insurance 
                issuers, or entities providing pharmacy benefits 
                management services or pharmacy benefits administrative 
                services under group health plan or group or individual 
                health insurance coverage receive reimbursement that is 
                greater than the median price charged to the group 
                health plan or health insurance issuer when the same 
                drug is dispensed to enrollees in the plan or coverage 
                by other pharmacies included in the pharmacy network of 
                that plan, issuer, or entity that are not wholly or 
                partially owned by the health insurance issuer or 
                entity providing pharmacy benefits management services.
            (2) Requirement.--The Comptroller General of the United 
        States shall ensure that the report under paragraph (1) does 
        not contain information that would allow a reader to identify a 
        specific plan or entity providing pharmacy benefits management 
        services or otherwise contain commercial or financial 
        information that is privileged or confidential.
            (3) Definitions.--In this subsection, the terms ``group 
        health plan'', ``health insurance coverage'', and ``health 
        insurance issuer'' have the meanings given such terms in 
        section 2791 of the Public Health Service Act (42 U.S.C. 300gg-
        91).
                                 <all>