[Congressional Record Volume 168, Number 133 (Saturday, August 6, 2022)]
[Senate]
[Pages S4350-S4360]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SA 5479. Mr. CRAPO (for himself, Mr. Marshall, Mr. Daines, Mr.
Tillis, Mr. Burr, and Mr. Risch) submitted an amendment intended to be
proposed to amendment SA 5194 proposed by Mr. Schumer to the bill H.R.
5376, to provide for reconciliation pursuant to title II of S. Con.
Res. 14; which was ordered to lie on the table; as follows:
Strike parts 1 through 4 of subtitle B of title I and
insert the following:
PART 1--MEDICARE AND MEDICAID PROVISIONS
Subpart A--Medicare Part B Provisions
SEC. 11001. IMPROVEMENTS TO MEDICARE SITE-OF-SERVICE
TRANSPARENCY.
Section 1834(t) of the Social Security Act (42 U.S.C.
1395m(t)) is amended--
(1) in paragraph (1)--
(A) in the heading, by striking ``In general'' and
inserting ``Site payment'';
(B) in the matter preceding subparagraph (A)--
(i) by striking ``or to'' and inserting ``, to'';
(ii) by inserting ``, or to a physician for services
furnished in a physician's office'' after ``surgical center
under this title''; and
(iii) by inserting ``(or 2023 with respect to a physician
for services furnished in a physician's office)'' after
``2018''; and
(C) in subparagraph (A)--
(i) by striking ``and the'' and inserting ``, the''; and
(ii) by inserting ``, and the physician fee schedule under
section 1848 (with respect to the practice expense component
of such payment amount)'' after ``such section'';
(2) by redesignating paragraphs (2) through (4) as
paragraphs (3) through (5), respectively; and
(3) by inserting after paragraph (1) the following new
paragraph:
``(2) Physician payment.--Beginning in 2023, the Secretary
shall expand the information included on the internet website
described in paragraph (1) to include--
``(A) the amount paid to a physician under section 1848 for
an item or service for the settings described in paragraph
(1); and
``(B) the estimated amount of beneficiary liability
applicable to the item or service.''.
SEC. 11002. PROVIDING FOR VARIATION IN PAYMENT FOR CERTAIN
DRUGS COVERED UNDER PART B OF THE MEDICARE
PROGRAM.
(a) In General.--Section 1847A(b) of the Social Security
Act (42 U.S.C. 1395w-3a(b)) is amended--
(1) in paragraph (1)--
(A) in subparagraph (A), by inserting after ``or 106
percent'' the following: ``(or, for a multiple source drug
(other than autologous cellular immunotherapy) furnished on
or after January 1, 2023, the applicable percent specified in
paragraph (9)(A) for the drug and quarter involved)''; and
(B) in subparagraph (B) of paragraph (1), by inserting
after ``106 percent'' the following: ``(or, for a single
source drug or biological (other than autologous cellular
immunotherapy) furnished on or after January 1, 2023, the
applicable percent specified in paragraph (9)(A) for the drug
or biological and quarter involved)''; and
(2) by adding at the end the following new paragraph:
``(9) Application of variable percentages based on
percentile ranking of per beneficiary allowed charges.--
``(A) Applicable percent to be applied.--
``(i) In general.--Subject to clause (ii), with respect to
a drug or biological furnished in a calendar quarter
beginning on or after January 1, 2023, if the Secretary
determines that the percentile rank of a drug or biological
under subparagraph (B)(i)(III), with respect to per
beneficiary allowed charges for all such drugs or
biologicals, is--
``(I) at least equal to the 85th percentile, the applicable
percent for the drug for such quarter under this subparagraph
is 104 percent;
``(II) at least equal to the 70th percentile, but less than
the 85th percentile, such applicable percent is 106 percent;
``(III) at least equal to the 50th percentile, but less
than the 70th percentile, such applicable percent is 108
percent; or
``(IV) less than the 50th percentile, such applicable
percent is 110 percent.
``(ii) Cases where data not sufficiently available to
compute per beneficiary allowed charges.--Subject to clause
(iii), in the case of a drug or biological furnished for
which the amount of payment is determined under subparagraph
(A) or (B) of paragraph (1) and not under subsection (c)(4),
for calendar quarters during a period in which data are not
sufficiently available to compute a per beneficiary allowed
charges for the drug or biological, the applicable percent is
106 percent.
``(B) Determination of percentile rank of per beneficiary
allowed charges of drugs.--
``(i) In general.--With respect to a calendar quarter
beginning on or after January 1, 2023, for drugs and
biologicals for which the amount of payment is determined
under subparagraph (A) or (B) of paragraph (1), except for
drugs or biologicals for which data are not sufficiently
available, the Secretary shall--
``(I) compute the per beneficiary allowed charges (as
defined in subparagraph (C)) for each such drug or
biological;
``(II) adjust such per beneficiary allowed charges for the
quarter, to the extent provided under subparagraph (D); and
``(III) arrange such adjusted per beneficiary allowed
charges for all such drugs or biologicals from high to low
and rank such drugs or biologicals by percentile of such per
beneficiary allowed charges.
``(ii) Frequency.--The Secretary shall make the
computations under clause (i)(I) every 6 months (or, if
necessary, as determined by the Secretary, every 9 or 12
months) and such computations shall apply
[[Page S4351]]
to succeeding calendar quarters until a new computation has
been made.
``(iii) Applicable data period.--For purposes of this
paragraph, the term `applicable data period' means the most
recent period for which the data necessary for making the
computations under clause (i) are available, as determined by
the Secretary.
``(C) Per beneficiary allowed charges defined.--In this
paragraph, the term `per beneficiary allowed charges' means,
with respect to a drug or biological for which the amount of
payment is determined under subparagraph (A) or (B) of
paragraph (1)--
``(i) the allowed charges for the drug or biological for
which payment is so made for the applicable data period, as
estimated by the Secretary; divided by
``(ii) the number of individuals for whom any payment for
the drug or biological was made under paragraph (1) for the
applicable data period, as estimated by the Secretary.
``(D) Adjustment to reflect changes in average sales
price.--In applying this paragraph for a particular calendar
quarter, the Secretary shall adjust the per beneficiary
allowed charges for a drug or biological by multiplying such
per beneficiary allowed charges under subparagraph (C) for
the applicable data period by the ratio of--
``(i) the average sales price for the drug or biological
for the most recent calendar quarter used under subsection
(c)(5)(B); to
``(ii) the average sales price for the drug or biological
for the calendar quarter (or the weighted average for the
quarters involved) included in the applicable data period.''.
(b) Application of Judicial Review Provisions.--Section
1847A(i) of the Social Security Act (42 U.S.C. 1395w-3a(i))
is amended--
(1) by striking ``and'' at the end of paragraph (4);
(2) by striking the period at the end of paragraph (5) and
inserting ``; and''; and
(3) by adding at the end the following new paragraph:
``(6) the determination of per beneficiary allowed charges
of drugs or biologicals and ranking of such charges under
subsection (b)(9).''.
SEC. 11003. ESTABLISHMENT OF MAXIMUM ADD-ON PAYMENT FOR DRUGS
AND BIOLOGICALS.
(a) In General.--Section 1847A of the Social Security Act
(42 U.S.C. 1395w-3a), as amended by section 11002, is
amended--
(1) in subsection (b)--
(A) in paragraph (1), in the matter preceding subparagraph
(A), by striking ``paragraph (7)'' and inserting ``paragraphs
(7) and (10)''; and
(B) by adding at the end the following new paragraph:
``(10) Maximum add-on payment amount.--
``(A) In general.--In determining the payment amount under
the provisions of subparagraph (A), (B), or (C) of paragraph
(1) of this subsection, subsection (c)(4)(A)(ii), or
subsection (d)(3)(C) for a drug or biological furnished on or
after January 1, 2023, if the applicable add-on payment (as
defined in subparagraph (B)) for each drug or biological on a
claim for a date of service exceeds the maximum add-on
payment amount specified under subparagraph (C) for the drug
or biological, then the payment amount otherwise determined
for the drug or biological under those provisions, as
applicable, shall be reduced by the amount of such excess.
``(B) Applicable add-on payment defined.--In this
paragraph, the term `applicable add-on payment' means the
following amounts, determined without regard to the
application of subparagraph (A):
``(i) In the case of a multiple source drug, an amount
equal to the difference between--
``(I) the amount that would otherwise be applied under
paragraph (1)(A); and
``(II) the amount that would be applied under such
paragraph if `100 percent' were substituted for the
applicable percent (as defined in paragraph (9)) for such
drug.
``(ii) In the case of a single source drug or biological,
an amount equal to the difference between--
``(I) the amount that would otherwise be applied under
paragraph (1)(B); and
``(II) the amount that would be applied under such
paragraph if `100 percent' were substituted for the
applicable percent (as defined in paragraph (9)) for such
drug or biological.
``(iii) In the case of a biosimilar biological product, the
amount otherwise determined under paragraph (8)(B).
``(iv) In the case of a drug or biological during the
initial period described in subsection (c)(4)(A), an amount
equal to the difference between--
``(I) the amount that would otherwise be applied under
subsection (c)(4)(A)(ii); and
``(II) the amount that would be applied under such
subsection if `100 percent' were substituted, as applicable,
for--
``(aa) `103 percent' in subclause (I) of such subsection;
or
``(bb) any percent in excess of 100 percent applied under
subclause (II) of such subsection.
``(v) In the case of a drug or biological to which
subsection (d)(3)(C) applies, an amount equal to the
difference between--
``(I) the amount that would otherwise be applied under such
subsection; and
``(II) the amount that would be applied under such
subsection if `100 percent' were substituted, as applicable,
for--
``(aa) any percent in excess of 100 percent applied under
clause (i) of such subsection; or
``(bb) `103 percent' in clause (ii) of such subsection.
``(C) Maximum add-on payment amount specified.--For
purposes of subparagraph (A), the maximum add-on payment
amount specified in this subparagraph is--
``(i) with respect to a drug or biological (other than
autologous or allogeneric cellular immunotherapy)--
``(I) for each of 2023 through 2030, $1,000; and
``(II) for a subsequent year, the amount specified in this
subparagraph for the preceding year increased by the
percentage increase in the consumer price index for all urban
consumers (all items; United States city average) for the 12-
month period ending with June of the previous year; or
``(ii) with respect to a drug or biological consisting of
autologous or allogeneric cellular immunotherapy--
``(I) for each of 2023 through 2030, $2,000; and
``(II) for a subsequent year, the amount specified in this
subparagraph for the preceding year increased by the
percentage increase in the consumer price index for all urban
consumers (all items; United States city average) for the 12-
month period ending with June of the previous year.
Any amount determined under this subparagraph that is not a
multiple of $10 shall be rounded to the nearest multiple of
$10.''; and
(2) in subsection (c)(4)(A)(ii), by striking ``in the
case'' and inserting ``subject to subsection (b)(10), in the
case''.
