,i #aaith ,,congress #ast ,session ,h4 ,r4 #iej ,,in ,,the ,,house ,,of ,,representatives ,february #d1 #bjbe,mr4 ,landsman 7for himself and ,mrs4 ,harshbarger7 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 ,,xviii of the ,social ,security ,act to establish pharmacy benefit manager reporting requirements with respect to prescription drug plans and ,,ma-,,pd plans under ,medicare part ,d4 #a4 ,short title ,this ,act may be cited as the ,saving ,seniors ,money on ,prescriptions ,act4 #b4 ,pharmacy benefit manager reporting requirements with respect to prescription drug plans and ,,ma-,,pd plans 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 ,pharmacy benefit manager reporting requirements ,for plan years beginning on or after ,january #a1 #bjbh3 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 manager agrees to meet the following requirements3 7,a7 ,transparency regarding guarantees and cost performance evaluations ,the pharmacy benefit manager shall-- 7i7 define1 interpret1 and apply terms 7such as generic drug1 brand name drug 7consistent with the definition of those terms under section #dbc4d of title #db1 ,code of ,federal ,regulations1 or a successor regulation71 specialty drug1 rebate1 and discount7 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 costs2 7ii7 identify any drugs1 claims1 or price concessions excluded from any pricing guarantee or other cost performance calculation or evaluation 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 measure in the contract4 7,b7 ,provision of information 7i7 ,in general ,not later than ,july #a of each year1 the pharmacy benefit manager shall submit to the ,,pdp sponsor1 and to the ,secretary upon request1 a report1 in accordance with this subparagraph1 and shall make such report available to the sponsor at no cost to such sponsor in a machine-readable format and1 as the ,secretary may determine1 other formats4 ,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 claims described in item 7bb7 that were dispensed using each type of dispensing channel1 including retail1 mail order1 specialty pharmacy1 or other types of pharmacies or providers as defined by the pharmacy benefit manager2 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 cost per day's supply1 cost per dosage unit1 and cost 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 charged to the plan for the drug by dispensing channel identified in item 7cc72 7jj7 the average ,national ,average ,drug ,acquisition ,cost 7,,nadac7 for retail community pharmacies2 and 7kk7 total manufacturer-derived revenue1 inclusive of bona fide service fees1 retained by the pharmacy benefit manager and any affiliate of such pharmacy benefit manager attributable to the drug4 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 with 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 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 network of the plan4 7ee7 ,the difference between the average acquisition cost of the affiliate that initially acquires the drug and the amount reported under subclause 7,i77jj7 for each drug4 7ff7 ,a list of prescription drugs for which the pharmacy benefit manager or an affiliate of the pharmacy benefit manager had a contract or other arrangement with a covered entity under section #cdj;,b of the ,public ,health ,service ,act 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 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 ,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 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 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 ,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 7,v7 ,total gross spending on prescription 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 prescription drugs under that plan1 inclusive of bona fide service fees4 7,,vii7 ,the total spending on prescription 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 ,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 7,x7 ,a list of all pharmacies1 wholesalers1 distributors1 private labelers1 providers1 group purchasing organizations1 health plans1 or any other entity that is an affiliate 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 ,standard formats ,not later than ,june #a1 #bjbe1 the ,secretary shall specify standard formats for pharmacy benefit managers to submit annual reports required under clause 7i74 7iii7 ,confidentiality 7,i7 ,in general ,information disclosed by a pharmacy benefit manager or ,,pdp sponsor under this subsection that is not otherwise publicly available 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 7aa7 ,as the ,secretary determines to be necessary to carry out this part4 7bb7 ,to permit the ,comptroller ,general to review the information provided4 7cc7 ,to permit the ,director of the ,congressional ,budget ,office to review the information provided4 7dd7 ,to permit the ,executive ,director of the ,medicare ,payment ,advisory ,commission to review the information provided4 7ee7 ,to the ,attorney ,general for the purposes of conducting oversight and enforcement under this title4 7,,ii7 ,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 subclause 7,i7 to the public in a manner that would identify a specific pharmacy benefit manager1 affiliate1 ,,pdp sponsor1 or plan1 or prices charged for specific drugs4 7,c7 ,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 contract and the accuracy of information reported under subparagraph 7,b74 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,b71 subject to reasonable restrictions on how such information must be reported 7as determined by the ,secretary7 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,b7 that is owned or held by an affiliate of such pharmacy benefit manager4 7,d7 ,enforcement ,the pharmacy benefit manager shall-- 7i7 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 to meet the requirements of this paragraph that are applicable to the pharmacy benefit manager under the agreement2 and 7ii7 be subject to punitive remedies for breach of contract for failure to comply with the requirements applicable under this paragraph4 7#b7 ,certification of compliance ,each ,,pdp sponsor shall furnish to the ,secretary 7in a time and 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#c7 ,definitions ,for purposes of this subsection3 7,a7 ,affiliate ,the term affiliate means any entity that is owned by1 controlled by1 or related under a common ownership structure with a pharmacy benefit manager 7including an entity owned or controlled by the ,,pdp sponsor7 or that acts as a contractor or agent to such pharmacy benefit manager1 insofar as such contractor or agent performs any of the functions described under subparagraph 7,b74 7,b7 ,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 services related thereto4 ,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 ,pharmacy benefit manager reporting requirements ,for plan years beginning on or after ,january #a1 #bjbh1 section #ahfj;,d-#ab7;h74 4 7b7 ,,gao study and report on certain reporting requirements 7#a7 ,study ,the ,comptroller ,general of the ,united ,states 7in this subsection referred to as the ,comptroller ,general7 shall conduct a study on ,federal and ,state reporting requirements for health plans and pharmacy benefit managers related to the transparency of prescription drug costs and prices4 ,such study shall include an analysis of the following3 7,a7 ,federal statutory and regulatory reporting requirements for health plans and pharmacy benefit managers related to prescription drug costs and prices4 7,b7 ,state statutory and regulatory reporting requirements for health plans and pharmacy benefit managers related to prescription drug costs and prices4 7,c7 ,the extent to which the statutory and regulatory reporting requirements identified in clauses 7i7 and 7ii7 overlap and conflict4 7,d7 ,the resources required by health plans and pharmacy benefit managers to comply with the reporting requirements described in clauses 7i7 and 7ii74 7,e7 ,other items determined appropriate by the ,comptroller ,general4 7#b7 ,report ,not later than #b years after enactment1 the ,comptroller ,general shall submit to ,congress a report containing the results of the study conducted under paragraph 7#a71 together with recommendations for legislation and administrative actions that would streamline and reduce the burden associated with the reporting requirements for health plans and pharmacy benefit managers described in paragraph 7#a74