[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 1131 Introduced in Senate (IS)]
<DOC>
118th CONGRESS
1st Session
S. 1131
To amend title XI of the Social Security Act and title XXVII of the
Public Health Service Act to establish requirements with respect to
prescription drug benefits.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 30, 2023
Mr. Braun (for himself and Mrs. Hyde-Smith) introduced the following
bill; which was read twice and referred to the Committee on Health,
Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To amend title XI of the Social Security Act and title XXVII of the
Public Health Service Act to establish requirements with respect to
prescription drug benefits.
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 ``Drug Price Transparency Act of
2023''.
SEC. 2. REQUIREMENTS FOR PRESCRIPTION DRUG BENEFITS.
(a) Removal of Safe Harbor Protection for Rebates Involving
Prescription Drugs and Establishment of New Safe Harbor Protections
Involving Prescription Drugs.--
(1) Removal of safe harbor protection for rebates involving
prescription drugs.--Section 1128B(b) of the Social Security
Act (42 U.S.C. 1320a-7b(b)) is amended--
(A) in paragraph (3)(A), by striking ``a discount''
and inserting ``subject to paragraph (5), a discount'';
and
(B) by adding at the end the following:
``(5) Removal of safe harbor protection for rebates
involving prescription drugs.--The safe harbor described in
paragraph (3)(A) shall not apply to a reduction in price or
other remuneration from a manufacturer of prescription drugs to
a sponsor of a prescription drug plan under part D of title
XVIII, an MA organization offering an MA-PD plan under part C
of such title, or a pharmacy benefit manager under contract
with such a sponsor or such an organization and, except as
provided in subparagraphs (M) and (N) of paragraph (3),
paragraphs (1) and (2) shall apply to any such reduction in
price or other remuneration.''.
(2) Establishment of new safe harbor protections involving
prescription drugs.--Section 1128B(b)(3) of the Social Security
Act (42 U.S.C. 1320a-7b(b)(3)) is amended--
(A) in subparagraph (K), by striking ``and'' at the
end;
(B) in subparagraph (L), by striking the period at
the end and inserting a semicolon; and
(C) by adding at the end the following:
``(M) a reduction in price offered by a
manufacturer of prescription drugs to a sponsor of a
prescription drug plan under part D of title XVIII, an
MA organization offering an MA-PD plan under part C of
such title, or a pharmacy benefit manager under
contract with such a sponsor or such an organization,
that is reflected at the point of sale to the
individual and meets such other conditions as the
Secretary may establish; and
``(N) flat fee service fees a manufacturer of
prescription drugs pays to a pharmacy benefit manager
for services rendered to the manufacturer that relate
to arrangements by the pharmacy benefit manager to
provide pharmacy benefit management services to a
health plan, if certain conditions established by the
Secretary are met, including requirements that the fees
are transparent to the health plan.''.
(3) Effective date.--The amendments made by this subsection
shall take effect on January 1, 2024.
(b) Requirements for Private Insurance Plans.--
(1) In general.--Part D of title XXVII of the Public Health
Service Act (42 U.S.C. 300gg-111 et seq.) is amended by adding
at the end the following:
``SEC. 2799A-11. REQUIREMENTS WITH RESPECT TO PRESCRIPTION DRUG
BENEFITS.
``(a) In General.--A group health plan or a health insurance issuer
offering group or individual health insurance coverage shall not, and
shall ensure that any entity that provides pharmacy benefits management
services under a contract with any such health plan or health insurance
coverage does not, receive from a drug manufacturer a reduction in
price or other remuneration with respect to any prescription drug
received by an enrollee in the plan or coverage and covered by the plan
or coverage, unless--
``(1) any such reduction in price is reflected at the point
of sale to the enrollee and meets such other conditions as the
Secretary may establish; and
``(2) any such other remuneration is a flat fee-based
service fee that a manufacturer of prescription drugs pays to
an entity that provides pharmacy benefits management services
for services rendered to the manufacturer that relate to
arrangements by the pharmacy benefit manager to provide
pharmacy benefit management services to a health plan or health
insurance issuer, if certain conditions established by the
Secretary are met, including requirements that the fees are
transparent to the health plan or health insurance issuer.
``(b) Entity That Provides Pharmacy Benefits Management Services.--
For purposes of this section, the term `entity that provides pharmacy
benefits management services' means--
``(1) any person, business, or other entity that, pursuant
to a written agreement with a group health plan or a health
insurance issuer offering group or individual health insurance
coverage, directly or through an intermediary--
``(A) acts as a price negotiator on behalf of the
plan or coverage; or
``(B) manages the prescription drug benefits
provided by the plan or coverage, which may include the
processing and payment of claims for prescription
drugs, the performance of drug utilization review, the
processing of drug prior authorization requests, the
adjudication of appeals or grievances related to the
prescription drug benefit, contracting with network
pharmacies, controlling the cost of covered
prescription drugs, or the provision of related
services; or
``(2) any entity that is owned, affiliated, or related
under a common ownership structure with a person, business, or
entity described in paragraph (1).''.