(b) Conforming Amendments Relating to Separately Payable
Drugs.--
(1) OPPS.--Section 1833(t)(14) of the Social Security Act
(42 U.S.C. 1395l(t)(14)) is amended--
(A) in subparagraph (A)(iii)(II), by inserting ``, subject
to subparagraph (I)'' after ``are not available''; and
(B) by adding at the end the following new subparagraph:
``(I) Application of maximum add-on payment for separately
payable drugs and biologicals.--In establishing the amount of
payment under subparagraph (A) for a specified covered
outpatient drug that is furnished as part of a covered OPD
service (or group of services) on or after January 1, 2023,
if such payment is determined based on the average price for
the year established under section 1847A pursuant to clause
(iii)(II) of such subparagraph, the provisions of subsection
(b)(10) of section 1847A shall apply to the amount of payment
so established in the same manner as such provisions apply to
the amount of payment under section 1847A.''.
(2) ASC.--Section 1833(i)(2)(D) of the Social Security Act
(42 U.S.C. 1395l(i)(2)(D)) is amended--
(A) by moving clause (v) 6 ems to the left;
(B) by redesignating clause (vi) as clause (vii); and
(C) by inserting after clause (v) the following new clause:
``(vi) If there is a separate payment under the system
described in clause (i) for a drug or biological furnished on
or after January 1, 2023, the provisions of subsection
(t)(14)(I) shall apply to the establishment of the amount of
payment for the drug or biological under such system in the
same manner in which such provisions apply to the
establishment of the amount of payment under subsection
(t)(14)(A).''.
SEC. 11004. TREATMENT OF DRUG ADMINISTRATION SERVICES
FURNISHED BY CERTAIN EXCEPTED OFF-CAMPUS
OUTPATIENT DEPARTMENTS OF A PROVIDER.
Section 1833(t)(16) of the Social Security Act (42 U.S.C.
1395l(t)(16)) is amended by adding at the end the following
new subparagraph:
``(G) Special payment rule for drug administration services
furnished by an excepted department of a provider.--
``(i) In general.--In the case of a covered OPD service
that is a drug administration service (as defined by the
Secretary) furnished by a department of a provider described
in clause (ii) or (iv) of paragraph (21)(B), the payment
amount for such service furnished on or after January 1,
2023, shall be the same payment amount (as determined in
paragraph (21)(C)) that would apply if the drug
administration service was furnished by an off-campus
outpatient department of a provider (as defined in paragraph
(21)(B)).
``(ii) Application without regard to budget neutrality.--
The reductions made under this subparagraph--
``(I) shall not be considered an adjustment under paragraph
(2)(E); and
``(II) shall not be implemented in a budget neutral
manner.''.
SEC. 11005. CREDIT UNDER THE MEDICARE MERIT-BASED INCENTIVE
PAYMENT SYSTEM FOR COMPLETION OF A CLINICAL
MEDICAL EDUCATION PROGRAM ON BIOSIMILAR
BIOLOGICAL PRODUCTS.
Section 1848(q)(5)(C) of the Social Security Act (42 U.S.C.
1395w-4(q)(5)(C)) is amended by adding at the end the
following new clause:
``(iv) Clinical medical education program on biosimilar
biological products.--Completion of a clinical medical
education program developed or improved under section 352A(b)
of the Public Health Service Act by a MIPS eligible
professional during a performance period shall earn such
eligible professional one-half of the highest potential score
for the performance category described in paragraph
(2)(A)(iii) for such performance period. A MIPS eligible
professional may only count the completion of such a program
for purposes of such category one time during the eligible
professional's lifetime.''.
[[Page S4352]]
SEC. 11006. GAO STUDY AND REPORT ON AVERAGE SALES PRICE.
(a) Study.--
(1) In general.--The Comptroller General of the United
States (in this section referred to as the ``Comptroller
General'') shall conduct a study on spending for applicable
drugs under part B of title XVIII of the Social Security Act.
(2) Applicable drugs defined.--In this section, the term
``applicable drugs'' means drugs and biologicals--
(A) for which reimbursement under such part B is based on
the average sales price of the drug or biological; and
(B) that account for the largest percentage of total
spending on drugs and biologicals under such part B (as
determined by the Comptroller General, but in no case less
than 25 drugs or biologicals).
(3) Requirements.--The study under paragraph (1) shall
include an analysis of the following:
(A) The extent to which each applicable drug is paid for--
(i) under such part B for Medicare beneficiaries; or
(ii) by private payers in the commercial market.
(B) Any change in Medicare spending or Medicare beneficiary
cost-sharing that would occur if the average sales price of
an applicable drug was based solely on payments by private
payers in the commercial market.
(C) The extent to which drug manufacturers provide rebates,
discounts, or other price concessions to private payers in
the commercial market for applicable drugs, which the
manufacturer includes in its average sales price calculation,
for--
(i) formulary placement;
(ii) utilization management considerations; or
(iii) other purposes.
(D) Barriers to drug manufacturers providing such price
concessions for applicable drugs.
(E) Other areas determined appropriate by the Comptroller
General.
(b) Report.--Not later than 2 years after the date of the
enactment of this Act, the Comptroller General shall submit
to Congress a report on the study conducted under subsection
(a), together with recommendations for such legislation and
administrative action as the Secretary determines
appropriate.
Subpart B--Medicare Part D Provisions
SEC. 11011. MEDICARE PART D BENEFIT REDESIGN.
(a) Benefit Structure Redesign.--Section 1860D-2(b) of the
Social Security Act (42 U.S.C. 1395w-102(b)) is amended--
(1) in paragraph (2)--
(A) in subparagraph (A)--
(i) in the matter preceding clause (i), by inserting ``for
a year preceding 2023 and for costs above the annual
deductible specified in paragraph (1) and up to the annual
out-of-pocket threshold specified in paragraph (4)(B) for
2023 and each subsequent year'' after ``paragraph (3)'';
(ii) in clause (i), by inserting after ``25 percent'' the
following: ``(or, for 2023 and each subsequent year, 15
percent)''; and
(iii) in clause (ii), by inserting ``(or, for 2023 and each
subsequent year, 15 percent)'' after ``25 percent'';
(B) in subparagraph (C)--
(i) in clause (i), in the matter preceding subclause (I),
by inserting ``for a year preceding 2023,'' after ``paragraph
(4),''; and
(ii) in clause (ii)(III), by striking ``and each subsequent
year'' and inserting ``2021, and 2022''; and
(C) in subparagraph (D)--
(i) in clause (i)--
(I) in the matter preceding subclause (I), by inserting
``for a year preceding 2023,'' after ``paragraph (4),''; and
(II) in subclause (I)(bb), by striking ``a year after
2018'' and inserting ``each of years 2018 through 2022''; and
(ii) in clause (ii)(V), by striking ``2019 and each
subsequent year'' and inserting ``each of years 2019 through
2022'';
(2) in paragraph (3)(A)--
(A) in the matter preceding clause (i), by inserting ``for
a year preceding 2023,'' after ``and (4),''; and
(B) in clause (ii), by striking ``for a subsequent year''
and inserting ``for each of years 2007 through 2022''; and
(3) in paragraph (4)--
(A) in subparagraph (A)--
(i) in clause (i)--
(I) by redesignating subclauses (I) and (II) as items (aa)
and (bb), respectively, and indenting appropriately;
(II) in the matter preceding item (aa), as redesignated by
subclause (I), by striking ``is equal to the greater of--''
and inserting ``is equal to--
``(I) for a year preceding 2023, the greater of--'';
(III) by striking the period at the end of item (bb), as
redesignated by subclause (I), and inserting ``; and''; and
(IV) by adding at the end the following:
``(II) for 2023 and each succeeding year, $0.''; and
(ii) in clause (ii)--
(I) by striking ``clause (i)(I)'' and inserting ``clause
(i)(I)(aa)''; and
(II) by adding at the end the following new sentence: ``The
Secretary shall continue to calculate the dollar amounts
specified in clause (i)(I)(aa), including with the adjustment
under this clause, after 2022 for purposes of section 1860D-
14(a)(1)(D)(iii).'';
(B) in subparagraph (B)--
(i) in clause (i)--
(I) in subclause (V), by striking ``or'' at the end;
(II) in subclause (VI)--
(aa) by striking ``for a subsequent year'' and inserting
``for 2021 and 2022''; and
(bb) by striking the period at the end and inserting a
semicolon; and
(III) by adding at the end the following new subclauses:
``(VII) for 2023, is equal to $3,100; or
``(VIII) for a subsequent year, is equal to the amount
specified in this subparagraph for the previous year,
increased by the annual percentage increase described in
paragraph (6) for the year involved.''; and
(ii) in clause (ii), by striking ``clause (i)(II)'' and
inserting ``clause (i)'';
(C) in subparagraph (C)(i), by striking ``and for amounts''
and inserting ``and for a year preceding 2023 for amounts'';
and
(D) in subparagraph (E), by striking ``In applying'' and
inserting ``For each of 2011 through 2022, in applying''.
(b) Decreasing Reinsurance Payment Amount.--Section 1860D-
15(b)(1) of the Social Security Act (42 U.S.C. 1395w-
115(b)(1)) is amended--
(1) by striking ``equal to 80 percent'' and inserting
``equal to--
``(A) for a year preceding 2023, 80 percent'';
(2) in subparagraph (A), as added by paragraph (1), by
striking the period at the end and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(B) for 2023 and each subsequent year, the sum of--
``(i) an amount equal to 20 percent of the allowable
reinsurance costs (as specified in paragraph (2))
attributable to that portion of gross covered prescription
drug costs as specified in paragraph (3) incurred in the
coverage year after such individual has incurred costs that
exceed the annual out-of-pocket threshold specified in
section 1860D-2(b)(4)(B) with respect to applicable drugs (as
defined in section 1860D-14B(g)(2)); and
``(ii) an amount equal to 30 percent of the allowable
reinsurance costs (as specified in paragraph (2))
attributable to that portion of gross covered prescription
drug costs as specified in paragraph (3) incurred in the
coverage year after such individual has incurred costs that
exceed the annual out-of-pocket threshold specified in
section 1860D-2(b)(4)(B) with respect to covered part D drugs
that are not applicable drugs (as so defined).''.
(c) Manufacturer Discount Program.--
(1) In general.--Part D of title XVIII of the Social
Security Act is amended by inserting after section 1860D-14A
(42 U.S.C. 1495w-114) the following new section:
``SEC. 1860D-14B. MANUFACTURER DISCOUNT PROGRAM.
``(a) Establishment.--The Secretary shall establish a
manufacturer discount program (in this section referred to as
the `program'). Under the program, the Secretary shall enter
into agreements described in subsection (b) with
manufacturers and provide for the performance of the duties
described in subsection (c). The Secretary shall establish a
model agreement for use under the program by not later than
January 1, 2024, in consultation with manufacturers, and
allow for comment on such model agreement.
``(b) Terms of Agreement.--
``(1) In general.--
``(A) Agreement.--An agreement under this section shall
require the manufacturer to provide applicable beneficiaries
access to discounted prices for applicable drugs of the
manufacturer that are dispensed on or after January 1, 2023.
