[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7497 Introduced in House (IH)]
<DOC>
117th CONGRESS
2d Session
H. R. 7497
To provide for lower prices for drugs through drug price negotiation,
and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 11, 2022
Ms. Slotkin introduced the following bill; which was referred to the
Committee on Energy and Commerce, and in addition to the Committees on
Ways and Means, and Education and Labor, 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 provide for lower prices for drugs through drug price negotiation,
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; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Make Medicine
Affordable Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--LOWERING PRICES THROUGH DRUG PRICE NEGOTIATION
Sec. 101. Providing for lower prices for certain high-priced single
source drugs.
Sec. 102. Selected drug manufacturer excise tax imposed during
noncompliance periods.
Sec. 103. Funding.
TITLE II--PRESCRIPTION DRUG INFLATION REBATES
Sec. 201. Medicare part B rebate by manufacturers.
Sec. 202. Medicare part D rebate by manufacturers.
TITLE III--PART D IMPROVEMENTS AND MAXIMUM OUT-OF-POCKET CAP FOR
MEDICARE BENEFICIARIES
Sec. 301. Medicare part D benefit redesign.
Sec. 302. Maximum monthly cap on cost-sharing payments under
prescription drug plans and MA-PD plans.
TITLE IV--REPEAL OF CERTAIN PRESCRIPTION DRUG REBATE RULE
Sec. 401. Prohibiting implementation of rule relating to eliminating
the anti-kickback statute safe harbor
protection for prescription drug rebates.
TITLE V--MISCELLANEOUS
Sec. 501. Appropriate cost-sharing for certain insulin products under
Medicare part D.
Sec. 502. Coverage of adult vaccines recommended by the Advisory
Committee on Immunization Practices under
Medicare part D.
Sec. 503. Payment for biosimilar biological products during initial
period.
Sec. 504. Temporary increase in Medicare part B payment for certain
biosimilar biological products.
Sec. 505. Improving access to adult vaccines under Medicaid and CHIP.
TITLE VI--ADDITIONAL INSULIN POLICIES
Sec. 601. ERISA requirements with respect to cost-sharing for certain
insulin products.
Sec. 602. Public Health Service Act requirements with respect to cost-
sharing for insulin products.
Sec. 603. IRC requirements with respect to cost-sharing for certain
insulin products.
TITLE I--LOWERING PRICES THROUGH DRUG PRICE NEGOTIATION
SEC. 101. PROVIDING FOR LOWER PRICES FOR CERTAIN HIGH-PRICED SINGLE
SOURCE DRUGS.
(a) Program To Lower Prices for Certain High-Priced Single Source
Drugs.--Title XI of the Social Security Act is amended by adding after
section 1184 (42 U.S.C. 1320e-3) the following new part:
``PART E--PRICE NEGOTIATION PROGRAM TO LOWER PRICES FOR CERTAIN HIGH-
PRICED SINGLE SOURCE DRUGS
``SEC. 1191. ESTABLISHMENT OF PROGRAM.
``(a) In General.--The Secretary shall establish a Drug Price
Negotiation Program (in this part referred to as the `program'). Under
the program, with respect to each price applicability period, the
Secretary shall--
``(1) publish a list of negotiation-eligible drugs and
selected drugs in accordance with section 1192;
``(2) enter into agreements with manufacturers of selected
drugs with respect to such period, in accordance with section
1193;
``(3) negotiate and, if applicable, renegotiate maximum
fair prices for such selected drugs, in accordance with section
1194; and
``(4) carry out the administrative duties described in
section 1196.
``(b) Definitions Relating to Timing.--For purposes of this part:
``(1) Initial price applicability year.--The term `initial
price applicability year' means a year (beginning with 2025).
``(2) Price applicability period.--The term `price
applicability period' means, with respect to a qualifying
single source drug, the period beginning with the first initial
price applicability year with respect to which such drug is a
selected drug and ending with the last year during which the
drug is a selected drug.
``(3) Selected drug publication date.--The term `selected
drug publication date' means, with respect to each initial
price applicability year, February 1 of the year that begins 2
years prior to such year.
``(4) Negotiation period.--The term `negotiation period'
means, with respect to an initial price applicability year with
respect to a selected drug, the period--
``(A) beginning on the sooner of--
``(i) the date on which the manufacturer of
the drug and the Secretary enter into an
agreement under section 1193 with respect to
such drug; or
``(ii) February 28 following the selected
drug publication date with respect to such
selected drug; and
``(B) ending on November 1 of the year that begins
2 years prior to the initial price applicability year.
``(c) Other Definitions.--For purposes of this part:
``(1) Maximum fair price eligible individual.--The term
`maximum fair price eligible individual' means, with respect to
a selected drug--
``(A) in the case such drug is dispensed to the
individual at a pharmacy, by a mail order service, or
by another dispenser, an individual who is enrolled
under a prescription drug plan under part D of title
XVIII or an MA-PD plan under part C of such title if
coverage is provided under such plan for such selected
drug; and
``(B) in the case such drug is furnished or
administered to the individual by a hospital,
physician, or other provider of services or supplier,
an individual who is enrolled under part B of title
XVIII, including an individual who is enrolled under an
MA plan under part C of such title, if such selected
drug is covered under such part.
``(2) Maximum fair price.--The term `maximum fair price'
means, with respect to a year during a price applicability
period and with respect to a selected drug (as defined in
section 1192(c)) with respect to such period, the price
published pursuant to section 1195 in the Federal Register for
such drug and year.
``(3) Unit.--The term `unit' means, with respect to a drug
or biological, the lowest identifiable amount (such as a
capsule or tablet, milligram of molecules, or grams) of the
drug or biological that is dispensed or furnished. The
determination of a unit, with respect to a drug or biological,
pursuant to this paragraph shall not be subject to
administrative or judicial review.
``(4) Total expenditures.--The term `total expenditures'
includes, in the case of expenditures with respect to part D of
title XVIII, ingredient costs, dispensing fees, sales tax, and
if applicable, vaccine administration fees. The term `total
expenditures' excludes, in the case of expenditures with
respect to part B of such title, expenditures for a drug or
biological that are bundled or packaged into the payment for
another service.
``SEC. 1192. SELECTION OF NEGOTIATION-ELIGIBLE DRUGS AS SELECTED DRUGS.
``(a) In General.--Not later than the selected drug publication
date with respect to an initial price applicability year, in accordance
with subsection (b), the Secretary shall select and publish in the
Federal Register a list of--
``(1)(A) with respect to the initial price applicability
year 2025, not more than 10 negotiation-eligible drugs
described in subparagraph (A)(i) of subsection (d)(1), but not
subparagraph (B) of such subsection, with respect to such year;
``(B) with respect to the initial price applicability year
2026, not more than 15 negotiation-eligible drugs described in
subparagraph (A)(i) of subsection (d)(1), but not subparagraph
(B) of such subsection, with respect to such year;
``(C) with respect to the initial price applicability year
2027, not more than 15 negotiation-eligible drugs described in
subparagraph (A) of subsection (d)(1), but not subparagraph (B)
of such subsection, with respect to such year; and
``(D) with respect to the initial price applicability year
2028 or a subsequent year, not more than 20 negotiation-
eligible drugs described in subparagraph (A) of subsection
(d)(1), but not subparagraph (B) of such subsection, with
respect to such year; and
``(2) all negotiation-eligible drugs described in
subparagraph (B) of such subsection with respect to such year.
Subject to subsection (c)(2) and section 1194(f)(5), each drug
published on the list pursuant to the previous sentence shall be
subject to the negotiation process under section 1194 for the
negotiation period with respect to such initial price applicability
year (and the renegotiation process under such section as applicable
for any subsequent year during the applicable price applicability
period).
``(b) Selection of Drugs.--
``(1) In general.--In carrying out subsection (a)(1),
subject to paragraph (2), the Secretary shall, with respect to
an initial price applicability year--
``(A) rank a combined list of negotiation-eligible
drugs described in subsection (d)(1)(A) according to
the total expenditures for such drugs under parts B and
D of title XVIII, as determined by the Secretary,
during the most recent period of 12 months prior to the
selected drug publication date (but ending not later
than October 31 of the year prior to the year of such
drug publication date), with respect to such year, for
which data are available, with the negotiation-eligible
drugs with the highest total expenditures being ranked
the highest; and
``(B) select from such ranked combined list for
inclusion on the published list described in subsection
(a) with respect to such year the negotiation-eligible
drugs with the highest such rankings.
``(2) High spend part d drugs for 2025 and 2026.--With
respect to the initial price applicability year 2025 and with
respect to the initial price applicability year 2026, the
Secretary shall apply paragraph (1) as if the reference to
`negotiation-eligible drugs described in subsection (d)(1)(A)'
were a reference to `negotiation-eligible drugs described in
subsection (d)(1)(A)(i)' and as if the reference to `total
expenditures for such drugs under parts B and D of title XVIII'
were a reference to `total expenditures for such drugs under
part D of title XVIII'.
``(c) Selected Drug.--
``(1) In general.--For purposes of this part, consistent
with subsection (e)(2) and subject to paragraph (2), each
negotiation-eligible drug included on the list published under
subsection (a) with respect to an initial price applicability
year shall be referred to as a `selected drug' with respect to
such year and each subsequent year beginning before the first
year that begins after the date on which the Secretary
determines at least one drug or biological product--
``(A) is approved or licensed (as applicable)--
``(i) under section 505(j) of the Federal
Food, Drug, and Cosmetic Act using such drug as
the listed drug; or
``(ii) under section 351(k) of the Public
Health Service Act using such drug as the
reference product; and
``(B) is marketed pursuant to such approval or
licensure.
``(2) Clarification.--A negotiation-eligible drug--
``(A) that is included on the list published under
subsection (a) with respect to an initial price
applicability year; and
``(B) for which the Secretary makes a determination
described in paragraph (1) before or during the
negotiation period with respect to such initial price
applicability year,
shall not be subject to the negotiation process under section
1194 with respect to such negotiation period and shall continue
to be considered a selected drug under this part with respect
to the number of negotiation-eligible drugs published on the
list under subsection (a) with respect to such initial price
applicability year.
``(d) Negotiation-Eligible Drug.--
``(1) In general.--For purposes of this part, subject to
paragraph (2), the term `negotiation-eligible drug' means, with
respect to the selected drug publication date with respect to
an initial price applicability year, a qualifying single source
drug, as defined in subsection (e), that is described in either
of the following subparagraphs (or, with respect to the initial
price applicability year 2025 or 2026, that is described in
subparagraph (A)(i) or (B)):
``(A) High spend drugs.--The qualifying single
source drug is, determined in accordance with
subsection (e)(2)--
``(i) among the 50 qualifying single source
drugs with the highest total expenditures under
part D of title XVIII, as determined by the
Secretary in accordance with paragraph (3),
during the most recent period for which data
are available of at least 12 months prior to
the selected drug publication date (but ending
no later than October 31 of the year prior to
the year of such drug publication date), with
respect to such year; or
``(ii) among the 50 qualifying single
source drugs with the highest total
expenditures under part B of title XVIII, as
determined by the Secretary in accordance with
paragraph (3), during such most recent period,
as described in clause (i).
``(B) Insulin.--The qualifying single source drug
is described in subsection (e)(1)(C).
``(2) Exception for small biotech drugs.--
``(A) In general.--Subject to subparagraph (C), the
term `negotiation-eligible drug' shall not include,
with respect to the initial price applicability years
2025, 2026, and 2027, a qualifying single source drug
that meets either of the following:
``(i) Part d drugs.--The total expenditures
for the qualifying single source drug under
part D of title XVIII, as determined by the
Secretary in accordance with paragraph (3),
during 2021--
``(I) are equal to or less than 1
percent of the total expenditures under
such part D, as so determined, for all
covered part D drugs during such year;
and
``(II) are equal to at least 80
percent of the total expenditures under
such part D, as so determined, for all
covered part D drugs for which the
manufacturer of the drug has an
agreement in effect under section
1860D-14A during such year.
``(ii) Part b drugs.--The total
expenditures for the qualifying single source
drug under part B of title XVIII, as determined
by the Secretary in accordance with paragraph
(3), during 2021--
``(I) are equal to or less than 1
percent of the total expenditures under
such part B, as so determined, for all
qualifying single source drugs covered
under such part B during such year; and
``(II) are equal to at least 80
percent of the total expenditures under
such part B, as so determined, for all
qualifying single source drugs of the
manufacturer that are covered under
such part B during such year.
``(B) Clarifications relating to manufacturers.--
``(i) Aggregation rule.--All persons
treated as a single employer under subsection
(a) or (b) of section 52 of the Internal
Revenue Code of 1986 shall be treated as one
manufacturer for purposes of this paragraph.
``(ii) Limitation.--A qualifying single
source drug described in subparagraph (A) shall
not include a qualifying single source drug of
a manufacturer if such manufacturer is acquired
after 2021 by another manufacturer that does
not meet the definition of a specified
manufacturer under section 1860D-
14C(g)(4)(B)(ii), effective at the beginning of
the plan year immediately following such
acquisition or, in the case of an acquisition
before 2024, effective January 1, 2024.
``(C) Drugs not included as small biotech drugs.--
The following shall not be considered a qualifying
single source drug described in subparagraph (A):
``(i) A vaccine that is licensed under
section 351 of the Public Health Service Act
and is marketed pursuant to such section.
``(ii) A new formulation, such as an
extended release formulation, of a qualifying
single source drug.
``(iii) A qualifying single source drug
described in subsection (e)(1)(C).
``(3) Clarifications and determinations.--
``(A) Previously selected drugs and small biotech
drugs excluded.--In applying clauses (i) and (ii) of
paragraph (1)(A), the Secretary shall not consider or
count--
``(i) drugs that are already selected
drugs; and
``(ii) for initial price applicability
years 2025, 2026, and 2027, qualifying single
source drugs described in paragraph (2)(A).
``(B) Use of data.--In determining whether a
qualifying single source drug satisfies any of the
criteria described in paragraph (1) or (2), the
Secretary shall use data that is aggregated across
dosage forms and strengths of the drug, including new
formulations of the drug, such as an extended release
formulation, and not based on the specific formulation
or package size or package type of the drug.
``(4) Publication.--Not later than the selected drug
publication date with respect to an initial price applicability
year, the Secretary shall publish in the Federal Register a
list of negotiation-eligible drugs with respect to such
selected drug publication date.
``(e) Qualifying Single Source Drug.--
``(1) In general.--For purposes of this part, the term
`qualifying single source drug' means, with respect to an
initial price applicability year, subject to paragraphs (2) and
(3), a covered part D drug (as defined in section 1860D-2(e))
that is described in any of the following or a drug or
biological product covered under part B of title XVIII that is
described in any of the following:
``(A) Drug products.--A drug--
``(i) that is approved under section 505(c)
of the Federal Food, Drug, and Cosmetic Act and
is marketed pursuant to such approval;
``(ii) for which, as of the selected drug
publication date with respect to such initial
price applicability year, at least 7 years will
have elapsed since the date of such approval;
and
``(iii) that is not the listed drug for any
drug that is approved and marketed under
section 505(j) of such Act.
``(B) Biological products.--A biological product--
``(i) that is licensed under section 351(a)
of the Public Health Service Act and is
marketed under section 351 of such Act;
``(ii) for which, as of the selected drug
publication date with respect to such initial
price applicability year, at least 11 years
will have elapsed since the date of such
licensure; and
``(iii) that is not the reference product
for any biological product that is licensed and
marketed under section 351(k) of such Act.
``(C) Insulin product.--Any insulin product that is
approved under section 505 of the Federal Food, Drug,
and Cosmetic Act or licensed under section 351 of the
Public Health Service Act and marketed pursuant to such
approval or licensure, including any insulin product
that has been deemed to be licensed under section 351
of the Public Health Service Act pursuant to section
7002(e)(4) of the Biologics Price Competition and
Innovation Act of 2009 and is marketed pursuant to such
section, regardless of whether such insulin product
would be described in subparagraph (A) or (B).
``(2) Treatment of authorized generic drugs.--
``(A) In general.--In the case of a qualifying
single source drug described in subparagraph (A) or (B)
of paragraph (1) that is the listed drug (as such term
is used in section 505(j) of the Federal Food, Drug,
and Cosmetic Act) or the reference product (as defined
in section 351(i) of the Public Health Service Act),
with respect to an authorized generic drug, in applying
the provisions of this part, such authorized generic
drug and such listed drug or reference product shall be
treated as the same qualifying single source drug.
