,i #aafth ,,congress #b;d ,session ,h4 ,r4 #egdi ,,in ,,the ,,house ,,of ,,representatives ,february #d1 #bjbj,mr4 ,crist introduced the following bill2 which was referred to the ,committee on ,energy and ,commerce1 and in addition to the ,committee on ,ways and ,means1 for a period to be subsequently determined by the ,speaker1 in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned ,a ,,bill ,to amend title ,,xi of the ,social ,security ,act to establish the ,american ,insulin ,program to provide for lower prices for insulin drugs1 to maintain effort throughout the insulin supply chain1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,affordable ,insulin for ,all ,act4 #b4 ,providing for lower prices for insulin drugs ,part ,a of title ,,xi of the ,social ,security ,act 7#db ,u4,s4,c4 #acja7 is amended by adding at the end the following new section3 #aaej;,c4 ,establishment of program 7a7 ,in general ,the ,secretary shall establish an ,american ,insulin ,program 7in this section referred to as the program7 by not later than #cj days after the date of the enactment of this section4 ,under the program1 the ,secretary shall enter into agreements described in subsection 7b7 with manufacturers and provide for the performance of duties described in subsection 7c74 ,the ,secretary shall establish a model agreement for use under the program by not later than #bj days after the date of the enactment of this section1 in consultation with manufacturers1 and allow for comment on such model agreement4 7b7 ,terms of agreement 7#a7 ,in general 7,a7 ,agreement ,an agreement under this section shall require the manufacturer to provide applicable individuals access to ,medicaid prices for insulin drugs of the manufacturer4 7,b7 ,provision of discounted prices as the point-of-sale 7i7 ,in general ,subject to clause 7ii71 such ,medicaid prices shall be provided to the applicable beneficiary at the pharmacy or by the mail order service at the point-of-sale of an insulin drug4 7ii7 ,certification of unsustainable revenues 7,i7 ,in general ,in the case the ,secretary submits to ,congress a certification that net revenues from the sale of insulin drugs by manufacturers with an agreement under this section is unsustainable because such manufactures will be unable to meet the demand for insulin drugs in the ,united ,states1 subject to subclause 7,,ii71 the ,secretary may increase the ,medicaid price by #e percent4 7,,ii7 ,limitation ,the ,secretary may not increase the ,medicaid price in accordance with subclause 7,i7 more than #c times4 7,,iii7 ,applicability of price increase ,an increase to the ,medicaid price of insulin drugs described in subclause 7,i7 shall apply to the sale of insulin drugs #ij days after the date of a certification described in such subclause4 7,c7 ,timing of agreement 7i7 ,special rule for #bjba ,in order for an agreement with a manufacturer to be in effect under this section with respect to the period beginning on ,january #a1 #bjba1 and ending on ,december #ca1 #bjba1 the manufacturer shall enter into such agreement not later than #cj days after the date of the establishment of a model agreement under subsection 7a74 7ii7 #bjbb and subsequent years ,in order for an agreement with a manufacturer to be in effect under this section with respect to plan year #bjbb or a subsequent plan year1 the manufacturer shall enter into such agreement 7or such agreement shall be renewed under paragraph 7#d77;,a77 not later than ,january #cj of the preceding year4 7#b7 ,provision of appropriate data ,each manufacturer with an agreement in effect under this section shall collect and have available appropriate data1 as determined by the ,secretary1 to ensure that it can demonstrate to the ,secretary compliance with the requirements under the program4 7#c7 ,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 7d77#c71 as applicable1 for purposes of administering the program1 including any determination under clause 7i7 of subsection 7c77#a77;,a7 or procedures established under such subsection 7c77#a77;,a74 7#d7 ,length of agreement 7,a7 ,in general ,an agreement under this section shall be effective for an initial period of not less than #ah months and shall be automatically renewed for a period of not less than #a