``(B) Provision of discounted prices at the point-of-
sale.--The discounted prices described in subparagraph (A)
shall be provided to the applicable beneficiary at the
pharmacy or by the mail order service at the point-of-sale of
an applicable drug.
``(2) Provision of appropriate data.--Each manufacturer
with an agreement in effect under this section shall collect
and have available appropriate data, as determined by the
Secretary, to ensure that it can demonstrate to the Secretary
compliance with the requirements under the program.
``(3) Compliance with requirements for administration of
program.--Each manufacturer with an agreement in effect under
this section shall comply with requirements imposed by the
Secretary or a third party with a contract under subsection
(d)(3), as applicable, for purposes of administering the
program, including any determination under subparagraph (A)
of subsection (c)(1) or procedures established under such
subsection (c)(1).
``(4) Length of agreement.--
``(A) In general.--An agreement under this section shall be
effective for an initial period of not less than 12 months
and shall be automatically renewed for a period of not less
than 1 year unless terminated under subparagraph (B).
``(B) Termination.--
``(i) By the secretary.--The Secretary may provide for
termination of an agreement under this section for a knowing
and willful violation of the requirements of the agreement or
other good cause shown. Such termination shall not be
effective earlier than 30 days after the date of notice to
the manufacturer of such termination. The Secretary shall
provide, upon request, a manufacturer with a hearing
concerning such a termination, and such hearing shall take
place prior to the effective date of the termination with
sufficient time for such effective date
[[Page S4353]]
to be repealed if the Secretary determines appropriate.
``(ii) By a manufacturer.--A manufacturer may terminate an
agreement under this section for any reason. Any such
termination shall be effective, with respect to a plan year--
``(I) if the termination occurs before January 30 of a plan
year, as of the day after the end of the plan year; and
``(II) if the termination occurs on or after January 30 of
a plan year, as of the day after the end of the succeeding
plan year.
``(iii) Effectiveness of termination.--Any termination
under this subparagraph shall not affect discounts for
applicable drugs of the manufacturer that are due under the
agreement before the effective date of its termination.
``(iv) Notice to third party.--The Secretary shall provide
notice of such termination to a third party with a contract
under subsection (d)(3) within not less than 30 days before
the effective date of such termination.
``(5) Effective date of agreement.--An agreement under this
section shall take effect on a date determined appropriate by
the Secretary, which may be at the start of a calendar
quarter.
``(c) Duties Described.--The duties described in this
subsection are the following:
``(1) Administration of program.--Administering the
program, including--
``(A) the determination of the amount of the discounted
price of an applicable drug of a manufacturer;
``(B) the establishment of procedures under which
discounted prices are provided to applicable beneficiaries at
pharmacies or by mail order service at the point-of-sale of
an applicable drug;
``(C) the establishment of procedures to ensure that, not
later than the applicable number of calendar days after the
dispensing of an applicable drug by a pharmacy or mail order
service, the pharmacy or mail order service is reimbursed for
an amount equal to the difference between--
``(i) the negotiated price of the applicable drug; and
``(ii) the discounted price of the applicable drug;
``(D) the establishment of procedures to ensure that the
discounted price for an applicable drug under this section is
applied before any coverage or financial assistance under
other health benefit plans or programs that provide coverage
or financial assistance for the purchase or provision of
prescription drug coverage on behalf of applicable
beneficiaries as the Secretary may specify; and
``(E) providing a reasonable dispute resolution mechanism
to resolve disagreements between manufacturers, applicable
beneficiaries, and the third party with a contract under
subsection (d)(3).
``(2) Monitoring compliance.--
``(A) In general.--The Secretary shall monitor compliance
by a manufacturer with the terms of an agreement under this
section.
``(B) Notification.--If a third party with a contract under
subsection (d)(3) determines that the manufacturer is not in
compliance with such agreement, the third party shall notify
the Secretary of such noncompliance for appropriate
enforcement under subsection (e).
``(3) Collection of data from prescription drug plans and
ma-pd plans.--The Secretary may collect appropriate data from
prescription drug plans and MA-PD plans in a timeframe that
allows for discounted prices to be provided for applicable
drugs under this section.
``(d) Administration.--
``(1) In general.--Subject to paragraph (2), the Secretary
shall provide for the implementation of this section,
including the performance of the duties described in
subsection (c).
``(2) Limitation.--In providing for the implementation of
this section, the Secretary shall not receive or distribute
any funds of a manufacturer under the program.
``(3) Contract with third parties.--The Secretary shall
enter into a contract with one or more third parties to
administer the requirements established by the Secretary in
order to carry out this section. At a minimum, the contract
with a third party under the preceding sentence shall require
that the third party--
``(A) receive and transmit information between the
Secretary, manufacturers, and other individuals or entities
the Secretary determines appropriate;
``(B) receive, distribute, or facilitate the distribution
of funds of manufacturers to appropriate individuals or
entities in order to meet the obligations of manufacturers
under agreements under this section;
``(C) provide adequate and timely information to
manufacturers, consistent with the agreement with the
manufacturer under this section, as necessary for the
manufacturer to fulfill its obligations under this section;
and
``(D) permit manufacturers to conduct periodic audits,
directly or through contracts, of the data and information
used by the third party to determine discounts for applicable
drugs of the manufacturer under the program.
``(4) Performance requirements.--The Secretary shall
establish performance requirements for a third party with a
contract under paragraph (3) and safeguards to protect the
independence and integrity of the activities carried out by
the third party under the program under this section.
``(5) Administration.--Chapter 35 of title 44, United
States Code, shall not apply to the program under this
section.
``(e) Enforcement.--
``(1) Audits.--Each manufacturer with an agreement in
effect under this section shall be subject to periodic audit
by the Secretary.
``(2) Civil money penalty.--
``(A) In general.--The Secretary shall impose a civil money
penalty on a manufacturer that fails to provide applicable
beneficiaries discounts for applicable drugs of the
manufacturer in accordance with such agreement for each such
failure in an amount the Secretary determines is commensurate
with the sum of--
``(i) the amount that the manufacturer would have paid with
respect to such discounts under the agreement, which will
then be used to pay the discounts which the manufacturer had
failed to provide; and
``(ii) 25 percent of such amount.
``(B) Application.--The provisions of section 1128A (other
than subsections (a) and (b)) shall apply to a civil money
penalty under this paragraph in the same manner as such
provisions apply to a penalty or proceeding under section
1128A(a).
``(f) Clarification Regarding Availability of Other Covered
Part D Drugs.--Nothing in this section shall prevent an
applicable beneficiary from purchasing a covered part D drug
that is not on the formulary of the prescription drug plan or
MA-PD plan that the applicable beneficiary is enrolled in.
``(g) Definitions.--In this section:
``(1) Applicable beneficiary.--The term `applicable
beneficiary' means an individual who, on the date of
dispensing a covered part D drug--
``(A) is enrolled in a prescription drug plan or an MA-PD
plan;
``(B) is not enrolled in a qualified retiree prescription
drug plan; and
``(C) has incurred costs for covered part D drugs in the
year that are equal to or exceed the annual deductible
specified in section 1860D-2(b)(1) for such year.
``(2) Applicable drug.--The term `applicable drug' means,
with respect to an applicable beneficiary, a covered part D
drug--
``(A) approved under a new drug application under section
505(c) of the Federal Food, Drug, and Cosmetic Act or, in the
case of a biologic product, licensed under section 351 of the
Public Health Service Act (including a product licensed under
subsection (k) of such section); and
``(B)(i) if the PDP sponsor of the prescription drug plan
or the MA organization offering the MA-PD plan uses a
formulary, which is on the formulary of the prescription drug
plan or MA-PD plan that the applicable beneficiary is
enrolled in;
``(ii) if the PDP sponsor of the prescription drug plan or
the MA organization offering the MA-PD plan does not use a
formulary, for which benefits are available under the
prescription drug plan or MA-PD plan that the applicable
beneficiary is enrolled in; or
``(iii) is provided through an exception or appeal.
``(3) Applicable number of calendar days.--The term
`applicable number of calendar days' means--
``(A) with respect to claims for reimbursement submitted
electronically, 14 days; and
``(B) with respect to claims for reimbursement submitted
otherwise, 30 days.
``(4) Discounted price.--
``(A) In general.--The term `discounted price' means, with
respect to an applicable drug of a manufacturer furnished
during a year to an applicable beneficiary, 90 percent of the
negotiated price of such drug.
``(B) Clarification.--Nothing in this section shall be
construed as affecting the responsibility of an applicable
beneficiary for payment of a dispensing fee for an applicable
drug.
``(C) Special case for claims spanning deductible.--In the
case where the entire amount of the negotiated price of an
individual claim for an applicable drug with respect to an
applicable beneficiary does not fall at or above the annual
deductible specified in section 1860D-2(b)(1) for the year,
the manufacturer of the applicable drug shall provide the
discounted price under this section on only the portion of
the negotiated price of the applicable drug that falls at or
above such annual deductible.
``(5) Manufacturer.--The term `manufacturer' means any
entity which is engaged in the production, preparation,
propagation, compounding, conversion, or processing of
prescription drug products, either directly or indirectly by
extraction from substances of natural origin, or
independently by means of chemical synthesis, or by a
combination of extraction and chemical synthesis. Such term
does not include a wholesale distributor of drugs or a retail
pharmacy licensed under State law.
``(6) Negotiated price.--The term `negotiated price' has
the meaning given such term in section 1860D-2(d)(1)(B),
except that such negotiated price shall not include any
dispensing fee for an applicable drug.
``(7) Qualified retiree prescription drug plan.--The term
`qualified retiree prescription drug plan' has the meaning
given such term in section 11860D-22(a)(2).''.
(2) Sunset of medicare coverage gap discount program.--
Section 1860D-14A of the Social Security Act (42 U.S.C. 1395-
114a) is amended--
(A) in subsection (a), in the first sentence, by striking
``The Secretary'' and inserting ``Subject to subsection (h),
the Secretary''; and
(B) by adding at the end the following new subsection:
``(h) Sunset of Program.--
[[Page S4354]]
``(1) In general.--The program shall not apply to
applicable drugs dispensed on or after January 1, 2023, and,
subject to paragraph (2), agreements under this section shall
be terminated as of such date.
``(2) Continued application for applicable drugs dispensed
prior to sunset.--The provisions of this section (including
all responsibilities and duties) shall continue to apply
after January 1, 2023, with respect to applicable drugs
dispensed prior to such date.''.
(3) Inclusion of actuarial value of manufacturer discounts
in bids.--Section 1860D-11 of the Social Security Act (42
U.S.C. 1395w-111) is amended--
(A) in subsection (b)(2)(C)(iii)--
(i) by striking ``assumptions regarding the reinsurance''
and inserting ``assumptions regarding--
``(I) the reinsurance''; and
(ii) by adding at the end the following:
``(II) for 2023 and each subsequent year, the manufacturer
discounts provided under section 1860D- 14B subtracted from
the actuarial value to produce such bid; and''; and
(B) in subsection (c)(1)(C)--
(i) by striking ``an actuarial valuation of the
reinsurance'' and inserting ``an actuarial valuation of--
``(i) the reinsurance'';
(ii) in clause (i), as added by clause (i) of this
subparagraph, by adding ``and'' at the end; and
(iii) by adding at the end the following:
``(ii) for 2023 and each subsequent year, the manufacturer
discounts provided under section 1860D-14B;''.