``(B) Authorized generic drug defined.--For
purposes of this paragraph, the term `authorized
generic drug' means--
``(i) in the case of a drug, an authorized
generic drug (as such term is defined in
section 505(t)(3) of the Federal Food, Drug,
and Cosmetic Act); and
``(ii) in the case of a biological product,
a reference product (as such term is defined in
section 351(i) of the Public Health Service
Act) that--
``(I) has been licensed under
section 351(a) of such Act; and
``(II) is marketed, sold, or
distributed directly or indirectly to
retail class of trade under a different
labeling, packaging (other than
repackaging as the reference product in
blister packs, unit doses, or similar
packaging for use in institutions),
product code, labeler code, trade name,
or trade mark than the reference
product.
``(3) Exclusions.--In this part, the term `qualifying
single source drug' does not include any of the following:
``(A) Certain orphan drugs.--A drug that is
designated as a drug for only one rare disease or
condition under section 526 of the Federal Food, Drug,
and Cosmetic Act and for which the only approved
indication (or indications) is for such disease or
condition.
``(B) Low spend medicare drugs.--A drug or
biological product (other than an insulin product
described in paragraph (1)(C)) with respect to which
the total expenditures under parts B and D of title
XVIII, as determined by the Secretary, during the most
recent period for which data are available of at least
12 months prior to the selected drug publication date
(but ending no later than October 31 of the year prior
to the year of such drug publication date), with
respect to such year is less than--
``(i) with respect to 2021, $200,000,000;
or
``(ii) with respect to a subsequent year,
the dollar amount specified in this
subparagraph for the previous year increased by
the annual percentage increase in the consumer
price index (all items; U.S. city average) as
of December of such previous year.
``(f) No Administrative or Judicial Review of Determinations and
Selections.--The determination of negotiation-eligible drugs under
subsection (d) and the selection of drugs under this section are not
subject to administrative or judicial review.
``SEC. 1193. MANUFACTURER AGREEMENTS.
``(a) In General.--For purposes of section 1191(a)(2), the
Secretary shall enter into agreements with manufacturers of selected
drugs with respect to a price applicability period, by not later than
February 28 following the selected drug publication date with respect
to such selected drug, under which--
``(1) during the negotiation period for the initial price
applicability year for the selected drug, the Secretary and
manufacturer, in accordance with section 1194, negotiate to
determine (and, by not later than the last date of such period,
agree to) a maximum fair price for such selected drug of the
manufacturer in order for the manufacturer to provide access to
such price--
``(A) to maximum fair price eligible individuals
who with respect to such drug are described in
subparagraph (A) of section 1191(c)(1) and are
dispensed such drug (and to pharmacies, mail order
services, and other dispensers, with respect to such
maximum fair price eligible individuals who are
dispensed such drugs) during, subject to subparagraph
(2), the price applicability period; and
``(B) to hospitals, physicians, and other providers
of services and suppliers with respect to maximum fair
price eligible individuals who with respect to such
drug are described in subparagraph (B) of such section
and are furnished or administered such drug during,
subject to subparagraph (2), the price applicability
period;
``(2) the Secretary and the manufacturer shall, in
accordance with section 1194, renegotiate (and, by not later
than the last date of such period, agree to) the maximum fair
price for such drug, in order for the manufacturer to provide
access to such maximum fair price (as so renegotiated)--
``(A) to maximum fair price eligible individuals
who with respect to such drug are described in
subparagraph (A) of section 1191(c)(1) and are
dispensed such drug (and to pharmacies, mail order
services, and other dispensers, with respect to such
maximum fair price eligible individuals who are
dispensed such drugs) during any year during the price
applicability period (beginning after such
renegotiation) with respect to such selected drug; and
``(B) to hospitals, physicians, and other providers
of services and suppliers with respect to maximum fair
price eligible individuals who with respect to such
drug are described in subparagraph (B) of such section
and are furnished or administered such drug during any
year described in subparagraph (A);
``(3) access to the maximum fair price (including as
renegotiated pursuant to paragraph (2)), with respect to such a
selected drug, shall be provided by the manufacturer to--
``(A) maximum fair price eligible individuals, who
with respect to such drug are described in subparagraph
(A) of section 1191(c)(1), at the pharmacy, mail order
service, or other dispenser at the point-of-sale of
such drug (and shall be provided by the manufacturer to
the pharmacy, mail order service, or other dispenser,
with respect to such maximum fair price eligible
individuals who are dispensed such drugs), as described
in paragraph (1)(A) or (2)(A), as applicable; and
``(B) hospitals, physicians, and other providers of
services and suppliers with respect to maximum fair
price eligible individuals who with respect to such
drug are described in subparagraph (B) of such section
and are furnished or administered such drug, as
described in paragraph (1)(B) or (2)(B), as applicable;
``(4) the manufacturer, subject to subsection (d), submits
to the Secretary, through an online portal established by the
Secretary or other form and manner specified by the Secretary,
for the negotiation period for the price applicability period
(and, if applicable, before any period of renegotiation
pursuant to section 1194(f)) with respect to such drug--
``(A) information on the non-Federal average
manufacturer price for the drug for the applicable year
or period; and
``(B) all other information that the Secretary
requires to carry out the negotiation (or renegotiation
process) under this part, including information
described in section 1194(e)(1); and
``(5) the manufacturer complies with requirements imposed
by the Secretary for purposes of administering the program,
including with respect to the duties described in section 1196.
``(b) Agreement in Effect Until Drug Is No Longer a Selected
Drug.--An agreement entered into under this section shall be effective,
with respect to a selected drug, until such drug is no longer
considered a selected drug under section 1192(c).
``(c) Confidentiality of Information.--Information submitted to the
Secretary under this part by a manufacturer of a selected drug that is
proprietary information of such manufacturer (as determined by the
Secretary) shall be used only by the Secretary or disclosed to and used
by the Comptroller General of the United States or the Medicare Payment
Advisory Commission for purposes of carrying out this part.
``(d) Implementation for 2025 and 2026.--Notwithstanding any other
provision of this part, the Secretary shall implement this section for
2025 and 2026 by program instruction or otherwise.
``SEC. 1194. NEGOTIATION AND RENEGOTIATION PROCESS.
``(a) In General.--For purposes of this part, under an agreement
under section 1193 between the Secretary and a manufacturer of a
selected drug, with respect to the period for which such agreement is
in effect and in accordance with subsections (b), (c), and (d), the
Secretary and the manufacturer--
``(1) shall during the negotiation period with respect to
such drug, in accordance with this section, negotiate a maximum
fair price for such drug for the purpose described in section
1193(a)(1); and
``(2) renegotiate, in accordance with the process specified
pursuant to subsection (f), such maximum fair price for such
drug if such drug is a renegotiation-eligible drug under such
subsection.
``(b) Negotiation Process Requirements.--
``(1) Methodology and process.--The Secretary shall develop
and use a consistent methodology and process, in accordance
with paragraph (2), for negotiations under subsection (a) that
aims to achieve the lowest maximum fair price for each selected
drug.
``(2) Specific elements of negotiation process.--As part of
the negotiation process under this section, with respect to a
selected drug and the negotiation period with respect to the
initial price applicability year with respect to such drug, the
following shall apply:
``(A) Submission of information.--Not later than
March 1 of the year of the selected drug publication
date, with respect to the selected drug, the
manufacturer of the drug shall submit to the Secretary,
in accordance with section 1193(a)(4), the information
described in such section.
``(B) Initial offer by secretary.--Not later than
the June 1 following the selected drug publication
date, the Secretary shall provide the manufacturer of a
selected drug with a written initial offer that
contains the Secretary's proposal for the maximum fair
price of the drug and a list of the considerations
described in section 1194(e) that were used in
developing such offer.
``(C) Response to initial offer.--
``(i) In general.--Not later than 30 days
after the date of receipt of an initial offer
under subparagraph (B), the manufacturer shall
either accept such offer or propose a
counteroffer to such offer.
``(ii) Counteroffer requirements.--If a
manufacturer proposes a counteroffer, such
counteroffer--
``(I) shall be in writing; and
``(II) shall be justified based on
the factors described in subsection
(e).
``(D) Response to counteroffer.--After receiving a
counteroffer under subparagraph (C), the Secretary
shall respond in writing to such counteroffer.
``(E) Deadline.--All negotiations shall end prior
to the first day of November following the selected
drug publication date, with respect to the initial
price applicability year.
``(F) Limitations on offer amount.--In negotiating
the maximum fair price of a selected drug, with respect
to an initial price applicability year for the selected
drug, and, as applicable, in renegotiating the maximum
fair price for such drug, with respect to a subsequent
year during the price applicability period for such
drug, the Secretary shall not offer (or agree to a
counteroffer for) a maximum fair price for the selected
drug that--
``(i) exceeds the ceiling determined under
subsection (c) for the selected drug and year;
or
``(ii) as applicable, is less than the
floor determined under subsection (d) for the
selected drug and year.
``(G) Treatment of determination.--The
establishment of a maximum fair price under this
section is not subject to administrative or judicial
review.
``(c) Ceiling for Maximum Fair Price.--
``(1) In general.--The maximum fair price negotiated under
this section for a selected drug, with respect to the first
year of the price applicability period with respect to such
drug, shall not exceed the applicable percent described in
paragraph (2), with respect to such drug, of the following:
``(A) Initial price applicability year 2025.--In
the case of a selected drug with respect to which such
initial price applicability year is 2025, the average
of the non-Federal average manufacturer price for such
drug for the first 3 calendar quarters of 2021 (or, in
the case that there is not a non-Federal average
manufacturer price available for such drug for any of
such first 3 calendar quarters of 2021, for the first
full year following the market entry for such drug),
increased by the percentage increase in the consumer
price index for all urban consumers (all items; United
States city average) from September 2021 (or such first
full year following the market entry), as applicable,
to the year prior to the selected drug publication date
with respect to such initial price applicability year.
``(B) Initial price applicability year 2026 and
subsequent years.--In the case of a selected drug with
respect to which such initial price applicability year
is 2026 or a subsequent year, the lower of--
``(i) the average of the non-Federal
average manufacturer price for such drug for
the first 3 calendar quarters of 2021 (or, in
the case that there is not a non-Federal
average manufacturer price available for such
drug for any of such first 3 calendar quarters
of 2021, for the first full year following the
market entry for such drug), increased by the
percentage increase in the consumer price index
for all urban consumers (all items; United
States city average) from September 2021 (or
such first full year following the market
entry), as applicable, to the year prior to the
selected drug publication date with respect to
such initial price applicability year; or
``(ii) the non-Federal average manufacturer
price for such drug for the year prior to the
selected drug publication date with respect to
such initial price applicability year.
``(2) Applicable percent described.--For purposes of
paragraph (1), the applicable percent described in this
paragraph is the following:
``(A) Short-monopoly drugs.--With respect to a
selected drug (other than a post-exclusivity drug and a
long-monopoly drug), 75 percent.
``(B) Post-exclusivity drugs.--With respect to a
post-exclusivity drug, 65 percent.
``(C) Long-monopoly drugs.--With respect to a long-
monopoly drug, 40 percent.
``(3) Post-exclusivity drug defined.--
``(A) In general.--In this part, subject to
subparagraph (B), the term `post-exclusivity drug'
means, with respect to an initial price applicability
year, a selected drug for which at least 12 years, but
fewer than 16 years, have elapsed since the date of
approval of such drug under section 505(c) of the
Federal Food, Drug, and Cosmetic Act or since the date
of licensure of such drug under section 351(a) of the
Public Health Service Act, as applicable.
``(B) Exclusions.--The term `post-exclusivity drug'
shall not include any of the following:
``(i) A vaccine that is licensed under
section 351 of the Public Health Service Act
and marketed pursuant to such section.
``(ii) A selected drug that had an
agreement under this part with the Secretary
prior to the initial price applicability year
2030.
``(C) Clarification.--Nothing in subparagraph
(B)(ii) shall limit the transition of a selected drug
described in paragraph (2)(A) to a long-monopoly drug
if the selected drug meets the definition of a long-
monopoly drug.
``(4) Long-monopoly drug defined.--
``(A) In general.--In this part, subject to
subparagraph (B), the term `long-monopoly drug' means,
with respect to an initial price applicability year, a
selected drug for which at least 16 years have elapsed
since the date of approval of such drug under section
505(c) of the Federal Food, Drug, and Cosmetic Act or
since the date of licensure of such drug under section
351(a) of the Public Health Service Act, as applicable.
``(B) Exclusion.--The term `long-monopoly drug'
shall not include a vaccine that is licensed under
section 351 of the Public Health Service Act and
marketed pursuant to such section.
``(5) Non-federal average manufacturer price.--In this
part, the term `non-Federal average manufacturer price' has the
meaning given such term in section 8126(h)(5) of title 38,
United States Code.
``(d) Temporary Floor for Small Biotech Drugs.--In the case of a
selected drug that is a qualifying single source drug described in
section 1192(d)(2) and with respect to which the first initial price
applicability year of the price applicability period with respect to
such drug is 2028 or 2029, the maximum fair price negotiated under this
section for such drug for such initial price applicability year may not
be less than 66 percent of the average of the non-Federal average
manufacturer price for such drug (as defined and applied in subsection
(c)(4)) for the first 3 calendar quarters of 2021 (or, in the case that
there is not a non-Federal average manufacturer price available for
such drug for any of such first 3 calendar quarters of 2021, for the
first full year following the market entry for such drug), increased by
the percentage increase in the consumer price index for all urban
consumers (all items; United States city average) from September 2021
(or such first full year following the market entry), as applicable, to
the year prior to the selected drug publication date with respect to
the initial price applicability year.
``(e) Considerations.--For purposes of negotiating the maximum fair
price of a selected drug under this part with the manufacturer of the
drug, the Secretary shall consider the following factors (and, with
respect to post-exclusivity drugs and long-monopoly drugs, shall not
consider factors other than those described in subparagraphs (B) and
(C) of paragraph (1)):
``(1) Manufacturer-specific information.--The following
information, with respect to such selected drug, including as
submitted by the manufacturer:
``(A) Research and development costs of the
manufacturer for the drug and the extent to which the
manufacturer has recouped research and development
costs.
``(B) Market data for the drug, including the
distribution of sales across different programs and
purchasers and projected future revenues for the drug.
``(C) Unit costs of production and distribution of
the drug.
``(D) Prior Federal financial support for novel
therapeutic discovery and development with respect to
the drug.
``(E) Data on patents and on existing and pending
exclusivity for the drug.
``(F) National sales data for the drug.
``(G) Information on clinical trials for the drug.
``(2) Information on unmet medical needs and alternative
treatments.--The following information, with respect to such
selected drug:
``(A) The extent to which the drug represents a
therapeutic advance as compared to existing therapeutic
alternatives and, to the extent such information is
available, the costs of such existing therapeutic
alternatives.
``(B) Information on approval by the Food and Drug
Administration of alternative drug products or
biological products.
``(C) Information on comparative effectiveness
analysis for such products, taking into consideration
the effects of such products on specific populations,
such as individuals with disabilities, the elderly, the
terminally ill, children, and other patient
populations.
``(D) The extent to which the drug addresses unmet
medical needs for a condition for which treatment or
diagnosis is not addressed adequately by available
therapy.
In considering information described in subparagraph (C), the
Secretary shall not use evidence or findings from comparative
clinical effectiveness research in a manner that treats
extending the life of an elderly, disabled, or terminally ill
individual as of lower value than extending the life of an
individual who is younger, nondisabled, or not terminally ill.
``(3) Additional information.--Information submitted to the
Secretary, in accordance with a process specified by the
Secretary, by other parties that are affected by the
establishment of a maximum fair price for the selected drug.
``(f) Renegotiation Process.--
``(1) In general.--In the case of a renegotiation-eligible
drug (as defined in paragraph (2)) that is selected under
paragraph (3), the Secretary shall provide for a process of
renegotiation (for years (beginning with 2027) during the price
applicability period, with respect to such drug) of the maximum
fair price for such drug consistent with paragraph (4).
``(2) Renegotiation-eligible drug defined.--In this
section, the term `renegotiation-eligible drug' means a
selected drug that is any of the following:
``(A) Addition of new indication.--A selected drug
for which a new indication is added to the drug.
``(B) Change of status to a post-exclusivity
drug.--A selected drug that is described in section
1192(d)(1)(A) that--
``(i) is not a post-exclusivity drug or a
long-monopoly drug; and
``(ii) for which there is a change in
status to that of a post-exclusivity drug.
``(C) Change of status to a long-monopoly drug.--A
selected drug that is described in section
1192(d)(1)(A) that--
``(i) is not a long-monopoly drug; and
``(ii) for which there is a change in
status to that of a long-monopoly drug.
``(D) Material changes.--A selected drug for which
the Secretary determines there has been a material
change of factors described in paragraph (1) or (2) of
subsection (e).