(2) ERISA.--
(A) In general.--Subpart B of part 7 of subtitle B
of title I of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1185 et seq.) is amended by
adding at the end the following:
``SEC. 726. REQUIREMENTS WITH RESPECT TO PRESCRIPTION DRUG BENEFITS.
``(a) In General.--A group health plan or a health insurance issuer
offering group health insurance coverage shall not, and shall ensure
that any entity that provides pharmacy benefits management services
under a contract with any such health plan or health insurance coverage
does not, receive from a drug manufacturer a reduction in price or
other remuneration with respect to any prescription drug received by an
enrollee in the plan or coverage and covered by the plan or coverage,
unless--
``(1) any such reduction in price is reflected at the point
of sale to the enrollee and meets such other conditions as the
Secretary may establish; and
``(2) any such other remuneration is a flat fee-based
service fee that a manufacturer of prescription drugs pays to
an entity that provides pharmacy benefits management services
for services rendered to the manufacturer that relate to
arrangements by the pharmacy benefit manager to provide
pharmacy benefit management services to a health plan or health
insurance issuer, if certain conditions established by the
Secretary are met, including requirements that the fees are
transparent to the health plan or health insurance issuer.
``(b) Entity That Provides Pharmacy Benefits Management Services.--
For purposes of this section, the term `entity that provides pharmacy
benefits management services' means--
``(1) any person, business, or other entity that, pursuant
to a written agreement with a group health plan or a health
insurance issuer offering group health insurance coverage,
directly or through an intermediary--
``(A) acts as a price negotiator on behalf of the
plan or coverage; or
``(B) manages the prescription drug benefits
provided by the plan or coverage, which may include the
processing and payment of claims for prescription
drugs, the performance of drug utilization review, the
processing of drug prior authorization requests, the
adjudication of appeals or grievances related to the
prescription drug benefit, contracting with network
pharmacies, controlling the cost of covered
prescription drugs, or the provision of related
services; or
``(2) any entity that is owned, affiliated, or related
under a common ownership structure with a person, business, or
entity described in paragraph (1).''.
(B) Clerical amendment.--The table of contents of
the Employee Retirement Income Security Act of 1974 is
amended by inserting after the item relating to section
725 the following:
``Sec. 725. Requirements with respect to prescription drug benefits.''.
(3) IRC.--
(A) In general.--Subchapter B of chapter 100 of the
Internal Revenue Code of 1986 is amended by adding at
the end the following:
``SEC. 9826. REQUIREMENTS WITH RESPECT TO PRESCRIPTION DRUG BENEFITS.
``(a) In General.--A group health plan shall not, and shall ensure
that any entity that provides pharmacy benefits management services
under a contract with any such health plan does not, receive from a
drug manufacturer a reduction in price or other remuneration with
respect to any prescription drug received by an enrollee in the plan
and covered by the plan, unless--
``(1) any such reduction in price is reflected at the point
of sale to the enrollee and meets such other conditions as the
Secretary may establish; and
``(2) any such other remuneration is a flat fee-based
service fee that a manufacturer of prescription drugs pays to
an entity that provides pharmacy benefits management services
for services rendered to the manufacturer that relate to
arrangements by the pharmacy benefit manager to provide
pharmacy benefit management services to a health plan, if
certain conditions established by the Secretary are met,
including requirements that the fees are transparent to the
health plan.
``(b) Entity That Provides Pharmacy Benefits Management Services.--
For purposes of this section, the term `entity that provides pharmacy
benefits management services' means--
``(1) any person, business, or other entity that, pursuant
to a written agreement with a group health plan, directly or
through an intermediary--
``(A) acts as a price negotiator on behalf of the
plan; or
``(B) manages the prescription drug benefits
provided by the plan, which may include the processing
and payment of claims for prescription drugs, the
performance of drug utilization review, the processing
of drug prior authorization requests, the adjudication
of appeals or grievances related to the prescription
drug benefit, contracting with network pharmacies,
controlling the cost of covered prescription drugs, or
the provision of related services; or
``(2) any entity that is owned, affiliated, or related
under a common ownership structure with a person, business, or
entity described in paragraph (1).''.
(B) Clerical amendment.--The table of sections for
subchapter B of chapter 100 of the Internal Revenue
Code of 1986 is amended by adding at the end the
following:
``Sec. 9816. Requirements with respect to prescription drug
benefits.''.
(4) Effective date.--The amendments made by paragraphs (1),
(2), and (3) shall take effect on January 1, <SUP>TM</SUP>.
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