(4) Clarification regarding exclusion of manufacturer
discounts from troop.--Section 1860D-2(b)(4) of the Social
Security Act (42 U.S.C. 1395w-102(b)(4)) is amended--
(A) in subparagraph (C), by inserting ``and subject to
subparagraph (F)'' after ``subparagraph (E)''; and
(B) by adding at the end the following new subparagraph:
``(F) Clarification regarding exclusion of manufacturer
discounts.--In applying subparagraph (A), incurred costs
shall not include any manufacturer discounts provided under
section 1860D-14B.''.
(d) Determination of Allowable Reinsurance Costs.--Section
1860D-15(b) of the Social Security Act (42 U.S.C. 1395w-
115(b)) is amended--
(1) in paragraph (2)--
(A) by striking ``Costs.--For purposes'' and inserting
``Costs.--
``(A) In general.--Subject to subparagraph (B), for
purposes''; and
(B) by adding at the end the following new subparagraph:
``(B) Inclusion of manufacturer discounts on applicable
drugs.--For purposes of applying subparagraph (A), the term
`allowable reinsurance costs' shall include the portion of
the negotiated price (as defined in section 1860D-14B(g)(6))
of an applicable drug (as defined in section 1860D-14(g)(2))
that was paid by a manufacturer under the manufacturer
discount program under section 1860D-14B.''; and
(2) in paragraph (3)--
(A) in the first sentence, by striking ``For purposes'' and
inserting ``Subject to paragraph (2)(B), for purposes''; and
(B) in the second sentence, by inserting ``or, in the case
of an applicable drug, by a manufacturer'' after ``by the
individual or under the plan''.
(e) Updating Risk Adjustment Methodologies To Account for
Part D Modernization Redesign.--Section 1860D-15(c) of the
Social Security Act (42 U.S.C. 1395w-115(c)) is amended by
adding at the end the following new paragraph:
``(3) Updating risk adjustment methodologies to account for
part d modernization redesign.--The Secretary shall update
the risk adjustment model used to adjust bid amounts pursuant
to this subsection as appropriate to take into account
changes in benefits under this part pursuant to the
amendments made by section 121 of the Lower Costs, More Cures
Act of 2019.''.
(f) Conditions for Coverage of Drugs Under This Part.--
Section 1860D-43 of the Social Security Act (42 U.S.C. 1395w-
153) is amended--
(1) in subsection (a)--
(A) in paragraph (2), by striking ``and'' at the end;
(B) in paragraph (3), by striking the period at the end and
inserting a semicolon; and
(C) by adding at the end the following new paragraphs:
``(4) participate in the manufacturer discount program
under section 1860D-14B;
``(5) have entered into and have in effect an agreement
described in subsection (b) of such section 1860D-14B with
the Secretary; and
``(6) have entered into and have in effect, under terms and
conditions specified by the Secretary, a contract with a
third party that the Secretary has entered into a contract
with under subsection (d)(3) of such section 1860D-14B.'';
(2) by striking subsection (b) and inserting the following:
``(b) Effective Date.--Paragraphs (1) through (3) of
subsection (a) shall apply to covered part D drugs dispensed
under this part on or after January 1, 2011, and before
January 1, 2023, and paragraphs (4) through (6) of such
subsection shall apply to covered part D drugs dispensed on
or after January 1, 2023.''; and
(3) in subsection (c), by striking paragraph (2) and
inserting the following:
``(2) the Secretary determines that in the period beginning
on January 1, 2011, and ending on December 31, 2011 (with
respect to paragraphs (1) through (3) of subsection (a)), or
the period beginning on January 1, 2023, and ending December
31, 2023 (with respect to paragraphs (4) through (6) of such
subsection), there were extenuating circumstances.''.
(g) Conforming Amendments.--
(1) Section 1860D-2 of the Social Security Act (42 U.S.C.
1395w-102) is amended--
(A) in subsection (a)(2)(A)(i)(I), by striking ``, or an
increase in the initial'' and inserting ``or for a year
preceding 2023 an increase in the initial'';
(B) in subsection (c)(1)(C)--
(i) in the subparagraph heading, by striking ``at initial
coverage limit''; and
(ii) by inserting ``for a year preceding 2023 or the annual
out-of-pocket threshold specified in subsection (b)(4)(B) for
the year for 2023 and each subsequent year'' after
``subsection (b)(3) for the year'' each place it appears; and
(C) in subsection (d)(1)(A), by striking ``or an initial''
and inserting ``or for a year preceding 2023, an initial''.
(2) Section 1860D-4(a)(4)(B)(i) of the Social Security Act
(42 U.S.C. 1395w-104(a)(4)(B)(i)) is amended by striking
``the initial'' and inserting ``for a year preceding 2023,
the initial''.
(3) Section 1860D-14(a) of the Social Security Act (42
U.S.C. 1395w-114(a)) is amended--
(A) in paragraph (1)--
(i) in subparagraph (C), by striking ``The continuation''
and inserting ``For a year preceding 2023, the
continuation'';
(ii) in subparagraph (D)(iii), by striking ``1860D-
2(b)(4)(A)(i)(I)'' and inserting ``1860D-
2(b)(4)(A)(i)(I)(aa)''; and
(iii) in subparagraph (E), by striking ``The elimination''
and inserting ``For a year preceding 2023, the elimination'';
and
(B) in paragraph (2)--
(i) in subparagraph (C), by striking ``The continuation''
and inserting ``For a year preceding 2023, the
continuation''; and
(ii) in subparagraph (E)--
(I) by inserting ``for a year preceding 2023,'' after
``subsection (c)''; and
(II) by striking ``1860D- 2(b)(4)(A)(i)(I)'' and inserting
``1860D-2(b)(4)(A)(i)(I)(aa)''.
(4) Section 1860D-21(d)(7) of the Social Security Act (42
U.S.C. 1395w-131(d)(7)) is amended by striking ``section
1860D-2(b)(4)(B)(i)'' and inserting ``section 1860D-
2(b)(4)(C)(i)''.
(5) Section 1860D-22(a)(2)(A) of the Social Security Act
(42 U.S.C. 1395w-132(a)(2)(A)) is amended--
(A) by striking ``the value of any discount'' and inserting
the following: ``the value of--
``(i) for years prior to 2023, any discount'';
(B) in clause (i), as inserted by subparagraph (A) of this
paragraph, by striking the period at the end and inserting
``; and''; and
(C) by adding at the end the following new clause:
``(ii) for 2023 and each subsequent year, any discount
provided pursuant to section 1860D-14B.''.
(6) Section 1860D-41(a)(6) of the Social Security Act (42
U.S.C. 1395w-151(a)(6)) is amended--
(A) by inserting ``for a year before 2023'' after ``1860D-
2(b)(3)''; and
(B) by inserting ``for such year'' before the period.
(h) Effective Date.--The amendments made by this section
shall apply to plan year 2023 and subsequent plan years.
SEC. 11012. ALLOWING THE OFFERING OF ADDITIONAL PRESCRIPTION
DRUG PLANS UNDER MEDICARE PART D.
(a) Rescinding and Issuance of New Guidance.--Not later
than one year after the date of the enactment of this Act,
the Secretary of Health and Human Services (in this section
referred to as the ``Secretary'') shall--
(1) rescind sections of any sub-regulatory guidance that
limit the number of prescription drug plans in each PDP
region that may be offered by a PDP sponsor under part D of
title XVIII of the Social Security Act (42 U.S.C. 1395w-101
et seq.); and
(2) issue new guidance specifying that a PDP sponsor may
offer up to 4 (or a greater number if determined appropriate
by the Secretary) prescription drug plans in each PDP region,
except in cases where the PDP sponsor may offer up to 2
additional plans in a PDP region pursuant to section 1860D-
11(d)(4) of the Social Security Act (42 U.S.C. 1395w-
111(d)(4)), as added by subsection (b).
(b) Offering of Additional Plans.--Section 1860D-11(d) of
the Social Security Act (42 U.S.C. 1395w-111(d)) is amended
by adding at the end the following new paragraph:
``(4) Offering of additional plans.--
``(A) In general.--For plan year 2023 and each subsequent
plan year, a PDP sponsor may offer up to 2 additional
prescription drug plans in a PDP region (in addition to any
limit established by the Secretary under this part) provided
that the PDP sponsor complies with subparagraph (B) with
respect to at least one such prescription drug plan.
``(B) Requirements.--In order to be eligible to offer up to
2 additional plans in a PDP region pursuant to subparagraph
(A), a PDP sponsor must ensure that, with respect to at least
one such prescription drug plan, the sponsor or any entity
that provides pharmacy benefits management services under a
contract with any such sponsor or plan does not receive
direct or indirect remuneration, as defined in section
423.308 of title 42, Code
[[Page S4355]]
of Federal Regulations (or any successor regulation), unless
at least 25 percent of the aggregate reductions in price or
other remuneration received by the PDP sponsor or entity from
drug manufacturers with respect to the plan and plan year--
``(i) are reflected at the point-of-sale to the enrollee;
or
``(ii) are used to reduce total beneficiary cost-sharing
estimated by the PDP sponsor for prescription drug coverage
under the plan in the annual bid submitted by the PDP sponsor
under section 1860D-11(b).
``(C) Definition of reductions in price.--For purposes of
subparagraph (B), the term `reductions in price' refers only
to collectible amounts, as determined by the Secretary, which
excludes amounts which after adjudication and reconciliation
with pharmacies and manufacturers are duplicate in nature,
contrary to other contractual clauses, or otherwise
ineligible (such as due to beneficiary disenrollment or
coordination of benefits).''.
(c) Rule of Construction.--Nothing in the provisions of, or
amendments made by, this section shall be construed as
limiting the ability of the Secretary to increase any limit
otherwise applicable on the number of prescription drug plans
that a PDP sponsor may offer, at the discretion of the PDP
sponsor, in a PDP region under part D of title XVIII of the
Social Security Act (42 U.S.C. 1395w-101 et seq.).
SEC. 11013. ALLOWING CERTAIN ENROLLEES OF PRESCRIPTION DRUG
PLANS AND MA-PD PLANS UNDER THE MEDICARE
PROGRAM TO SPREAD OUT COST-SHARING UNDER
CERTAIN CIRCUMSTANCES.