``(3) Selection of drugs for renegotiation.--Each year the
Secretary shall select among renegotiation-eligible drugs for
renegotiation as follows:
``(A) All post-exclusivity negotiation-eligible
drugs.--The Secretary shall select all renegotiation-
eligible drugs described in paragraph (2)(B).
``(B) All long-monopoly negotiation-eligible
drugs.--The Secretary shall select all renegotiation-
eligible drugs described in paragraph (2)(C).
``(C) Remaining drugs.--Among the remaining
renegotiation-eligible drugs described in subparagraphs
(A) and (D) of paragraph (2), the Secretary shall
select renegotiation-eligible drugs for which the
Secretary expects renegotiation is likely to result in
a significant change in the maximum fair price
otherwise negotiated.
``(4) Renegotiation process.--The Secretary shall specify
the process for renegotiation of maximum fair prices with the
manufacturer of a renegotiation-eligible drug selected for
renegotiation under this subsection. Such process shall, to the
extent practicable, be consistent with the methodology and
process established under subsection (b) and in accordance with
subsections (c) and (d), and for purposes of applying
subsections (c) and (d), the reference to the first initial
price applicability year of the price applicability period with
respect to such drug shall be treated as the first initial
price applicability year of such period for which the maximum
fair price established pursuant to such renegotiation applies,
including for applying subsection (c)(2)(B) in the case of
renegotiation-eligible drugs described in paragraph (3)(A) of
this subsection and subsection (c)(2)(C) in the case of
renegotiation-eligible drugs described in paragraph (3)(B) of
this subsection.
``(5) Clarification.--A renegotiation-eligible drug for
which the Secretary makes a determination described in section
1192(c)(1) before or during the period of renegotiation shall
not be subject to the renegotiation process under this section.
``(6) No administrative or judicial review.--The
determination of renegotiation-eligible drugs under paragraph
(2) and the selection of renegotiation-eligible drugs under
paragraph (3) are not subject to administrative or judicial
review.
``(g) Request for Information.--For purposes of negotiating and, as
applicable, renegotiating (including for purposes of determining
whether to renegotiate) the maximum fair price of a selected drug under
this part with the manufacturer of the drug, with respect to a price
applicability period, and other relevant data for purposes of this
section--
``(1) the Secretary shall, not later than the selected drug
publication date with respect to the initial price
applicability year of such period, request drug pricing
information from the manufacturer of such selected drug,
including information described in subsection (e)(1); and
``(2) by not later than March 1 following the selected drug
publication date, the manufacturer of such selected drug shall
submit to the Secretary such requested information in such form
and manner as the Secretary requires.
The Secretary shall request, from the manufacturer or others, all
additional information needed to carry out the negotiation and
renegotiation process under this section.
``(h) Clarification.--In no case shall the maximum fair price
negotiated under this section for a selected drug that is a qualifying
single source drug described in subparagraph (A) or (B) of section
1192(e)(1) apply before--
``(1) in the case the selected drug is a qualifying single
source drug described in such subparagraph (A), the date that
is 9 years after the date on which the drug was approved under
section 505(c) of the Federal Food, Drug, and Cosmetic Act; and
``(2) in the case the selected drug is a qualifying single
source drug described in such subparagraph (B), the date that
is 13 years after the date on which the drug was licensed under
section 351(a) of the Public Health Service Act.
``(i) Implementation for 2025 and 2026.--Notwithstanding any other
provision of this part, the Secretary shall implement this section for
2025 and 2026 by program instruction or otherwise.
``SEC. 1195. PUBLICATION OF MAXIMUM FAIR PRICES.
``(a) In General.--With respect to an initial price applicability
year and a selected drug with respect to such year--
``(1) not later than November 15 of the year that is 2
years prior to such initial price applicability year, the
Secretary shall publish on CMS.gov the maximum fair price for
such drug negotiated under this part with the manufacturer of
such drug;
``(2) not later than November 30 of the year that is 2
years prior to such initial price applicability year, the
Secretary shall publish in the Federal Register the maximum
fair price for such drug described in paragraph (1); and
``(3) not later than March 1 of the year prior to such
initial price applicability year, the Secretary shall publish
in the Federal Register, subject to section 1193(c) and based
on the considerations as described in section 1194(e), the
explanation for the maximum fair price for such drug described
in paragraphs (1) and (2).
``(b) Updates.--
``(1) Subsequent year maximum fair prices.--For a selected
drug, for each year subsequent to first initial price
applicability year of the price applicability period with
respect to such drug, with respect to which an agreement for
such drug is in effect under section 1193, not later than
November 30 of the year that is 2 years prior to such
subsequent year, the Secretary shall publish in the Federal
Register the maximum fair price applicable to such drug and
year, which shall be--
``(A) subject to subparagraph (B), the amount equal
to the maximum fair price published for such drug for
the previous year, increased by the annual percentage
increase in the consumer price index for all urban
consumers (all items; U.S. city average) as of
September of such previous year; or
``(B) in the case the maximum fair price for such
drug was renegotiated, for the first year for which
such price as so renegotiated applies, such
renegotiated maximum fair price.
``(2) Prices negotiated after deadline.--In the case of a
selected drug with respect to an initial price applicability
year for which the maximum fair price is determined under this
part after the date of publication under this section, the
Secretary shall publish such maximum fair price in the Federal
Register by not later than 30 days after the date such maximum
price is so determined.
``SEC. 1196. ADMINISTRATIVE DUTIES; COORDINATION PROVISIONS.
``(a) Administrative Duties.--
``(1) In general.--For purposes of section 1191, the
administrative duties described in this section are the
following:
``(A) The establishment of procedures to ensure
that the maximum fair price for a selected drug is
applied before--
``(i) 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 maximum fair price
eligible individuals; and
``(ii) any other discounts.
``(B) The establishment of procedures to compute
and apply the maximum fair price across different
strengths and dosage forms of a selected drug and not
based on the specific formulation or package size or
package type of the drug.
``(C) The establishment of procedures to carry out
the provisions of this part, as applicable, with
respect to--
``(i) maximum fair price eligible
individuals who are enrolled under a
prescription drug plan under part D of title
XVIII or an MA-PD plan under part C of such
title; and
``(ii) maximum fair price eligible
individuals who are enrolled under part B of
such title, including who are enrolled under an
MA plan under part C of such title.
``(D) The establishment of a negotiation process
and renegotiation process in accordance with section
1194, including a process for acquiring information
described in subsection (e) of such section.
``(E) The establishment of an online portal which
manufacturers shall be required to use to submit
information described in section 1194(b)(2)(A).
``(F) The sharing with the Secretary of the
Treasury of such information as is necessary to
determine the tax imposed by section 4192 of the
Internal Revenue Code of 1986 (relating to enforcement
of this part).
``(G) The establishment of an attestation and
verification process for purposes of applying section
1192(d)(2)(B).
``(2) Monitoring compliance.--The Secretary shall monitor
compliance by a manufacturer with the terms of an agreement
under section 1193, including by establishing a mechanism
through which violations of such terms shall be reported.
``(b) Implementation for 2025 and 2026.--Notwithstanding any other
provision of this part, the Secretary shall implement this section for
2025 and 2026 by program instruction or otherwise.
``SEC. 1197. CIVIL MONETARY PENALTY.
``(a) Violations Relating to Offering of Maximum Fair Price.--Any
manufacturer of a selected drug that has entered into an agreement
under section 1193, with respect to a year during the price
applicability period with respect to such drug, that does not provide
access to a price that is not more than the maximum fair price (or a
lesser price) for such drug for such year--
``(1) to a maximum fair price eligible individual who with
respect to such drug is described in subparagraph (A) of
section 1191(c)(1) and who is dispensed such drug during such
year (and to pharmacies, mail order services, and other
dispensers, with respect to such maximum fair price eligible
individuals who are dispensed such drugs); or
``(2) to a hospital, physician, or other provider of
services or supplier with respect to maximum fair price
eligible individuals who with respect to such drug is described
in subparagraph (B) of such section and is furnished or
administered such drug by such hospital, physician, or provider
or supplier during such year,
shall be subject to a civil monetary penalty equal to ten times the
amount equal to the product of the number of units of such drug so
furnished, dispensed, or administered during such year and the
difference between the price for such drug made available for such year
by such manufacturer with respect to such individual or hospital,
physician, provider of services, or supplier and the maximum fair price
for such drug for such year.
``(b) Violations of Certain Terms of Agreement.--Any manufacturer
of a selected drug that has entered into an agreement under section
1193, with respect to a year during the price applicability period with
respect to such drug, that is in violation of a requirement imposed
pursuant to section 1193(a)(5), including the requirement to submit
information pursuant to section 1193(a)(4), shall be subject to a civil
monetary penalty equal to $1,000,000 for each day of such violation.
``(c) False Information.--Any manufacturer that knowingly provides
false information for the attestation process or verification process
established pursuant to section 1196(a)(1)(H), shall be subject to a
civil monetary penalty equal to $100,000,000 for each item of such
false information.
``(d) Application.--The provisions of section 1128A (other than
subsections (a) and (b)) shall apply to a civil monetary penalty under
this section in the same manner as such provisions apply to a penalty
or proceeding under section 1128A(a).''.
(b) Application of Maximum Fair Prices and Conforming Amendments.--
(1) Under medicare.--
(A) Application to payments under part b.--Section
1847A(b)(1)(B) of the Social Security Act (42 U.S.C.
1395w-3a(b)(1)(B)) is amended by inserting ``or in the
case of such a drug or biological that is a selected
drug (as referred to in section 1192(c)), with respect
to a price applicability period (as defined in section
1191(b)(2)), 106 percent of the maximum fair price (as
defined in section 1191(c)(2)) applicable for such drug
and a year during such period'' after ``paragraph
(4)''.
(B) Application under ma of cost-sharing for part b
drugs based off of negotiated price.--Section
1852(a)(1)(B)(iv) of the Social Security Act (42 U.S.C.
1395w-22(a)(1)(B)(iv)) is amended--
(i) by redesignating subclause (VII) as
subclause (VIII); and
(ii) by inserting after subclause (VI) the
following subclause:
``(VII) A drug or biological that
is a selected drug (as referred to in
section 1192(c)).''.
(C) Exception to part d non-interference.--Section
1860D-11(i) of the Social Security Act (42 U.S.C.
1395w-111(i)) is amended--
(i) in paragraph (1), by striking ``and''
at the end;
(ii) in paragraph (2), by striking ``or
institute a price structure for the
reimbursement of covered part D drugs'' and
inserting ``for covered part D drugs; and'';
and
(iii) by adding at the end the following:
``(3) may not institute a price structure for the
reimbursement of covered part D drugs, except as provided under
part E of title XI.''.
(D) Application as negotiated price under part d.--
Section 1860D-2(d)(1) of the Social Security Act (42
U.S.C. 1395w-102(d)(1)) is amended--
(i) in subparagraph (B), by inserting ``,
subject to subparagraph (D),'' after
``negotiated prices''; and
(ii) by adding at the end the following new
subparagraph:
``(D) Application of maximum fair price for
selected drugs.--In applying this section, in the case
of a covered part D drug that is a selected drug (as
referred to in section 1192(c)), with respect to a
price applicability period (as defined in section
1191(b)(2)), the negotiated prices used for payment (as
described in this subsection) shall be no greater than
the maximum fair price (as defined in section
1191(c)(2)) for such drug and for each year during such
period plus any dispensing fees for such drug.''.
(E) Coverage of selected drugs.--Section 1860D-
4(b)(3) of the Social Security Act (42 U.S.C. 1395w-
104(b)(3)) is amended by adding at the end the
following new subparagraph:
``(I) Required inclusion of selected drugs.--For
2025 and each subsequent year, the PDP sponsor offering
a prescription drug plan shall include each covered
part D drug that is a selected drug under section 1192
for which an agreement for such drug is in effect under
section 1193 with respect to the year.''.
(F) Information from prescription drug plans and
ma-pd plans required.--
(i) Prescription drug plans.--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) Provision of information related to maximum fair
prices.--Each contract entered into with a PDP sponsor under
this part with respect to a prescription drug plan offered by
such sponsor shall require the sponsor to provide information
to the Secretary as requested by the Secretary in accordance
with section 1194(g).''.
(ii) MA-PD plans.--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) Provision of information related to maximum
fair prices.--Section 1860D-12(b)(8).''.
(2) Drug price negotiation program prices included in best
price.--Section 1927(c)(1)(C) of the Social Security Act (42
U.S.C. 1396r-8(c)(1)(C)) is amended--
(A) in clause (i)(VI), by striking ``any prices
charged'' and inserting ``subject to clause (ii)(V),
any prices charged''; and
(B) in clause (ii)--
(i) in subclause (III), by striking at the
end ``; and'';
(ii) in subclause (IV), by striking at the
end the period and inserting ``; and''; and
(iii) by adding at the end the following
new subclause:
``(V) in the case of a rebate
period and a covered outpatient drug
that is a selected drug (as referred to
in section 1192(c)) during such rebate
period, shall be inclusive of the
maximum fair price (as defined in
section 1191(c)(2)) for such drug with
respect to such period.''.
SEC. 102. SELECTED DRUG MANUFACTURER EXCISE TAX IMPOSED DURING
NONCOMPLIANCE PERIODS.
(a) In General.--Chapter 32 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new subchapter:
``Subchapter E--Other Items
``Sec. 4192. Selected drugs during noncompliance periods.
``SEC. 4192. SELECTED DRUGS DURING NONCOMPLIANCE PERIODS.
``(a) In General.--There is hereby imposed on the sale by the
manufacturer, producer, or importer of any selected drug during a day
described in subsection (b) a tax in an amount such that the applicable
percentage is equal to the ratio of--
``(1) such tax, divided by
``(2) the sum of such tax and the price for which so sold.
``(b) Noncompliance Periods.--A day is described in this subsection
with respect to a selected drug if it is a day during one of the
following periods:
``(1) The period beginning on the March 1st immediately
following the selected drug publication date and ending on the
first date during which the manufacturer of the drug has in
place an agreement described in subsection (a) of section 1193
of the Social Security Act with respect to such drug.
``(2) The period beginning on the November 2nd immediately
following the March 1st described in paragraph (1) and ending
on the first date during which the manufacturer of the drug and
the Secretary have agreed to a maximum fair price under such
agreement.
``(3) In the case of a selected drug with respect to which
the Secretary of Health and Human Services has specified a
renegotiation period under such agreement, the period beginning
on the first date after the last date of such renegotiation
period and ending on the first date during which the
manufacturer of the drug has agreed to a renegotiated maximum
fair price under such agreement.
``(4) With respect to information that is required to be
submitted to the Secretary of Health and Human Services under
such agreement, the period beginning on the date on which such
Secretary certifies that such information is overdue and ending
on the date that such information is so submitted.
``(c) Applicable Percentage.--For purposes of this section, the
term `applicable percentage' means--
``(1) in the case of sales of a selected drug during the
first 90 days described in subsection (b) with respect to such
drug, 65 percent,
``(2) in the case of sales of such drug during the 91st day
through the 180th day described in subsection (b) with respect
to such drug, 75 percent,
``(3) in the case of sales of such drug during the 181st
day through the 270th day described in subsection (b) with
respect to such drug, 85 percent, and
``(4) in the case of sales of such drug during any
subsequent day, 95 percent.
``(d) Selected Drug.--For purposes of this section--
``(1) In general.--The term `selected drug' means any
selected drug (within the meaning of section 1192 of the Social
Security Act) which is manufactured or produced in the United
States or entered into the United States for consumption, use,
or warehousing.
``(2) United states.--The term `United States' has the
meaning given such term by section 4612(a)(4).
``(3) Coordination with rules for possessions of the united
states.--Rules similar to the rules of paragraphs (2) and (4)
of section 4132(c) shall apply for purposes of this section.
``(e) Other Definitions.--For purposes of this section, the terms
`selected drug publication date' and `maximum fair price' have the
meaning given such terms in section 1191 of the Social Security Act.
``(f) Anti-Abuse Rule.--In the case of a sale which was timed for
the purpose of avoiding the tax imposed by this section, the Secretary
may treat such sale as occurring during a day described in subsection
(b).''.
(b) No Deduction for Excise Tax Payments.--Section 275(a)(6) of the
Internal Revenue Code of 1986 is amended by inserting ``or by section
4192'' before the period at the end.
(c) Certain Exemptions From Tax Not Applicable.--
(1) Section 4221(a) of the Internal Revenue Code of 1986 is
amended by adding at the end the following: ``In the case of
the tax imposed by section 4192, paragraphs (3), (4), (5), and
(6) shall not apply.''.
