,i #aaith ,,congress #ast ,session ,h4 ,r4 #feja ,,in ,,the ,,house ,,of ,,representatives ,december #i1 #bjbe,mr4 ,fitzpatrick 7for himself1 ,mr4 ,golden of ,maine1 ,mr4 ,bacon1 ,mr4 ,suozzi1 ,mr4 ,bresnahan1 ,mr4 ,davis of ,north ,carolina1 ,ms4 ,malliotakis1 ,ms4 ,perez1 ,mr4 ,lawler1 ,ms4 ,salazar1 ,mr4 ,mackenzie1 ,mr4 ,kean1 ,mr4 ,van ,drew1 ,mr4 ,valadao1 ,mr4 ,ciscomani1 and ,mr4 ,la,lota7 introduced the following bill2 which was referred to the ,committee on ,energy and ,commerce1 and in addition to the ,committees on ,ways and ,means1 and ,education and ,workforce1 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 the ,internal ,revenue ,code of #aihf to extend and modify the enhanced premium tax credit1 to amend the ,patient ,protection and ,affordable ,care ,act to make certain adjustments to the operation of the ,exchanges established under such ,act1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,bipartisan ,health ,insurance ,affordability ,act4 #b4 ,extension and modification of enhanced premium tax credit 7a7 ,extension and modification of rules ,to increase premium assistance amounts ,section #cf;,b7b77#c77;,a77iii7 of the ,internal ,revenue ,code of #aihf is amended-- 7#a7 by redesignating subclauses 7,i7 and 7,,ii7 as items 7aa7 and 7bb71 respectively1 and adjusting the margins accordingly1 7#b7 by striking ,temporary percentages for #bjba through #bjbe4--;,in the case of and inserting ,temporary rules for certain years4-- 7,i7 ,before #bjbf ,in the case of 1 and 7#c7 by adding at the end the following3 7,,ii7 ,after #bjbe for taxpayers whose household income does not exceed #aej percent of poverty line ,in the case of a taxable year beginning after ,december #ca1 #bjbe1 and before ,january #a1 #bjbh1 if any taxpayer's household income does not exceed #aej percent of the poverty line for such taxable year1 the premium assistance amount determined under subsection 7b77#b71 with respect to any coverage month1 is the excess of the lesser of the amount described in paragraph 7#b77;,a7 or the amount described in paragraph 7#b77;,b77i71 over #e4 7,,iii7 ,after #bjbe for taxpayers whose household income does not exceed #bjj percent of poverty line ,in the case of a taxable year beginning after ,december #ca1 #bjbe1 and before ,january #a1 #bjbh1 if any taxpayer's household income exceeds #aej percent of the poverty line but does not exceed #bjj percent of the poverty line for such taxable year1 the premium assistance amount determined under subsection 7b77#b71 with respect to any coverage month1 shall be such that the premium assistance amount for such a taxpayer shall decrease1 on a sliding scale in a linear manner1 from the amount that would result if determined in accordance with subclause 7,,ii7 to the amount that would result under subsection 7b77#b7 by substituting #b percent for the applicable percentage in subparagraph 7,b77ii7 thereof4 7,,iv7 ,after #bjbe for taxpayers whose household income exceeds #bjj percent of poverty line ,in the case of a taxable year beginning after ,december #ca1 #bjbe1 and before ,january #a1 #bjbh1 if any taxpayer's household income exceeds #bjj percent of the poverty line for such taxable year-- 7aa7 clause 7ii7 shall not apply for purposes of adjusting premium percentages under this subparagraph1 and 7bb7 the following table shall be applied in lieu of the table contained in clause 7i73 ,in the case of household income 7expressed as a percent of poverty line7 within the following income tier3 ,the initial premium percentage is- ,the final premium percentage is- #bjj up to #bej #b4j #d4j #bej up to #cjj #d4j #f4j #cjj up to #djj #f4j #h4e #djj up to #fjj #h4e #h4e #fjj up to #gjj #h4e #i4be 4 7b7 ,extension and modification of rule ,to allow credit to taxpayers whose household income exceeds #djj percent of poverty line ,section #cf;,b7c77#a77;,e7 of such ,code is amended-- 7#a7 by striking ,temporary rule for #bjba through #bjbe4--;,in the case of and inserting ,temporary rule for certain years4-- 7i7 ,before #bjbf ,in the case of 1 and 7#b7 by adding at the end the following3 7ii7 ,after #bjbe ,in the case of a taxable year beginning after ,december #ca1 #bjbe1 and before ,january #a1 #bjbh1 subparagraph 7,a7 shall be applied by substituting but does not exceed #gjj percent for but does not exceed #djj percent4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #c4 ,guardrails to prevent fraud in ,exchanges 7a7 ,reduction of fraudulent enrollment in qualified health plans 7#a7 ,penalties for agents and brokers ,section #adaa7;h77#a7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjha7;h77#a77 is amended-- 7,a7 in subparagraph 7,a7-- 7i7 by redesignating clause 7ii7 as clause 7iv72 7ii7 in clause 7i7-- 7,i7 in the matter preceding subclause 7,i71 by striking ,if-- and all that follows through the such person in the matter following subclause 7,,ii7 and inserting the following3 ,if any person 7other than an agent or broker7 fails to provide correct information under subsection 7b7 and such failure is attributable to negligence or disregard of any rules or regulations of the ,secretary1 such person2 and 7,,ii7 in the second sentence1 by striking ,for purposes and inserting the following3 7iii7 ,definitions of negligence1 disregard ,for purposes 2 7iii7 by inserting after clause 7i7 the following3 7ii7 ,civil penalties for certain violations by agents or brokers ,if any agent or broker fails to provide correct information under subsection 7b7 or section #acaa7;c77#h7 or other information1 as specified by the ,secretary1 and such failure is attributable to negligence or disregard of any rules or regulations of the ,secretary1 such agent or broker shall be subject1 in addition to any other penalties that may be prescribed by law1 including subparagraph 7,c71 to a civil penalty of not less than #aj1jjj and not more than #ej1jjj with respect to each individual who is the subject of an application for which such incorrect information is provided4 2 and 7iv7 in clause 7iv7 7as so redesignated71 by inserting or 7ii7 after clause 7i72 7,b7 in subparagraph 7,b7-- 7i7 by inserting including subparagraph 7,c71 after law12 7ii7 by striking ,any person and inserting the following3 7i7 ,in general ,any person 2 and 7iii7 by adding at the end the following3 7ii7 ,civil penalties for knowing violations by agents or brokers 7,i7 ,in general ,any agent or broker who knowingly provides false or fraudulent information under subsection 7b7 or section #acaa7;c77#h71 or other false or fraudulent information as part of an application for enrollment in a qualified health plan offered through an ,exchange1 as specified by the ,secretary1 shall be subject1 in addition to any other penalties that may be prescribed by law1 including subparagraph 7,c71 to a civil penalty of not more than #bjj1jjj with respect to each individual who is the subject of an application for which such false or fraudulent information is provided4 7,,ii7 ,procedure ,the provisions of section #aabh;,a of the ,social ,security ,act 7other than subsections 7a7 and 7b7 of such section7 shall apply to a civil monetary penalty under subclause 7,i7 in the same manner as such provisions apply to a penalty or proceeding under section #aabh;,a of the ,social ,security ,act4 2 and 7,c7 by adding at the end the following3 7,c7 ,criminal penalties ,any agent or broker who knowingly and willfully provides false or fraudulent information under subsection 7b7 or section #acaa7;c77#h71 or other false or fraudulent information as part of an application for enrollment in a qualified health plan offered through an ,exchange1 as specified by the ,secretary1 shall be fined under title #ah1 ,united ,states ,code1 imprisoned for not more than #aj years1 or both4 4 7#b7 ,consumer protections 7,a7 ,in general ,section #acaa7;c7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjca7;c77 is amended by adding at the end the following new paragraph3 7#h7 ,agent- or broker-assisted enrollment in qualified health plans in certain exchanges 7,a7 ,in general ,for plan years beginning on or after such date specified by the ,secretary1 but not later than ,january #a1 #bjbi1 in the case of an ,exchange that the ,secretary operates pursuant to section #acba7;c77#a71 the ,secretary shall establish a verification process for new enrollments of individuals in1 and changes in coverage for individuals under1 a qualified health plan offered through such ,exchange1 which are submitted by an agent or broker in accordance with section #acab7;e7 and for which the agent or broker is eligible to receive a commission4 7,b7 ,requirements ,the enrollment verification process under subparagraph 7,a7 shall include-- 7i7 a requirement that the agent or broker provide with the new enrollment or coverage change such documentation or evidence 7such as a standardized consent form7 or other sources as the ,secretary determines necessary to establish that the agent or broker has the consent of the individual for the new enrollment or coverage change2 7ii7 a requirement that any commissions due to a broker or agent for such