[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2534 Introduced in House (IH)]
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118th CONGRESS
1st Session
H. R. 2534
To amend title XXVII of the Public Health Service Act to ensure the
equitable treatment of covered entities and pharmacies participating in
the 340B drug discount program, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 6, 2023
Ms. Spanberger (for herself and Mr. Johnson of South Dakota) introduced
the following bill; which was referred to the Committee on Energy and
Commerce, and in addition to the Committee on Ways and Means, for a
period to be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the
committee concerned
_______________________________________________________________________
A BILL
To amend title XXVII of the Public Health Service Act to ensure the
equitable treatment of covered entities and pharmacies participating in
the 340B drug discount program, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Preserving Rules Ordered for The
Entities Covered Through 340B Act of 2023'' or the ``PROTECT 340B Act
of 2023''.
SEC. 2. FINDINGS AND PURPOSE.
(a) Findings.--Congress finds the following:
(1) The 340B drug pricing program is an essential part of
the Nation's health care safety net.
(2) 340B enables safety-net providers to stretch scarce
resources further to offer services and treat patients through
the savings these providers receive under the program.
(3) 340B savings support hospitals, clinics, and health
centers' care for patients who have low incomes, including
those with low incomes enrolled in Medicare and Medicaid.
(4) 340B savings are critically important to rural
hospitals that operate on very slim margins and serve patients
in isolated areas with limited access to health care.
(5) 340B supports care for those in need without using
taxpayer dollars.
(6) Some commercial payers and pharmacy benefit managers
are paying less to 340B covered entities and their contract
pharmacies for 340B drugs, requiring identification of 340B
drug claims or otherwise discriminating against 340B covered
entities and their contract pharmacies on the basis of their
status as providers or pharmacies that dispense 340B drugs.
(7) These types of discriminatory actions undermine the
purpose of the 340B program and harm the patients served by
340B covered entities. Commercial payers and pharmacy benefit
managers' imposition of requirements on a 340B pharmacy because
it is a pharmacy that dispenses 340B drugs, or requirements
with respect to the use of and billing for drugs purchased
under 340B because they are 340B drugs is inconsistent with
public policy because of the deleterious effects on the
nation's health care safety net.
(b) Purposes.--The purposes of this Act are the following:
(1) To prohibit discriminatory actions, including several
specified actions, by a pharmacy benefit manager, a group
health plan, a health insurance issuer offering group or
individual health insurance, or a sponsor of a Medicare part D
prescription drug plan against 340B covered entities and their
pharmacies and requiring them to be treated as any other
provider or pharmacy.
(2) To provide for the imposition of civil monetary
penalties on pharmacy benefit managers that violate the new
protections and require the Health Services and Resources
Administration to promulgate implementing regulations.
(3) To authorize the Secretary to contract with a third-
party entity to collect and review data from State Medicaid
agencies and covered entities to prevent Medicaid duplicate
discounts.
SEC. 3. ENSURING THE EQUITABLE TREATMENT OF COVERED ENTITIES AND
PHARMACIES PARTICIPATING IN THE 340B DRUG DISCOUNT
PROGRAM.
(a) Group Health Plan and Health Insurance Issuer Requirements.--
Subpart II of part A of title XXVII of the Public Health Service Act
(42 U.S.C. 300gg-11 et seq.) is amended by adding at the end the
following new section:
``SEC. 2730. REQUIREMENTS RELATING TO THE 340B DRUG DISCOUNT PROGRAM.
``(a) In General.--A group health plan, a health insurance issuer
offering group or individual health insurance coverage, or a pharmacy
benefit manager may not discriminate against a covered entity (as
defined in subsection (d)(1)), a specified pharmacy (as defined in
subsection (d)(2)), or a participant, beneficiary, or enrollee of such
plan or coverage by imposing requirements, exclusions, reimbursement
terms, or other conditions on such entity or pharmacy that differ from
those applied to entities or pharmacies that are not covered entities
or specified pharmacies on the basis that the entity or pharmacy is a
covered entity or specified pharmacy or that the entity or pharmacy
dispenses 340B drugs, including by taking any action prohibited under
subsection (b).