(2) Section 6416(b)(2) of such Code is amended by adding at
the end the following: ``In the case of the tax imposed by
section 4192, subparagraphs (B), (C), (D), and (E) shall not
apply.''.
(d) Clerical Amendment.--The table of subchapters for chapter 32 of
such Code is amended by adding at the end the following new item:
``subchapter e. other items''.
(e) Effective Date.--The amendments made by this section shall
apply to sales after the date of the enactment of this Act.
SEC. 103. FUNDING.
In addition to amounts otherwise available, there is appropriated
for fiscal year 2022, out of any money in the Treasury not otherwise
appropriated, to remain available until expended--
(1) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2022;
(2) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2023;
(3) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2024;
(4) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2025;
(5) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2026;
(6) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2027;
(7) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2028;
(8) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2029;
(9) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2030; and
(10) $300,000,000 to carry out the provisions of, including
the amendments made by, this part in fiscal year 2031.
TITLE II--PRESCRIPTION DRUG INFLATION REBATES
SEC. 201. MEDICARE PART B REBATE BY MANUFACTURERS.
(a) In General.--Section 1847A of the Social Security Act (42
U.S.C. 1395w-3a) is amended--
(1) by redesignating subsection (h) as subsection (i) and
by inserting after subsection (g) the following subsection:
``(h) Rebate by Manufacturers for Single Source Drugs and
Biologicals With Prices Increasing Faster Than Inflation.--
``(1) Requirements.--
``(A) Secretarial provision of information.--Not
later than 6 months after the end of each calendar
quarter beginning on or after July 1, 2023, the
Secretary shall, for each part B rebatable drug, report
to each manufacturer of such part B rebatable drug the
following for such calendar quarter:
``(i) Information on the total number of
billing units of the billing and payment code
described in subparagraph (A)(i) of paragraph
(3) with respect to such drug and calendar
quarter.
``(ii) Information on the amount (if any)
of the excess average sales price increase
described in subparagraph (A)(ii) of such
paragraph for such drug and calendar quarter.
``(iii) The rebate amount specified under
such paragraph for such part B rebatable drug
and calendar quarter.
``(B) Manufacturer requirement.--For each calendar
quarter beginning on or after July 1, 2023, the
manufacturer of a part B rebatable drug shall, for such
drug, not later than 30 days after the date of receipt
from the Secretary of the information described in
subparagraph (A) for such calendar quarter, provide to
the Secretary a rebate that is equal to the amount
specified in paragraph (3) for such drug for such
calendar quarter.
``(2) Part b rebatable drug defined.--
``(A) In general.--In this subsection, the term
`part B rebatable drug' means a single source drug or
biological (as defined in subparagraph (D) of
subsection (c)(6)), including a biosimilar biological
product (as defined in subparagraph (H) of such
subsection) but excluding a qualifying biosimilar
biological product (as defined in subsection
(b)(8)(B)(iii)), that would be payable under this part
if such drug were furnished to an individual enrolled
under this part, except such term shall not include
such a drug or biological--
``(i) if, as determined by the Secretary,
the average total allowed charges for such drug
or biological under this part for a year per
individual that uses such a drug or biological
are less than, subject to subparagraph (B),
$100; or
``(ii) that is a vaccine described in
subparagraph (A) or (B) of section 1861(s)(10).
``(B) Increase.--The dollar amount applied under
subparagraph (A)(i)--
``(i) for 2024, shall be the dollar amount
specified under such subparagraph for 2023,
increased by the percentage increase in the
consumer price index for all urban consumers
(United States city average) for the 12-month
period ending with June of the previous year;
and
``(ii) for a subsequent year, shall be the
dollar amount specified in this clause (or
clause (i)) for the previous year (without
application of subparagraph (C)), increased by
the percentage increase in the consumer price
index for all urban consumers (United States
city average) for the 12-month period ending
with June of the previous year.
``(C) Rounding.--Any dollar amount determined under
subparagraph (B) that is not a multiple of $10 shall be
rounded to the nearest multiple of $10.
``(3) Rebate amount.--
``(A) In general.--For purposes of paragraph (1),
the amount specified in this paragraph for a part B
rebatable drug assigned to a billing and payment code
for a calendar quarter is, subject to subparagraphs (B)
and (G) and paragraph (4), the amount equal to the
product of--
``(i) the total number of billing units
determined under subparagraph (B) for the
billing and payment code of such drug; and
``(ii) the amount (if any) by which--
``(I) the amount equal to--
``(aa) in the case of a
part B rebatable drug described
in paragraph (1)(B) of section
1847A(b), 106 percent of the
amount determined under
paragraph (4) of such section
for such drug during the
calendar quarter; or
``(bb) in the case of a
part B rebatable drug described
in paragraph (1)(C) of such
section, the payment amount
under such paragraph for such
drug during the calendar
quarter; exceeds
``(II) the inflation-adjusted
payment amount determined under
subparagraph (C) for such part B
rebatable drug during the calendar
quarter.
``(B) Total number of billing units.--For purposes
of subparagraph (A)(i), the total number of billing
units with respect to a part B rebatable drug is
determined as follows:
``(i) Determine the total number of units
equal to--
``(I) the total number of units, as
reported under subsection (c)(1)(B) for
each National Drug Code of such drug
during the calendar quarter that is two
calendar quarters prior to the calendar
quarter as described in subparagraph
(A), minus
``(II) the total number of units
with respect to each National Drug Code
of such drug for which payment was made
under a State plan under title XIX (or
waiver of such plan), as reported by
States under section 1927(b)(2)(A) for
the rebate period that is the same
calendar quarter as described in
subclause (I).
``(ii) Convert the units determined under
clause (i) to billing units for the billing and
payment code of such drug, using a methodology
similar to the methodology used under this
section, by dividing the units determined under
clause (i) for each National Drug Code of such
drug by the billing unit for the billing and
payment code of such drug.
``(iii) Compute the sum of the billing
units for each National Drug Code of such drug
in clause (ii).
``(C) Determination of inflation-adjusted payment
amount.--The inflation-adjusted payment amount
determined under this subparagraph for a part B
rebatable drug for a calendar quarter is--
``(i) the payment amount for the billing
and payment code for such drug in the payment
amount benchmark quarter (as defined in
subparagraph (D)); increased by
``(ii) the percentage by which the rebate
period CPI-U (as defined in subparagraph (F))
for the calendar quarter exceeds the benchmark
period CPI-U (as defined in subparagraph (E)).
``(D) Payment amount benchmark quarter.--The term
`payment amount benchmark quarter' means the calendar
quarter immediately prior to the calendar quarter
beginning October 1, 2021.
``(E) Benchmark period cpi-u.--The term `benchmark
period CPI-U' means the consumer price index for all
urban consumers (United States city average) for the
last month of the calendar quarter beginning October 1,
2021.
``(F) Rebate period cpi-u.--The term `rebate period
CPI-U' means, with respect to a calendar quarter
described in subparagraph (C), the greater of the
benchmark period CPI-U and the consumer price index for
all urban consumers (United States city average) for
the first month of the calendar quarter that is two
calendar quarters prior to such described calendar
quarter.
``(G) Exemption for shortages and severe supply
chain disruptions.--The Secretary shall reduce or waive
the amount under subparagraph (A) with respect to a
part B rebatable drug that is described as currently in
shortage on the shortage list in effect under section
506E of the Federal Food, Drug, and Cosmetic Act or in
the case of a biosimilar biological product, when the
Secretary determines there are severe supply chain
disruptions.
``(4) Special treatment of certain drugs and exemption.--
``(A) Subsequently approved drugs.--In the case of
a part B rebatable drug first approved or licensed by
the Food and Drug Administration after March 1, 2021,
clause (i) of paragraph (3)(C) shall be applied as if
the term `payment amount benchmark quarter' were
defined under paragraph (3)(D) as the third full
calendar quarter after the day on which the drug was
first marketed and clause (ii) of paragraph (3)(C)
shall be applied as if the term `benchmark period CPI-
U' were defined under paragraph (3)(E) as if the
reference to `the last month of the calendar quarter
immediately prior to the calendar quarter beginning
October 1, 2021' under such paragraph were a reference
to `the first month of the first full calendar quarter
after the day on which the drug was first marketed'.
``(B) Timeline for provision of rebates for
subsequently approved drugs.--In the case of a part B
rebatable drug first approved or licensed by the Food
and Drug Administration after March 1, 2021, paragraph
(1)(B) shall be applied as if the reference to `July 1,
2023' under such paragraph were a reference to the
later of the 6th full calendar quarter after the day on
which the drug was first marketed or July 1, 2023.
``(C) Selected drugs.--In the case of a part B
rebatable drug that is a selected drug (as defined in
section 1192(c)) for a price applicability period (as
defined in section 1191(b)(2)), in the case such drug
is determined (pursuant to such section 1192(c)) to no
longer be a selected drug, beginning the first calendar
quarter after the price applicability period with
respect to such drug, clause (i) of paragraph (3)(C)
shall be applied as if the term `payment amount
benchmark quarter' were defined under paragraph (3)(D)
as the calendar quarter beginning January 1 of the last
year beginning during such price applicability period
with respect to such selected drug and clause (ii) of
paragraph (3)(C) shall be applied as if the term
`benchmark period CPI-U' were defined under paragraph
(3)(E) as if the reference to `the last month of the
calendar quarter immediately prior to the calendar
quarter beginning October 1, 2021' under such paragraph
were a reference to the March of the year preceding
such last year.
``(5) Application to beneficiary coinsurance.--In the case
of a part B rebatable drug, if the payment amount described in
paragraph (3)(A)(ii)(I) (or, in the case of a part B rebatable
drug that is a selected drug (as defined in section 1192(c)),
the payment amount described in subsection (b)(1)(B) for such
drug) for a calendar quarter exceeds the inflation adjusted
payment for such quarter--
``(A) in computing the amount of any coinsurance
applicable under this part to an individual to whom
such drug is furnished, the computation of such
coinsurance shall be equal to 20 percent of the
inflation-adjusted payment amount determined under
paragraph (3)(C) for such part B rebatable drug; and
``(B) the amount of such coinsurance for such
calendar quarter, as computed under subparagraph (A),
shall be applied as a percent, as determined by the
Secretary, to the payment amount that would otherwise
apply under subparagraph (B) or (C) of subsection
(b)(1).
``(6) Rebate deposits.--Amounts paid as rebates under
paragraph (1)(B) shall be deposited into the Federal
Supplementary Medical Insurance Trust Fund established under
section 1841.
``(7) Civil money penalty.--If a manufacturer of a part B
rebatable drug has failed to comply with the requirements under
paragraph (1)(B) for such drug for a calendar quarter, the
manufacturer shall be subject to, in accordance with a process
established by the Secretary pursuant to regulations, a civil
money penalty in an amount equal to at least 125 percent of the
amount specified in paragraph (3) for such drug for such
calendar quarter. The provisions of section 1128A (other than
subsections (a) (with respect to amounts of penalties or
additional assessments) 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).''; and
(2) in subsection (i), as redesignated by paragraph (1)--
(A) in paragraph (4), by striking at the end
``and'';
(B) in paragraph (5), by striking at the end the
period and inserting a semicolon; and
(C) by adding at the end the following new
paragraphs:
``(6) the determination of units under subsection (h);
``(7) the determination of whether a drug is a part B
rebatable drug under subsection (h);
``(8) the calculation of the rebate amount under subsection
(h);
``(9) the computation of coinsurance under subsection
(h)(5); and
``(10) the computation of amounts paid under section
1833(a)(1)(EE).''.
(b) Amounts Payable; Cost-Sharing.--Section 1833 of the Social
Security Act (42 U.S.C. 1395l) is amended--
(1) in subsection (a)(1)--
(A) in subparagraph (G), by inserting ``, subject
to subsection (i)(9),'' after ``the amounts paid'';
(B) in subparagraph (S), by striking ``with respect
to'' and inserting ``subject to subparagraph (EE), with
respect to'';
(C) by striking ``and (DD)'' and inserting
``(DD)''; and
(D) by inserting before the semicolon at the end
the following: ``, and (EE) with respect to a part B
rebatable drug (as defined in paragraph (2) of section
1847A(h)) for which the payment amount for a calendar
quarter under paragraph (3)(A)(ii)(I) of such section
(or, in the case of a part B rebatable drug that is a
selected drug (as defined in section 1192(c)) for
which, the payment amount described in section
1847A(b)(1)(B)) for such drug for such quarter exceeds
the inflation-adjusted payment under paragraph
(3)(A)(ii)(II) of such section for such quarter, the
amounts paid shall be equal to the percent of the
payment amount under paragraph (3)(A)(ii)(I) of such
section or section 1847A(b)(1)(B), as applicable, that
equals the difference between (i) 100 percent, and (ii)
the percent applied under section 1847A(h)(5)(B)'';
(2) in subsection (i), by adding at the end the following
new paragraph:
``(9) In the case of a part B rebatable drug (as defined in
paragraph (2) of section 1847A(h)) for which payment under this
subsection is not packaged into a payment for a service furnished on or
after July 1, 2023, under the revised payment system under this
subsection, in lieu of calculation of coinsurance and the amount of
payment otherwise applicable under this subsection, the provisions of
section 1847A(h)(5) and paragraph (1)(EE) of subsection (a), shall, as
determined appropriate by the Secretary, apply under this subsection in
the same manner as such provisions of section 1847A(h)(5) and
subsection (a) apply under such section and subsection.''; and
(3) in subsection (t)(8), by adding at the end the
following new subparagraph:
``(F) Part b rebatable drugs.--In the case of a
part B rebatable drug (as defined in paragraph (2) of
section 1847A(h), except if such drug does not have a
copayment amount as a result of application of
subparagraph (E)) for which payment under this part is
not packaged into a payment for a covered OPD service
(or group of services) furnished on or after July 1,
2023, and the payment for such drug under this
subsection is the same as the amount for a calendar
quarter under paragraph (3)(A)(ii)(I) of section
1847A(h), under the system under this subsection, in
lieu of calculation of the copayment amount and the
amount of payment otherwise applicable under this
subsection (other than the application of the
limitation described in subparagraph (C)), the
provisions of section 1847A(h)(5) and paragraph (1)(EE)
of subsection (a), shall, as determined appropriate by
the Secretary, apply under this subsection in the same
manner as such provisions of section 1847A(h)(5) and
subsection (a) apply under such section and
subsection.''.
(c) Conforming Amendments.--
(1) To part b asp calculation.--Section 1847A(c)(3) of the
Social Security Act (42 U.S.C. 1395w-3a(c)(3)) is amended by
inserting ``subsection (h) or'' before ``section 1927''.
(2) Excluding part b drug inflation rebate from best
price.--Section 1927(c)(1)(C)(ii)(I) of the Social Security Act
(42 U.S.C. 1396r-8(c)(1)(C)(ii)(I)) is amended by inserting
``or section 1847A(h)'' after ``this section''.
(3) Coordination with medicaid rebate information
disclosure.--Section 1927(b)(3)(D)(i) of the Social Security
Act (42 U.S.C. 1396r-8(b)(3)(D)(i)) is amended by inserting
``and the rebate'' after ``the payment amount''.
(4) Excluding part b drug inflation rebates from average
manufacturer price.--Section 1927(k)(1)(B)(i) of the Social
Security Act (42 U.S.C. 1396r-8(k)(1)(B)(i)), as previously
amended, is further amended--
(A) in subclause (IV), by striking ``and'';
(B) in subclause (V), by striking the period at the
end and inserting a semicolon; and
(C) by adding at the end the following new
subclause:
``(VI) rebates paid by
manufacturers under section 1847A(h);
and''.
(d) Funding.--In addition to amounts otherwise available, there are
appropriated to the Centers for Medicare & Medicaid Services, out of
any money in the Treasury not otherwise appropriated, $12,500,000 for
fiscal year 2022 and $7,500,000 for each of fiscal years 2023 through
2031, to remain available until expended, to carry out the provisions
of, including the amendments made by, this section.
SEC. 202. MEDICARE PART D REBATE BY MANUFACTURERS.
(a) In General.--Part D of title XVIII of the Social Security Act
is amended by inserting after section 1860D-14A (42 U.S.C. 1395w-114a)
the following new section:
``SEC. 1860D-14B. MANUFACTURER REBATE FOR CERTAIN DRUGS WITH PRICES
INCREASING FASTER THAN INFLATION.
``(a) Requirements.--
``(1) Secretarial provision of information.--Not later than
9 months after the end of each applicable year (as defined in
subsection (g)(7)), subject to paragraph (3), the Secretary
shall, for each part D rebatable drug, report to each
manufacturer of such part D rebatable drug the following for
such year:
``(A) The amount (if any) of the excess annual
manufacturer price increase described in subsection
(b)(1)(A)(ii) for each dosage form and strength with
respect to such drug and year.
