,,ii  #aae? ,,congress  #a/ ,session    
,s4 #cdh  ,,9 ,,! ,,s5ate ,,( ,,!       
,,unit$ ,,/ates  ,febru>y #i1 #bjag ,mr4
 ,frank5 7= himself1 ,mr4 ,re$1 & ,mr4  
,br[n7 introduc$ ! foll[+ bill2 :i* 0   
read twice & ref]r$ to ! ,committee on  
,f9ance  ,a ,,bill  ,to am5d title      
,,xviii ( ! ,social ,security ,act to   
require ! ,secret>y ( ,heal? & ,human   
,s]vices to negotiate l[] cov]$ "p ,d   
drug prices on behalf ( ,m$ic>e         
b5efici>ies4  #a4 ,%ort title  ,?is ,act
 may be cit$ z ! ,prescription ,drug &  
,heal? ,improvem5t ,act ( #bjag4  #b4   
,negotiat+ fair prices = ,m$ic>e        
prescription drugs  7a7 ,negotiat+ fair 
prices  7#a7 ,9 g5]al ,section          
#ahfj;,d-#aa ( ! ,social ,security ,act 
7#db ,u4,s4,c4 #aciew-#aaa7 is am5d$ by 
/rik+ subsection 7i7 7relat+ to         
non9t]f]5ce7 & by ins]t+ ! foll[+3  7i7 
,negotiat+ fair prices ) drug           
manufactur]s  7#a7 ,9 g5]al ,not)/&+ any
 o!r provision ( law1 9 fur!rance ( !   
goals ( provid+ quality c>e & conta9+   

co/s "u ?is "p1 ! ,secret>y %all1 )     
respect to applicable cov]$ "p ,d drugs1
 & may1 ) respect to o!r cov]$ "p ,d    
drugs1 negotiate1 us+ ! negotiation     
te*nique t ! ,secret>y det]m9es w       
maximize sav+s & value = a cov]$ "p ,d  
drug & plan enrollees 79 a mann] t may  
be simil> to ,f$]al entities & t may    
include1 b is n limit$ to1 =mul>ies1    
ref]5ce pric+1 disc\nts1 rebates1 & o!r 
price concessions71 ) drug manufactur]s 
! prices t may be *>g$ to ,,pdp sponsors
 & ,,ma organizations = su* drugs = "p  
,d eligible individuals :o are enroll$ 9
 a prescription drug plan or 9 an       
,,ma-,,pd plan4 ,9 conduct+ su*         
negotiations1 ! ,secret>y %all consid] !
 drug's curr5t price1 initial laun*     
price1 preval5ce & usage1 & approv$     
indications1 ! numb] ( simil>ly         
effective alt]native treatm5ts = ea*    
approv$ use ( ! drug1 ! budget>y impact 
( provid+ cov]age "u ?is "p = su* drug =
 all individuals :o w\ld likely b5efit f
 ! drug1 & evid5ce on ! drug's          

effectiv5ess comp>$ to simil> drugs4    
7#b7 ,use ( l[] ( ,,va or big f\r price 
if negotiations fail ,if1 aft] attempt+ 
to negotiate = a price ) respect to a   
cov]$ "p ,d drug "u p>agraph 7#a7 = a   
p]iod ( #a ye>1 ! ,secret>y is n        
successful 9 obta9+ an appropriate price
 = ! drug 7z det]m9$ by ! ,secret>y71 ! 
,secret>y %all e/abli% ! price t may be 
*>g$ to ,,pdp sponsors & ,,ma           
organizations = su* drug = "p ,d        
eligible individuals :o are enroll$ 9 a 
prescription drug plan or 9 an ,,ma-,,pd
 plan at an am\nt equal to ! less] (--  
7,a7 ! price paid by ! ,secret>y (      
,vet]ans ,affairs to procure ! drug "u !
 laws adm9i/]$ by ! ,secret>y ( ,vet]ans
 ,affairs2 or  7,b7 ! price paid to     
procure ! drug "u section #habf ( title 
#ch1 ,unit$ ,/ates ,code4  7#c7         
,applicable cov]$ "p ,d drug def9$ ,=   
purposes ( ?is subsection1 ! t]m        
applicable cov]$ "p ,d drug means a     
cov]$ "p ,d drug t ! ,secret>y det]m9es 
to be appropriate = negotiation "u      

p>agraph 7#a7 bas$ on "o or m ( ! foll[+
 factors z appli$ to su* drug3  7,a7    
,sp5d+ on a p] b5efici>y basis4  7,b7   
,sp5d+ "u ?is title4  7,c7 ,unit price  
increases ov] ! prec$+ ye>s4  7,d7      
,initial laun* price4  7,e7             
,availability ( simil>ly effective      
alt]native treatm5ts4  7,f7 ,/atus ( !  
drug z a foll[-on to previ\sly approv$  
drugs4  7,g7 ,any o!r crit]ia det]m9$ by
 ! ,secret>y4  7#d7 ,,pdp sponsors &    
,,ma organization may negotiate l[]     
prices ,no?+ 9 ?is subsection %all be   
con/ru$ z prev5t+ ! sponsor ( a         
prescription drug plan1 or an           
organization (f]+ an ,,ma-,,pd plan1 f  
obta9+ a disc\nt or r$uction ( ! price =
 a cov]$ "p ,d drug bel[ ! price        
negotiat$ "u p>agraph 7#a7 or ! price   
e/abli%$ "u p>agraph 7#b74  7#e7 ,no    
affect on exi/+ appeals process ,no?+ 9 
?is subsection %all be con/ru$ to affect
 ! appeals proc$ures "u subsections 7g7 
& 7h7 ( section #ahfj;,d-#d4  4  7#b7   
,effective date ,! am5dm5ts made by ?is 

