,,ii  #aac? ,,congress  #a/ ,session    
,s4 #hfg  ,,9 ,,! ,,s5ate ,,( ,,!       
,,unit$ ,,/ates  ,may #f1 #bjac ,mr4    
,pryor 7= himself1 ,mr4 ,moran1 ,mr4    
,wick]1 & ,mr4 ,boozman7 introduc$ !    
foll[+ bill2 :i* 0 read twice & ref]r$  
to ! ,committee on ,f9ance  ,a ,,bill   
,to am5d title ,,xviii ( ! ,social      
,security ,act to provide = ph>macy     
b5efits manag] /&>ds "u ! ,m$ic>e       
prescription drug program1 to e/abli%   
basic audit /&>ds ( ph>macies1 to fur!r 
transp>5cy ( paym5t me?odology to       
ph>macies1 & to provide = rec\pm5t      
returns to ,m$ic>e4  #a4 ,%ort title    
,?is ,act may be cit$ z ! ,m$ic>e       
,prescription ,drug ,program ,integrity 
& ,transp>5cy ,act ( #bjac4  #b4        
,ph>macy b5efits manag] /&>ds "u !      
,m$ic>e program  7a7 ,9 g5]al ,section  
#ahfj;,d-#ab7;b7 ( ! ,social ,security  
,act 7#db ,u4,s4,c4 #aciew-#aab7;b77 is 
am5d$ by add+ at ! end ! foll[+ new     
p>agraphs3  7#g7 ,ph>macy b5efits manag]
 transp>5cy & prop] op]ations           

requirem5ts  7,a7 ,9 g5]al ,ea* contract
 ent]$ into ) a ,,pdp sponsor "u ?is "p 
) respect to a prescription drug plan   
(f]$ by su* sponsor %all provide t !    
,,pdp may n ent] into a contract ) any  
ph>macy b5efits manag] 7ref]r$ to 9 ?is 
p>agraph z a ,,pbm7 to manage !         
prescription drug cov]age provid$ "u su*
 plan1 or to control ! co/s ( !         
prescription drug cov]age "u su* plan1  
unless ! ,,pbm satisfies ! requirem5ts  
describ$ 9 subp>agraph 7,b74  7,b7      
,requirem5ts ,! requirem5ts describ$ 9  
?is subp>agraph are z foll[s3  7i7      
,prop] audit proc$ures ,! foll[+ %all   
apply to ea* audit ( a ph>macy conduct$ 
by or = ! ph>macy b5efits manag] )      
respect to su* prescription drug plan3  
7,i7 ,assur+ recov]ies to ,m$ic>e  7aa7 
,! ,,pbm 7or audit+ entity7 %all        
disclose ! am\nt ( ea* paym5t recov]$   
pursuant to ! audit to ! ,,pdp sponsor )
 a copy to ! ph>macy4  7bb7 ,any paym5t 
recov]$ by ! ,,pbm 7or audit+ entity7   
pursuant to ! audit %all be return$ to !

 ,,pdp sponsor4  7,,ii7 ,assur+ cl9ical 
decisions 9 audits  7aa7 ,9 ! case !    
audit involves cl9ical or pr(essional   
judgm5t1 ! audit %all be conduct$ by1 or
 9 consultation )1 a ph>maci/ lic5s$ 9 !
 ,/ate ( ! audit or ! ,/ate bo>d (      
ph>macy4  7bb7 ,! ph>macy1 practice     
site1 or o!r entity may use a nurs+     
home's m$ication adm9i/ration record    
7,,m>71 ! records ( a hospital1         
physician1 rehabilitation facility1     
,/ate-lic5s$ heal?c>e facility1 or o!r  
au?oriz$ practition] to validate !      
ph>macy records & any legal prescription
 7"o t complies ) ,/ate ,bo>d ( ,ph>macy
 requirem5ts7 may be us$ to validate    
claims submitt$ by ! ph>macy 9          
connection ) prescriptions1 refills1    
pro( ( deliv]y1 or *anges 9             
prescriptions dur+ any phase ( ! audit1 
includ+ appeal4  7,,iii7 ,assur+ prop]  
proc$ures  7aa7 ,! ,,pbm 7or audit+     
entity7 may n apply recordkeep+ or o!r  
requirem5ts on ! ph>macy t are m /r+5t  
?an su* requirem5ts appli$ "u ,f$]al law

 or ! ,/ate law involv$4  7bb7 ,! ,,pbm 
7or audit+ entity7 %all accept all      
ph>macy prescription records relat$ to !
 audit 9 an electronic =mat or o!r      
digital m$ia4  7cc7 ,! ,,pbm 7or audit+ 
entity7 may n1 pursuant to ! audit1     
disall[ ! entire paym5t ) respect to a  
claim submitt$ by ! ph>macy because ( a 
cl]ical or recordkeep+ error 7su* z a   
typographical error1 scriv5]'s error1 or
 comput] error7 if !re is an abs5ce (   
int5t to commit fraud1 z def9$ 9 section
 #acdg ( title #ah1 ,unit$ ,/ates ,code4
 ,9 ! case ( errors t h no f9ancial h>m 
to ! pati5t or plan1 ! ,,pbm %all n     
assess any *>gebacks4  7dd7 ,! ,,pbm 7or
 audit+ entity7 may n use extrapolation 
or o!r /ati/ical expansion te*niques 9  
calculat+ any rec\pm5t or p5alty        
pursuant to ! audit4  7ee7 ,! p]iod     
cov]$ by ! audit may n exce$ #b ye>s f !
 date ! claim involv$ 0 submitt$ to1 or 
adju/$ by1 ! ,,pbm 7or audit+ entity74  
7ff7 ,! ,,pbm 7or audit+ entity7 %all h 
9 place a writt5 appeals process t af=ds