``(B) The rebate amount specified under subsection
(b) for each dosage form and strength with respect to
such drug and year.
``(2) Manufacturer requirements.--For each applicable year,
the manufacturer of a part D rebatable drug, for each dosage
form and strength with respect to such drug, not later than 30
days after the date of receipt from the Secretary of the
information described in paragraph (1) for such year, shall
provide to the Secretary a rebate that is equal to the amount
specified in subsection (b) for such dosage form and strength
with respect to such drug for such year.
``(3) Transition rule for reporting.--The Secretary may,
for each rebatable covered part D drug, delay the timeframe for
reporting the information and rebate amount described in
subparagraphs (A) and (B) of such paragraph for the applicable
year of 2023 until not later than September 30, 2025.
``(b) Rebate Amount.--
``(1) In general.--
``(A) Calculation.--For purposes of this section,
the amount specified in this subsection for a dosage
form and strength with respect to a part D rebatable
drug and applicable year is, subject to subparagraph
(C), paragraph (5)(B), and paragraph (6), the amount
equal to the product of--
``(i) subject to subparagraph (B) of this
paragraph, the total number of units that are
used to calculate the average manufacturer
price of such dosage form and strength with
respect to such part D rebatable drug, as
reported by the manufacturer of such drug under
section 1927 for each month, with respect to
such year; and
``(ii) the amount (if any) by which--
``(I) the annual manufacturer price
(as determined in paragraph (2)) paid
for such dosage form and strength with
respect to such part D rebatable drug
for the year; exceeds
``(II) the inflation-adjusted
payment amount determined under
paragraph (3) for such dosage form and
strength with respect to such part D
rebatable drug for the year.
``(B) Excluded units.--For purposes of subparagraph
(A)(i), the Secretary shall exclude from the total
number of units for a dosage form and strength with
respect to a part D rebatable drug, with respect to an
applicable year, the following:
``(i) Units of each dosage form and
strength of such part D rebatable drug for
which payment was made under a State plan under
title XIX (or waiver of such plan), as reported
by States under section 1927(b)(2)(A).
``(ii) Units of each dosage form and
strength of such part D rebatable drug for
which a rebate is paid under section 1847A(h).
``(C) Exemption for shortages and severe supply
chain disruptions.--The Secretary shall reduce or waive
the amount under subparagraph (A) with respect to a
part D rebatable drug that is described as currently in
shortage on the shortage list in effect under section
506E of the Federal Food, Drug, and Cosmetic Act or in
the case of a generic drug, when the Secretary
determines there are severe supply chain disruptions.
``(2) Determination of annual manufacturer price.--The
annual manufacturer price determined under this paragraph for a
dosage form and strength, with respect to a part D rebatable
drug and an applicable year, is the sum of the products of--
``(A) the average manufacturer price (as defined in
subsection (g)(6)) of such dosage form and strength, as
calculated for a unit of such drug, with respect to
each of the calendar quarters of such year; and
``(B) the ratio of--
``(i) the total number of units of such
dosage form and strength reported under section
1927 with respect to each such calendar quarter
of such year; to
``(ii) the total number of units of such
dosage form and strength reported under section
1927 with respect to such year, as determined
by the Secretary.
``(3) Determination of inflation-adjusted payment amount.--
The inflation-adjusted payment amount determined under this
paragraph for a dosage form and strength with respect to a part
D rebatable drug for an applicable year, subject to paragraph
(5), is--
``(A) the benchmark year manufacturer price
determined under paragraph (4) for such dosage form and
strength with respect to such drug and year; increased
by
``(B) the percentage by which the applicable year
CPI-U (as defined in subsection (g)(5)) for the year
exceeds the benchmark period CPI-U (as defined in
subsection (g)(4)).
``(4) Determination of benchmark year manufacturer price.--
The benchmark year manufacturer price determined under this
paragraph for a dosage form and strength, with respect to a
part D rebatable drug and an applicable year, is the sum of the
products of--
``(A) the average manufacturer price (as defined in
subsection (g)(6)) of such dosage form and strength, as
calculated for a unit of such drug, with respect to
each of the calendar quarters of the payment amount
benchmark year (as defined in subsection (g)(3)); and
``(B) the ratio of--
``(i) the total number of units reported
under section 1927 of such dosage form and
strength with respect to each such calendar
quarter of such payment amount benchmark year;
to
``(ii) the total number of units reported
under section 1927 of such dosage form and
strength with respect to such payment amount
benchmark year.
``(5) Special treatment of certain drugs and exemption.--
``(A) Subsequently approved drugs.--In the case of
a part D rebatable drug first approved or licensed by
the Food and Drug Administration after October 1, 2021,
subparagraphs (A) and (B) of paragraph (4) shall be
applied as if the term `payment amount benchmark year'
were defined under subsection (g)(3) as the first
calendar year beginning after the day on which the drug
was first marketed by any manufacturer and subparagraph
(B) of paragraph (3) shall be applied as if the term
`benchmark period CPI-U' were defined under subsection
(g)(4) as if the reference to `the month immediately
prior to October 2021' under such subsection were a
reference to `January of the first year beginning after
the date on which the drug was first marketed by any
manufacturer'.
``(B) Treatment of new formulations.--
``(i) In general.--In the case of a part D
rebatable drug that is a line extension of a
part D rebatable drug that is an oral solid
dosage form, the Secretary shall establish a
formula for determining the rebate amount under
paragraph (1) and the inflation adjusted
payment amount under paragraph (3) with respect
to such part D rebatable drug and an applicable
year, consistent with the formula applied under
subsection (c)(2)(C) of section 1927 for
determining a rebate obligation for a rebate
period under such section.
``(ii) Line extension defined.--In this
subparagraph, the term `line extension' means,
with respect to a part D rebatable drug, a new
formulation of the drug, such as an extended
release formulation, but does not include an
abuse-deterrent formulation of the drug (as
determined by the Secretary), regardless of
whether such abuse-deterrent formulation is an
extended release formulation.
``(C) Selected drugs.--In the case of a part D
rebatable drug that is a selected drug (as defined in
section 1192(c)) for a price applicability period (as
defined in section 1191(b)(2)), in the case such drug
is determined (pursuant to such section 1192(c)) to no
longer be a selected drug, for each applicable year
beginning after the price applicability period with
respect to such drug, subparagraphs (A) and (B) of
paragraph (4) shall be applied as if the term `payment
amount benchmark year' were defined under subsection
(g)(3) as the last year beginning during such price
applicability period with respect to such selected drug
and subparagraph (B) of paragraph (3) shall be applied
as if the term `benchmark period CPI-U' were defined
under subsection (g)(4) as if the reference to `the
month immediately prior to October 1, 2021' under such
subsection were a reference to January of the last year
beginning during such price applicability period with
respect to such drug.
``(6) Reconciliation in case of revised amp reports.--The
Secretary shall provide for a method and process under which,
in the case of a manufacturer of a part D rebatable drug that
submits revisions to information submitted under section 1927
by the manufacturer with respect to such drug, the Secretary
determines, pursuant to such revisions, adjustments, if any, to
the calculation of the amount specified in this subsection for
a dosage form and strength with respect to such part D
rebatable drug and an applicable year and reconciles any
overpayments or underpayments in amounts paid as rebates under
this subsection. Any identified underpayment shall be rectified
by the manufacturer not later than 30 days after the date of
receipt from the Secretary of information on such underpayment.
``(c) Rebate Deposits.--Amounts paid as rebates under subsection
(b) shall be deposited into the Medicare Prescription Drug Account in
the Federal Supplementary Medical Insurance Trust Fund established
under section 1841.
``(d) Information.--For purposes of carrying out this section, the
Secretary shall use information submitted by manufacturers under
section 1927(b)(3) and information submitted by States under section
1927(b)(2)(A).
``(e) Civil Money Penalty.--If a manufacturer of a part D rebatable
drug has failed to comply with the requirement under subsection (a)(2)
with respect to such drug for an applicable year, the manufacturer
shall be subject to, in accordance with a process established by the
Secretary pursuant to regulations, a civil money penalty in an amount
equal to 125 percent of the amount specified in subsection (b) for such
drug for such year. The provisions of section 1128A (other than
subsections (a) (with respect to amounts of penalties or additional
assessments) and (b)) shall apply to a civil money penalty under this
subsection in the same manner as such provisions apply to a penalty or
proceeding under section 1128A(a).
``(f) No Administrative or Judicial Review.--There shall be no
administrative or judicial review of the following:
``(1) The determination of units under this section.
``(2) The determination of whether a drug is a part D
rebatable drug under this section.
``(3) The calculation of the rebate amount under this
section.
``(g) Definitions.--In this section:
``(1) Part d rebatable drug.--
``(A) In general.--The term `part D rebatable drug'
means a drug or biological that would (without
application of this section) be a covered part D drug,
except such term shall, with respect to an applicable
year, not include such a drug or biological if the
average annual total cost under this part for such year
per individual who uses such a drug or biological, as
determined by the Secretary, is less than, subject to
subparagraph (B), $100, as determined by the Secretary
using the most recent data available or, if data is not
available, as estimated by the Secretary.
``(B) Increase.--The dollar amount applied under
subparagraph (A)--
``(i) for 2024, shall be the dollar amount
specified under such subparagraph for 2023,
increased by the percentage increase in the
consumer price index for all urban consumers
(United States city average) for the 12-month
period beginning with January of 2023; and
``(ii) for a subsequent year, shall be the
dollar amount specified in this subparagraph
for the previous year, increased by the
percentage increase in the consumer price index
for all urban consumers (United States city
average) for the 12-month period beginning with
January of the previous year.
Any dollar amount specified under this subparagraph
that is not a multiple of $10 shall be rounded to the
nearest multiple of $10.
``(2) Unit.--The term `unit' means, with respect to a part
D rebatable drug, the lowest dispensable amount (such as a
capsule or tablet, milligram of molecules, or grams) of the
part D rebatable drug, as reported under section 1927.
``(3) Payment amount benchmark year.--The term `payment
amount benchmark year' means the year ending in the month
immediately prior to October 1, 2021.
``(4) Benchmark period cpi-u.--The term `benchmark period
CPI-U' means the consumer price index for all urban consumers
(United States city average) for the month immediately prior to
October 2021.
``(5) Applicable year cpi-u.--The term `applicable year
CPI-U' means, with respect to an applicable year, the consumer
price index for all urban consumers (United States city
average) for January of such year.
``(6) Average manufacturer price.--The term `average
manufacturer price' has the meaning, with respect to a part D
rebatable drug of a manufacturer, given such term in section
1927(k)(1), with respect to a covered outpatient drug of a
manufacturer for a rebate period under section 1927.
``(7) Applicable year.--The term `applicable year' means a
calendar year beginning with 2023.
``(h) Implementation for 2023 and 2024.--Notwithstanding any other
provision of this section, the Secretary shall implement this section
for 2023 and 2024 by program instruction or otherwise.''.
(b) Conforming Amendments.--
(1) To part b asp calculation.--Section 1847A(c)(3) of the
Social Security Act (42 U.S.C. 1395w-3a(c)(3)), as amended by
section 201(c)(1), is further amended by striking ``subsection
(h) or section 1927'' and inserting ``subsection (h), section
1927, or section 1860D-14B''.
(2) Excluding part d drug inflation rebate from best
price.--Section 1927(c)(1)(C)(ii)(I) of the Social Security Act
(42 U.S.C. 1396r-8(c)(1)(C)(ii)(I)), as amended by section
201(c)(2), is further amended by striking ``or section
1847A(h)'' and inserting ``, section 1847A(h), or section
1860D-14B''.
(3) Coordination with medicaid rebate information
disclosure.--Section 1927(b)(3)(D)(i) of the Social Security
Act (42 U.S.C. 1396r-8(b)(3)(D)(i)), as amended by section
201(c)(3), is further amended by striking ``or to carry out
section 1847B'' and inserting ``or to carry out section 1847B
or section 1860D-14B''.
(4) Excluding part d drug inflation rebates from average
manufacturer price.--Section 1927(k)(1)(B)(i) of the Social
Security Act (42 U.S.C. 1396r-8(k)(1)(B)(i)), as previously
amended, is further amended by adding at the end the following
new subclause:
``(VII) rebates paid by
manufacturers under section 1860D-
14B.''.
(c) Funding.--In addition to amounts otherwise available, there are
appropriated to the Centers for Medicare & Medicaid Services, out of
any money in the Treasury not otherwise appropriated, $12,500,000 for
fiscal year 2022 and $7,500,000 for each of fiscal years 2023 through
2031, to remain available until expended, to carry out the provisions
of, including the amendments made by, this section.
TITLE III--PART D IMPROVEMENTS AND MAXIMUM OUT-OF-POCKET CAP FOR
MEDICARE BENEFICIARIES
SEC. 301. 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), in the matter preceding
clause (i), by inserting ``for a year preceding 2024
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 2024 and
each subsequent year'' after ``paragraph (3)'';
(B) in subparagraph (C)--
(i) in clause (i), in the matter preceding
subclause (I), by inserting ``for a year
preceding 2024,'' after ``paragraph (4),''; and
(ii) in clause (ii)(III), by striking ``and
each subsequent year'' and inserting ``through
2023''; and
(C) in subparagraph (D)--
(i) in clause (i)--
(I) in the matter preceding
subclause (I), by inserting ``for a
year preceding 2024,'' after
``paragraph (4),''; and
(II) in subclause (I)(bb), by
striking ``a year after 2018'' and
inserting ``each of years 2019 through
2023''; and
(ii) in clause (ii)(V), by striking ``2019
and each subsequent year'' and inserting ``each
of years 2019 through 2023'';
(2) in paragraph (3)(A)--
(A) in the matter preceding clause (i), by
inserting ``for a year preceding 2024,'' after ``and
(4),''; and
(B) in clause (ii), by striking ``for a subsequent
year'' and inserting ``for each of years 2007 through
2023''; 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 moving the margin of
each such redesignated item 2 ems to
the right;
(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 2024,
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 2024 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 2023 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 each of years 2021
through 2023''; 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 2024, is equal to
$2,000; 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
2024, for amounts''; and
(D) in subparagraph (E), by striking ``In
applying'' and inserting ``For each of years 2011
through 2023, in applying''.
(b) Reinsurance Payment Amount.--Section 1860D-15(b) of the Social
Security Act (42 U.S.C. 1395w-115(b)) is amended--
(1) in paragraph (1)--
(A) by striking ``equal to 80 percent'' and
inserting ``equal to--
``(A) for a year preceding 2024, 80 percent'';
(B) in subparagraph (A), as added by subparagraph
(A), by striking the period at the end and inserting
``; and''; and
(C) by adding at the end the following new
subparagraph:
``(B) for 2024 and each subsequent year, the sum
of--
``(i) an amount equal to 20 percent of such
allowable reinsurance costs attributable to
that portion of gross 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-14C(g)(2)); and
``(ii) an amount equal to 40 percent of
such allowable reinsurance costs attributable
to that portion of gross 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).'';
(2) 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-14C(g)(6)) of an
applicable drug (as defined in section 1860D-14C(g)(2))
that was paid by a manufacturer under the manufacturer
discount program under section 1860D-14C.''; and
(3) 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,
with respect to 2024 and subsequent years, in the case
of an applicable drug, as defined in section 1860D-
14C(g)(2), by a manufacturer)'' after ``by the
individual or under the plan''.
(c) Reduced Cost-Sharing; Beneficiary Premium Percentage.--
(1) Cost-sharing.--
(A) In general.--Section 1860D-2(b)(2)(A) of the
Social Security Act (42 U.S.C. 1395w-102(b)(2)(A)) is
amended--
(i) in the subparagraph header, by striking
``25 percent coinsurance'' and inserting
``Coinsurance'';
(ii) in clause (i), by inserting ``(or, for
2024 and each subsequent year, 23 percent)''
after ``25 percent''; and
(iii) in clause (ii), by inserting ``(or,
for 2024 and each subsequent year, 23
percent)'' after ``25 percent''.
(B) Conforming amendment.--Section 1860D-
14(a)(2)(D) of the Social Security Act (42 U.S.C.
1395w-114(a)(2)(D)) is amended by inserting ``(or, for
2024 and each subsequent year, instead of coinsurance
of `23 percent')'' after ``instead of coinsurance of
`25 percent'''.
(2) Beneficiary premium percentage.--
(A) In general.--Section 1860D-13(a)(3)(A) of the
Social Security Act (42 U.S.C. 1395w-113(a)(3)(A)) is
amended by inserting ``(or, for 2024 and each
subsequent year, 23.5 percent)'' after ``25.5
percent''.