new enrollment or coverage change are paid after the enrollee has resolved all inconsistencies in accordance with paragraphs 7#c7 and 7#d7 of section #adaa7;e72 7iii7 a requirement that the information required under clause 7i7 and1 as applicable1 the date on which inconsistencies are resolved as described in clause 7ii71 is accessible to the applicable qualified health plan through a database or other resource1 as determined by the ,secretary1 so that any commissions due to a broker or agent for such enrollment can be effectuated at the appropriate time2 7iv7 a requirement that individuals are notified of any changes to enrollment1 coverage1 the agent of record1 or premium tax credits in a timely manner and that such notice provides plain language instructions on how individuals can cancel unauthorized activity2 7v7 a requirement that individuals be able to access their account information on a website or other technology platform1 as defined by the ,secretary1 when used to submit an enrollment or plan change1 in lieu of the ,exchange website described in subsection 7d77#d77;,c71 including information on the agent of record1 the qualified health plan1 and when any changes are made to the agent of record or the qualified health plan1 on a consumer-facing website or through a toll-free telephone hotline2 and 7vi7 a requirement that the agent or broker report to the ,secretary any third-party marketing organization or field marketing organization 7as such terms are defined in section #acab7;e77 involved in the chain of enrollment 7as so defined7 with respect to such new enrollment or coverage change4 7,c7 ,consumer protection ,the ,secretary shall ensure that the enrollment verification process under subparagraph 7,a7 prioritizes continuity of coverage and care for individuals1 including by not disenrolling individuals from a qualified health plan without the consent of the individual1 regardless of whether the broker1 agent1 or qualified health plan is in violation of any requirement under this paragraph4 4 7,b7 ,required reporting ,section #acaa7;c77#a7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjca7;c77#a77 is amended-- 7i7 in subparagraph 7,h71 by striking and at the end2 7ii7 in subparagraph 7,i71 by striking the period at the end and inserting 2 and2 and 7iii7 by adding at the end the following3 7,j7 report to the ,secretary the termination 7as defined in section #acab7;e77#a77;,c77 of an issuer4 4 7#c7 ,authority to regulate field marketing organizations and third-party marketing organizations ,section #acab7;e7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjcb7;e77 is amended-- 7,a7 by redesignating paragraphs 7#a7 and 7#b7 as subclauses 7,i7 and 7,,ii71 respectively1 and adjusting the margins accordingly2 7,b7 in subclause 7,,ii7 7as so redesignated71 by striking the period at the end and inserting 2 and2 7,c7 by striking the subsection designation and heading and all that follows through brokers-- and inserting the following3 7e7 ,regulation of agents1 brokers1 and certain marketing organizations 7#a7 ,agents1 brokers1 and certain marketing organizations 7,a7 ,in general ,the ,secretary shall establish procedures under which a ,state may allow-- 7i7 agents or brokers-- 2 and 7,d7 by adding at the end the following3 7ii7 field marketing organizations and third-party marketing organizations to participate in the chain of enrollment for an individual with respect to qualified health plans offered through an ,exchange4 7,b7 ,criteria ,for plan years beginning on or after such date specified by the ,secretary1 but not later than ,january #a1 #bjbi1 the ,secretary1 by regulation1 shall establish criteria for ,states to use in determining whether to allow agents and brokers to enroll individuals and employers in qualified health plans as described in subclause 7,i7 of subparagraph 7,a77i7 and to assist individuals as described in subclause 7,,ii7 of such subparagraph and field marketing organizations and third-party marketing organizations to participate in the chain of enrollment as described in subparagraph 7,a77ii74 ,such criteria shall1 at a minimum1 require that-- 7i7 an agent or broker act in accordance with a standard of conduct that includes a duty of such agent or broker to act in the best interests of the enrollee2 7ii7 a field marketing organization or third-party marketing organization agree to report the termination of an agent or broker to the applicable ,state and the ,secretary1 including the reason for termination2 and 7iii7 an agent1 broker1 field marketing organization1 or third-party marketing organization-- 7,i7 meet such marketing requirements as are required by the ,secretary2 7,,ii7 meet marketing requirements in accordance with other applicable ,federal or ,state law2 7,,iii7 does not employ practices that are confusing or misleading1 as determined by the ,secretary2 7,,iv7 submit all marketing materials to the ,secretary for1 as determined appropriate by the ,secretary1 review and approval2 7,v7 is a licensed agent or broker or meets other licensure requirements1 as required by the ,state2 7,,vi7 register with the ,secretary2 and 7,,vii7 does not compensate any individual or organization for referrals or any other service relating to the sale of1 marketing for1 or enrollment in qualified health plans unless such individual or organization meets the criteria described in subclauses 7,i7 through 7,,vi74 7,c7 ,definitions ,in this paragraph3 7i7 ,chain of enrollment ,the term chain of enrollment1 with respect to enrollment of an individual in a qualified health plan offered through an ,exchange1 means any steps taken from marketing to such individual1 to such individual making an enrollment decision with respect to such a plan4 7ii7 ,field marketing organization ,the term field marketing organization means an organization or individual that directly employs or contracts with agents and brokers1 or contracts with carriers1 to provide functions relating to enrollment of individuals in qualified health plans offered through an ,exchange as part of the chain of enrollment4 7iii7 ,marketing ,the term marketing means the use of marketing materials to provide information to current and prospective enrollees in a qualified health plan offered through an ,exchange4 7iv7 ,marketing materials ,the term marketing materials means materials relating to a qualified health plan offered through an ,exchange or benefits offered through an ,exchange that-- 7,i7 are intended-- 7aa7 to draw an individual's attention to such plan or the premium tax credits or cost-sharing reductions for such plan or plans offered through an ,exchange2 7bb7 to influence an individual's decision-making process when selecting a qualified health plan in which to enroll2 or 7cc7 to influence an enrollee's decision to stay enrolled in such plan2 and 7,,ii7 include or address content regarding the benefits1 benefit structure1 premiums1 or cost sharing of such plan4 7v7 ,termination ,the term termination1 with respect to a contract or business arrangement between an agent or broker and a field marketing organization1 third-party marketing organization1 or health insurance issuer1 means-- 7,i7 the ending of such contract or business arrangement1 either unilaterally by one of the parties or on mutual agreement2 or 7,,ii7 the expiration of such contract or business arrangement that is not replaced by a substantially similar agreement4 7vi7 ,third-party marketing organization ,the term third-party marketing organization means an organization or individual that is compensated to perform lead generation1 marketing1 or sales relating to enrollment of individuals in qualified health plans offered through an ,exchange as part of the chain of enrollment4 4 7#d7 ,transparency ,section #acab7;e7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjcb7;e771 as amended by paragraph 7#c71 is further amended by adding at the end the following new paragraphs3 7#b7 ,audits 7,a7 ,in general ,for plan years beginning on or after such date specified by the ,secretary1 but not later than ,january #a1 #bjbi1 the ,secretary1 in coordination with the ,states and in consultation with the ,national ,association of ,insurance ,commissioners1 shall implement a process for the oversight and enforcement of agent and broker compliance with this section and other applicable ,federal and ,state law 7including regulations7 that shall include-- 7i7 periodic audits of agents and brokers based on-- 7,i7 complaints filed with the ,secretary by individuals enrolled by such an agent or broker in a qualified health plan offered through an ,exchange2 7,,ii7 an incident or enrollment pattern that suggests fraud2 and 7,,iii7 other factors determined by the ,secretary2 and 7ii7 a process under which the ,secretary shall share audit results and refer potential cases of fraud to the relevant ,state department of insurance4 7,b7 ,effect ,nothing in this paragraph limits or restricts any referrals made under section #acaa7;i77#c7 or any enforcement actions under section #adaa7;h74 7#c7 ,list ,the ,secretary shall develop a process