(a) Standard Prescription Drug Coverage.--Section 1860D-
2(b)(2) of the Social Security Act (42 U.S.C. 1395w-
102(b)(2)), as amended by section 11011, is amended--
(1) in subparagraph (A), by striking ``Subject to
subparagraphs (C) and (D)'' and inserting ``Subject to
subparagraphs (C), (D), and (E)''; and
(2) by adding at the end the following new subparagraph:
``(E) Enrollee option regarding spreading cost-sharing.--
``(i) In general.--The Secretary shall establish by
regulation a process under which, with respect to plan year
2023 and subsequent plan years, a prescription drug plan or
an MA-PD plan shall, in the case of a part D eligible
individual enrolled with such plan for such plan year with
respect to whom the plan projects that the dispensing of a
covered part D drug to such individual will result in the
individual incurring costs within a 30-day period that are
equal to a significant percentage (as specified by the
Secretary pursuant to such regulation) of the annual out-of-
pocket threshold specified in paragraph (4)(B) for such plan
year, provide such individual with the option to make the
coinsurance payment required under subparagraph (A) for such
costs in the form of equal monthly installments over the
remainder of such plan year.
``(ii) Significant percentage limitations.--In specifying a
significant percentage pursuant to the regulation established
by the Secretary under clause (i), the Secretary shall not
specify a percentage that is less than 30 percent or greater
than 100 percent.''.
(b) Alternative Prescription Drug Coverage.--Section 1860D-
2(c) of the Social Security Act (42 U.S.C. 1395w-102(c)) is
amended by adding at the end the following new paragraph:
``(4) Same enrollee option regarding spreading cost-
sharing.--For plan year 2023 and subsequent plan years, the
coverage provides the enrollee option regarding spreading
cost-sharing described in and required under subsection
(b)(2)(E).''.
SEC. 11014. CONTINUATION OF PART D SENIOR SAVINGS MODEL.
Section 1115A of the Social Security Act (42 U.S.C. 1315a)
is amended by adding at the end the following new subsection:
``(h) Part D Senior Savings Model.--Notwithstanding any
other provision of law, the Secretary shall provide for the
continued implementation on a permanent basis of the Part D
Senior Savings Model under this section, under the same
parameters under which such model was implemented for plan
year 2021.''.
SEC. 11015. REQUIRING PRESCRIPTION DRUG PLANS AND MA-PD PLANS
TO REPORT POTENTIAL FRAUD, WASTE, AND ABUSE TO
THE SECRETARY OF HHS.
Section 1860D-4 of the Social Security Act (42 U.S.C.
1395w-104) is amended by adding at the end the following new
subsection:
``(p) Reporting Potential Fraud, Waste, and Abuse.--
Beginning January 1, 2023, the PDP sponsor of a prescription
drug plan shall report to the Secretary, as specified by the
Secretary--
``(1) any substantiated or suspicious activities (as
defined by the Secretary) with respect to the program under
this part as it relates to fraud, waste, and abuse; and
``(2) any steps made by the PDP sponsor after identifying
such activities to take corrective actions.''.
SEC. 11016. ESTABLISHMENT OF PHARMACY QUALITY MEASURES UNDER
MEDICARE PART D.
Section 1860D-4(c) of the Social Security Act (42 U.S.C.
1395w-104(c)) is amended by adding at the end the following
new paragraph:
``(8) Application of pharmacy quality measures.--
``(A) In general.--A PDP sponsor that implements incentive
payments to a pharmacy or price concessions paid by a
pharmacy based on quality measures shall use measures
established or approved by the Secretary under subparagraph
(B) with respect to payment for covered part D drugs
dispensed by such pharmacy.
``(B) Standard pharmacy quality measures.--The Secretary
shall establish or approve standard quality measures from a
consensus and evidence-based organization for payments
described in subparagraph (A). Such measures shall focus on
patient health outcomes and be based on proven criteria
measuring pharmacy performance.
``(C) Effective date.--The requirement under subparagraph
(A) shall take effect for plan years beginning on or after
January 1, 2024, or such earlier date specified by the
Secretary if the Secretary determines there are sufficient
measures established or approved under subparagraph (B) to
meet the requirement under subparagraph (A).''.
Subpart C--Medicaid Provisions
SEC. 11021. PRICE REPORTING CLARIFICATIONS FOR GENE THERAPY
OUTCOMES-BASED AGREEMENTS.
(a) Quarterly Price Reporting Obligation.--Section
1927(b)(3) of the Social Security Act (42 U.S.C. 1396r-
8(b)(3)) is amended by adding at the end the following new
subparagraph:
``(E) Outcomes-based agreements.--
``(i) In general.--Beginning January 1, 2023, in the case
of a covered outpatient drug that is a single course
transformative therapy (as defined in subsection (k)(12)) and
is sold under an outcomes-based agreement (as defined in
subsection (k)(13)) during a rebate period, the manufacturer
of such drug shall report (in addition to any other
information required under this paragraph) the pricing
structure for such drug based on pre-defined outcomes or
measures specified in such outcomes-based agreement.
``(ii) Access to outcomes-based agreements for state
plans.--As a condition of excluding a refund, rebate,
reimbursement, free item, withholding, or repayment made
under an outcomes-based agreement with respect to a covered
outpatient drug from the best price or average manufacturer
price of the drug for a rebate period (as described in
subsection (c)(1)(C)(i)(VII) or (k)(1)(B)(i)(VI), as
applicable), the manufacturer shall--
``(I) make available to each State plan the opportunity to
enter into an outcomes-based agreement for such drug and
rebate period; and
``(II) certify to the Secretary that the manufacturer has
made such opportunity so available to each State plan.
``(iii) Rules of construction.--Nothing in this
subparagraph shall be construed as--
``(I) requiring a manufacturer to execute an outcomes-based
agreement with a State for a covered outpatient drug that is
a single course transformative therapy (as defined in
subsection (k)(12)); ;
``(II) precluding the execution of a rebate agreement under
this section for such a drug; or
``(III) limiting States' ability to join together for a
multi-State contract with a single manufacturer to establish
an outcomes-based agreement for such a drug.''.
(b) Definition of Best Price.--Section 1927(c)(1)(C) of the
Social Security Act (42 U.S.C. 1396-8(c)(1)(C)) is amended--
(1) in clause (i)--
(A) in subclause (V), by striking ``and'';
(B) in subclause (VI), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new subclause:
``(VII) subject to subsection (b)(3)(E)(ii), with respect
to a covered outpatient drug that is a single course
transformative therapy (as defined in subsection (k)(12)) and
is sold under an outcomes-based agreement (as defined in
subsection (k)(13)) during the rebate period, any prices
resulting from--
``(aa) a refund, rebate, reimbursement, or free goods from
the manufacturer or third party on behalf of the
manufacturer; or
``(bb) the withholding or reduction of a payment to the
manufacturer or third party on behalf of the manufacturer,
that is triggered by a patient who fails to achieve outcomes
or measures defined under the terms of such outcomes-based
agreement during the period for which such agreement is
effective.''; and
(2) in clause (ii)
(A) in subclause (I), by striking the semicolon at the end
and inserting ``, except any price adjustment described in
clause (i)(VII);'';
(B) in subclause (III), by striking ``and'';
(C) in subclause (IV)--
(i) by moving the left margin of such subclause 2 ems to
the right; and
(ii) by striking the period at the end and inserting ``;
and''; and
(D) by adding at the end the following new subclause:
``(V) in the case of a covered outpatient drug that is a
single course transformative therapy (as defined in
subsection (k)(12)) and is sold under an outcomes-based
agreement (as defined in subsection (k)(13)) that provides
that payment for such drug is made in installments over the
course of such agreement, shall be determined as if the
aggregate price per the terms of the agreement was paid in
full in the first installment during the rebate period.''.
(c) Definition of Average Manufacturer Price.--Section
1927(k)(1) of the Social Security Act (42 U.S.C. 1396r-
8(k)(1)) is amended--
[[Page S4356]]
(1) in subparagraph (B)(i)--
(A) in subclause (IV), by striking at the end ``and'';
(B) in subclause (V), by striking the period at the end and
inserting ``; and''; and
(C) by adding at the end the following new subclause:
``(VI) subject to subsection (b)(3)(E)(ii), with respect to
a covered outpatient drug that is a single course
transformative therapy (as defined in paragraph (12)) and is
sold under an outcomes-based agreement (as defined in
paragraph (13)) during the rebate period--
``(aa) a refund, rebate, reimbursement, or free goods from
the manufacturer or third party on behalf of the
manufacturer; or
``(bb) the withholding or reduction of a payment to the
manufacturer or third party on behalf of the manufacturer,
that is triggered by a patient who fails to achieve outcomes
or measures defined under the terms of such outcomes-based
agreement during the period for which such agreement is
effective.''; and
(2) by adding at the end the following new subparagraph:
``(D) Special rule for certain outcomes-based agreements.--
For the purpose of subparagraph (A), in determining the
average price paid to the manufacturer for a covered
outpatient drug that is a single course transformative
therapy (as defined in paragraph (12)) and is sold under an
outcomes-based agreement (as defined in paragraph (13)) that
provides that payment for such drug is made in installments
over the course of such agreement, such price shall be
determined as if the aggregate price per the terms of the
agreement was paid in full in the first installment during
the rebate period.''.
(d) Other Definitions.--Section 1927(k) of the Social
Security Act (42 U.S.C. 1396r-8(k)) is amended by adding at
the end the following paragraphs:
``(12) Single course transformative therapy.--The term
`single course transformative therapy' means a treatment that
consists of the administration of a covered outpatient drug
that--
``(A) is a form of gene therapy, as defined by the
Commissioner of Food and Drugs, that is--
``(i) designated under section 526 of the Federal Food,
Drug, and Cosmetics Act; and
``(ii) licensed under subsection (a) or (k) of section 351
of the Public Health Service Act for a serious or life-
threatening rare disease or condition;
``(B) if administered in accordance with the `Indications
and Usage' section of its label, is expected to result in--
``(i) the cure of such disease or condition;
``(ii) a reduction in the symptoms of such disease or
condition to the extent that it is expected to--
``(I) extend life expectancy for those individuals with
such disease or condition;
``(II) prevent, eliminate, or halt progression of
comorbidities related to such disease or condition in such
individuals; or
``(III) allow such individuals to achieve or maintain
maximum functional capacity in performing daily activities;
or
``(iii) prevention or elimination of episodes, illnesses,
injuries, or disabilities related to such disease or
condition; and
``(C) is expected to achieve a result described in
subparagraph (B), which may be achieved over an extended
period of time, following a single prescribed course of
treatment.
``(13) Outcomes-based agreement.--The term `outcomes-based
agreement' means a written contract between a manufacturer
and purchaser in which the aggregate price over the course of
the contract of the covered outpatient drug is based on the
achievement of pre-defined outcomes or measures and adjusted
accordingly.''.
(e) Effective Date.--The amendments made by this section
shall take effect on January 1, 2023.
SEC. 11022. ANTI-KICKBACK STATUTE AND PHYSICIAN SELF-REFERRAL
SAFE HARBORS.