(B) Conforming amendments.--
(i) Section 1860D-11(g)(6) of the Social
Security Act (42 U.S.C. 1395w-111(g)(6)) is
amended by inserting ``(or, for 2024 and each
subsequent year, 23.5 percent)'' after ``25.5
percent''.
(ii) Section 1860D-13(a)(7)(B)(i) of the
Social Security Act (42 U.S.C. 1395w-
113(a)(7)(B)(i)) is amended--
(I) in subclause (I), by inserting
``(or, for 2024 and each subsequent
year, 23.5 percent)'' after ``25.5
percent''; and
(II) in subclause (II), by
inserting ``(or, for 2024 and each
subsequent year, 23.5 percent)'' after
``25.5 percent''.
(iii) Section 1860D-15(a) of the Social
Security Act (42 U.S.C. 1395w-115(a)) is
amended by inserting ``(or, for 2024 and each
subsequent year, 76.5 percent)'' after ``74.5
percent''.
(d) Manufacturer Discount Program.--
(1) In general.--Part D of title XVIII of the Social
Security Act (42 U.S.C. 1395w-101 through 42 U.S.C. 1395w-153),
as amended by section 202, is further amended by inserting
after section 1860D-14B the following new sections:
``SEC. 1860D-14C. 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,
2023, 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, in
accordance with this section, discounted prices for
applicable drugs of the manufacturer that are dispensed
to applicable beneficiaries on or after January 1,
2024.
``(B) Clarification.--Nothing in this section shall
be construed as affecting--
``(i) the application of a coinsurance of
23 percent of the negotiated price, as applied
under paragraph (2)(A) of section 1860D-2(b),
for costs described in such paragraph; or
``(ii) the application of the copayment
amount described in paragraph (4)(A) of such
section, with respect to costs described in
such paragraph.
``(C) Timing of agreement.--
``(i) Special rule for 2024.--In order for
an agreement with a manufacturer to be in
effect under this section with respect to the
period beginning on January 1, 2024, and ending
on December 31, 2024, the manufacturer shall
enter into such agreement not later than 30
days after the date of the establishment of a
model agreement under subsection (a).
``(ii) 2025 and subsequent years.--In order
for an agreement with a manufacturer to be in
effect under this section with respect to plan
year 2025 or a subsequent plan year, the
manufacturer shall enter into such agreement
not later than a calendar quarter or semi-
annual deadline established by the Secretary.
``(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
shall 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 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 31 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 31 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.
``(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 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;
``(C) 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 specified by the Secretary; and
``(D) 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 1 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) Implementation.--The Secretary shall implement the
program under this section for 2024 and 2025 by program
instruction or otherwise.
``(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.--A manufacturer that fails to
provide discounted prices for applicable drugs of the
manufacturer dispensed to applicable beneficiaries in
accordance with such agreement shall be subject to a
civil money penalty for each such failure in an amount
the Secretary determines is equal to 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 an applicable drug
(including a generic drug or a 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, as determined in
accordance with section 1860D-2(b)(4)(C) as if clause
(iii) of such section included a reference to costs
reimbursed through insurance, a group health plan, or
certain other third-party payment arrangements, for
covered part D drugs in the year that exceed--
``(i) in the case of an individual not
described in clause (ii) or (iii), the annual
deductible for such year, as specified in
section 1860D-2(b)(1);
``(ii) in the case of a subsidy eligible
individual described in section 1860D-14(a)(1),
the annual deductible for such year, as
specified in subparagraph (B) of such section;
and
``(iii) in the case of a subsidy eligible
individual described in section 1860D-14(a)(2),
the annual deductible for such year, as
specified in subparagraph (B) of such section.
``(2) Applicable drug.--The term `applicable drug', with
respect to an applicable beneficiary--
``(A) means a covered part D drug--
``(i) 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; and
``(ii)(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; and
``(B) does not include a selected drug (as referred
to under section 1192(c)) during a price applicability
period (as defined in section 1191(b)(2)) with respect
to such drug.
``(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, subject to subparagraphs (B) and (C), with
respect to an applicable drug of a manufacturer
dispensed during a year to an applicable beneficiary--
``(i) who has not incurred costs, as
determined in accordance with section 1860D-
2(b)(4)(C), for covered part D drugs in the
year that are equal to or exceed the annual
out-of-pocket threshold specified in section
1860D-2(b)(4)(B)(i) for the year, 90 percent of
the negotiated price of such drug; and
``(ii) who has incurred such costs, as so
determined, in the year that are equal to or
exceed such threshold for the year, 80 percent
of the negotiated price of such drug.
``(B) Phase-in for certain drugs dispensed to lis
beneficiaries.--
``(i) In general.--In the case of an
applicable drug of a specified manufacturer (as
defined in clause (ii)) that is marketed as of
the date of enactment of this subparagraph and
dispensed for an applicable beneficiary who is
a subsidy eligible individual (as defined in
section 1860D-14(a)(3)), the term `discounted
price' means the specified LIS percent (as
defined in clause (iii)) of the negotiated
price of the applicable drug of the
manufacturer.
``(ii) Specified manufacturer.--
``(I) In general.--In this
subparagraph, subject to subclause
(II), the term `specified manufacturer'
means a manufacturer of an applicable
drug for which, in 2021--
``(aa) the manufacturer had
a coverage gap discount
agreement under section 1860D-
14A;
``(bb) the total
expenditures for all of the
specified drugs of the
manufacturer covered by such
agreement or agreements for
such year and covered under
this part during such year
represented less than 1.0
percent of the total
expenditures under this part
for all covered Part D drugs
during such year; and
``(cc) the total
expenditures for all of the
specified drugs of the
manufacturer that are single
source drugs and biological
products covered under part B
during such year represented
less than 1.0 percent of the
total expenditures under part B
for all drugs or biological
products covered under such
part during such year.
``(II) Specified drugs.--
``(aa) In general.--For
purposes of this clause, the
term `specified drug' means,
with respect to a specified
manufacturer, for 2021, an
applicable drug that is
produced, prepared, propagated,
compounded, converted, or
processed by the manufacturer.
``(bb) Aggregation rule.--
All persons treated as a single
employer under subsection (a)
or (b) of section 52 of the
Internal Revenue Code of 1986
shall be treated as one
manufacturer for purposes of
this subparagraph. For purposes
of making a determination
pursuant to the previous
sentence, an agreement under
this section shall require that
a manufacturer provide and
attest to such information as
specified by the Secretary as
necessary.
``(III) Limitation.--The term
`specified manufacturer' shall not
include a manufacturer described in
subclause (I) if such manufacturer is
acquired after 2021 by another
manufacturer that is not a specified
manufacturer, effective at the
beginning of the plan year immediately
following such acquisition or, in the
case of an acquisition before 2024,
effective January 1, 2024.
``(iii) Specified lis percent.--In this
subparagraph, the `specified LIS percent'
means, with respect to a year--
``(I) for an applicable drug
dispensed for an applicable beneficiary
described in clause (i) who has not
incurred costs, as determined in
accordance with section 1860D-
2(b)(4)(C), for covered part D drugs in
the year that are equal to or exceed
the annual out-of-pocket threshold
specified in section 1860D-
2(b)(4)(B)(i) for the year--
``(aa) for 2024, 99
percent;
``(bb) for 2025, 98
percent;
``(cc) for 2026, 95
percent;
``(dd) for 2027, 92
percent; and
``(ee) for 2028 and each
subsequent year, 90 percent;
and
``(II) for an applicable drug
dispensed for an applicable beneficiary
described in clause (i) who has
incurred costs, as determined in
accordance with section 1860D-
2(b)(4)(C), for covered part D drugs in
the year that are equal to or exceed
the annual out-of-pocket threshold
specified in section 1860D-
2(b)(4)(B)(i) for the year--
``(aa) for 2024, 99
percent;
``(bb) for 2025, 98
percent;
``(cc) for 2026, 95
percent;
``(dd) for 2027, 92
percent;
``(ee) for 2028, 90
percent;
``(ff) for 2029, 85
percent; and
``(gg) for 2030 and each
subsequent year, 80 percent.
``(C) Phase-in for specified small manufacturers.--
``(i) In general.--In the case of an
applicable drug of a specified small
manufacturer (as defined in clause (ii)) that
is marketed as of the date of enactment of this
subparagraph and dispensed for an applicable
beneficiary, the term `discounted price' means
the specified small manufacturer percent (as
defined in clause (iii)) of the negotiated
price of the applicable drug of the
manufacturer.
``(ii) Specified small manufacturer.--
``(I) In general.--In this
subparagraph, subject to subclause
(III), the term `specified small
manufacturer' means a manufacturer of
an applicable drug for which, in 2021--
``(aa) the manufacturer is
a specified manufacturer (as
defined in subparagraph
(B)(ii)); and
``(bb) the total
expenditures under part D for
any one of the specified small
manufacturer drugs of the
manufacturer that are covered
by the agreement or agreements
under section 1860D-14A of such
manufacturer for such year and
covered under this part during
such year are equal to or more
than 80 percent of the total
expenditures under this part
for all specified small
manufacturer drugs of the
manufacturer that are covered
by such agreement or agreements
for such year and covered under
this part during such year.
``(II) Specified small manufacturer
drugs.--
``(aa) In general.--For
purposes of this clause, the
term `specified small
manufacturer drugs' means, with
respect to a specified small
manufacturer, for 2021, an
applicable drug that is
produced, prepared, propagated,
compounded, converted, or
processed by the manufacturer.
``(bb) Aggregation rule.--
All persons treated as a single
employer under subsection (a)
or (b) of section 52 of the
Internal Revenue Code of 1986
shall be treated as one
manufacturer for purposes of
this subparagraph. For purposes
of making a determination
pursuant to the previous
sentence, an agreement under
this section shall require that
a manufacturer provide and
attest to such information as
specified by the Secretary as
necessary.
``(III) Limitation.--The term
`specified small manufacturer' shall
not include a manufacturer described in
subclause (I) if such manufacturer is
acquired after 2021 by another
manufacturer that is not a specified
small manufacturer, effective at the
beginning of the plan year immediately
following such acquisition or, in the
case of an acquisition before 2024,
effective January 1, 2024.
``(iii) Specified small manufacturer
percent.--In this subparagraph, the term
`specified small manufacturer percent' means,
with respect to a year--
``(I) for an applicable drug
dispensed for an applicable beneficiary
who has not incurred costs, as
determined in accordance with section
1860D-2(b)(4)(C), for covered part D
drugs in the year that are equal to or
exceed the annual out-of-pocket
threshold specified in section 1860D-
2(b)(4)(B)(i) for the year--
``(aa) for 2024, 99
percent;
``(bb) for 2025, 98
percent;
``(cc) for 2026, 95
percent;
``(dd) for 2027, 92
percent; and
``(ee) for 2028 and each
subsequent year, 90 percent;
and
``(II) for an applicable drug
dispensed for an applicable beneficiary
who has incurred costs, as determined
in accordance with section 1860D-
2(b)(4)(C), for covered part D drugs in
the year that are equal to or exceed
the annual out-of-pocket threshold
specified in section 1860D-
2(b)(4)(B)(i) for the year--
``(aa) for 2024, 99
percent;
``(bb) for 2025, 98
percent;
``(cc) for 2026, 95
percent;
``(dd) for 2027, 92
percent;
``(ee) for 2028, 90
percent;
``(ff) for 2029, 85
percent; and
``(gg) for 2030 and each
subsequent year, 80 percent.
``(D) Total expenditures.--For purposes of this
paragraph, the term `total expenditures' includes, in
the case of expenditures with respect to part D,
ingredient costs, dispensing fees, sales tax, and, if
applicable, vaccine administration fees. The term
`total expenditures' excludes, in the case of
expenditures with respect to part B, expenditures for a
drug or biological that are bundled or packaged into
the payment for another service.
``(E) Special case for certain claims.--
``(i) 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 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 above
such annual deductible.
``(ii) Claims spanning out-of-pocket
threshold.--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 entirely
below or entirely above the annual out-of-
pocket threshold specified in section 1860D-
2(b)(4)(B)(i) for the year, the manufacturer of
the applicable drug shall provide the
discounted price--
``(I) in accordance with
subparagraph (A)(i) on the portion of
the negotiated price of the applicable
drug that falls below such threshold;
and
``(II) in accordance with
subparagraph (A)(ii) on the portion of
such price of such drug that falls at
or above such threshold.
``(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 423.100 of title 42,
Code of Federal Regulations (or any successor regulation) and,
with respect to an applicable drug, such negotiated price shall
include any dispensing fee and, if applicable, any vaccine
administration fee for the applicable drug.
``(7) Qualified retiree prescription drug plan.--The term
`qualified retiree prescription drug plan' has the meaning
given such term in section 1860D-22(a)(2).
``SEC. 1860D-14D. SELECTED DRUG SUBSIDY PROGRAM.
``With respect to covered part D drugs that would be applicable
drugs (as defined in section 1860D-14C(g)(2)) but for the application
of subparagraph (B) of such section, the Secretary shall provide a
process whereby, in the case of an applicable beneficiary (as defined
in section 1860D-14C(g)(1)) who, with respect to a year, is enrolled in
a prescription drug plan or is enrolled in an MA-PD plan, has not
incurred costs that are equal to or exceed the annual out-of-pocket
threshold specified in section 1860D-2(b)(4)(B)(i), and is dispensed
such a drug the Secretary (periodically and on a timely basis) provides
the PDP sponsor or the MA organization offering the plan, a subsidy
with respect to such drug that is equal to 10 percent of the negotiated
price (as defined in section 1860D-14C(g)(6)) of such drug.''.
(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.--
``(1) In general.--The program shall not apply with respect
to applicable drugs dispensed on or after January 1, 2024, 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 on and
after January 1, 2024, 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 2024 and each subsequent
year, the manufacturer discounts
provided under section 1860D-14C
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 inserted by clause
(i) of this subparagraph, by adding ``and'' at
the end; and
(iii) by adding at the end the following:
``(ii) for 2024 and each subsequent year,
the manufacturer discounts provided under
section 1860D-14C;''.
(e) 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 2024, 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
2024 or the annual out-of-pocket threshold
specified in subsection (b)(4)(B) for the year
for 2024 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
2024, 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 2024, 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 2024, 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 2024, the elimination''; and
(B) in paragraph (2)--
(i) in subparagraph (C), by striking ``The
continuation'' and inserting ``For a year
preceding 2024, the continuation''; and
(ii) in subparagraph (E), 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 2024, 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 2024 and each subsequent year,
any discount provided pursuant to section
1860D-14C.''.
(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 2024'' after
``1860D-2(b)(3)''; and
(B) by inserting ``for such year'' before the
period.
(7) Section 1860D-43 of the Social Security Act (42 U.S.C.
1395w-153) is amended--
(A) in subsection (a)--
(i) by striking paragraph (1) and inserting
the following:
``(1) participate in--
``(A) for 2011 through 2023, the Medicare coverage
gap discount program under section 1860D-14A; and
``(B) for 2024 and each subsequent year, the
manufacturer discount program under section 1860D-
14C;'';
(ii) by striking paragraph (2) and
inserting the following:
``(2) have entered into and have in effect--
``(A) for 2011 through 2023, an agreement described
in subsection (b) of section 1860D-14A with the
Secretary; and
``(B) for 2024 and each subsequent year, an
agreement described in subsection (b) of section 1860D-
14C with the Secretary; and''; and
(iii) by striking paragraph (3) and
inserting the following:
``(3) have entered into and have in effect, under terms and
conditions specified by the Secretary--
``(A) for 2011 through 2023, a contract with a
third party that the Secretary has entered into a
contract with under subsection (d)(3) of section 1860D-
14A; and
``(B) for 2024 and each subsequent year, a contract
with a third party that the Secretary has entered into
a contract with under subsection (d)(3) of section
1860D-14C.''; and
(B) by striking subsection (b) and inserting the
following:
``(b) Effective Date.--Paragraphs (1)(A), (2)(A), and (3)(A) of
subsection (a) shall apply to covered part D drugs dispensed under this
part on or after January 1, 2011, and before January 1, 2024, and
paragraphs (1)(B), (2)(B), and (3)(B) of such subsection shall apply to
covered part D drugs dispensed under this part on or after January 1,
2024.''.
(8) Section 1927 of the Social Security Act (42 U.S.C.
1396r-8) is amended--
(A) in subsection (c)(1)(C)(i)(VI), by inserting
before the period at the end the following: ``or under
the manufacturer discount program under section 1860D-
14C''; and
(B) in subsection (k)(1)(B)(i)(V), by inserting
before the period at the end the following: ``or under
section 1860D-14C''.