``(b) Specified Prohibited Actions.--A group health plan, a health
insurance issuer offering group or individual health insurance
coverage, or a pharmacy benefit manager may not discriminate against a
covered entity, a specified pharmacy, or a participant, beneficiary, or
enrollee of such plan or coverage by doing any of the following:
``(1) Reimbursing a covered entity or specified pharmacy
for a quantity of a 340B drug (as defined in subsection (d)) in
an amount less than such plan, issuer, or manager (as
applicable) would pay to any other similarly situated (as
specified by the Secretary) entity or pharmacy that is not a
covered entity or a specified pharmacy for such quantity of
such drug on the basis that the entity or pharmacy is a covered
entity or specified pharmacy or that the entity or pharmacy
dispenses 340B drugs.
``(2) Imposing any terms or conditions on covered entities
or specified pharmacies with respect to any of the following
that differ from such terms or conditions applied to other
similarly situated entities or pharmacies that are not covered
entities or specified pharmacies on the basis that the entity
or pharmacy is a covered entity or specified pharmacy or that
the entity or pharmacy dispenses 340B drugs:
``(A) Fees, chargebacks, clawbacks, adjustments, or
other assessments.
``(B) Professional dispensing fees.
``(C) Restrictions or requirements regarding
participation in standard or preferred pharmacy
networks.
``(D) Requirements relating to the frequency or
scope of audits or to inventory management systems
using generally accepted accounting principles.
``(E) Any other restrictions, conditions,
practices, or policies that, as specified by the
Administrator of the Health Resources and Services
Administration, interfere with the ability of a covered
entity to maximize the value of discounts provided
under section 340B.
``(3) Interfering with an individual's choice to receive a
340B drug from a covered entity or specified pharmacy, whether
in person or via direct delivery, mail, or other form of
shipment.
``(4) Requiring a covered entity or specified pharmacy to
identify, either directly or through a third party, 340B drugs.
``(5) Refusing to contract with a covered entity or
specified pharmacy for reasons other than those that apply
equally to entities or pharmacies that are not covered entities
or specified pharmacies, or on the basis that--
``(A) the entity or pharmacy is a covered entity or
a specified pharmacy; or
``(B) the entity or pharmacy is described in any of
subparagraphs (A) through (O) of section 340B(a)(4).
``(6) With respect to a group health plan or health
insurance issuer for health insurance coverage, denying
coverage of a drug on the basis that such drug is a 340B drug.
``(c) Enforcement Mechanism for Pharmacy Benefit Managers.--The
Secretary shall impose a civil monetary penalty on any pharmacy benefit
manager that violates the requirements of this section. Such penalty
shall not exceed $5,000 per violation per day. The Secretary shall
issue proposed regulations to implement this subsection not later than
60 days after the date of the enactment of this subsection and shall
finalize such regulations not later than 180 days after such date of
enactment.
``(d) Definitions.--For purposes of this section:
``(1) Covered entity.--The term `covered entity' has the
meaning given such term in section 340B(a)(4).
``(2) Specified pharmacy.--The term `specified pharmacy'
means a pharmacy with which a covered entity has contracted to
dispense 340B drugs on behalf of the covered entity whether
distributed in person or via mail.
``(3) 340B drug.--The term `340B drug' means a drug that
is--
``(A) a covered outpatient drug (as defined for
purposes of section 340B); and
``(B) purchased under an agreement in effect under
such section.''.
(b) Application of Requirements to Medicare.--
(1) Part d.--Section 1860D-12(b) of the Social Security Act
(42 U.S.C. 1395w-112(b)) is amended by adding at the end the
following new paragraph:
``(8) Application of requirements relating to the 340b drug
discount program.--Each contract entered into under this
subsection with a PDP sponsor shall provide that the
requirements of section 2730 of the Public Health Service Act
apply to such sponsor, and to any pharmacy benefit manager that
contracts with such sponsor, in the same manner as such
requirements apply with respect to a group health plan, a
health insurance issuer, or a pharmacy benefit manager
described in such section.''.