subsection %all take effect on ! date ( 
! enactm5t ( ?is ,act & %all fir/ apply 
to negotiations & prices = plan ye>s    
beg9n+ on ,janu>y #a1 #bjai4  7b7       
,reports to ,congress  7#a7 ,secret>y ( 
,,hhs  7,a7 ,9 g5]al ,n lat] ?an #c ye>s
 aft] ! date ( ! enactm5t ( ?is ,act1 & 
e #f mon?s !reaft]1 ! ,secret>y ( ,heal?
 & ,human ,s]vices %all submit to       
,congress a report on ! foll[+3  7i7 ,! 
negotiations conduct$ by ! ,secret>y "u 
section #ahfj;,d-#aa7;i7 ( ! ,social    
,security ,act 7#db ,u4,s4,c4           
#aciew-#aaa7;i771 z am5d$ by subsection 
7a71 includ+ a description ( h[ su*     
negotiations are a*iev+ l[] prices =    
cov]$ "p ,d drugs 7z def9$ 9 section    
#ahfj;,d-#b7;e7 ( ! ,social ,security   
,act 7#db ,u4,s4,c4 #aciew-#ajb7;e777 = 
,m$ic>e b5efici>ies4  7ii7 ,data on     
sp5d+ "u "p ,d ( ! ,m$ic>e program on   
cov]$ "p ,d drugs1 includ+ data on cov]$
 "p ,d drugs )--  7,i7 sp5d+ on a p]    
b5efici>y basis t is above ! m$ian sp5d+
 on o!r drugs 9 ! same class or above ! 

m$ian sp5d+ ( o!r drug classes2 &       
7,,ii7 high unit co/ increases ov] ! pa/
 five ye>s1 especially :]e su* increases
 are great] ?an ! increases = cov]$ "p  
,d drugs 9 g5]al4  7iii7 ,a li/ ( !     
cov]$ "p ,d drugs ) no !rapeutic        
sub/itute & data on sp5d+ "u "p ,d ( !  
,m$ic>e program on su* drugs4  7iv7     
,access to cov]$ "p ,d drugs4  7v7      
,appeals by enrollees ) respect to cov]$
 "p ,d drugs n includ$ on plan =mul>ies4
  7,b7 ,public availability ( report ,! 
,secret>y ( ,heal? & ,human ,s]vices    
%all publi% on ! ,int]net website ( !   
,c5t]s = ,m$ic>e  ,m$icaid ,s]vices a   
copy ( ea* report submitt$ "u           
subp>agraph 7,a74  7#b7 ,med,p,a,c  7,a7
 ,/udy ,! ,comptroll] ,g5]al ( ! ,unit$ 
,/ates %all conduct a /udy on !         
negotiations conduct$ by ! ,secret>y "u 
section #ahfj;,d-#aa7;i7 ( ! ,social    
,security ,act 7#db ,u4,s4,c4           
#aciew-#aaa7;i771 z am5d$ by subsection 
7a71 includ+ a description ( h[ su*     
negotiations are a*iev+ l[] prices =    

cov]$ "p ,d drugs 7z def9$ 9 section    
#ahfj;,d-#b7;e7 ( ! ,social ,security   
,act 7#db ,u4,s4,c4 #aciew-#ajb7;e777 = 
,m$ic>e b5efici>ies4  7,b7 ,report ,n   
lat] ?an ,janu>y #a1 #bjbb1 !           
,comptroll] ,g5]al ( ! ,unit$ ,/ates    
%all submit to ,congress a report on !  
/udy conduct$ "u subp>agraph 7,a71      
toge!r ) recomm5dations = improv+ su*   
negotiations4  7c7 ,,cmi te/+ (         
negotiat+ drug & biological prices ,to  
improve value  ,section #aaae;,a7b77#b7 
( ! ,social ,security ,act 7#db         
,u4,s4,c4 #acae;a7b77#b77 is am5d$--    
7#a7 9 subp>agraph 7,a71 by add+ at !   
end ! foll[+ new s5t5ce3 ,! models      
select$ "u ?is subp>agraph %all include 
at lea/ #c ( ! models describ$ 9        
subp>agraph 7,d71 :i* %all be implem5t$ 
by n lat] ?an #ah mon?s aft] ! date ( ! 
enactm5t ( ! ,prescription ,drug &      
,heal? ,improvem5t ,act ( #bjag2 &  7#b7
 by add+ at ! end ! foll[+ new          
subp>agraph3  7,d7 ,models ( negotiat+  
drug & biological prices to improve     

value ,! models describ$ 9 ?is          
subp>agraph are ! foll[+ models =       
negotiat+ drug & biological prices "u ! 
applicable titles 7includ+ "u bo? p>ts  
,b & ,d ( title ,,xviii7 9 ord] to      
improve ! value ( paym5ts = su* drugs & 
biologicals "u su* titles3  7i7         
,disc\nt+ or elim9at+ pati5t co/-%>+ on 
high-value drugs & biologicals4  7ii7   
,value-bas$ =mul>ies4  7iii7            
,indications-bas$ pric+4  7iv7 ,ref]5ce 
pric+4  7v7 ,risk-%>+ agreem5ts bas$ on 
outcomes4  7vi7 ,pric+ bas$ on          
comp>ative effectiv5ess rese>*4  7vii7  
,episode-bas$ paym5ts = *emo!rapy & o!r 
conditions det]m9$ appropriate by !     
,secret>y4  4