year unless terminated under subparagraph 7,b74 7,b7 ,termination 7i7 ,by the ,secretary ,the ,secretary may 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 shown4 ,such termination shall not be effective earlier than #cj days after the date of notice to the manufacturer of such termination4 ,the ,secretary shall provide1 upon request1 a manufacturer with a hearing concerning such a termination1 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 appropriate4 7ii7 ,by a manufacturer ,a manufacturer may terminate an agreement under this section for any reason4 ,any such termination shall be effective1 with respect to a plan year-- 7,i7 if the termination occurs before ,january #cj of a plan year1 as of the day after the end of the plan year2 and 7,,ii7 if the termination occurs on or after ,january #cj of a plan year1 as of the day after the end of the succeeding plan year4 7iii7 ,effectiveness of termination ,any termination under this subparagraph shall not affect discounts for insulin drugs of the manufacturer that are due under the agreement before the effective date of its termination4 7iv7 ,notice to third party ,the ,secretary shall provide notice of such termination to a third party with a contract under subsection 7d77#c7 within not less than #cj days before the effective date of such termination4 7c7 ,duties described ,the duties described in this subsection are the following3 7#a7 ,administration of program ,administering the program1 including-- 7,a7 the determination of the amount of the ,medicaid price of an insulin drug of a manufacturer for applicable individuals in each ,state2 7,b7 except as provided in subparagraph 7,c71 the establishment of procedures under which ,medicaid prices are provided to applicable individuals at pharmacies or by mail order service at the point-of-sale of an insulin drug2 7,c7 in the case where1 during the period beginning on ,january #a1 #bjbb1 and ending on ,december #ca1 #bjbb1 it is not practicable to provide such ,medicaid prices at the point-of-sale 7as described in subparagraph 7,b771 the establishment of procedures to provide such ,medicaid prices as soon as practicable after the point-of-sale2 7,d7 the establishment of procedures to ensure that1 not later than the applicable number of calendar days after the dispensing of an insulin drug by a pharmacy or mail order service1 the pharmacy or mail order service is reimbursed for an amount equal to the difference between-- 7i7 the negotiated price of the insulin drug2 and 7ii7 the ,medicaid price of the insulin drug2 and 7,e7 providing a reasonable dispute resolution mechanism to resolve disagreements between manufacturers1 applicable individuals1 and the third party with a contract under subsection 7d77#c74 7#b7 ,monitoring compliance 7,a7 ,in general ,the ,secretary shall monitor compliance by a manufacturer with the terms of an agreement under this section4 7,b7 ,notification ,if a third party with a contract under subsection 7d77#c7 determines that the manufacturer is not in compliance with such agreement1 the third party shall notify the ,secretary of such noncompliance for appropriate enforcement under subsection 7e74 7#c7 ,collection of data from ,state ,medicaid programs ,the ,secretary may collect appropriate data from each ,state ,medicaid program under title ,,xix in a timeframe that allows for ,medicaid prices to be provided for applicable drugs under this section4 7d7 ,administration 7#a7 ,in general ,subject to paragraph 7#b71 the ,secretary shall provide for the implementation of this section1 including the performance of the duties described in subsection 7c74 7#b7 ,limitation 7,a7 ,in general ,subject to subparagraph 7,b71 in providing for such implementation1 the ,secretary shall not receive or distribute any funds of a manufacturer under the program4 7,b7 ,exception ,the limitation under subparagraph 7,a7 shall not apply to the ,secretary with respect to insulin drugs dispensed during the period beginning on ,january #a1 #bjbb1 and ending on ,december #ca1 #bjbb1 but only if the ,secretary determines that the exception to such limitation under this subparagraph is necessary in order for the ,secretary to begin implementation of this section and provide applicable beneficiaries timely