(2) Part c.--Section 1857(f)(3) of the Social Security Act
(42 U.S.C. 1395w-27(f)(3)) is amended by adding at the end the
following new subparagraph:
``(E) 340B drug discount program.--Section 1860D-
12(b)(8).''.
(c) Medicaid Requirements.--
(1) In general.--Section 1927 of the Social Security Act
(42 U.S.C. 1396r-8) is amended by adding at the end the
following new subsection:
``(l) Review To Prevent Duplicate Discounts.--
``(1) In general.--Not later than 1 year after the date of
the enactment of this subsection, the Secretary shall enter
into a contract with a third-party entity (who shall be free of
conflicts of interest, as specified by the Secretary) for
purposes of--
``(A) identifying claims for 340B drugs (as defined
in section 2730(d) of the Public Health Service Act)
for which reimbursement was made under a State plan (or
waiver of such plan); and
``(B) ensuring such claims are not included in any
State rebate request under this section in violation of
section 340B(a)(5)(A) of the Public Health Service Act
or section 1903(m)(2)(A)(xiii) or 1927(j)(1).
``(2) Duties of contracting entity.--
``(A) In general.--The entity with a contract in
effect under paragraph (1) shall--
``(i) request and review, in the most
efficient and least burdensome manner
practicable--
``(I) claims level data from
covered entities (as defined in section
340B of the Public Health Service Act)
itemizing 340B drugs dispensed to
individuals enrolled under a State plan
(or waiver of such plan); and
``(II) claims level rebate file
data from State agencies administering
such plan (or such waiver);
``(ii) request, receive, and maintain data
described in either of subclauses (I) and (II)
of clause (i) in a confidential manner; and
``(iii) notify the State and the Secretary
of any violation described in paragraph (1)(B)
to ensure that such violation is remedied.
``(B) Retrospective submission of data.--In
requesting and reviewing claims level data described in
subparagraph (A)(i)(I) from a covered entity, the
entity with a contract in effect under paragraph (1)
shall allow such covered entity the option of
submitting such data on a retrospective basis through a
data file or another method that does not exclusively
require point-of-sale identification.''.
(2) Ensuring access to information.--
(A) Covered entity requirement.--Section 340B(a)(5)
of the Public Health Service Act (42 U.S.C. 256b(a)(5))
is amended by adding at the end the following new
subparagraph:
``(E) Provision of information to contracted entity
for medicaid claims review.--A covered entity shall
furnish to the entity with a contract in effect under
section 1927(l) of the Social Security Act, upon
request of such entity, the data described in paragraph
(2)(A)(i) of such section.''.
(B) State plan requirement.--Section 1902(a) of the
Social Security Act (42 U.S.C. 1396a(a)) is amended--
(i) in paragraph (86), by striking ``and''
at the end;
(ii) in paragraph (87)(D), by striking the
period and inserting ``; and''; and
(iii) by inserting after paragraph (87) the
following new paragraph:
``(88) provide for a mechanism to furnish to the entity
with a contract in effect under section 1927(l), upon request
of such entity, the data described in paragraph (2)(A)(ii) of
such section and remove from any rebate request described in
paragraph (1)(B) of such section any claim that is the subject
of a notice submitted by such entity under paragraph (2)(C) of
such section.''.
(d) Prohibition on Certain Use of Funds.--No funds appropriated
under any Act may be used to implement Executive Order 13937 published
on July 29, 2020, or to otherwise specify or limit the amount that a
covered entity (as defined in section 340B(a)(4) of the Public Health
Service Act (42 U.S.C. 256b(a)(4))) charges patients for 340B drugs (as
defined in section 2730(d) of the Public Health Service Act, as added
by subsection (a)).
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