(a) Exclusion From Antikickback Prohibition.--Section
1128B(b)(3) of the Social Security Act (42 U.S.C. 1320a-
7b(b)(3)) is amended--
(1) in subclause (J)--
(A) by moving the left margin of such subparagraph 2 ems to
the left; and
(B) by striking ``and'' after the semicolon at the end;
(2) in subclause (K)--
(A) by moving the left margin of such subparagraph 2 ems to
the left; and
(B) by striking the period at the end and inserting ``;
and''; and
(3) by adding at the end the following new subparagraph:
``(L) any remuneration provided by a manufacturer or third
party on behalf of a manufacturer to a plan under an
outcomes-based agreement (as defined in section 1927(k)(13))
in the event a patient fails to achieve outcomes or measures
defined in such agreement following the administration of a
covered outpatient drug that is a single course
transformative therapy (as defined in section 1927(k)(12).''.
(b) Exclusion From Physician Self-referral Prohibition.--
Section 1877(h)(1)(C) of the Social Security Act (42 U.S.C.
1395nn(h)(1)(C)) is amended by adding at the end the
following new clause:
``(iv) Any amounts paid under an outcomes-based agreement
(as defined in section 1927(k)(13)).''.
(c) Effective Date.--The amendments made by this section
shall take effect on January 1, 2023.
SEC. 11023. GAO STUDY AND REPORT ON USE OF OUTCOMES-BASED
AGREEMENTS.
(a) Study.--The Comptroller General of the United States
shall conduct a study on the extent to which outcomes-based
agreements (as defined in section 1927(k)(13) of the Social
Security Act (42 U.S.C. 1396r-8(k)(13)) for rare disease gene
therapies facilitate patient access to such therapies,
improve patient outcomes, lower overall health system costs,
and lower costs for patients in Federal health care programs.
In conducting such study, the Comptroller General shall--
(1) study the impact of this subpart on--
(A) mitigating socioeconomic disparities in accessing rare
disease gene therapies through its requirement that State
Medicaid programs have access to the same outcomes-based
agreement remedy terms that are available in the commercial
market for the gene therapy; and
(B) the Medicaid Drug Rebate Program, the 340B Drug Pricing
Program, and the Medicare Part B program, including
compliance with such programs; and
(2) with respect to rare disease gene therapies sold under
an outcomes-based agreement (as so defined), conduct an audit
of manufacturers offering State Medicaid programs the same
remedy terms for non-responding patients as offered to
commercial insurance plans during a particular rebate period,
as described in subsections (c)(1)(C)(i)(VII) and
(k)(1)(B)(i)(VI) of section 1927 of the Social Security Act
(42 U.S.C. 1396r-8), as added by this subpart.
(b) Report.--Not later than June 30, 2027, the Comptroller
General of the United States shall submit to Congress a
report containing the results of the study conducted under
subsection (a).
PART 2--DRUG PRICE TRANSPARENCY PROVISIONS
SEC. 11101. REPORTING ON EXPLANATION FOR DRUG PRICE
INCREASES.
(a) In General.--Title XI of the Social Security Act (42
U.S.C. 1301 et seq.) is amended by inserting after section
1128K the following new section:
``SEC. 1128L. DRUG PRICE REPORTING.
``(a) Definitions.--In this section:
``(1) Manufacturer.--The term `manufacturer' means the
person--
``(A) that holds the application for a drug approved under
section 505 of the Federal Food, Drug, and Cosmetic Act or
licensed under section 351 of the Public Health Service Act;
or
``(B) who is responsible for setting the wholesale
acquisition cost for the drug.
``(2) Qualifying drug.--The term `qualifying drug' means
any drug that is approved under subsection (c) or (j) of
section 505 of the Federal Food, Drug, and Cosmetic Act or
licensed under subsection (a) or (k) of section 351 of this
Act--
``(A) that has a wholesale acquisition cost of $100 or
more, adjusted for inflation occurring after the date of
enactment of this section, for a month's supply or a typical
course of treatment that lasts less than a month, and is--
``(i) subject to section 503(b)(1) of the Federal Food,
Drug, and Cosmetic Act;
``(ii) administered or otherwise dispensed to treat a
disease or condition affecting more than 200,000 persons in
the United States; and
``(iii) not a vaccine; and
``(B) for which, during the previous calendar year, at
least 1 dollar of the total amount of sales were for
individuals enrolled under the Medicare program under title
XVIII or under a State Medicaid plan under title XIX or under
a waiver of such plan.
``(3) Wholesale acquisition cost.--The term `wholesale
acquisition cost' has the meaning given that term in section
1847A(c)(6)(B).
``(b) Report.--
``(1) Report required.--The manufacturer of a qualifying
drug shall submit a report to the Secretary--
``(A) for each increase in the price of a qualifying drug
that results in an increase in the wholesale acquisition cost
of that drug that is equal to--
``(i) 10 percent or more within a single calendar year
beginning on or after January 1, 2022; or
``(ii) 25 percent or more within three consecutive calendar
years for which the first such calendar year begins on or
after January 1, 2022; and
``(B) in the case that the qualifying drug is first covered
under title XVIII with respect to an applicable year, if the
estimated cost or spending under such title per individual or
per user of such drug (as estimated by the Secretary) for
such applicable year (or per course of treatment in such
applicable year, as defined by the Secretary) is at least
$26,000.
``(2) Report deadline.--Each report described in paragraph
(1) shall be submitted to the Secretary--
``(A) in the case of a report with respect to an increase
in the price of a qualifying drug that occurs during the
period beginning on January 1, 2022, and ending on the day
that is 60 days after the date of enactment of this section,
not later than 90 days after such date of enactment;
``(B) in the case of a report with respect to an increase
in the price of a qualifying drug that occurs after the
period described in subparagraph (A), not later than 30 days
prior to the planned effective date of such price increase
for such qualifying drug; and
[[Page S4357]]
``(C) in the case of a report with respect to a qualifying
drug that meets the criteria described in paragraph (1)(B),
not later than 30 days after such drug meets such criteria.
``(c) Contents.--A report under subsection (b), consistent
with the standard for disclosures described in section
213.3(d) of title 12, Code of Federal Regulations (as in
effect on the date of enactment of this section), shall, at a
minimum, include--
``(1) with respect to the qualifying drug--
``(A) the percentage by which the manufacturer will raise
the wholesale acquisition cost of the drug within the
calendar year or three consecutive calendar years as
described in subsection (b)(1)(A) or (b)(1)(B), if
applicable, and the effective date of such price increase;
``(B) an explanation for, and description of, each price
increase for such drug that will occur during the calendar
year period described in subsection (b)(1)(A) or the three
consecutive calendar year period described in subsection
(b)(1)(B), as applicable;
``(C) if known and different from the manufacturer of the
qualifying drug, the identity of--
``(i) the sponsor or sponsors of any investigational new
drug applications under section 505(i) of the Federal Food,
Drug, and Cosmetic Act for clinical investigations with
respect to such drug, for which the full reports are
submitted as part of the application--
``(I) for approval of the drug under section 505 of such
Act; or
``(II) for licensure of the drug under section 351 of the
Public Health Service Act; and
``(ii) the sponsor of an application for the drug approved
under such section 505 of the Federal Food, Drug, and
Cosmetic Act or licensed under section 351 of the Public
Health Service Act;
``(D) a description of the history of the manufacturer's
price increases for the drug since the approval of the
application for the drug under section 505 of the Federal
Food, Drug, and Cosmetic Act or the issuance of the license
for the drug under section 351 of the Public Health Service
Act, or since the manufacturer acquired such approved
application or license, if applicable;
``(E) the current wholesale acquisition cost of the drug;
``(F) the total expenditures of the manufacturer on--
``(i) materials and manufacturing for such drug; and
``(ii) acquiring patents and licensing for such drug;
``(G) the percentage of total expenditures of the
manufacturer on research and development for such drug that
was derived from Federal funds;
``(H) the total expenditures of the manufacturer on
research and development for such drug that is necessary to
demonstrate that it meets applicable statutory standards for
approval under section 505 of the Federal Food, Drug, and
Cosmetic Act or licensure under section 351 of the Public
Health Service Act, as applicable;
``(I) the total expenditures of the manufacturer on
pursuing new or expanded indications or dosage changes for
such drug under section 505 of the Federal Food, Drug, and
Cosmetic Act or section 351 of the Public Health Service Act;
``(J) the total expenditures of the manufacturer on
carrying out postmarket requirements related to such drug,
including under section 505(o)(3) of the Federal Food, Drug,
and Cosmetic Act;
``(K) the total revenue and the net profit generated from
the qualifying drug for each calendar year since the approval
of the application for the drug under section 505 of the
Federal Food, Drug, and Cosmetic Act or the issuance of the
license for the drug under section 351 of the Public Health
Service Act, or since the manufacturer acquired such approved
application or license; and
``(L) the total costs associated with marketing and
advertising for the qualifying drug;
``(2) with respect to the manufacturer--
``(A) the total revenue and the net profit of the
manufacturer for each of the 1-year period described in
subsection (b)(1)(A) or the 3-year period described in
subsection (b)(1)(B), as applicable;
``(B) all stock-based performance metrics used by the
manufacturer to determine executive compensation for each of
the 1-year period described in subsection (b)(1)(A) or the 3-
year period described in subsection (b)(1)(B), as applicable;
and
``(C) any additional information the manufacturer chooses
to provide related to drug pricing decisions, such as total
expenditures on--
``(i) drug research and development; or
``(ii) clinical trials, including on drugs that failed to
receive approval by the Food and Drug Administration; and
``(3) such other related information as the Secretary
considers appropriate and as specified by the Secretary
through notice-and-comment rulemaking.
``(d) Information Provided.--The manufacturer of a
qualifying drug that is required to submit a report under
subsection (b), shall ensure that such report and any
explanation for, and description of, each price increase
described in subsection (c)(1)(B) shall be truthful, not
misleading, and accurate.
``(e) Civil Monetary Penalty.--Any manufacturer of a
qualifying drug that fails to submit a report for the drug as
required by this section, following notification by the
Secretary to the manufacturer that the manufacturer is not in
compliance with this section, shall be subject to a civil
monetary penalty of $75,000 for each day on which the
violation continues.
``(f) False Information.--Any manufacturer that submits a
report for a drug as required by this section that knowingly
provides false information in such report is subject to a
civil monetary penalty in an amount not to exceed $75,000 for
each item of false information.
``(g) Public Posting.--
``(1) In general.--Subject to paragraph (3), the Secretary
shall post each report submitted under subsection (b) on the
public website of the Department of Health and Human Services
the day the price increase of a qualifying drug is scheduled
to go into effect.
``(2) Format.--In developing the format in which reports
will be publicly posted under paragraph (1), the Secretary
shall consult with stakeholders, including beneficiary
groups, and shall seek feedback from consumer advocates and
readability experts on the format and presentation of the
content of such reports to ensure that such reports are--
``(A) user-friendly to the public; and
``(B) written in plain language that consumers can readily
understand.
``(3) Protected information.--Nothing in this section shall
be construed to authorize the public disclosure of
information submitted by a manufacturer that is prohibited
from disclosure by applicable laws concerning the protection
of trade secrets, commercial information, and other
information covered under such laws.