access to ,medicaid prices during such period4 7#c7 ,contract with third parties ,the ,secretary shall enter into a contract with #a or more third parties to administer the requirements established by the ,secretary in order to carry out this section4 ,at a minimum1 the contract with a third party under the preceding sentence shall require that the third party-- 7,a7 receive and transmit information between the ,secretary1 manufacturers1 and other individuals or entities the ,secretary determines appropriate2 7,b7 receive1 distribute1 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 section2 7,c7 provide adequate and timely information to manufacturers1 consistent with the agreement with the manufacturer under this section1 as necessary for the manufacturer to fulfill its obligations under this section2 and 7,d7 permit manufacturers to conduct periodic audits1 directly or through contracts1 of the data and information used by the third party to determine discounts for insulin drugs of the manufacturer under the program4 7#d7 ,performance requirements ,the ,secretary shall establish performance requirements for a third party with a contract under paragraph 7#c7 and safeguards to protect the independence and integrity of the activities carried out by the third party under the program under this section4 7#e7 ,implementation ,the ,secretary may implement the program under this section by program instruction or otherwise4 7#f7 ,administration ,chapter #ce of title #dd1 ,united ,states ,code1 shall not apply to the program under this section4 7e7 ,enforcement 7#a7 ,audits ,each manufacturer with an agreement in effect under this section shall be subject to periodic audit by the ,secretary4 7#b7 ,civil monetary penalty 7,a7 ,in general ,the ,secretary shall impose a civil money penalty on a manufacturer that fails to provide individuals ,medicaid prices for insulin drugs of the manufacturer in accordance with such agreement for each such failure in an amount the ,secretary determines is commensurate with the sum of-- 7i7 the amount that the manufacturer would have paid with respect to such discounts under the agreement1 which will then be used to pay the discounts which the manufacturer had failed to provide2 and 7ii7 #be percent of such amount4 7,b7 ,application ,the provisions of section #aabh;,a 7other than subsections 7a7 and 7b77 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 #aabh;,a7a74 7f7 ,definitions ,in this section3 7#a7 ,applicable individual ,the term applicable individual means an individual who has received a diagnosis of diabetes4 7#b7 ,applicable number of calendar days ,the term applicable number of calendar days means-- 7,a7 with respect to claims for reimbursement submitted electronically1 #ad days2 and 7,b7 with respect to claims for reimbursement submitted otherwise1 #cj days4 7#c7 ,insulin drug ,the term insulin drug means a medication approved by the ,food and ,drug ,administration to treat high blood glucose4 7#d7 ,manufacturer ,the term manufacturer means1 with respect to insulin drugs1 any entity which is engaged in the production1 preparation1 propagation1 compounding1 conversion1 or processing of prescription drug products1 either directly or indirectly by extraction from substances of natural origin1 or independently by means of chemical synthesis1 or by a combination of extraction and chemical synthesis4 ,such term does not include a wholesale distributor of insulin drugs or a retail pharmacy licensed under ,state law4 7#e7 ,medicaid price 7,a7 ,in general ,the term ,medicaid price means1 with respect to an individual entitled to medical assistance under title ,,xix1 the net receipt specified in subparagraph 7,b7 for the dosage form and strength of an insulin drug and any increase due to a certification described in subsection 7b77#a77;,b77ii77,i74 7,b7 ,net receipt specified ,for purposes of subparagraph 7,a71 the net receipt specified in this subparagraph shall be equal to the product of-- 7i7 the total number of units of each dosage form and strength purchased under the program in the rebate period 7as determined by the ,secretary71 and 7ii7 the amount that is the list price of such drug during such rebate period1 less1 the total amount of rebates that the manufacturer