to regularly provide to qualified health plans1 ,exchanges1 and ,states a list of suspended and terminated agents and brokers4 4 7b7 ,removal of deceased individuals from ,exchange plans ,section #acaa7;c7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjca7;c771 as amended by subsection 7a71 is further amended by adding at the end the following new paragraph3 7#i7 ,removal of deceased individuals from ,exchange plans 7,a7 ,in general ,not later than #ij days after the date of the enactment of this paragraph1 and on a quarterly basis thereafter1 the ,secretary shall conduct a check of the ,death ,master ,file 7as such term is defined in section #bjc7;d7 of the ,bipartisan ,budget ,act of #bjac7 for purposes of identifying individuals enrolled in a qualified health plan through an ,exchange who are deceased4 7,b7 ,process ,the ,secretary shall-- 7i7 establish a process to verify that an individual identified pursuant to a check described in subparagraph 7,a7 is deceased2 and 7ii7 require an ,exchange to terminate such individual's enrollment under a qualified health plan4 4 7c7 ,standard of proof for terminating agents and brokers ,section #acab7;e7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjcb7;e771 as amended by subsection 7a71 is further amended by adding at the end the following new paragraph3 7#d7 ,standard for termination for certain ,exchanges ,in the case of an agent or broker with an agreement in effect with an ,exchange operated by the ,secretary pursuant to section #acba7;c7 to perform activities described in paragraph 7#a77;,a77i7 with respect to such ,exchange1 the ,secretary may terminate such agreement for cause if the ,secretary finds1 based on a preponderance of the evidence1 that such agent or broker has violated such agreement1 otherwise applicable law1 or any other requirement applicable to such agent or broker4 4 7d7 ,requirement for ,exchange ,to notify individuals of value of premium tax credits ,section #adab7;c77#b7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjhb7;c77#b77 is amended by adding at the end the following new subparagraph3 7,c7 ,exchange responsibilities ,beginning ,january #a1 #bjbg1 if an ,exchange is notified under paragraph 7#a7 of an advance determination under section #adaa with respect to the eligibility of an individual for a premium tax credit under section #cf;,b of the ,internal ,revenue ,code of #aihf1 the ,exchange shall1 prior to enrolling such individual in a qualified health plan1 clearly notify such individual of the amount of such tax credit4 4 #d4 ,extending annual open enrollment period for ,exchanges for plan year #bjbf ,the ,secretary of ,health and ,human ,services shall revise section #aee4daj7;e7 of title #de1 ,code of ,federal ,regulations 7or any successor regulation7 to provide that the annual open enrollment period determined for plan year #bjbf pursuant to section #acaa7;c77#f7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjca7;c77#f77 shall begin on ,november #a1 #bjbe1 and end on ,march #a1 #bjbf4 #e4 ,modernizing and ,ensuring ,,pbm ,accountability 7a7 ,in general 7#a7 ,prescription drug plans ,section #ahfj;,d-#ab of the ,social ,security ,act 7#db ,u4,s4,c4 #aciew-#aab7 is amended by adding at the end the following new subsection3 7h7 ,requirements relating to pharmacy benefit managers ,for plan years beginning on or after ,january #a1 #bjbi3 7#a7 ,agreements with pharmacy benefit managers ,each contract entered into with a ,,pdp sponsor under this part with respect to a prescription drug plan offered by such sponsor shall provide that any pharmacy benefit manager acting on behalf of such sponsor has a written agreement with the ,,pdp sponsor under which the pharmacy benefit manager1 and any affiliates of such pharmacy benefit manager1 as applicable1 agree to meet the following requirements3 7,a7 ,no income other than bona fide service fees 7i7 ,in general ,the pharmacy benefit manager and any affiliate of such pharmacy benefit manager shall not derive any remuneration with respect to any services provided on behalf of any entity or individual1 in connection with the utilization of covered part ,d drugs1 from any such entity or individual other than bona fide service fees1 subject to clauses 7ii7 and 7iii74 7ii7 ,incentive payments ,for the purposes of this subsection1 an incentive payment 7as determined by the ,secretary7 paid by a ,,pdp sponsor to a pharmacy benefit manager that is performing services on behalf of such sponsor shall be deemed a bona fide service fee 7even if such payment does not otherwise meet the definition of such term under paragraph 7#g77;,b77 if such payment is a flat dollar amount1 is consistent with fair market value 7as specified by the ,secretary71 is related to services actually performed by the pharmacy benefit manager or affiliate of such pharmacy benefit manager1 on behalf of the ,,pdp sponsor making such payment1 in connection with the utilization of covered part ,d drugs1 and meets additional requirements1 if any1 as determined appropriate by the ,secretary4 7iii7 ,clarification on rebates and discounts used to lower costs for covered part d drugs ,rebates1 discounts1 and other price concessions received by a pharmacy benefit manager or an affiliate of a pharmacy benefit manager from manufacturers1 even if such price concessions are calculated as a percentage of a drug's price1 shall not be considered a violation of the requirements of clause 7i7 if they are fully passed through to a ,,pdp sponsor and are compliant with all regulatory and subregulatory requirements related to direct and indirect remuneration for manufacturer rebates under this part1 including in cases where a ,,pdp sponsor is acting as a pharmacy benefit manager on behalf of a prescription drug plan offered by such ,,pdp sponsor4 7iv7 ,evaluation of remuneration arrangements ,components of subsets of remuneration arrangements 7such as fees or other forms of compensation paid to or retained by the pharmacy benefit manager or affiliate of such pharmacy benefit manager71 as determined appropriate by the ,secretary1 between pharmacy benefit managers or affiliates of such pharmacy benefit managers1 as applicable1 and other entities involved in the dispensing or utilization of covered part ,d drugs 7including ,,pdp sponsors1 manufacturers1 pharmacies1 and other entities as determined appropriate by the ,secretary7 shall be subject to review by the ,secretary1 in consultation with the ,office of the ,inspector ,general of the ,department of ,health and ,human ,services1 as determined appropriate by the ,secretary4 ,the ,secretary1 in consultation with the ,office of the ,inspector ,general1 shall review whether remuneration under such arrangements is consistent with fair market value 7as specified by the ,secretary7 through reviews and assessments of such remuneration1 as determined appropriate4 7v7 ,disgorgement ,the pharmacy benefit manager shall disgorge any remuneration paid to such pharmacy benefit manager or an affiliate of such pharmacy benefit manager in violation of this subparagraph to the ,,pdp sponsor4 7vi7 ,additional requirements ,the pharmacy benefit manager shall-- 7,i7 enter into a written agreement with any affiliate of such pharmacy benefit manager1 under which the affiliate shall identify and disgorge any remuneration described in clause 7v7 to the pharmacy benefit manager2 and 7,,ii7 attest1 subject to any requirements determined appropriate by the ,secretary1 that the pharmacy benefit manager has entered into a written agreement described in subclause 7,i7 with any relevant affiliate of the pharmacy benefit manager4 7,b7 ,transparency regarding guarantees and cost performance evaluations ,the pharmacy benefit manager shall-- 7i7 define1 interpret1 and apply1 in a fully transparent and consistent manner for purposes of calculating or otherwise evaluating pharmacy benefit manager performance against pricing guarantees or similar cost performance measurements related to rebates1 discounts1 price concessions1 or net costs1 terms such as-- 7,i7 generic drug1 in a manner consistent with the definition of the term under section #dbc4d of title #db1 ,code of ,federal ,regulations1 or a successor regulation2 7,,ii7 brand name drug1 in a manner consistent with the definition of the term under section #dbc4d of title #db1 ,code of ,federal ,regulations1 or a successor regulation2 7,,iii7 specialty drug2 7,,iv7 rebate2 and 7,v7 discount2 7ii7 identify any drugs1 claims1 or price concessions excluded from any pricing guarantee or other cost performance measure in a clear and consistent manner2 and 7iii7 where a pricing guarantee or other cost performance measure is based on a pricing benchmark other than the wholesale acquisition cost 7as defined in section #ahdg;,a7c77#f77;,b77 of a drug1 calculate and provide a wholesale acquisition cost-based equivalent to the pricing guarantee or other cost performance measure4 7,c7 ,provision of information 7i7 ,in general ,not later than ,july #a of each year1 beginning in #bjbi1 the pharmacy benefit manager shall submit to the ,,pdp sponsor1 and to the ,secretary1 a report1 in accordance with this subparagraph1 and shall make such report available to such sponsor at no cost to such sponsor in a format specified by the ,secretary under paragraph 7#e74 ,each such report shall include1 with respect to such ,,pdp sponsor and each plan offered by such sponsor1 the following information with respect to the previous plan year3 7,i7 ,a list of all drugs covered by the plan that were dispensed including1 with respect to each such drug-- 7aa7 the brand name1 generic or non-proprietary name1 and ,national ,drug ,code2 7bb7 the number of plan enrollees for whom the drug was dispensed1 the total number of prescription claims for the drug 7including original prescriptions and refills1 counted as separate claims71 and the total number of dosage units of the drug dispensed2 7cc7 the number of prescription claims described in item 7bb7 by each type of dispensing channel through which the drug was dispensed1 including retail1 mail order1 specialty pharmacy1 long term care pharmacy1 home infusion pharmacy1 or other types of pharmacies or providers2 7dd7 the average wholesale acquisition cost1 listed as cost per day's supply1 cost per dosage unit1 and cost per typical course of treatment 7as applicable72 7ee7 the average wholesale price for the drug1 listed as price per day's supply1 price per dosage unit1 and price per typical course of treatment 7as applicable72 7ff7 the total out-of-pocket spending by plan enrollees on such drug after application of any benefits under the plan1 including plan enrollee spending through copayments1 coinsurance1 and deductibles2 7gg7 total rebates paid by the manufacturer on the drug as reported under the ,detailed ,,dir ,report 7or any successor report7 submitted by such sponsor to the ,centers for ,medicare ,medicaid ,services2 7hh7 all other direct or indirect remuneration on the drug as reported under the ,detailed ,,dir ,report 7or any successor report7 submitted by such sponsor to the ,centers for ,medicare ,medicaid ,services2 7ii7 the average pharmacy reimbursement amount paid by the plan for the drug in the aggregate and disaggregated by dispensing channel identified in item 7cc72 7jj7 the average ,national ,average ,drug ,acquisition ,cost 7,,nadac72 and 7kk7 total manufacturer-derived revenue1 inclusive of bona fide service fees1 attributable to the drug and retained by the pharmacy benefit manager and any affiliate of such pharmacy benefit manager4 7,,ii7 ,in the case of a pharmacy benefit manager that has an affiliate that is a retail1 mail order1 or specialty pharmacy1 with respect to drugs covered by such plan that were dispensed1 the following information3 7aa7 ,the percentage of total prescriptions that were dispensed by pharmacies that are an affiliate of the pharmacy benefit manager for each drug4 7bb7 ,the interquartile range of the total combined costs paid by the plan and plan enrollees1 per dosage unit1 per course of treatment1 per #cj-;day supply1 and per #ij-;day supply for each drug dispensed by pharmacies that are not an affiliate of the pharmacy benefit manager and that are included in the pharmacy network of such plan4 7cc7 ,the interquartile range of the total combined costs paid by the plan and plan enrollees1 per dosage unit1 per course of treatment1 per #cj-;day supply1 and per #ij-;day supply for each drug dispensed by pharmacies that are an affiliate of the pharmacy benefit manager and that are included in the pharmacy network of such plan4 7dd7 ,the lowest total combined cost paid by the plan and plan enrollees1 per dosage unit1 per course of treatment1 per #cj-;day supply1 and per #ij-;day supply1 for each drug that is available from any pharmacy included in the pharmacy network of such plan4 7ee7 ,the difference between the average acquisition cost of the affiliate1 such as a pharmacy or other entity that acquires prescription drugs1 that initially acquires the drug and the amount reported under subclause 7,i77jj7 for each drug4 7ff7 ,a list inclusive of the brand name1 generic or non-proprietary name1 and ,national ,drug ,code of covered part ,d drugs subject to an agreement with a covered entity under section #cdj;,b of the ,public ,health ,service ,act for which the pharmacy benefit manager or an affiliate of the pharmacy benefit manager had a contract or other arrangement with such a covered entity in the service area of such plan4 7,,iii7 ,where a drug approved under section #eje7;c7 of the ,federal ,food1 ,drug1 and ,cosmetic ,act 7referred to in this subclause as the listed drug7 is covered by the plan1 the following information3 7aa7 ,a list of currently marketed generic drugs approved under section #eje7;j7 of the ,federal ,food1 ,drug1 and ,cosmetic ,act pursuant to an application that references such listed drug that are not covered by the plan1 are covered on the same formulary tier or a formulary tier typically associated with higher cost-sharing than the listed drug1 or are subject to utilization management that the listed drug is not subject to4 7bb7 ,the estimated average beneficiary cost-sharing under the plan for a #cj-;day supply of the listed drug4 7cc7 ,where a generic drug listed under item 7aa7 is on a formulary tier typically associated with higher cost-sharing than the listed drug1 the estimated average cost-sharing that a beneficiary would have paid for a #cj-;day supply of each of the generic drugs described in item 7aa71 had the plan provided coverage for such drugs on the same formulary tier as the listed drug4 7dd7 ,a written justification for providing more favorable coverage of the listed drug than the generic drugs described in item 7aa74 7ee7 ,the number of currently marketed generic drugs approved under section #eje7;j7 of the ,federal ,food1 ,drug1 and ,cosmetic ,act pursuant to an application that references such listed drug4 7,,iv7 ,where a reference product 7as defined in section #cea7;i7 of the ,public ,health ,service ,act7 is covered by the plan1 the following information3 7aa7 ,a list of currently marketed biosimilar biological products licensed under section #cea7k7 of the ,public ,health ,service ,act pursuant to an application that refers to such reference product that are not covered by the plan1 are covered on the same formulary tier or a formulary tier typically associated with higher cost-sharing than the reference product1 or are subject to utilization management that the reference product is not subject to4 7bb7 ,the estimated average beneficiary cost-sharing under the plan for a #cj-;day supply of the reference product4 7cc7 ,where a biosimilar biological product listed under item 7aa7 is on a formulary tier typically associated with higher cost-sharing than the reference product1 the estimated average cost-sharing that a beneficiary would have paid for a #cj-;day supply of each of the biosimilar biological products described in item 7aa71 had the plan provided coverage for such products on the same formulary tier as the reference product4 7dd7 ,a written justification for providing more favorable coverage of the reference product than the biosimilar biological product described in item 7aa74 7ee7 ,the number of currently marketed biosimilar biological products licensed under section #cea7k7 of the ,public ,health ,service ,act1 pursuant to an application that refers to such reference product4 7,v7 ,total gross spending on covered part ,d drugs by the plan1 not net of rebates1 fees1 discounts1 or other direct or indirect remuneration4 7,,vi7 ,the total amount retained by the pharmacy benefit manager or an affiliate of such pharmacy benefit manager in revenue related to utilization of covered part ,d drugs under that plan1 inclusive of bona fide service fees4 7,,vii7 ,the total spending on covered part ,d drugs net of rebates1 fees1 discounts1 or other direct and indirect remuneration by the plan4 7,,viii7 ,an explanation of any benefit design parameters under such plan that encourage plan enrollees to fill prescriptions at pharmacies that are an affiliate of such pharmacy benefit manager1 such as mail and specialty home delivery programs1 and retail and mail auto-refill programs4 7,,ix7 ,the following information3 7aa7 ,a list of all brokers1 consultants1 advisors1 and auditors that receive compensation from the pharmacy benefit manager or an affiliate of such pharmacy benefit manager for referrals1 consulting1 auditing1 or other services offered to ,,pdp sponsors related to pharmacy benefit management services4 7bb7 ,the amount of compensation provided by such pharmacy benefit manager or affiliate to each such broker1 consultant1 advisor1 and auditor4 7cc7 ,the methodology for calculating the amount of compensation provided by such pharmacy benefit manager or affiliate1 for each such broker1 consultant1 advisor1 and auditor4 7,x7 ,a list of all affiliates of the pharmacy benefit manager4 7,,xi7 ,a summary document submitted in a standardized template developed by the ,secretary that includes such information described in subclauses 7,i7 through 7,x74 7ii7 ,written explanation of contracts or