(f) Implementation for 2024 and 2025.--Notwithstanding any other
provision of this section, the Secretary shall implement this section,
including the amendments made by this section, for 2024 and 2025 by
program instruction or otherwise.
(g) Funding.--In addition to amounts otherwise available, there are
appropriated to the Centers for Medicare & Medicaid Services, out of
any money in the Treasury not otherwise appropriated, $44,000,000 for
fiscal year 2022, $38,000,000 for fiscal year 2023, and $32,000,000 for
each of fiscal years 2024 through 2031, to remain available until
expended, to carry out the provisions of, including the amendments made
by, this section.
SEC. 302. MAXIMUM MONTHLY CAP ON COST-SHARING PAYMENTS UNDER
PRESCRIPTION DRUG PLANS AND MA-PD PLANS.
(a) In General.--Section 1860D-2(b) of the Social Security Act (42
U.S.C. 1395w-102(b)), as amended by section 301, is amended--
(1) in paragraph (2)--
(A) in subparagraph (A), by striking ``and (D)''
and inserting ``, (D), and (E)''; and
(B) by adding at the end the following new
subparagraph:
``(E) Maximum monthly cap on cost-sharing
payments.--
``(i) In general.--For plan years beginning
on or after January 1, 2025, each PDP sponsor
offering a prescription drug plan and each MA
organization offering an MA-PD plan shall
provide to any enrollee of such plan, including
an enrollee who is a subsidy eligible
individual (as defined in paragraph (3) of
section 1860D-14(a)), the option to elect with
respect to a plan year to pay cost-sharing
under the plan in monthly amounts that are
capped in accordance with this subparagraph.
``(ii) Determination of maximum monthly
cap.--For each month in the plan year for which
an enrollee in a prescription drug plan or an
MA-PD plan has made an election pursuant to
clause (i), the PDP sponsor or MA organization
shall determine a maximum monthly cap (as
defined in clause (iv)) for such enrollee.
``(iii) Beneficiary monthly payments.--With
respect to an enrollee who has made an election
pursuant to clause (i), for each month
described in clause (ii), the PDP sponsor or MA
organization shall bill such enrollee an amount
(not to exceed the maximum monthly cap) for the
out-of-pocket costs of such enrollee in such
month.
``(iv) Maximum monthly cap defined.--In
this subparagraph, the term `maximum monthly
cap' means, with respect to an enrollee--
``(I) for the first month for which
the enrollee has made an election
pursuant to clause (i), an amount
determined by calculating--
``(aa) the annual out-of-
pocket threshold specified in
paragraph (4)(B) minus the
incurred costs of the enrollee
as described in paragraph
(4)(C); divided by
``(bb) the number of months
remaining in the plan year; and
``(II) for a subsequent month, an
amount determined by calculating--
``(aa) the sum of any
remaining out-of-pocket costs
owed by the enrollee from a
previous month that have not
yet been billed to the enrollee
and any additional out-of-
pocket costs incurred by the
enrollee; divided by
``(bb) the number of months
remaining in the plan year.
``(v) Additional requirements.--The
following requirements shall apply with respect
to the option to make an election pursuant to
clause (i) under this subparagraph:
``(I) Secretarial
responsibilities.--The Secretary shall
provide information to part D eligible
individuals on the option to make such
election through educational materials,
including through the notices provided
under section 1804(a).
``(II) Timing of election.--An
enrollee in a prescription drug plan or
an MA-PD plan may make such an
election--
``(aa) prior to the
beginning of the plan year; or
``(bb) in any month during
the plan year.
``(III) PDP sponsor and ma
organization responsibilities.--Each
PDP sponsor offering a prescription
drug plan or MA organization offering
an MA-PD plan--
``(aa) may not limit the
option for an enrollee to make
such an election to certain
covered part D drugs;
``(bb) shall, prior to the
plan year, notify prospective
enrollees of the option to make
such an election in promotional
materials;
``(cc) shall include
information on such option in
enrollee educational materials;
``(dd) shall have in place
a mechanism to notify a
pharmacy during the plan year
when an enrollee incurs out-of-
pocket costs with respect to
covered part D drugs that make
it likely the enrollee may
benefit from making such an
election;
``(ee) shall provide that a
pharmacy, after receiving a
notification described in item
(dd) with respect to an
enrollee, informs the enrollee
of such notification;
``(ff) shall ensure that
such an election by an enrollee
has no effect on the amount
paid to pharmacies (or the
timing of such payments) with
respect to covered part D drugs
dispensed to the enrollee; and
``(gg) shall have in place
a financial reconciliation
process to correct inaccuracies
in payments made by an enrollee
under this subparagraph with
respect to covered part D drugs
during the plan year.
``(IV) Failure to pay amount
billed.--If an enrollee fails to pay
the amount billed for a month as
required under this subparagraph, the
election of the enrollee pursuant to
clause (i) shall be terminated and the
enrollee shall pay the cost-sharing
otherwise applicable for any covered
part D drugs subsequently dispensed to
the enrollee up to the annual out-of-
pocket threshold specified in paragraph
(4)(B).
``(V) Clarification regarding past
due amounts.--Nothing in this
subparagraph shall be construed as
prohibiting a PDP sponsor or an MA
organization from billing an enrollee
for an amount owed under this
subparagraph.
``(VI) Treatment of unsettled
balances.--Any unsettled balances with
respect to amounts owed under this
subparagraph shall be treated as plan
losses and the Secretary shall not be
liable for any such balances outside of
those assumed as losses estimated in
plan bids.''; and
(2) in paragraph (4)--
(A) in subparagraph (C), by striking ``in
subparagraph (E)'' and inserting ``in subparagraph (E)
and subject to subparagraph (F)''; and
(B) by adding at the end the following new
subparagraph:
``(F) Inclusion of costs paid under maximum monthly
cap option.--In applying subparagraph (A), with respect
to an enrollee who has made an election pursuant to
clause (i) of paragraph (2)(E), costs shall be treated
as incurred if such costs are paid by a PDP sponsor or
an MA organization under the option provided under such
paragraph.''.
(b) Application to 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 maximum monthly cap on cost-sharing.--For plan
years beginning on or after January 1, 2025, the maximum
monthly cap on cost-sharing payments under the option provided
under subsection (b)(2)(E) shall apply to such coverage.''.
(c) Implementation for 2025.--The Secretary shall implement this
section, including the amendments made by this section, for 2025 by
program instruction or otherwise.
(d) Funding.--In addition to amounts otherwise available, there are
appropriated to the Centers for Medicare & Medicaid Services, out of
any money in the Treasury not otherwise appropriated, $1,000,000 for
each of fiscal years 2022 through 2031, to remain available until
expended, to carry out the provisions of, including the amendments made
by, this section.
TITLE IV--REPEAL OF CERTAIN PRESCRIPTION DRUG REBATE RULE
SEC. 401. PROHIBITING IMPLEMENTATION OF RULE RELATING TO ELIMINATING
THE ANTI-KICKBACK STATUTE SAFE HARBOR PROTECTION FOR
PRESCRIPTION DRUG REBATES.
Beginning January 1, 2026, the Secretary of Health and Human
Services shall not implement, administer, or enforce the provisions of
the final rule published by the Office of the Inspector General of the
Department of Health and Human Services on November 30, 2020, and
titled ``Fraud and Abuse; Removal of Safe Harbor Protection for Rebates
Involving Prescription Pharmaceuticals and Creation of New Safe Harbor
Protection for Certain Point-of-Sale Reductions in Price on
Prescription Pharmaceuticals and Certain Pharmacy Benefit Manager
Service Fees'' (85 Fed. Reg. 76666).
TITLE V--MISCELLANEOUS
SEC. 501. APPROPRIATE COST-SHARING FOR CERTAIN INSULIN PRODUCTS UNDER
MEDICARE PART D.
(a) In General.--Section 1860D-2 of the Social Security Act (42
U.S.C. 1395w-102) is amended--
(1) in subsection (b)--
(A) in paragraph (1)(A), by striking ``The
coverage'' and inserting ``Subject to paragraph (8),
the coverage'';
(B) in paragraph (2)(A), by striking ``and (D)''
and inserting ``and (D) and paragraph (8)'';
(C) in paragraph (3)(A), by striking ``and (4)''
and inserting ``(4), and (8)'';
(D) in paragraph (4)(A)(i), by striking ``The
coverage'' and inserting ``Subject to paragraph (8),
the coverage''; and
(E) by adding at the end the following new
paragraph:
``(8) Treatment of cost-sharing for certain insulin
products.--
``(A) In general.--For plan years beginning on or
after January 1, 2023, the following shall apply with
respect to insulin products (as defined in subparagraph
(B)):
``(i) No application of deductible.--The
deductible under paragraph (1) shall not apply
with respect to such insulin products.
``(ii) Application of cost-sharing.--
``(I) Plan year 2023.--For plan
year 2023, the coverage provides
benefits for such insulin products,
regardless of whether an individual has
reached the initial coverage limit
under paragraph (3) or the out-of-
pocket threshold under paragraph (4),
with cost-sharing that is equal to the
applicable copayment amount.
``(II) Plan year 2024 and
subsequent plan years.--For plan year
2024 and subsequent plan years, the
coverage provides benefits for such
insulin products, prior to an
individual reaching the out-of-pocket
threshold under paragraph (4), with
cost-sharing that is equal to the
applicable copayment amount.
``(III) Applicable copayment
amount.--For purposes of this clause,
the term `applicable copayment amount'
means, with respect to an insulin
product under a prescription drug plan
or an MA-PD plan, an amount that is not
more than $35.
``(B) Insulin product.--For purposes of this
paragraph, the term `insulin product' means an insulin
product that is approved under section 505 of the
Federal Food, Drug, and Cosmetic Act or licensed under
section 351 of the Public Health Service Act and
marketed pursuant to such approval or licensure,
including any insulin product that has been deemed to
be licensed under section 351 of the Public Health
Service Act pursuant to section 7002(e)(4) of the
Biologics Price Competition and Innovation Act of 2009
and marketed pursuant to such section.''; and
(2) in subsection (c), by adding at the end the following
new paragraph:
``(4) Treatment of cost-sharing for insulin products.--The
coverage is provided in accordance with subsection (b)(8).''.
(b) Conforming Amendments to Cost-Sharing for Low-Income
Individuals.--Section 1860D-14(a) of the Social Security Act (42 U.S.C.
1395w-114(a)) is amended--
(1) in paragraph (1)--
(A) in subparagraph (D)(iii), by adding at the end
the following new sentence: ``For plan year 2023 and
subsequent plan years, the copayment amount applicable
under the preceding sentence to an insulin product (as
defined in section 1860D-2(b)(8)(B)) furnished to the
individual may not exceed the applicable copayment
amount for the product under the prescription drug plan
or MA-PD plan in which the individual is enrolled.'';
and
(B) in subparagraph (E), by inserting the following
before the period at the end ``or under section 1860D-
2(b)(8) in the case of an insulin product (as defined
in subparagraph (B) of such section)''; and
(2) in paragraph (2)--
(A) in subparagraph (D), by adding at the end the
following new sentence: ``For plan year 2023 and
subsequent plan years, the amount of the coinsurance
applicable under the preceding sentence to an insulin
product (as defined in section 1860D-2(b)(8)(B))
furnished to the individual may not exceed the
applicable copayment amount for the product under the
prescription drug plan or MA-PD plan in which the
individual is enrolled.''; and
(B) in subparagraph (E), by adding at the end the
following new sentence: ``For plan year 2023, the
amount of the copayment or coinsurance applicable under
the preceding sentence to an insulin product (as
defined in section 1860D-2(b)(8)(B)) furnished to the
individual may not exceed the applicable copayment
amount for the product under the prescription drug plan
or MA-PD plan in which the individual is enrolled.''.
(c) Implementation.--The Secretary shall implement this section for
plan years 2023 and 2024 by program instruction or otherwise.
SEC. 502. COVERAGE OF ADULT VACCINES RECOMMENDED BY THE ADVISORY
COMMITTEE ON IMMUNIZATION PRACTICES UNDER MEDICARE PART
D.
(a) Ensuring Treatment of Cost-Sharing Is Consistent With Treatment
of Vaccines Under Medicare Part B.--Section 1860D-2 of the Social
Security Act (42 U.S.C. 1395w-102), as amended by section 501, is
further amended--
(1) in subsection (b)--
(A) in paragraph (1)(A), by striking ``paragraph
(8)'' and inserting ``paragraphs (8) and (9)'';
(B) in paragraph (2)(A), by striking ``paragraph
(8)'' and inserting ``paragraphs (8) and (9)'';
(C) in paragraph (3)(A), by striking ``and (8)''
and inserting ``(8), and (9)'';
(D) in paragraph (4)(A)(i), by striking ``paragraph
(8)'' and inserting ``paragraphs (8) and (9)''; and
(E) by adding at the end the following new
paragraph:
``(9) Treatment of cost-sharing for adult vaccines
recommended by the advisory committee on immunization practices
consistent with treatment of vaccines under part b.--
``(A) In general.--For plan years beginning on or
after January 1, 2024, the following shall apply with
respect to an adult vaccine recommended by the Advisory
Committee on Immunization Practices (as defined in
subparagraph (B)):
``(i) No application of deductible.--The
deductible under paragraph (1) shall not apply
with respect to such vaccine.
``(ii) No application of coinsurance or any
other cost-sharing.--There shall be no
coinsurance or other cost-sharing under this
part with respect to such vaccine, regardless
of whether for costs below, at, or above the
initial coverage limit under paragraph (3) or
the out-of-pocket threshold under paragraph
(4).
``(B) Adult vaccines recommended by the advisory
committee on immunization practices.--For purposes of
this paragraph, the term `adult vaccine recommended by
the Advisory Committee on Immunization Practices' means
a covered part D drug that is a vaccine licensed under
section 351 of the Public Health Service Act for use by
adult populations and administered in accordance with
recommendations of the Advisory Committee on
Immunization Practices of the Centers for Disease
Control and Prevention.''; and
(2) in subsection (c), by adding at the end the following
new paragraph:
``(5) Treatment of cost-sharing for adult vaccines
recommended by the advisory committee on immunization
practices.--The coverage is in accordance with subsection
(b)(9).''.
(b) Conforming Amendments to Cost-Sharing for Low-Income
Individuals.--Section 1860D-14(a) of the Social Security Act (42 U.S.C.
1395w-114(a)), as amended by section 501, is further amended--
(1) in paragraph (1)(D), in each of clauses (ii) and (iii),
by striking ``In the case'' and inserting ``Subject to
paragraph (6), in the case'';
(2) in paragraph (2)--
(A) in subparagraph (B), by striking ``A
reduction'' and inserting ``Subject to paragraph (6), a
reduction'';
(B) in subparagraph (D), by striking ``The
substitution'' and inserting ``Subject to paragraph
(6), the substitution''; and
(C) in subparagraph (E), by striking ``subsection
(c)'' and inserting ``paragraph (6) and subsection
(c)''; and
(3) by adding at the end the following new paragraph:
``(6) No application of cost-sharing for adult vaccines
recommended by the advisory committee on immunization
practices.--For plan years beginning on or after January 1,
2024, there shall be no cost-sharing under this section,
including no annual deductible applicable under this section,
with respect to an adult vaccine recommended by the Advisory
Committee on Immunization Practices (as defined in subparagraph
(B) of such section).''.
(c) Rule of Construction.--Nothing in this section shall be
construed as limiting coverage under part D of title XVIII of the
Social Security Act for vaccines that are not recommended by the
Advisory Committee on Immunization Practices.
(d) Implementation for 2024.--The Secretary shall implement this
section, including the amendments made by this section, for 2024 by
program instruction or otherwise.
SEC. 503. PAYMENT FOR BIOSIMILAR BIOLOGICAL PRODUCTS DURING INITIAL
PERIOD.
Section 1847A(c)(4) of the Social Security Act (42 U.S.C. 1395w-
3a(c)(4)) is amended--
(1) in each of subparagraphs (A) and (B), by redesignating
clauses (i) and (ii) as subclauses (I) and (II), respectively,
and moving such subclauses 2 ems to the right;
(2) by redesignating subparagraphs (A) and (B) as clauses
(i) and (ii) and moving such clauses 2 ems to the right;
(3) by striking ``unavailable.--In the case'' and inserting
``unavailable.--
``(A) In general.--Subject to subparagraph (B), in
the case''; and
(4) by adding at the end the following new subparagraph:
``(B) Limitation on payment amount for biosimilar
biological products during initial period.--In the case
of a biosimilar biological product furnished on or
after July 1, 2023, during the initial period described
in subparagraph (A) with respect to the biosimilar
biological product, the amount payable under this
section for the biosimilar biological product is the
lesser of the following:
``(i) The amount determined under clause
(ii) of such subparagraph for the biosimilar
biological product.