paid with respect to such drug during such rebate period4 7#f7 ,negotiated price ,the term negotiated price has the meaning given such term in section #dbc4ajj of title #db1 ,code of ,federal ,regulations 7as in effect on the date of enactment of this section71 except that such negotiated price shall not include any dispensing fee for the applicable drug4 4 #c4 ,maintenance of effort throughout the insulin supply chain 7a7 ,elimination of ,,pbm rebates ,section #aabh;,b7b77#c7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acbj;a-#g;b7b77#c77 is amended-- 7#a7 in subparagraph 7,e71 by inserting 7except for a payment practice that permits rebates1 discounts1 or price concessions for insulin drugs 7as defined in section #aaej;,c7f77#c77 to be paid by a manufacturer to a ,,pbm 7as defined in section #aaej;,a7a77 before the semicolon at the end2 and 7#b7 in subparagraph 7,j7-- 7,a7 by moving the margin two ems to the left2 and 7,b7 by inserting 7except for an insulin drug7 after section #ahfj;,d-#ad;,a7g74 7b7 ,exclusion of insulin payments from ,,mlr ,not later than #ij days after the date of the enactment of this ,act1 the ,secretary of ,health and ,human ,services shall exclude1 beginning with plan years beginning on or after ,january #a1 #bjba1 from the denominator 7as defined in section #aeh4bba7;c7 of title #de1 ,code of ,federal ,regulations7 section of a medical loss ratio 7as calculated under section #aeh4bba7;a7 of such title7 of a health insurance issuer 7as defined in section #add4ajc of such title7 the amount of payments that such issuer paid during a ,,mlr reporting year 7as defined in section #add4ajc of such title7 for insulin drugs through the promulgation of a regulation4 7c7 ,maximum cost sharing and coinsurance for insulin drugs in certain private plans and ,medicare 7#a7 ,,phsa amendment ,subpart ,,ii of part ,a of title ,,xxvii of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;gg-#aa et seq47 is amended by inserting after section #bgac the following new section3 #bgac;,a4 ,coverage of insulin drugs 7a7 ,in general ,beginning with plan years beginning #ij days after the date of the enactment of this section1 a group health plan and a health insurance issuer offering group or individual health insurance coverage shall1 at a minimum provide coverage and may impose cost sharing for an insulin drug in accordance with subsection 7b7 for an individual that is provided a prescription for such drug4 7b7 ,cost sharing ,beginning with plan years beginning #ij days after the date of the enactment of this section1 the cost sharing incurred under a plan or coverage described in subsection 7a7 for an insulin drug may not exceed #aj for each #a-month period of coverage4 7c7 ,insulin drug defined ,in this section1 the term insulin drug has the meaning given such term in section #aaej;,c7f77#c7 of the ,social ,security ,act4 4 7#b7 ,medicare amendments 7,a7 ,coinsurance limitation ,section #ahfj;,d-#b7;b77#b7 of the ,social ,security ,act 7#db ,u4,s4,c4 #aciew-#ajb7;b77#b77 is amended-- 7i7 in subparagraph 7,a71 by striking ,subject to subparagraphs 7,c7 and 7,d7 and inserting ,subject to subparagraphs 7,c71 7,d71 and 7,e72 and 7ii7 by adding at the end1 the following new subparagraph3 7,e7 ,coverage for insulin drugs ,beginning with plan years beginning #ij days after the date of the enactment of this subparagraph1 the coverage has coinsurance 7for costs above the annual deductible specified in paragraph 7#a7 and up to the initial coverage limit under paragraph 7#c77 for an insulin drug 7as defined in section #ahfa7kkk77 is not more than #aj for each #a-month period of coverage4 4 7,b7 ,insulin drug defined ,section #ahfa of the ,social ,security ,act 7#db ,u4,s4,c4 #aciex7 is amended by adding at the end the following new subsection3 7kkk7 ,insulin drug ,the term insulin drug has the meaning given such term in section #aaej;,c7f77#c7 furnished on or after #ij days after the date of the enactment of this subsection4 4 7d7 ,freezing of supplemental rebates in ,medicaid ,section #aijb7;a7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acif;a7a77 is amended-- 7#a7 in paragraph 7#he71 by striking at the end and2 7#b7 in paragraph 7#hf71 by striking the period at the end and inserting 2 and2 