agreements with drug manufacturers 7,i7 ,in general ,the pharmacy benefit manager shall1 not later than #cj days after the finalization of any contract or agreement between such pharmacy benefit manager or an affiliate of such pharmacy benefit manager and a drug manufacturer 7or subsidiary1 agent1 or entity affiliated with such drug manufacturer7 that makes rebates1 discounts1 payments1 or other financial incentives related to one or more covered part ,d drugs or other prescription drugs1 as applicable1 of the manufacturer directly or indirectly contingent upon coverage1 formulary placement1 or utilization management conditions on any other covered part ,d drugs or other prescription drugs1 as applicable1 submit to the ,,pdp sponsor a written explanation of such contract or agreement4 7,,ii7 ,requirements ,a written explanation under subclause 7,i7 shall-- 7aa7 include the manufacturer subject to the contract or agreement1 all covered part ,d drugs and other prescription drugs1 as applicable1 subject to the contract or agreement and the manufacturers of such drugs1 and a high-level description of the terms of such contract or agreement and how such terms apply to such drugs2 and 7bb7 be certified by the ,chief ,executive ,officer1 ,chief ,financial ,officer1 or ,general ,counsel of such pharmacy benefit manager1 or affiliate of such pharmacy benefit manager1 as applicable1 or an individual delegated with the authority to sign on behalf of one of these officers1 who reports directly to the officer4 7,,iii7 ,definition of other prescription drugs ,for purposes of this clause1 the term other prescription drugs means prescription drugs covered as supplemental benefits under this part or prescription drugs paid outside of this part4 7,d7 ,audit rights 7i7 ,in general ,not less than once a year1 at the request of the ,,pdp sponsor1 the pharmacy benefit manager shall allow for an audit of the pharmacy benefit manager to ensure compliance with all terms and conditions under the written agreement described in this paragraph and the accuracy of information reported under subparagraph 7,c74 7ii7 ,auditor ,the ,,pdp sponsor shall have the right to select an auditor4 ,the pharmacy benefit manager shall not impose any limitations on the selection of such auditor4 7iii7 ,provision of information ,the pharmacy benefit manager shall make available to such auditor all records1 data1 contracts1 and other information necessary to confirm the accuracy of information provided under subparagraph 7,c71 subject to reasonable restrictions on how such information must be reported to prevent redisclosure of such information4 7iv7 ,timing ,the pharmacy benefit manager must provide information under clause 7iii7 and other information1 data1 and records relevant to the audit to such auditor within #f months of the initiation of the audit and respond to requests for additional information from such auditor within #cj days after the request for additional information4 7v7 ,information from affiliates ,the pharmacy benefit manager shall be responsible for providing to such auditor information required to be reported under subparagraph 7,c7 or under clause 7iii7 of this subparagraph that is owned or held by an affiliate of such pharmacy benefit manager4 7#b7 ,enforcement 7,a7 ,in general ,each ,,pdp sponsor shall-- 7i7 disgorge to the ,secretary any amounts disgorged to the ,,pdp sponsor by a pharmacy benefit manager under paragraph 7#a77;,a77v72 7ii7 require1 in a written agreement with any pharmacy benefit manager acting on behalf of such sponsor or affiliate of such pharmacy benefit manager1 that such pharmacy benefit manager or affiliate reimburse the ,,pdp sponsor for any civil money penalty imposed on the ,,pdp sponsor as a result of the failure of the pharmacy benefit manager or affiliate to meet the requirements of paragraph 7#a7 that are applicable to the pharmacy benefit manager or affiliate under the agreement2 and 7iii7 require1 in a written agreement with any such pharmacy benefit manager acting on behalf of such sponsor or affiliate of such pharmacy benefit manager1 that such pharmacy benefit manager or affiliate be subject to punitive remedies for breach of contract for failure to comply with the requirements applicable under paragraph 7#a74 7,b7 ,reporting of alleged violations ,the ,secretary shall make available and maintain a mechanism for manufacturers1 ,,pdp sponsors1 pharmacies1 and other entities that have contractual relationships with pharmacy benefit managers or affiliates of such pharmacy benefit managers to report1 on a confidential basis1 alleged violations of paragraph 7#a77;,a7 or subparagraph 7,c74 7,c7 ,anti-retaliation and anti-coercion ,consistent with applicable ,federal or ,state law1 a ,,pdp sponsor shall not-- 7i7 retaliate against an individual or entity for reporting an alleged violation under subparagraph 7,b72 or 7ii7 coerce1 intimidate1 threaten1 or interfere with the ability of an individual or entity to report any such alleged violations4 7#c7 ,certification of compliance 7,a7 ,in general ,each ,,pdp sponsor shall furnish to the ,secretary 7at a time and in a manner specified by the ,secretary7 an annual certification of compliance with this subsection1 as well as such information as the ,secretary determines necessary to carry out this subsection4 7,b7 ,implementation ,notwithstanding any other provision of law1 the ,secretary may implement this paragraph by program instruction or otherwise4 7#d7 ,rule of construction ,nothing in this subsection shall be construed as-- 7,a7 prohibiting flat dispensing fees or reimbursement or payment for ingredient costs 7including customary1 industry-standard discounts directly related to drug acquisition that are retained by pharmacies or wholesalers7 to entities that acquire or dispense prescription drugs2 or 7,b7 modifying regulatory requirements or sub-regulatory program instruction or guidance related to pharmacy payment1 reimbursement1 or dispensing fees4 7#e7 ,standard formats 7,a7 ,in general ,not later than ,june #a1 #bjbh1 the ,secretary shall specify standard1 machine-readable formats for pharmacy benefit managers to submit annual reports required under paragraph 7#a77;,c77i74 7,b7 ,implementation ,notwithstanding any other provision of law1 the ,secretary may implement this paragraph by program instruction or otherwise4 7#f7 ,confidentiality 7,a7 ,in general ,information disclosed by a pharmacy benefit manager1 an affiliate of a pharmacy benefit manager1 a ,,pdp sponsor1 or a pharmacy under this subsection that is not otherwise publicly available or available for purchase shall not be disclosed by the ,secretary or a ,,pdp sponsor receiving the information1 except that the ,secretary may disclose the information for the following purposes3 7i7 ,as the ,secretary determines necessary to carry out this part4 7ii7 ,to permit the ,comptroller ,general to review the information provided4 7iii7 ,to permit the ,director of the ,congressional ,budget ,office to review the information provided4 7iv7 ,to permit the ,executive ,director of the ,medicare ,payment ,advisory ,commission to review the information provided4 7v7 ,to the ,attorney ,general for the purposes of conducting oversight and enforcement under this title4 7vi7 ,to the ,inspector ,general of the ,department of ,health and ,human ,services in accordance with its authorities under the ,inspector ,general ,act of #aigh 7section #djf of title #e1 ,united ,states ,code71 and other applicable statutes4 7,b7 ,restriction on use of information ,the ,secretary1 the ,comptroller ,general1 the ,director of the ,congressional ,budget ,office1 and the ,executive ,director of the ,medicare ,payment ,advisory ,commission shall not report on or disclose information disclosed pursuant to subparagraph 7,a7 to the public in a manner that would identify-- 7i7 a specific pharmacy benefit manager1 affiliate1 pharmacy1 manufacturer1 wholesaler1 ,,pdp sponsor1 or plan2 or 7ii7 contract prices1 rebates1 discounts1 or other remuneration for specific drugs in a manner that may allow the identification of specific contracting parties or of such specific drugs4 7#g7 ,definitions ,for purposes of this subsection3 7,a7 ,affiliate ,the term affiliate means1 with respect to any pharmacy benefit manager or ,,pdp sponsor1 any entity that1 directly or indirectly-- 7i7 owns or is owned by1 controls or is controlled by1 or is otherwise related in any ownership structure to such pharmacy benefit manager or ,,pdp sponsor2 or 7ii7 acts as a contractor1 principal1 or agent to such pharmacy benefit manager or ,,pdp sponsor1 insofar as such contractor1 principal1 or agent performs any of the functions described under subparagraph 7,c74 7,b7 ,bona fide service fee ,the term bona fide service fee means a fee that is reflective of the fair market value 7as specified by the ,secretary1 through notice and comment rulemaking7 for a bona fide1 itemized service actually performed on behalf of an entity1 that the entity would otherwise perform 7or contract for7 in the absence of the service arrangement and that