``(ii) The amount determined under
subsection (b)(1)(B) for the reference
biological product.''.
SEC. 504. TEMPORARY INCREASE IN MEDICARE PART B PAYMENT FOR CERTAIN
BIOSIMILAR BIOLOGICAL PRODUCTS.
Section 1847A(b)(8) of the Social Security Act (42 U.S.C. 1395w-
3a(b)(8)) is amended--
(1) by redesignating subparagraphs (A) and (B) as clauses
(i) and (ii), respectively, and moving the margin of each such
redesignated clause 2 ems to the right;
(2) by striking ``product.--The amount'' and inserting the
following: ``product.--
``(A) In general.--Subject to subparagraph (B), the
amount''; and
(3) by adding at the end the following new subparagraph:
``(B) Temporary payment increase.--
``(i) In general.--In the case of a
qualifying biosimilar biological product that
is furnished during the applicable 5-year
period for such product, the amount specified
in this paragraph for such product with respect
to such period is the sum determined under
subparagraph (A), except that clause (ii) of
such subparagraph shall be applied by
substituting `8 percent' for `6 percent'.
``(ii) Applicable 5-year period.--For
purposes of clause (i), the applicable 5-year
period for a qualifying biosimilar biological
product is--
``(I) in the case of such a product
for which payment was made under this
paragraph as of March 31, 2022, the 5-
year period beginning on April 1, 2022;
and
``(II) in the case of such a
product for which payment is first made
under this paragraph during a calendar
quarter during the period beginning
April 1, 2022, and ending March 31,
2027, the 5-year period beginning on
the first day of such calendar quarter
during which such payment is first
made.
``(iii) Qualifying biosimilar biological
product defined.--For purposes of this
subparagraph, the term `qualifying biosimilar
biological product' means a biosimilar
biological product described in paragraph
(1)(C) with respect to which--
``(I) in the case of a product
described in clause (ii)(I), the
average sales price under paragraph
(8)(A)(i) for a calendar quarter during
the 5-year period described in such
clause is not more than the average
sales price under paragraph (4)(A) for
such quarter for the reference
biological product; and
``(II) in the case of a product
described in clause (ii)(II), the
average sales price under paragraph
(8)(A)(i) for a calendar quarter during
the 5-year period described in such
clause is not more than the average
sales price under paragraph (4)(A) for
such quarter for the reference
biological product.''.
SEC. 505. IMPROVING ACCESS TO ADULT VACCINES UNDER MEDICAID AND CHIP.
(a) Medicaid.--
(1) Requiring coverage of adult vaccinations.--
(A) In general.--Section 1902(a)(10)(A) of the
Social Security Act (42 U.S.C. 1396a(a)(10)(A)) is
amended in the matter preceding clause (i) by inserting
``(13)(B),'' after ``(5),''.
(B) Medically needy.--Section 1902(a)(10)(C)(iv) of
such Act (42 U.S.C. 1396a(a)(10)(C)(iv)) is amended by
inserting ``, (13)(B),'' after ``(5)''.
(2) No cost-sharing for vaccinations.--
(A) General cost-sharing limitations.--Section 1916
of the Social Security Act (42 U.S.C. 1396o) is
amended--
(i) in subsection (a)(2)--
(I) in subparagraph (G), by
inserting a comma after ``State plan'';
(II) in subparagraph (H), by
striking ``; or'' and inserting a
comma;
(III) in subparagraph (I), by
striking ``; and'' and inserting ``,
or''; and
(IV) by adding at the end the
following new subparagraph:
``(J) vaccines described in section 1905(a)(13)(B)
and the administration of such vaccines; and''; and
(ii) in subsection (b)(2)--
(I) in subparagraph (G), by
inserting a comma after ``State plan'';
(II) in subparagraph (H), by
striking ``; or'' and inserting a
comma;
(III) in subparagraph (I), by
striking ``; and'' and inserting ``,
or''; and
(IV) by adding at the end the
following new subparagraph:
``(J) vaccines described in section 1905(a)(13)(B)
and the administration of such vaccines; and''.
(B) Application to alternative cost-sharing.--
Section 1916A(b)(3)(B) of the Social Security Act (42
U.S.C. 1396o-1(b)(3)(B)) is amended by adding at the
end the following new clause:
``(xiv) Vaccines described in section
1905(a)(13)(B) and the administration of such
vaccines.''.
(3) Increased fmap for adult vaccines.--Section 1905(b) of
the Social Security Act (42 U.S.C. 1396d(b)) is amended--
(A) by striking ``and (5)'' and inserting ``(5)'';
(B) by striking ``services and vaccines described
in subparagraphs (A) and (B) of subsection (a)(13), and
prohibits cost-sharing for such services and vaccines''
and inserting ``services described in subsection
(a)(13)(A), and prohibits cost-sharing for such
services'';
(C) by striking ``medical assistance for such
services and vaccines'' and inserting ``medical
assistance for such services''; and
(D) by inserting ``, and (6) during the first 8
fiscal quarters beginning on or after the effective
date of this clause, in the case of a State which, as
of the date of enactment of the Act titled `An Act to
provide for reconciliation pursuant to title II of S.
Con. Res. 14', provides medical assistance for vaccines
described in subsection (a)(13)(B) and their
administration and prohibits cost-sharing for such
vaccines, the Federal medical assistance percentage, as
determined under this subsection and subsection (y),
shall be increased by 1 percentage point with respect
to medical assistance for such vaccines'' before the
first period.
(b) CHIP.--
(1) Requiring coverage of adult vaccinations.--Section
2103(c) of the Social Security Act (42 U.S.C. 1397cc(c)) is
amended by adding at the end the following paragraph:
``(12) Required coverage of approved, recommended adult
vaccines and their administration.--Regardless of the type of
coverage elected by a State under subsection (a), if the State
child health plan or a waiver of such plan provides child
health assistance or pregnancy-related assistance (as defined
in section 2112) to an individual who is 19 years of age or
older, such assistance shall include coverage of vaccines
described in section 1905(a)(13)(B) and their
administration.''.
(2) No cost-sharing for vaccinations.--Section 2103(e)(2)
of such Act (42 U.S.C. 1397cc(e)(2)) is amended by inserting
``vaccines described in subsection (c)(12) (and the
administration of such vaccines),'' after ``in vitro diagnostic
products described in subsection (c)(10) (and administration of
such products),''.
(c) Effective Date.--The amendments made by this section take
effect on the 1st day of the 1st fiscal quarter that begins on or after
the date that is 1 year after the date of enactment of this Act and
shall apply to expenditures made under a State plan or waiver of such
plan under title XIX of the Social Security Act (42 U.S.C. 1396 through
1396w-6) or under a State child health plan or waiver of such plan
under title XXI of such Act (42 U.S.C. 1397aa through 1397mm) on or
after such effective date.
TITLE VI--ADDITIONAL INSULIN POLICIES
SEC. 601. ERISA REQUIREMENTS WITH RESPECT TO COST-SHARING FOR CERTAIN
INSULIN PRODUCTS.
(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 COST-SHARING FOR CERTAIN
INSULIN PRODUCTS.
``(a) In General.--For plan years beginning on or after January 1,
2023, a group health plan or health insurance issuer offering group
health insurance coverage shall provide coverage of selected insulin
products, and with respect to such products, shall not--
``(1) apply any deductible; or
``(2) impose any cost-sharing in excess of the lesser of,
per 30-day supply--
``(A) $35; or
``(B) the amount equal to 25 percent of the
negotiated price of the selected insulin product net of
all price concessions received by or on behalf of the
plan or coverage, including price concessions received
by or on behalf of third-party entities providing
services to the plan or coverage, such as pharmacy
benefit management services.
``(b) Definitions.--In this section:
``(1) Selected insulin products.--The term `selected
insulin products' means at least one of each dosage form (such
as vial, pump, or inhaler dosage forms) of each different type
(such as rapid-acting, short-acting, intermediate-acting, long-
acting, ultra long-acting, and premixed) of insulin (as defined
below), when available, as selected by the group health plan or
health insurance issuer.
``(2) Insulin defined.--The term `insulin' means insulin
that is licensed under subsection (a) or (k) of section 351 of
the Public Health Service Act (42 U.S.C. 262) and continues to
be marketed under such section, including any insulin product
that has been deemed to be licensed under section 351(a) of
such Act pursuant to section 7002(e)(4) of the Biologics Price
Competition and Innovation Act of 2009 (Public Law 111-148) and
continues to be marketed pursuant to such licensure.
``(c) Out-of-Network Providers.--Nothing in this section requires a
plan or issuer that has a network of providers to provide benefits for
selected insulin products described in this section that are delivered
by an out-of-network provider, or precludes a plan or issuer that has a
network of providers from imposing higher cost-sharing than the levels
specified in subsection (a) for selected insulin products described in
this section that are delivered by an out-of-network provider.
``(d) Rule of Construction.--Subsection (a) shall not be construed
to require coverage of, or prevent a group health plan or health
insurance coverage from imposing cost-sharing other than the levels
specified in subsection (a) on, insulin products that are not selected
insulin products, to the extent that such coverage is not otherwise
required and such cost-sharing is otherwise permitted under Federal and
applicable State law.
``(e) Application of Cost-Sharing Towards Deductibles and Out-of-
Pocket Maximums.--Any cost-sharing payments made pursuant to subsection
(a)(2) shall be counted toward any deductible or out-of-pocket maximum
that applies under the plan or coverage.''.
(b) Clerical Amendment.--The table of contents in section 1 of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001 et
seq.) is amended by inserting after the item relating to section 725
the following:
``Sec. 726. Requirements with respect to cost-sharing for certain
insulin products.''.
SEC. 602. PUBLIC HEALTH SERVICE ACT REQUIREMENTS WITH RESPECT TO COST-
SHARING FOR INSULIN PRODUCTS.
(a) 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 COST-SHARING FOR CERTAIN
INSULIN PRODUCTS.
``(a) In General.--For plan years beginning on or after January 1,
2023, a group health plan or health insurance issuer offering group or
individual health insurance coverage shall provide coverage of selected
insulin products, and with respect to such products, shall not--
``(1) apply any deductible; or
``(2) impose any cost-sharing in excess of the lesser of,
per 30-day supply--
``(A) $35; or
``(B) the amount equal to 25 percent of the
negotiated price of the selected insulin product net of
all price concessions received by or on behalf of the
plan or coverage, including price concessions received
by or on behalf of third-party entities providing
services to the plan or coverage, such as pharmacy
benefit management services.
``(b) Definitions.--In this section:
``(1) Selected insulin products.--The term `selected
insulin products' means at least one of each dosage form (such
as vial, pump, or inhaler dosage forms) of each different type
(such as rapid-acting, short-acting, intermediate-acting, long-
acting, ultra long-acting, and premixed) of insulin (as defined
below), when available, as selected by the group health plan or
health insurance issuer.
``(2) Insulin defined.--The term `insulin' means insulin
that is licensed under subsection (a) or (k) of section 351 and
continues to be marketed under such section, including any
insulin product that has been deemed to be licensed under
section 351(a) pursuant to section 7002(e)(4) of the Biologics
Price Competition and Innovation Act of 2009 and continues to
be marketed pursuant to such licensure.
``(c) Out-of-Network Providers.--Nothing in this section requires a
plan or issuer that has a network of providers to provide benefits for
selected insulin products described in this section that are delivered
by an out-of-network provider, or precludes a plan or issuer that has a
network of providers from imposing higher cost-sharing than the levels
specified in subsection (a) for selected insulin products described in
this section that are delivered by an out-of-network provider.
``(d) Rule of Construction.--Subsection (a) shall not be construed
to require coverage of, or prevent a group health plan or health
insurance coverage from imposing cost-sharing other than the levels
specified in subsection (a) on, insulin products that are not selected
insulin products, to the extent that such coverage is not otherwise
required and such cost-sharing is otherwise permitted under Federal and
applicable State law.
``(e) Application of Cost-Sharing Towards Deductibles and Out-of-
Pocket Maximums.--Any cost-sharing payments made pursuant to subsection
(a)(2) shall be counted toward any deductible or out-of-pocket maximum
that applies under the plan or coverage.''.
(b) No Effect on Other Cost-Sharing.--Section 1302(d)(2) of the
Patient Protection and Affordable Care Act (42 U.S.C. 18022(d)(2)) is
amended by adding at the end the following new subparagraph:
``(D) Special rule relating to insulin coverage.--
The exemption of coverage of selected insulin products
(as defined in section 2799A-11(b) of the Public Health
Service Act) from the application of any deductible
pursuant to section 2799A-11(a)(1) of such Act, section
726(a)(1) of the Employee Retirement Income Security
Act of 1974, or section 9826(a)(1) of the Internal
Revenue Code of 1986 shall not be considered when
determining the actuarial value of a qualified health
plan under this subsection.''.
(c) Coverage of Certain Insulin Products Under Catastrophic
Plans.--Section 1302(e) of the Patient Protection and Affordable Care
Act (42 U.S.C. 18022(e)) is amended by adding at the end the following:
``(4) Coverage of certain insulin products.--
``(A) In general.--Notwithstanding paragraph
(1)(B)(i), a health plan described in paragraph (1)
shall provide coverage of selected insulin products, in
accordance with section 2799A-11 of the Public Health
Service Act, for a plan year before an enrolled
individual has incurred cost-sharing expenses in an
amount equal to the annual limitation in effect under
subsection (c)(1) for the plan year.
``(B) Terminology.--For purposes of subparagraph
(A)--
``(i) the term `selected insulin products'
has the meaning given such term in section
2799A-11(b) of the Public Health Service Act;
and
``(ii) the requirements of section 2799A-11
of such Act shall be applied by deeming each
reference in such section to `individual health
insurance coverage' to be a reference to a plan
described in paragraph (1).''.
SEC. 603. IRC REQUIREMENTS WITH RESPECT TO COST-SHARING FOR CERTAIN
INSULIN PRODUCTS.
(a) In General.--Subchapter B of chapter 100 is amended by adding
at the end the following new section:
``SEC. 9826. REQUIREMENTS WITH RESPECT TO COST-SHARING FOR CERTAIN
INSULIN PRODUCTS.
``(a) In General.--For plan years beginning on or after January 1,
2023, a group health plan shall provide coverage of selected insulin
products, and with respect to such products, shall not--
``(1) apply any deductible; or
``(2) impose any cost-sharing in excess of the lesser of,
per 30-day supply--
``(A) $35; or
``(B) the amount equal to 25 percent of the
negotiated price of the selected insulin product net of
all price concessions received by or on behalf of the
plan, including price concessions received by or on
behalf of third-party entities providing services to
the plan, such as pharmacy benefit management services.
``(b) Definitions.--In this section:
``(1) Selected insulin products.--The term `selected
insulin products' means at least one of each dosage form (such
as vial, pump, or inhaler dosage forms) of each different type
(such as rapid-acting, short-acting, intermediate-acting, long-
acting, ultra long-acting, and premixed) of insulin (as defined
below), when available, as selected by the group health plan.
``(2) Insulin defined.--The term `insulin' means insulin
that is licensed under subsection (a) or (k) of section 351 of
the Public Health Service Act (42 U.S.C. 262) and continues to
be marketed under such section, including any insulin product
that has been deemed to be licensed under section 351(a) of
such Act pursuant to section 7002(e)(4) of the Biologics Price
Competition and Innovation Act of 2009 (Public Law 111-148) and
continues to be marketed pursuant to such licensure.
``(c) Out-of-Network Providers.--Nothing in this section requires a
plan that has a network of providers to provide benefits for selected
insulin products described in this section that are delivered by an
out-of-network provider, or precludes a plan that has a network of
providers from imposing higher cost-sharing than the levels specified
in subsection (a) for selected insulin products described in this
section that are delivered by an out-of-network provider.
``(d) Rule of Construction.--Subsection (a) shall not be construed
to require coverage of, or prevent a group health plan from imposing
cost-sharing other than the levels specified in subsection (a) on,
insulin products that are not selected insulin products, to the extent
that such coverage is not otherwise required and such cost-sharing is
otherwise permitted under Federal and applicable State law.
``(e) Application of Cost-Sharing Towards Deductibles and Out-of-
Pocket Maximums.--Any cost-sharing payments made pursuant to subsection
(a)(2) shall be counted toward any deductible or out-of-pocket maximum
that applies under the plan.''.
(b) Clerical Amendment.--The table of sections for subchapter B of
chapter 100 is amended by adding at the end the following new item:
``Sec. 9826. Requirements with respect to cost-sharing for certain
insulin products.''.
<all>