``(h) Annual Report to Congress.--
``(1) In general.--Subject to paragraph (2), the Secretary
shall submit to Congress, and post on the public website of
the Department of Health and Human Services in a way that is
user-friendly to the public and written in plain language
that consumers can readily understand, an annual report--
``(A) summarizing the information reported pursuant to this
section;
``(B) including copies of the reports and supporting
detailed economic analyses submitted pursuant to this
section;
``(C) detailing the costs and expenditures incurred by the
Department of Health and Human Services in carrying out this
section; and
``(D) explaining how the Department of Health and Human
Services is improving consumer and provider information about
drug value and drug price transparency.
``(2) Protected information.--Nothing in this subsection
shall be construed to authorize the public disclosure of
information submitted by a manufacturer that is prohibited
from disclosure by applicable laws concerning the protection
of trade secrets, commercial information, and other
information covered under such laws.''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect on the date of enactment of this Act.
SEC. 11102. PUBLIC DISCLOSURE OF DRUG DISCOUNTS.
Section 1150A of the Social Security Act (42 U.S.C. 1320b-
23) is amended--
(1) in subsection (c), in the matter preceding paragraph
(1), by inserting ``(other than as permitted under subsection
(e))'' after ``disclosed by the Secretary''; and
(2) by adding at the end the following new subsection:
``(e) Public Availability of Certain Information.--
``(1) In general.--In order to allow the comparison of
PBMs' ability to negotiate rebates, discounts, direct and
indirect remuneration fees, administrative fees, and price
concessions and the amount of such rebates, discounts, direct
and indirect remuneration fees, administrative fees, and
price concessions that are passed through to plan sponsors,
beginning January 1, 2023, the Secretary shall make available
on the internet website of the Department of Health and Human
Services the information with respect to the second preceding
calendar year provided to the Secretary on generic dispensing
rates (as described in paragraph (1) of subsection (b)) and
information provided to the Secretary under paragraphs (2)
and (3) of such subsection that, as determined by the
Secretary, is with respect to each PBM.
``(2) Availability of data.--In carrying out paragraph (1),
the Secretary shall ensure the following:
``(A) Confidentiality.--The information described in such
paragraph is displayed in a manner that prevents the
disclosure of information, with respect to an individual drug
or an individual plan, on rebates, discounts, direct and
indirect remuneration fees, administrative fees, and price
concessions.
``(B) Class of drug.--The information described in such
paragraph is made available by class of drug, using an
existing classification system, but only if the class
contains such number of drugs, as specified by the Secretary
(but not fewer than three drugs), to ensure confidentiality
of proprietary information or other information that is
prevented to be disclosed under subparagraph (A).''.
SEC. 11102. MAKING PRESCRIPTION DRUG MARKETING SAMPLE
INFORMATION REPORTED BY MANUFACTURERS AVAILABLE
TO CERTAIN INDIVIDUALS AND ENTITIES.
(a) In General.--Section 1128H of the Social Security Act
(42 U.S.C. 1320a-7i) is amended--
(1) by redesignating subsection (b) as subsection (e); and
(2) by inserting after subsection (a) the following new
subsections:
[[Page S4358]]
``(b) Data Sharing Agreements.--
``(1) In general.--The Secretary shall enter into
agreements with the specified data sharing individuals and
entities described in paragraph (2) under which--
``(A) upon request of such an individual or entity, as
applicable, the Secretary makes available to such individual
or entity the information submitted under subsection (a) by
manufacturers and authorized distributors of record; and
``(B) such individual or entity agrees to not disclose
publicly or to another individual or entity any information
that identifies a particular practitioner or health care
facility.
``(2) Specified data sharing individuals and entities.--For
purposes of paragraph (1), the specified data sharing
individuals and entities described in this paragraph are the
following:
``(A) Oversight agencies.--Health oversight agencies (as
defined in section 164.501 of title 45, Code of Federal
Regulations), including the Centers for Medicare & Medicaid
Services, the Office of the Inspector General of the
Department of Health and Human Services, the Government
Accountability Office, the Congressional Budget Office, the
Medicare Payment Advisory Commission, and the Medicaid and
CHIP Payment and Access Commission.
``(B) Researchers.--Individuals who conduct scientific
research (as defined in section 164.501 of title 45, Code of
Federal Regulations) in relevant areas as determined by the
Secretary.
``(C) Payers.--Private and public health care payers,
including group health plans, health insurance coverage
offered by health insurance issuers, Federal health programs,
and State health programs.
``(3) Exemption from freedom of information act.--Except as
described in paragraph (1), the Secretary may not be
compelled to disclose the information submitted under
subsection (a) to any individual or entity. For purposes of
section 552 of title 5, United States Code (commonly referred
to as the Freedom of Information Act), this paragraph shall
be considered a statute described in subsection (b)(3)(B) of
such section.
``(c) Penalties.--
``(1) Data sharing agreements.--Subject to paragraph (3),
any specified data sharing individual or entity described in
subsection (b)(2) that violates the terms of a data sharing
agreement the individual or entity has with the Secretary
under subsection (b)(1) shall be subject to a civil money
penalty of not less than $1,000, but not more than $10,000,
for each such violation. Such penalty shall be imposed and
collected in the same manner as civil money penalties under
subsection (a) of section 1128A are imposed and collected
under that section.
``(2) Failure to report.--Subject to paragraph (3), any
manufacturer or authorized distributor of record of an
applicable drug under subsection (a) that fails to submit
information required under such subsection in a timely manner
in accordance with rules or regulations promulgated to carry
out such subsection shall be subject to a civil money penalty
of not less than $1,000, but not more than $10,000, for each
such failure. Such penalty shall be imposed and collected in
the same manner as civil money penalties under subsection (a)
of section 1128A are imposed and collected under that
section.
``(3) Limitation.--The total amount of civil money
penalties imposed under paragraph (1) or (2) with respect to
a year and an individual or entity described in paragraph (1)
or a manufacturer or distributor described in paragraph (2),
respectively, shall not exceed $150,000.
``(d) Drug Sample Distribution Information.--
``(1) In general.--Not later than January 1 of each year
(beginning with 2023), the Secretary shall maintain a list
containing information related to the distribution of samples
of applicable drugs. Such list shall provide the following
information with respect to the preceding year:
``(A) The name of the manufacturer or authorized
distributor of record of an applicable drug for which samples
were requested or distributed under this section.
``(B) The quantity and class of drug samples requested.
``(C) The quantity and class of drug samples distributed.
``(2) Public availability.--The Secretary shall make the
information in such list available to the public on the
internet website of the Food and Drug Administration.''.
(b) FDA Maintenance of Information.--The Food and Drug
Administration shall maintain information available to
affected reporting companies to ensure their ability to fully
comply with the requirements of section 1128H of the Social
Security Act.
(c) Prohibition on Distribution of Samples of Opioids.--
Section 503(d) of the Federal Food, Drug, and Cosmetic Act
(21 U.S.C. 353(d)) is amended--
(1) by moving the margin of paragraph (4) 2 ems to the
left; and
(2) by adding at the end the following:
``(5) No person may distribute a drug sample of a drug that
is--
``(A) an applicable drug (as defined in section 1128H(e) of
the Social Security Act);
``(B) a controlled substance (as defined in section 102 of
the Controlled Substances Act) for which the findings
required under section 202(b)(2) of such Act have been made;
and
``(C) approved under section 505 for use in the management
or treatment of pain (other than for the management or
treatment of a substance use disorder).''.
(d) MedPAC Report.--Not later than 3 years after the date
of the enactment of this Act, the Medicare Payment Advisory
Commission shall conduct a study on the impact of drug
samples on provider prescribing practices and health care
costs and may, as the Commission deems appropriate, make
recommendations on such study.
SEC. 11104. SENSE OF THE SENATE REGARDING THE NEED TO EXPAND
COMMERCIALLY AVAILABLE DRUG PRICING COMPARISON
PLATFORMS.
It is the sense of the Senate that--
(1) commercially available drug pricing comparison
platforms can, at no cost, help patients find the lowest
price for their medications at their local pharmacy;
(2) such platforms should be integrated, to the maximum
extent possible, in the health care delivery ecosystem; and
(3) pharmacy benefit managers should work to disclose
generic and brand name drug prices to such platforms to
ensure that--
(A) patients can benefit from the lowest possible price
available to them; and
(B) overall drug prices can be reduced as more educated
purchasing decisions are made based on price transparency.
PART 3--REVENUE PROVISION
SEC. 11201. INCLUSION OF INSULIN AND OTHER TREATMENTS FOR
CHRONIC CONDITIONS AS PREVENTIVE CARE.
(a) In General.--Subparagraph (C) of section 223(c)(2) of
the Internal Revenue Code of 1986 is amended--
(1) by striking ``deductible.--A plan'' and inserting
``deductible.--
``(i) In general.--A plan'', and
(2) by adding at the end the following new clause:
``(ii) Special rule.--The term `preventive care' includes
such drugs (including insulin), devices, supplies, and
medical services or screenings prescribed for the prevention
or avoidance of a disease or condition, or the regular
treatment and maintenance of a chronic disease or condition,
as are determined by the Secretary, in consultation with the
Secretary of Health and Human Services, to be--
``(I) low in cost,
``(II) supported by medical evidence to have a high cost
efficiency in preventing exacerbation of a chronic condition
or the development of a secondary condition, and
``(III) likely (as documented by clinical evidence), when
prescribed for a class of individuals, to prevent
exacerbation of the chronic condition of such individuals or
the development of a secondary condition requiring
significantly higher cost treatments.''.
(b) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to taxable years beginning after the date of the
enactment of this Act.
(2) Treasury guidance in effect on date of enactment.--
(A) In general.--No inference shall be drawn by reason of
the amendments made by this Act with respect to the
effectiveness of the provisions of Internal Revenue Service
Notice 2019-45 on the date of the enactment of this Act, and
such notice shall continue to apply as in effect on July 17,
2019, unless amended by the Secretary of the Treasury (or the
Secretary's delegate) pursuant to the amendments made by this
Act or pursuant to subparagraph (B).
(B) Continued publication and update of list.--
(i) In general.--The Secretary of the Treasury (or the
Secretary's delegate) may publish, and update from time to
time as such Secretary (or delegate) deems appropriate, a
list of the drugs, devices, supplies, and services identified
under section 223(c)(2)(C)(ii) of the Internal Revenue Code
of 1986, in consultation with the Secretary of Health and
Human Services (or such Secretary's delegate), as preventive
care.
(ii) Inclusion of certain diabetic supplies.--As soon as
practicable after the date of the enactment of this Act, the
list in effect under Internal Revenue Service Notice 2019-45
shall be amended to include insulin delivery devices and
related supplies, and continuous glucose monitoring systems
and related supplies.
PART 4--OTHER PROVISIONS
SEC. 11301. IMPROVING COORDINATION BETWEEN THE FOOD AND DRUG
ADMINISTRATION AND THE CENTERS FOR MEDICARE &
MEDICAID SERVICES.