is not passed on in whole or in part to a client or customer1 whether or not the entity takes title to the drug4 ,such fee must be a flat dollar amount and shall not be directly or indirectly based on1 or contingent upon-- 7i7 drug price1 such as wholesale acquisition cost or drug benchmark price 7such as average wholesale price72 7ii7 the amount of discounts1 rebates1 fees1 or other direct or indirect remuneration with respect to covered part ,d drugs dispensed to enrollees in a prescription drug plan1 except as permitted pursuant to paragraph 7#a77;,a77ii72 7iii7 coverage or formulary placement decisions or the volume or value of any referrals or business generated between the parties to the arrangement2 or 7iv7 any other amounts or methodologies prohibited by the ,secretary4 7,c7 ,pharmacy benefit manager ,the term pharmacy benefit manager means any person or entity that1 either directly or through an intermediary1 acts as a price negotiator or group purchaser on behalf of a ,,pdp sponsor or prescription drug plan1 or manages the prescription drug benefits provided by such sponsor or plan1 including the processing and payment of claims for prescription drugs1 the performance of drug utilization review1 the processing of drug prior authorization requests1 the adjudication of appeals or grievances related to the prescription drug benefit1 contracting with network pharmacies1 controlling the cost of covered part ,d drugs1 or the provision of related services4 ,such term includes any person or entity that carries out one or more of the activities described in the preceding sentence1 irrespective of whether such person or entity calls itself a pharmacy benefit manager4 4 7#b7 ,,ma-,,pd plans ,section #aheg7;f77#c7 of the ,social ,security ,act 7#db ,u4,s4,c4 #aciew-#bg7;f77#c77 is amended by adding at the end the following new subparagraph3 7,f7 ,requirements relating to pharmacy benefit managers ,for plan years beginning on or after ,january #a1 #bjbi1 section #ahfj;,d-#ab7;h74 4 7#c7 ,nonapplication of ,paperwork ,reduction ,act ,chapter #ce of title #dd1 ,united ,states ,code1 shall not apply to the implementation of this subsection4 7#d7 ,funding 7,a7 ,secretary ,in addition to amounts otherwise available1 there is appropriated to the ,centers for ,medicare ,medicaid ,services ,program ,management ,account1 out of any money in the ,treasury not otherwise appropriated1 #aac1jjj1jjj for fiscal year #bjbf1 to remain available until expended1 to carry out this subsection4 7,b7 ,,oig ,in addition to amounts otherwise available1 there is appropriated to the ,inspector ,general of the ,department of ,health and ,human ,services1 out of any money in the ,treasury not otherwise appropriated1 #bj1jjj1jjj for fiscal year #bjbf1 to remain available until expended1 to carry out this subsection4 7b7 ,,gao ,study and ,report on ,price-,related ,compensation ,across the ,supply ,chain 7#a7 ,study ,the ,comptroller ,general of the ,united ,states 7in this subsection referred to as the ,comptroller ,general7 shall conduct a study describing the use of compensation and payment structures related to a prescription drug's price within the retail prescription drug supply chain in part ,d of title ,,xviii of the ,social ,security ,act 7#db ,u4,s4,c4 #aciew-#aja et seq474 ,such study shall summarize information from ,federal agencies and industry experts1 to the extent available1 with respect to the following3 7,a7 ,the type1 magnitude1 other features 7such as the pricing benchmarks used71 and prevalence of compensation and payment structures related to a prescription drug's price1 such as calculating fee amounts as a percentage of a prescription drug's price1 between intermediaries in the prescription drug supply chain1 including-- 7i7 pharmacy benefit managers2 7ii7 ,,pdp sponsors offering prescription drug plans and ,medicare ,advantage organizations offering ,,ma-,,pd plans2 7iii7 drug wholesalers2 7iv7 pharmacies2 7v7 manufacturers2 7vi7 pharmacy services administrative organizations2 7vii7 brokers1 auditors1 consultants1 and other entities that-- 7,i7 advise ,,pdp sponsors offering prescription drug plans and ,medicare ,advantage organizations offering ,,ma-,,pd plans regarding pharmacy benefits2 or 7,,ii7 review ,,pdp sponsor and ,medicare ,advantage organization contracts with pharmacy benefit managers2 and 7viii7 other service providers that contract with any of the entities described in clauses 7i7 through 7vii7 that may use price-related compensation and payment structures1 such as rebate aggregators 7or other entities that negotiate or process price concessions on behalf of pharmacy benefit managers1 plan sponsors1 or pharmacies74 7,b7 ,the primary business models and compensation structures for each category of intermediary described in subparagraph 7,a74 7,c7 ,variation in price-related compensation structures between affiliated entities 7such as entities with common ownership1 either full or partial1 and subsidiary relationships7 and unaffiliated entities4 7,d7 ,potential conflicts of interest among contracting entities related to the use of prescription drug price-related compensation structures1 such as the potential for fees or other payments set as a percentage of a prescription drug's price to advantage formulary selection1 distribution1 or purchasing of prescription drugs with higher prices4 7,e7 ,notable differences1 if any1 in the use and level of price-based compensation structures over time and between different market segments1 such as under part ,d of title ,,xviii of the ,social ,security ,act 7#db ,u4,s4,c4 #aciew-#aja et seq47 and the ,medicaid program under title ,,xix of such ,act 7#db ,u4,s4,c4 #acif et seq474 7,f7 ,the effects of drug price-related compensation structures and alternative compensation structures on ,federal health care programs and program beneficiaries1 including with respect to cost-sharing1 premiums1 ,federal outlays1 biosimilar and generic drug adoption and utilization1 drug shortage risks1 and the potential for fees set as a percentage of a drug's price to advantage the formulary selection1 distribution1 or purchasing of drugs with higher prices4 7,g7 ,other issues determined to be relevant and appropriate by the ,comptroller ,general4 7#b7 ,report ,not later than #b years after the date of enactment of this section1 the ,comptroller ,general shall submit to ,congress a report containing the results of the study conducted under paragraph 7#a71 together with recommendations for such legislation and administrative action as the ,comptroller ,general determines appropriate4 7c7 ,med,p,a,c reports on agreements with pharmacy benefit managers with respect to prescription drug plans and ,,ma-,,pd plans 7#a7 ,in general ,the ,medicare ,payment ,advisory ,commission shall submit to ,congress the following reports3 7,a7 ,initial report ,not later than the first ,march #ae occurring after the date that is #b years after the date on which the ,secretary makes the data available to the ,commission1 a report regarding agreements with pharmacy benefit managers with respect to prescription drug plans and ,,ma-,,pd plans4 ,such report shall include1 to the extent practicable-- 7i7 a description of trends and patterns1 including relevant averages1 totals1 and other figures for the types of information submitted2 7ii7 an analysis of any differences in agreements and their effects on plan enrollee out-of-pocket spending and average pharmacy reimbursement1 and other impacts2 and 7iii7 any recommendations the ,commission determines appropriate4 7,b7 ,final report ,not later than #b years after the date on which the ,commission submits the initial report under subparagraph 7,a71 a report describing any changes with respect to the information described in subparagraph 7,a7 over time1 together with any recommendations the ,commission determines appropriate4 7#b7 ,funding ,in addition to amounts otherwise available1 there is appropriated to the ,medicare ,payment ,advisory ,commission1 out of any money in the ,treasury not otherwise appropriated1 #a1jjj1jjj for fiscal year #bjbf1 to remain available until expended1 to carry out this subsection4 #f4 ,full rebate pass through to plan2 exception for innocent plan fiduciaries 7a7 ,in general ,section #djh7;b77#b7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aajh7;b77#b77 is amended-- 7#a7 in subparagraph 7,b77viii7-- 7,a7 by redesignating subclauses 7,,ii7 through 7,,iv7 as subclauses 7,,iii7 through 7,v71 respectively2 7,b7 in subclause 7,i7-- 7i7 by striking subclause 7,,ii7 and inserting subclause 7,,iii72 and 7ii7 by striking subclauses 7,,ii7 and 7,,iii7 and inserting subclauses 7,,iii7 and 7,,iv72 and 7,c7 by inserting after subclause 7,i7 the following3 7,,ii7 ,pursuant to subsection 7a71 subparagraphs 7,c7 and 7,d7 of section #djf7;a77#a7 shall not apply to a responsible plan fiduciary1 notwithstanding any failure to remit required amounts under subparagraph 7,c77i71 if the following conditions are met3 7aa7 ,the responsible plan fiduciary did not know that the covered service provider failed or would fail