,,ii #aafth ,,congress #ast ,session ,s4 #bbdg ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,july #bd1 #bjai ,mr4 ,kennedy 7for himself1 ,mr4 ,tester1 ,mrs4 ,capito1 ,mr4 ,brown1 ,mr4 ,cassidy1 ,mr4 ,lankford1 ,mr4 ,daines1 ,mr4 ,cramer1 ,mrs4 ,hyde-,smith1 ,mr4 ,manchin1 and ,mr4 ,wicker7 introduced the following bill2 which was read twice and referred to the ,committee on ,finance ,a ,,bill ,to amend titles ,,xi and ,,xviii of the ,social ,security ,act to provide greater transparency of discounts provided by drug manufacturers1 to establish requirements relating to pharmacy-negotiated price concessions1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,phair ,relief ,act of #bjai4 #b4 ,public disclosure of drug discounts 7a7 ,in general ,section #aaej;,a of the ,social ,security ,act 7#db ,u4,s4,c4 #acbj;b-#bc7 is amended-- 7#a7 in subsection 7c71 in the matter preceding paragraph 7#a71 by striking this section and inserting subsection 7b77#a72 and 7#b7 by adding at the end the following new subsection3 7e7 ,public availability of certain information ,in order to allow patients and employers to compare ,p,b,ms' ability to negotiate rebates1 discounts1 and price concessions and the amount of such rebates1 discounts1 and price concessions that are passed through to plan sponsors1 beginning ,january #a1 #bjbj1 the ,secretary shall make available on the ,internet website of the ,department of ,health and ,human ,services the information provided to the ,secretary under paragraphs 7#b7 and 7#c7 of subsection 7b7 with respect to each ,,pbm4 ,the ,secretary shall ensure that such information is displayed in a manner that prevents the disclosure of information on rebates1 discounts1 and price concessions with respect to an individual drug or an individual plan4 4 7b7 ,effective date ,the amendments made by subsection 7a7 shall take effect on ,january #a1 #bjbj4 #c4 ,minimum drug discounts required to be passed through to the plan sponsor 7a7 ,in general ,section #aaej;,a of the ,social ,security ,act 7#db ,u4,s4,c4 #acbj;b-#bc71 as amended by section #b7;a77#b71 is amended-- 7#a7 in the heading1 by inserting 2 minimum drug discounts required to be passed through to the plan sponsor before the period at the end2 and 7#b7 by adding at the end the following new subsection3 7f7 ,minimum drug discounts required ,to be passed through to the plan sponsor 7#a7 ,requirement ,beginning ,january #a1 #bjbb1 a ,,pbm that manages prescription drug coverage under a contract with a ,,pdp sponsor or ,,ma organization described in subsection 7b77#a7 or a qualified health benefits plan described in subsection 7b77#b71 shall1 with respect to the plan sponsor of a health benefits plan1 pass through to the plan sponsor a minimum percent 7as established by the ,secretary7 of the aggregate amount of the rebates1 discounts1 or price concessions that the ,,pbm negotiates that are attributable to patient utilization under the plan4 7#b7 ,establishment ,the ,secretary shall establish the minimum percent described in paragraph 7#a7 in such a manner as will ensure that patients receive the maximum benefit of rebates1 discounts1 or price concessions while taking into account the costs of negotiating such rebates1 discounts1 and price concessions4 7#c7 ,enforcement ,a ,,pdp sponsor of a prescription drug plan or an ,,ma organization offering an ,,ma-,,pd plan under part ,d of title ,,xviii may not contract with a ,,pbm that is not in compliance with the requirement under paragraph 7#a74 4 7b7 ,effective date ,the amendments made by subsection 7a7 shall take effect on ,january #a1 #bjbb4 #d4 ,requirements relating to pharmacy-negotiated price concessions and pharmacy incentive payments ,section #ahfj;,d-#b7;d77#a77;,b7 of the ,social ,security ,act 7#db ,u4,s4,c4 #aciew-#ajb7;d77#a77;,b77 is amended-- 7#a7 by striking prices4--,for purposes and inserting 8prices4-- 7i7 ,in general ,for purposes 2 and 7#b7 by adding at the end the following new clauses3 7ii7 ,prices negotiated with pharmacy at point-of-sale 7,i7 ,temporary freeze on dir payments ,subject to subclause 7,,iv71 for plan years beginning on or after ,january #a1 #bjba1 and before ,january #a1 #bjbf1 negotiated prices for covered part ,d drugs described in clause 7i7 provided under all phases of coverage under a prescription drug plan1 including all contingent and noncontingent concessions1 payments1 and fees negotiated with the pharmacy dispensing such drug1 shall be provided at the point-of-sale of such drug4 ,for purposes of the preceding sentence1 such negotiated price shall not include any incentive payments paid to pharmacies4 7,,ii7 ,application of price concessions ,for plan years beginning on or after ,january #a1 #bjbf1 the ,secretary shall promulgate regulations prohibiting the application of any pharmacy price concessions that are not based on quality measures established or approved by the ,secretary under subclause 7,,iii74 7,,iii7 ,standard pharmacy quality measures ,subject to subclause 7,i71 not later than ,january #a1 #bjba1 the ,secretary shall establish or approve standard quality measures for use in the application of pharmacy price concessions and incentive payments with respect to payment for covered part ,d drugs dispensed by a pharmacy4 ,such measures shall be-- 7aa7 focused on improving patient health outcomes2 7bb7 standardized across ,,pdp sponsors2 7cc7 pharmacy-specific in application2 7dd7 relevant to the type of pharmacy concerned 7such as specialty pharmacies71 taking into account the items and services furnished by the pharmacy and the patient population served by the pharmacy2 7ee7 applied only when relevant to the specific drug 7or drug class of such drug7 being furnished by the pharmacy or when relevant to management of the condition for which such drug has been prescribed2 and 7ff7 based