 ! ph>macy a m9imum ( #fj days to       
respond to ! auditor f9d+s1 %all include
 proc$ures = appeals f prelim9>y reports
 & f9al reports relat$ to su* audit1 &  
%all p]mit ! ph>macy to introduce any   
docum5tation :i* w\ld validate a claim  
conte/$ 9 ! audit until ! f9al writt5   
decision is issu$ on appeal4  7ii7      
,bus9ess practice pr$ictability ,a ,,pbm
 %all provide a p>ticul> aggregate      
av]age reimbursem5t rate = g5]ics or a  
maximum av]age disc\nt (f ( an accept$  
ph>maceutical pric+ b5*m>k = multi-s\rce
 g5]ics z a :ole 7(t5 ref]r$ to z a     
g5]ic effective rate7 & provide a       
process = ! g5]ic effective rate to be  
appeal$4 ,= ! purposes ( ?is rate or    
b5*m>k am\nt1 ! ,,pbm %all utilize a    
ph>maceutical pric+ b5*m>k publi%$ by a 
nationally available comp5dium4 ,!      
aggregate av]age reimbursem5t rate =    
g5]ics 7g5]ic effective rate7 %all be   
calculat$ us+ ! actual am\nt paid to !  
ph>macy 7typically ! am\nt (            
reimbursem5t to ! ,,pbm plus ! pati5t   

co-pay71 exclud+ ! disp5s+ fee1 %all n  
be calculat$ solely accord+ to ! am\nt  
all[$ by ! plan1 & %all include all     
g5]ics disp5s$1 reg>dless ( :e!r !y are 
subject to ,,mac pric+4  7iii7 ,protect+
 pati5t & claims relat$ data ,a ,,pbm   
%all adh]e to ! foll[+ crit]ia :5 h&l+  
p]sonally id5tifiable utilization &     
claims data or o!r s5sitive pati5t data3
  7,i7 ,a ,,pbm may n transmit any      
p]sonally id5tifiable utilization or    
claims data to a ph>macy own$ by a ,,pbm
 if ! plan enrollee has n volunt>ily    
elect$ 9 writ+ or via secure electronic 
means to fill t p>ticul> prescription at
 ! ,,pbm-own$ ph>macy4  7,,ii7 ,a ,,pbm 
may n require t a plan enrollee use a   
retail ph>macy1 mail ord] ph>macy1      
specialty ph>macy1 or o!r ph>macy entity
 provid+ ph>macy s]vices 9 :i* ! ,,pbm  
has an own]%ip int]e/ or t has an       
own]%ip int]e/ 9 ! ,,pbm or provide an  
inc5tive to a b5efici>y to enc\rage !   
individual to use a retail ph>macy1 mail
 ord] ph>macy1 specialty ph>macy1 or o!r

 ph>macy entity provid+ ph>macy s]vices 
9 :i* ! ,,pbm has an own]%ip int]e/ or t
 has an own]%ip int]e/ 9 ! ,,pbm1 if !  
inc5tive is applicable only to su*      
ph>macies4  4  7b7 ,disclosure & regul> 
update ( prescription drug reimbursem5t 
,section #ahfj;,d-#ab7;b7 ( ! ,social   
,security ,act 7#db ,u4,s4,c4           
#aciew-#aab7;b77 is am5d$ to read z     
foll[s3  7#f7 ,disclosure & regul>      
update ( prescription drug reimbursem5t 
,ea* contract ent]$ into ) a ,,pdp      
sponsor "u ?is "p ) respect to a        
prescription drug plan (f]$ by su*      
sponsor %all provide t ! sponsor or     
subcontractor ( su* sponsor %all--  7,a7
 disclose to a ph>macy1 at ! "t :5 a    
contract is (f]$1 ! me?odology & actual 
p] unit reimbursem5t am\nt = ea* cov]$  
drug = ea* su* ph>macy2 &  7,b7 n less  
frequ5tly ?an once e #g days1 beg9n+ )  
an initial update on ,janu>y #a ( ea*   
ye>--  7i7 update su* reimbursem5t am\nt
 to accurately reflect ! m>ket price (  
acquir+ ! drug2 &  7ii7 disclose to ea* 

contract$ ph>macy su* me?odology &      
reimbursem5t am\nts4  4  7c7 ,effective 
date ,! am5dm5ts made by ?is section    
%all apply to plan ye>s beg9n+ on or    
aft] ,janu>y #a1 #bjae4