to make required remittances and reasonably believed that the covered service provider remitted such required amounts4 7bb7 ,the responsible plan fiduciary1 upon discovering that the covered service provider failed to remit the required amounts1 requests in writing that the covered service provider remit such amounts4 7cc7 ,if the covered service provider fails to comply with a written request described in subclause 7,,iii7 within #ij days of the request1 the responsible plan fiduciary notifies the ,secretary of the covered service provider's failure1 in accordance with subclauses 7,,iii7 and 7,,iv74 2 and 7#b7 by adding at the end the following3 7,c7 7i7 7,i7 ,for plan years beginning on or after the date that is #cj months after the date of enactment of this subparagraph 7referred to in this clause as the effective date71 no contract or arrangement or renewal or extension of a contract or arrangement1 entered into on or after the effective date1 for services between a covered plan and a covered service provider1 through a health insurance issuer offering group health insurance coverage1 a third party administrator1 an entity providing pharmacy benefit management services1 or other entity1 for pharmacy benefit management services1 is reasonable within the meaning of this paragraph unless such entity providing pharmacy benefit management services-- 7aa7 remits #ajj percent of rebates1 fees1 alternative discounts1 and other remuneration received from any applicable entity that are related to utilization of drugs or drug spending under such health plan or health insurance coverage1 to the group health plan or health insurance issuer offering group health insurance coverage2 and 7bb7 does not enter into any contract for pharmacy benefit management services on behalf of such a plan or coverage1 with an applicable entity unless #ajj percent of rebates1 fees1 alternative discounts1 and other remuneration received under such contract that are related to the utilization of drugs or drug spending under such group health plan or health insurance coverage are remitted to the group health plan or health insurance issuer by the entity providing pharmacy benefit management services4 7,,ii7 ,nothing in subclause 7,i7 shall be construed to affect the term of a contract or arrangement1 as in effect on the effective date 7as described in such subclause71 except that such subclause shall apply to any renewal or extension of such a contract or arrangement entered into on or after such effective date1 as so described4 7ii7 ,with respect to such rebates1 fees1 alternative discounts1 and other remuneration-- 7,i7 the rebates1 fees1 alternative discounts1 and other remuneration under clause 7i77,i7 shall be-- 7aa7 remitted-- 7,,aa7 on a quarterly basis1 to the group health plan or the group health insurance issuer1 not later than #ij days after the end of each quarter2 or 7,,bb7 in the case of an underpayment in a remittance for a prior quarter1 as soon as practicable1 but not later than #ij days after notice of the underpayment is first given2 7bb7 fully disclosed and enumerated to the group health plan or health insurance issuer2 and 7cc7 returned to the covered service provider for pharmacy benefit management services on behalf of the group health plan if any audit by a plan sponsor1 issuer or a third party designated by a plan sponsor1 indicates that the amounts received are incorrect after such amounts have been paid to the group health plan or health insurance issuer2 7,,ii7 the ,secretary may establish procedures for the remittance of rebates fees1 alternative discounts1 and other remuneration under subclause 7,i77aa7 and the disclosure of rebates1 fees1 alternative discounts1 and other remuneration under subclause 7,i77bb72 and 7,,iii7 the records of such rebates1 fees1 alternative discounts1 and other remuneration shall be available for audit by the plan sponsor1 issuer1 or a third party designated by a plan sponsor1 not less than once per plan year4 7iii7 ,to ensure that an entity providing pharmacy benefit management services is able to meet the requirements of clause 7ii77,i71 a rebate aggregator 7or other purchasing entity designed to aggregate rebates7 and an applicable group purchasing organization shall remit such rebates to the entity providing pharmacy benefit management services not later than #de days after the end of each quarter4 7iv7 ,a third-party administrator of a group health plan1 a health insurance issuer offering group health insurance coverage1 or a covered service provider for pharmacy benefit management services under such health plan or health insurance coverage shall make rebate contracts with rebate aggregators or drug manufacturers available for audit by such plan sponsor or designated third party1 subject to reasonable restrictions 7as determined by the ,secretary7 on confidentiality to prevent re-disclosure of such contracts or use of such information in audits for purposes unrelated to this section4 7v7 ,audits carried out under clauses 7ii77,,iii7 and 7iv7 shall be performed by an auditor selected by the responsible plan fiduciary4 ,payment for such audits shall not be made1 whether directly or indirectly1 by the entity providing pharmacy benefit management services4 7vi7 ,nothing in this subparagraph shall be construed to-- 7,i7 prohibit reasonable payments to entities offering pharmacy benefit management services for bona fide services using a fee structure not described in this subparagraph1 provided that such fees are transparent and quantifiable to group health plans and health insurance issuers2 7,,ii7 require a third-party administrator of a group health plan or covered service provider for pharmacy benefit management services under such health plan or health insurance coverage to remit bona fide service fees to the group health plan2 7,,iii7 limit the ability of a group health plan or health insurance issuer to pass through rebates1 fees1 alternative discounts1 and other remuneration to the participant or beneficiary2 or 7,,iv7 modify the requirements for the creation1 receipt1 maintenance1 or transmission of protected health information under the privacy regulations promulgated under the ,health ,insurance ,portability and ,accountability ,act of #aiif in part #afj and subparts ,a and ,e of part #afd of title #de1 ,code of ,federal ,regulations 7or successor regulations74 7vii7 ,for purposes of this subparagraph-- 7,i7 the terms applicable entity and applicable group purchasing organization have the meanings given such terms in section #gbf7;e72 7,,ii7 the terms covered plan1 covered service provider1 and responsible plan fiduciary have the meanings given such terms in subparagraph 7,b72 and 7,,iii7 the terms group health insurance coverage1 health insurance coverage1 and health insurance issuer have the meanings given such terms in section #gcc4 4 7b7 ,rule of construction ,subclause 7,,ii77aa7 of section #djh7;b77#b77;,b77viii7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aajh7;b77#b77;,b77viii771 as amended by subsection 7a71 shall not be construed to relieve or limit a responsible plan fiduciary from the duty to monitor the practices of any covered service provider that contracts with the applicable covered plan1 including for the purposes of ensuring the reasonableness of compensation4 ,for purposes of this subsection1 the terms covered plan1 covered service provider1 and responsible plan fiduciary have the meanings given such terms in section #djh7;b77#b77;,b77ii7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aajh7;b77#b77;,b77ii774 7c7 ,clarification of covered service provider 7#a7 ,services 7,a7 ,in general ,section #djh7;b77#b77;,b77ii77,i77bb7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aajh7;b77#b77;,b77ii77,i77bb77 is amended-- 7i7 in subitem 7,,aa7 by striking ,brokerage services1 and inserting ,services 7including brokerage services712 and 7ii7 in subitem 7,,bb7-- 7,i7 by striking ,consulting1 and inserting ,other services12 and 7,,ii7 by striking related to the development or implementation of plan design and all that follows through the period at the end and inserting including any of the following3 plan design1 insurance or insurance product selection 7including vision and dental71 recordkeeping1 medical management1 benefits administration selection 7including vision and dental71 stop-loss insurance1 pharmacy benefit management services1 wellness design and management services1 transparency tools1 group purchasing organization agreements and services1 participation in and services from preferred vendor panels1 disease management1 compliance services1 employee assistance programs1 or third party administration services1 or consulting services related to any such services44 7,b7 ,sense of ,congress ,it is the sense of ,congress that the amendment made by subparagraph 7,a7 clarifies the existing requirement of covered service providers with respect to services described in section #djh7;b77#b77;,b77ii77,i77bb77,,bb7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aajh7;b77#b77;,b77ii77,i77bb77,,bb77 that