(a) In General.--
(1) Public meeting.--
(A) In general.--Not later than 12 months after the date of
the enactment of this Act, the Secretary of Health and Human
Services (referred to in this section as the ``Secretary'')
shall convene a public meeting for the purposes of discussing
and providing input on improvements to coordination between
the Food and Drug Administration and the Centers for Medicare
& Medicaid Services in preparing for the availability of
novel medical products described in subsection (c) on the
market in the United States.
(B) Attendees.--The public meeting shall include--
(i) representatives of relevant Federal agencies, including
representatives from each of the medical product centers
within the Food and Drug Administration and representatives
from the coding, coverage, and payment offices within the
Centers for Medicare & Medicaid Services;
[[Page S4359]]
(ii) stakeholders with expertise in the research and
development of novel medical products, including
manufacturers of such products;
(iii) representatives of commercial health insurance
payers;
(iv) stakeholders with expertise in the administration and
use of novel medical products, including physicians; and
(v) stakeholders representing patients and with expertise
in the utilization of patient experience data in medical
product development.
(C) Topics.--The public meeting shall include a discussion
of--
(i) the status of the drug and medical device development
pipeline related to the availability of novel medical
products;
(ii) the anticipated expertise necessary to review the
safety and effectiveness of such products at the Food and
Drug Administration and current gaps in such expertise, if
any;
(iii) the expertise necessary to make coding, coverage, and
payment decisions with respect to such products within the
Centers for Medicare & Medicaid Services, and current gaps in
such expertise, if any;
(iv) trends in the differences in the data necessary to
determine the safety and effectiveness of a novel medical
product and the data necessary to determine whether a novel
medical product meets the reasonable and necessary
requirements for coverage and payment under title XVIII of
the Social Security Act pursuant to section 1862(a)(1)(A) of
such Act (42 U.S.C. 1395y(a)(1)(A));
(v) the availability of information for sponsors of such
novel medical products to meet each of those requirements;
and
(vi) the coordination of information related to significant
clinical improvement over existing therapies for patients
between the Food and Drug Administration and the Centers for
Medicare & Medicaid Services with respect to novel medical
products.
(D) Trade secrets and confidential information.--No
information discussed as a part of the public meeting under
this paragraph shall be construed as authorizing the
Secretary to disclose any information that is a trade secret
or confidential information subject to section 552(b)(4) of
title 5, United States Code.
(2) Improving transparency of criteria for medicare
coverage.--
(A) Draft guidance.--Not later than 18 months after the
public meeting under paragraph (1), the Secretary shall
update the final guidance titled ``National Coverage
Determinations with Data Collection as a Condition of
Coverage: Coverage with Evidence Development'' to address any
opportunities to improve the availability and coordination of
information as described in clauses (iv) through (vi) of
paragraph (1)(C).
(B) Final guidance.--Not later than 12 months after issuing
draft guidance under subparagraph (A), the Secretary shall
finalize the updated guidance to address any such
opportunities.
(b) Report on Coding, Coverage, and Payment Processes Under
Medicare for Novel Medical Products.--Not later than 12
months after the date of the enactment of this Act, the
Secretary shall publish a report on the internet website of
the Department of Health and Human Services regarding
processes under the Medicare program under title XVIII of the
Social Security Act (42 U.S.C. 1395 et seq.) with respect to
the coding, coverage, and payment of novel medical products
described in subsection (c). Such report shall include the
following:
(1) A description of challenges in the coding, coverage,
and payment processes under the Medicare program for novel
medical products.
(2) Recommendations to--
(A) incorporate patient experience data (such as the impact
of a disease or condition on the lives of patients and
patient treatment preferences) into the coverage and payment
processes within the Centers for Medicare & Medicaid
Services;
(B) decrease the length of time to make national and local
coverage determinations under the Medicare program (as those
terms are defined in subparagraph (A) and (B), respectively,
of section 1862(l)(6) of the Social Security Act (42 U.S.C.
1395y(l)(6)));
(C) streamline the coverage process under the Medicare
program and incorporate input from relevant stakeholders into
such coverage determinations; and
(D) identify potential mechanisms to incorporate novel
payment designs similar to those in development in commercial
insurance plans and State plans under title XIX of such Act
(42 U.S.C. 1396 et seq.) into the Medicare program.
(c) Novel Medical Products Described.--For purposes of this
section, a novel medical product described in this subsection
is a medical product, including a drug, biological (including
gene and cell therapy), or medical device, that has been
designated as a breakthrough therapy under section 506(a) of
the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 356(a)),
a breakthrough device under section 515B of such Act (21
U.S.C. 360e-3), or a regenerative advanced therapy under
section 506(g) of such Act (21 U.S.C. 356(g)).
SEC. 11302. PATIENT CONSULTATION IN MEDICARE NATIONAL AND
LOCAL COVERAGE DETERMINATIONS IN ORDER TO
MITIGATE BARRIERS TO INCLUSION OF SUCH
PERSPECTIVES.
Section 1862(l) of the Social Security Act (42 U.S.C.
1395y(l)) is amended by adding at the end the following new
paragraph:
``(7) Patient consultation in national and local coverage
determinations.--The Secretary may consult with patients and
organizations representing patients in making national and
local coverage determinations.''.
SEC. 11303. MEDPAC REPORT ON SHIFTING COVERAGE OF CERTAIN
MEDICARE PART B DRUGS TO MEDICARE PART D.
(a) Study.--The Medicare Payment Advisory Commission (in
this section referred to as the ``Commission'') shall conduct
a study on shifting coverage of certain drugs and biologicals
for which payment is currently made under part B of title
XVIII of the Social Security Act (42 U.S.C. 1395j et seq.) to
part D of such title (42 U.S.C. 1395w-21 et seq.). Such study
shall include an analysis of--
(1) differences in program structures and payment methods
for drugs and biologicals covered under such parts B and D,
including effects of such a shift on program spending,
beneficiary cost-sharing liability, and utilization
management techniques for such drugs and biologicals; and
(2) the feasibility and policy implications of shifting
coverage of drugs and biologicals for which payment is
currently made under such part B to such part D.
(b) Report.--
(1) In general.--Not later than June 30, 2024, the
Commission shall submit to Congress a report containing the
results of the study conducted under subsection (a).
(2) Contents.--The report under paragraph (1) shall include
information, and recommendations as the Commission deems
appropriate, regarding--
(A) formulary design under such part D;
(B) the ability of the benefit structure under such part D
to control total spending on drugs and biologicals for which
payment is currently made under such part B;
(C) changes to the bid process under such part D, if any,
that may be necessary to integrate coverage of such drugs and
biologicals into such part D;
(D) any other changes to the program that Congress should
consider in determining whether to shift coverage of such
drugs and biologicals from such part B to such part D; and
(E) the feasibility and policy implications of creating a
methodology to preserve the healthcare provider's ability to
take title of the drug, including a methodology under which--
(i) prescription drug plans negotiate reimbursement rates
and other arrangements with drug manufacturers on behalf of a
wholesaler;
(ii) wholesalers purchase the drugs from the manufacturers
at the negotiated rate and ship them through distributors to
physicians to administer to patients;
(iii) physicians and hospitals purchase the drug from the
wholesaler via the distributor;
(iv) after administering the drug, the physician submits a
claim to the MAC for their drug administration fee;
(v) to be reimbursed for the purchase of the drug from the
distributor, the physician furnishes the claim for the drug
itself to the wholesaler and the wholesaler would refund the
cost of the drug to the physician; and
(vi) the wholesaler passes this claim to the PDP to receive
reimbursement.
SEC. 11304. AUTHORITY TO REQUIRE THAT DIRECT-TO-CONSUMER
ADVERTISEMENTS FOR PRESCRIPTION DRUGS AND
BIOLOGICAL PRODUCTS INCLUDE TRUTHFUL AND NON-
MISLEADING PRICING INFORMATION.
Part A of title XI of the Social Security Act is amended by
adding at the end the following new section:
``SEC. 1150D. AUTHORITY TO REQUIRE THAT DIRECT-TO-CONSUMER
ADVERTISEMENTS FOR PRESCRIPTION DRUGS AND
BIOLOGICAL PRODUCTS INCLUDE TRUTHFUL AND NON-
MISLEADING PRICING INFORMATION.
``(a) In General.--The Secretary may require that each
direct-to-consumer advertisement for a prescription drug or
biological product for which payment is available under title
XVIII or XIX includes an internet website address that
provides an appropriate disclosure of truthful and non-
misleading pricing information with respect to the drug or
product.
``(b) Determination by CMS.--The Secretary, acting through
the Administrator of the Centers for Medicare & Medicaid
Services, shall determine the components of the requirement
under subsection (a), such as the forms of advertising, the
manner of disclosure, the price point listing, and the price
information for disclosure.''.
SEC. 11305. CHIEF PHARMACEUTICAL NEGOTIATOR AT THE OFFICE OF
THE UNITED STATES TRADE REPRESENTATIVE.
(a) In General.--Section 141 of the Trade Act of 1974 (19
U.S.C. 2171) is amended--
(1) in subsection (b)(2)--
(A) by striking ``and one Chief Innovation and Intellectual
Property Negotiator'' and inserting ``one Chief Innovation
and Intellectual Property Negotiator, and one Chief
Pharmaceutical Negotiator'';
(B) by striking ``or the Chief Innovation and Intellectual
Property Negotiator'' and inserting ``the Chief Innovation
and Intellectual Property Negotiator, or the Chief
Pharmaceutical Negotiator''; and
(C) by striking ``and the Chief Innovation and Intellectual
Property Negotiator'' and inserting ``the Chief Innovation
and Intellectual Property Negotiator, and the Chief
Pharmaceutical Negotiator''; and
(2) in subsection (c), by adding at the end the following
new paragraph:
[[Page S4360]]
``(7) The principal function of the Chief Pharmaceutical
Negotiator shall be to conduct trade negotiations and to
enforce trade agreements relating to United States
pharmaceutical products and services. The Chief
Pharmaceutical Negotiator shall be a vigorous advocate on
behalf of United States pharmaceutical interests. The Chief
Pharmaceutical Negotiator shall perform such other functions
as the United States Trade Representative may direct.''.
(b) Compensation.--Section 5314 of title 5, United States
Code, is amended by striking ``Chief Innovation and
Intellectual Property Negotiator, Office of the United States
Trade Representative.'' and inserting the following:
``Chief Innovation and Intellectual Property Negotiator,
Office of the United States Trade Representative.
``Chief Pharmaceutical Negotiator, Office of the United
States Trade Representative.''.
(c) Report Required.--Not later than the date that is one
year after the appointment of the first Chief Pharmaceutical
Negotiator pursuant to paragraph (2) of section 141(b) of the
Trade Act of 1974, as amended by subsection (a), and annually
thereafter, the United States Trade Representative shall
submit to the Committee on Finance of the Senate and the
Committee on Ways and Means of the House of Representatives a
report describing in detail--
(1) enforcement actions taken by the United States Trade
Representative during the 1-year period preceding the
submission of the report to ensure the protection of United
States pharmaceutical products and services; and
(2) other actions taken by the United States Trade
Representative to advance United States pharmaceutical
products and services.
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