on achievable and proven criteria measuring pharmacy performance over which the pharmacy has meaningful control and ability to influence4 ,in establishing such standards1 the ,secretary shall consult with stakeholders1 including ,,pdp sponsors and ,,ma organizations1 pharmacies across pharmacy practice types1 pharmacy benefit managers1 patient advocacy organizations1 drug manufacturers1 appropriate standard-setting organizations1 professional pharmacy organizations1 and other entities determined appropriate by the ,secretary4 ,the ,secretary shall review and update the standard pharmacy quality measures on an ongoing basis with appropriate notice and period for comments from stakeholders4 7,,iv7 ,no increase in cost sharing during temporary freeze ,subclause 7,i7 shall not apply in the case where application of such subclause would increase the amount owed by an individual in cost sharing above the amount such individual would have owed in cost sharing without application of such subclause4 7,v7 ,discrepancies between negotiated prices and actual reimbursement ,in the case that the ,secretary determines that the negotiated price of a ,,pdp sponsor applied at the point-of-sale with respect to a covered part ,d drug for a year dispensed by a pharmacy was greater than the total reimbursement made to such pharmacy for such drug for such year1 such sponsor shall1 not later than #ij days after receiving notice of such determination1 furnish to the pharmacy that dispensed such drug and to the ,secretary a written explanation of why such negotiated price was greater than such reimbursement4 7,,vi7 ,specialty pharmacy ,for purposes of carrying out this clause 7including subclause 7,,iii77dd771 the ,secretary shall1 not later than ,december #ca1 #bjbj1 define the term specialty pharmacy in consultation with relevant stakeholders4 7,,vii7 ,definitions ,in this clause3 7aa7 ,quality measure ,the term quality measure means criteria used by a ,,pdp sponsor 7including an entity that contracts with such sponsor1 such as a pharmacy benefit manager7 to determine the amount or applicability of incentive payments and pharmacy price concessions4 7bb7 ,,pdp sponsor ,the term ,,pdp sponsor includes an ,,ma organization offering an ,,ma-,,pd plan under part ,c and an entity that contracts with such sponsor or organization1 such as a pharmacy benefit manager4 7iii7 ,audits of ,,pdp sponsors and negotiated price 7,i7 ,in general ,beginning ,january #a1 #bjba1 the ,secretary shall conduct annual audits of ,,pdp sponsors by reviewing a representative sample of claims between ,,pdp sponsors or other intermediary contracting organizations and all pharmacy types and those pharmacies' lowest actual acquisition and dispensing costs to assess whether reimbursement for individual network pharmacies is below the pharmacy's lowest actual cost of acquiring and dispensing covered part ,d drugs and providing pharmacy services necessary for dispensing such drugs4 ,in conducting such audits1 the ,secretary shall focus on determining whether or not the requirements under clause 7ii7 are negatively impacting network pharmacy participation in the program under this part and beneficiary access to pharmacy providers4 ,such audits shall occur not less than annually and when requested by the ,medicare ,pharmaceutical and ,technology ,ombudsman4 7,,ii7 ,appeal ,if a network pharmacy believes that a ,,pdp sponsor has reimbursed for a covered part ,d drug below the pharmacy's lowest actual acquisition and dispensing costs1 the pharmacy may appeal the reimbursement1 in writing1 to the ,medicare ,pharmaceutical and ,technology ,ombudsman within #fj days following notification of the reimbursement and provide necessary documentation to support its claim4 7,,iii7 ,annual report to congress ,not later than ,january #a1 #bjbb1 and annually thereafter1 the ,secretary shall submit to ,congress a report that contains a summary of the audits conducted under subclause 7,i7 and activity under subclause 7,,ii71 together with recommendations for such legislation and administrative action as the ,secretary determines appropriate4 7iv7 ,claim reimbursement disclosure requirements ,with respect to payment made by a ,,pdp sponsor to a pharmacy for a covered part ,d drug furnished by such pharmacy during a plan year beginning on or after ,january #a1 #bjbj1 such sponsor shall promptly furnish all pricing components including the ,network ,reimbursement ,,id used to price the claim1 any fees1 pharmacy price concessions1 discounts1 incentives or any other forms of remuneration to or from the pharmacy that affect payment and pricing of the claim as part of the claim adjudication response at the point-of-sale4 ,each of the aforementioned data elements shall each be identified in a predetermined line item in the remittance advice that is standard across the industry1 which shall include suitable claim-level detail needed to properly identify the claim1 including the ,claim ,authorization ,number1 date of service1 date of payment remittance1 ingredient cost reimbursed1 dispensing fee reimbursed1 payment amounts including the specific dollar amounts and the appropriate qualifier codes for each payment adjustment including fees1 pharmacy price concessions1 or incentives4 7v7 ,violation process ,a ,,pdp sponsor shall participate in any process established by the ,secretary for purposes of determining whether such sponsor has violated a provision of clause 7ii7 or 7iii74 4 #e4 ,pharmacy benefit manager provision of information 7a7 ,in general ,section #aaej;,a7b77#b7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acbj;b-#bc7;b77#b77 is amended by striking excluding and inserting including4 7b7 ,effective date ,the amendment made by subsection 7a7 shall apply with respect to contract years beginning on or after ,january #a1 #bjbj4