were in effect since the application date described in section #bjb7;e7 of the ,no ,surprises ,act 7,public ,law #aaf-bfj2 #bi ,u4,s4,c4 #aajh note71 and does not impose any additional requirement under section #djh7;b77#b77;,b7 of such ,act4 7#b7 ,certain arrangements for pharmacy benefit management services considered as indirect 7,a7 ,in general ,section #djh7;b77#b77;,b77i7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aajh7;b77#b77;,b77i77 is amended-- 7i7 by striking requirements of this clause and inserting requirements of this subparagraph2 and 7ii7 by adding at the end the following3 ,for purposes of applying section #djf7;a77#a77;,c7 with respect to a transaction described under this subparagraph or subparagraph 7,c71 a contract or arrangement for services between a covered plan and an entity providing services to the plan1 including a health insurance issuer providing health insurance coverage in connection with the covered plan1 in which such entity contracts1 in connection with such plan1 with a service provider for pharmacy benefit management services1 shall be considered an indirect furnishing of goods1 services1 or facilities between the covered plan and the service provider for pharmacy benefit management services acting as the party in interest44 7,b7 ,health insurance issuer and health insurance coverage defined ,section #djh7;b77#b77;,b77ii77,i77aa7 of such ,act 7#bi ,u4,s4,c4 #aajh7;b77#b77;,b77ii77,i77aa77 is amended by inserting before the period at the end and the terms health insurance coverage and health insurance issuer have the meanings given such terms in section #gcc7;b74 7,c7 ,technical amendment ,section #djh7;b77#b77;,b77ii77,i77aa7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aajh7;b77#b77;,b77ii77,i77aa77 is amended by inserting in after defined4 #g4 ,qualified ,exchange enrollees eligible to establish health savings accounts 7a7 ,in general ,section #bbc of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new subsection3 7i7 ,qualified ,exchange enrollees eligible ,to establish health savings accounts 7#a7 ,in general ,for purposes of this section1 an individual who is a qualified ,exchange enrollee for any month during a taxable year shall be treated as an eligible individual for each of the months in such taxable year and each taxable year thereafter4 ,notwithstanding the previous sentence1 any individual who elects to make an advance premium payment under section #adab7;c77#b77;,c7 of the ,patient ,protection and ,affordable ,care ,act with respect to any month during a taxable year shall not be treated as an eligible individual for such month or any other month during such taxable year4 7#b7 ,qualified ,exchange enrollee ,for purposes of this subsection1 the term qualified ,exchange enrollee means1 with respect to any month during a taxable year1 any individual if1 as of the #ast day of such month1 such individual is enrolled in a qualified health plan in the individual market through an ,exchange established under the ,patient ,protection and ,affordable ,care ,act that is-- 7,a7 the lowest cost bronze plan available to such individual through such ,exchange1 or 7,b7 in the case that1 for any month during the preceding taxable year1 such individual was enrolled in a qualified health plan in the individual market through such an ,exchange 7referred to in this paragraph as the previous plan71 such a qualified health plan for which the monthly premium is lower than the monthly premium that was in effect for the previous plan4 7#c7 ,application of monthly limitations for contributions ,in the case of an individual who is treated as an eligible individual under paragraph 7#a71 subsection 7b77#b7 shall be applied as if each reference to high deductible health plan were a reference to a qualified health plan in the individual market that was enrolled in through an ,exchange established under the ,patient ,protection and ,affordable ,care ,act4 7#d7 ,coordination with contributions of partial advance premium tax credit ,the limitation which would 7but for this paragraph7 apply under subsection 7b7 for any taxable year to an individual who is treated as an eligible individual under paragraph 7#a7 shall be reduced 7but not below zero7 by the aggregate amount contributed to health savings accounts of such individual for such taxable year under section #adab7;f7 of the ,patient ,protection and ,affordable ,care ,act 7and such amount shall not be allowed as a deduction under subsection 7a774 7#e7 ,allowing health insurance to be purchased from account ,in the case of an individual who is treated as an eligible individual under paragraph 7#a71 subsection 7d77#b7 shall be applied without regard to subparagraphs 7,b7 and 7,c7 thereof4 4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #h4 ,option to prepay annual premium2 option to direct partial advance payment of premium tax credit into ,,hsa 7a7 ,option ,to prepay annual premium ,section #adab7;c77#b7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjhb7;c77#b77 is amended-- 7#a7 in subparagraph 7,b77i71 by inserting 1 and1 in the case of an individual who elects to make an advance premium payment under subparagraph 7,c71 further reduce such premium by #e before the semicolon2 7#b7 by redesignating subparagraph 7,c71 as added by section #c7;d71 as subparagraph 7,d72 and 7#c7 by inserting after subparagraph 7,b7 the following new subparagraph3 7,c7 ,individual option to prepay annual premium ,beginning with plan years beginning in #bjbf1 in the case of an individual with respect to whom an advance determination has been made under section #adaa that such individual is eligible for a premium tax credit under section #cf;,b of the ,internal ,revenue ,code of #aihf1 if the premium assistance amount under subsection 7b77#b7 of such section is determined with respect to such individual in accordance with subsection 7b77#c77;,a77iii77,,ii7 of such section1 such individual may elect to make an advance premium payment to the issuer of the qualified health plan in which such individual is enrolled in an amount equal to #e multiplied by-- 7i7 in the case that the advance determination of eligibility was made during the annual open enrollment period for such plan year1 #ab2 or 7ii7 in the case that the advance determination of eligibility was made during an open enrollment period other than the annual open enrollment period for such plan year1 the number of months remaining in such plan year4 4 7b7 ,option ,to direct partial advance payment of premium tax credit into ,,hsa ,section #adab of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjhb7 is amended-- 7#a7 in subsection 7c77#b7-- 7,a7 in subparagraph 7,a71 by striking ,the and inserting ,subject to subsection 7f71 the2 and 7,b7 in subparagraph 7,b71 by inserting 7including such a payment made in accordance with subsection 7f77 after an advance payment2 and 7#b7 by adding at the end the following new subsection3 7f7 ,option ,to direct partial advance payment of premium tax credit to ,,hsa 7#a7 ,in general ,beginning with plan years beginning in #bjbf1 at the election of an eligible enrolled individual described in paragraph 7#b71 the advance payment of the premium tax credit allowed under section #cf;,b of the ,internal ,revenue ,code of #aihf shall be made as follows3 7,a7 ,the ,secretary of the ,treasury shall make advance payment of #ej percent of such premium tax credit to the issuer of a qualified health plan on a monthly basis 7or such other periodic basis as the ,secretary may provide74 7,b7 ,the ,secretary of the ,treasury shall make advance payment of #ej percent of such premium tax credit into a health savings account 7as defined in section #bbc7;d7 of the ,internal ,revenue ,code of #aihf7 of such individual 7as designated by such individual7 on the same basis provided for under subparagraph 7,a71 but only to the extent that the aggregate amount of such payments does not exceed the limitation under section #bbc7;b7 of such ,code 7determined without regard to this subsection7 which is applicable to such individual for the taxable year in which such payments are made4 7#b7 ,eligible enrolled individual ,for purposes of this subsection1 the term eligible enrolled individual means1 with respect to a plan year 7starting with #bjbf71 an individual-- 7,a7 with respect to whom an advance determination has been made under section #adaa that such individual is eligible for a premium tax credit under section #cf;,b of the ,internal ,revenue ,code of #aihf2 7,b7 who is1 for the first month of such plan year1 a qualified ,exchange enrollee 7as defined in section #bbc7;i7 of the ,internal ,revenue ,code of #aihf72 and 7,c7 who does not elect to make an advance premium payment under subsection 7c77#b77;,c74 4 #i4 ,report ,not later than one year after the date of the enactment of this ,act1 the ,secretary of the ,treasury and the ,secretary of ,health and ,human ,services shall jointly submit to ,congress a report on the implementation of sections #g and #h and any recommendations on expanding accessibility of health savings accounts4