and 7#c7 by inserting after paragraph 7#hf71 the following new paragraph3 7#hg7 provide that the ,state may not-- 7,a7 secure from the manufacturer of a drug payable under this title a supplemental rebate that is not a rebate under section #aibg that exceeds the amount of the supplemental rebate on the date of the enactment of this paragraph2 or 7,b7 secure any other supplemental rebates4 4 7e7 ,elimination of spread pricing and related practices in ,medicaid 7#a7 ,in general ,section #aibg7;e7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acifr-#h7;e77 is amended by adding at the end the following3 7#f7 ,pass-through pricing required ,a contract between the ,state and a pharmacy benefit manager 7referred to in this paragraph as a ,,pbm71 or a contract between the ,state and a managed care entity or other specified entity 7as such terms are defined in section #aijc7m77#i77;,d77 that includes provisions making the entity responsible for coverage of covered outpatient drugs dispensed to individuals enrolled with the entity1 shall require that payment for such drugs and related administrative services 7as applicable71 including payments made by a ,,pbm on behalf of the ,state or entity1 is based on a pass-through pricing model under which-- 7,a7 any payment made by the entity or the ,,pbm 7as applicable7 for such a drug-- 7i7 is limited to-- 7,i7 ingredient cost2 and 7,,ii7 a professional dispensing fee that is not less than the professional dispensing fee that the ,state plan or waiver would pay if the plan or waiver was making the payment directly2 7ii7 is passed through in its entirety by the entity or ,,pbm to the pharmacy that dispenses the drug2 and 7iii7 is made in a manner that is consistent with section #aijb7;a77#cj77;,a7 and sections #ddg4eab1 #ddg4ead1 and #ddg4eah of title #db1 ,code of ,federal ,regulations 7or any successor regulation7 as if such requirements applied directly to the entity or the ,,pbm2 7,b7 payment to the entity or the ,,pbm 7as applicable7 for administrative services performed by the entity or ,,pbm is limited to a reasonable administrative fee that covers the reasonable cost of providing such services2 7,c7 the entity or the ,,pbm 7as applicable7 shall make available to the ,state1 and the ,secretary upon request1 all costs and payments related to covered outpatient drugs and accompanying administrative services incurred1 received1 or made by the entity or the ,,pbm1 including ingredient costs1 professional dispensing fees1 administrative fees1 post-sale and post-in-voice fees4 ,discounts1 or related adjustments such as direct and indirect remuneration fees1 and any and all remuneration2 and 7,d7 any form of spread pricing whereby any amount charged or claimed by the entity or the ,,pbm 7as applicable7 that is in excess of the amount paid to the pharmacies on behalf of the entity1 including any post-sale or post-invoice fees1 discounts1 or related adjustments such as direct and indirect remuneration fees or assessments 7after allowing for a reasonable administrative fee as described in subparagraph 7,b771 is not allowable for purposes of claiming ,federal matching payments under this title4 4 7#b7 ,conforming amendment ,clause 7xiii7 of section #aijc7m77#b77;,a7 of such ,act 7#db ,u4,s4,c4 #acif;b7m77#b77;,a77 is amended-- 7,a7 by striking and 7,,iii7 and inserting 7,,iii72 and 7,b7 by inserting before the period at the end the following3 1 and 7,,iv7 pharmacy benefit management services provided by the entity1 or provided by a pharmacy benefit manager on behalf of the entity under a contract or other arrangement between the entity and the pharmacy benefit manager1 shall comply with the requirements of section #aibg7;e77#f74 7#c7 ,effective date ,the amendments made by this subsection apply to contracts between ,states and managed care entities1 other specified entities1 or pharmacy benefits managers that are entered into or renewed on or after the date that is #ij days after the date of enactment of this ,act4 #d4 ,,gao report ,not later than #ahj days after the date of the enactment of this ,act1 the ,comptroller ,general of the ,united ,states shall submit to ,congress a report on the feasibility and affordability of direct manufacturing by the ,federal ,government4