,i  #aai? ,,congress  #a/ ,session  ,h4 
,r4 #iej  ,,9 ,,! ,,h\se ,,(            
,,repres5tatives  ,febru>y #d1 #bjbe,mr4
 ,l&sman 7= himself & ,mrs4 ,h>%b>g]7   
introduc$ ! foll[+ bill2 :i* 0 ref]r$ to
 ! ,committee on ,en]gy & ,comm]ce1 & 9 
addition to ! ,committee on ,ways &     
,means1 = a p]iod to be subsequ5tly     
det]m9$ by ! ,speak]1 9 ea* case =      
consid]ation ( su* provisions z fall )9 
! jurisdiction ( ! committee conc]n$  ,a
 ,,bill  ,to am5d title ,,xviii ( !     
,social ,security ,act to e/abli%       
ph>macy b5efit manag] report+           
requirem5ts ) respect to prescription   
drug plans & ,,ma-,,pd plans "u ,m$ic>e 
"p ,d4  #a4 ,%ort title ,?is ,act may be
 cit$ z ! ,sav+ ,s5iors ,money on       
,prescriptions ,act4  #b4 ,ph>macy      
b5efit manag] report+ requirem5ts )     
respect to prescription drug plans &    
,,ma-,,pd plans  7a7 ,9 g5]al  7#a7     
,prescription drug plans ,section       
#ahfj;,d-#ab ( ! ,social ,security ,act 
7#db ,u4,s4,c4 #aciew-#aab7 is am5d$ by 

add+ at ! end ! foll[+ new subsection3  
7h7 ,ph>macy b5efit manag] report+      
requirem5ts ,= plan ye>s beg9n+ on or   
aft] ,janu>y #a1 #bjbh3 7#a7 ,agreem5ts 
) ph>macy b5efit manag]s ,ea* contract  
ent]$ into ) a ,,pdp sponsor "u ?is "p )
 respect to a prescription drug plan    
(f]$ by su* sponsor %all provide t any  
ph>macy b5efit manag] act+ on behalf (  
su* sponsor has a writt5 agreem5t ) !   
,,pdp sponsor "u :i* ! ph>macy b5efit   
manag] agrees to meet ! foll[+          
requirem5ts3 7,a7 ,transp>5cy reg>d+    
gu>antees & co/ p]=mance evaluations ,! 
ph>macy b5efit manag] %all-- 7i7 def9e1 
int]pret1 & apply t]ms 7su* z g5]ic     
drug1 br& "n drug 7consi/5t ) !         
def9ition ( ^? t]ms "u section #dbc4d ( 
title #db1 ,code ( ,f$]al ,regulations1 
or a successor regulation71 specialty   
drug1 rebate1 & disc\nt7 9 a fully      
transp>5t & consi/5t mann] = purposes ( 
calculat+ or o!rwise evaluat+ ph>macy   
b5efit manag] p]=mance aga9/ pric+      
gu>antees or simil> co/ p]=mance        

measurem5ts relat$ to rebates1 disc\nts1
 price concessions1 or net co/s2  7ii7  
id5tify any drugs1 claims1 or price     
concessions exclud$ f any pric+ gu>antee
 or o!r co/ p]=mance calculation or     
evaluation 9 a cle> & consi/5t mann]2 & 
7iii7 :]e a pric+ gu>antee or o!r co/   
p]=mance measure is bas$ on a pric+     
b5*m>k o!r ?an ! :olesale acquisition   
co/ 7z def9$ 9 section                  
#ahdg;,a7c77#f77;,b77 ( a drug1         
calculate & provide a :olesale          
acquisition co/-bas$ equival5t to !     
pric+ gu>antee or o!r co/ p]=mance      
measure 9 ! contract4  7,b7 ,provision (
 in=mation  7i7 ,9 g5]al ,n lat] ?an    
,july #a ( ea* ye>1 ! ph>macy b5efit    
manag] %all submit to ! ,,pdp sponsor1 &
 to ! ,secret>y ^u reque/1 a report1 9  
accordance ) ?is subp>agraph1 & %all    
make su* report available to ! sponsor  
at no co/ to su* sponsor 9 a            
ma*9e-readable =mat &1 z ! ,secret>y may
 det]m9e1 o!r =mats4 ,ea* su* report    
%all include1 ) respect to su* ,,pdp    

sponsor & ea* plan (f]$ by su* sponsor1 
! foll[+ in=mation ) respect to !       
previ\s plan ye>3 7,i7 ,a li/ ( all     
drugs cov]$ by ! plan t 7 disp5s$       
includ+1 ) respect to ea* su* drug--    
7aa7 ! br& "n1 g5]ic or non-propriet>y  
"n1 & ,national ,drug ,code2  7bb7 !    
numb] ( plan enrollees = :om ! drug 0   
disp5s$1 ! total numb] ( prescription   
claims = ! drug 7includ+ orig9al        
prescriptions & refills1 c\nt$ z sep>ate
 claims71 & ! total numb] ( dosage units
 ( ! drug disp5s$2  7cc7 ! numb] (      
claims describ$ 9 item 7bb7 t 7 disp5s$ 
us+ ea* type ( disp5s+ *annel1 includ+  
retail1 mail ord]1 specialty ph>macy1 or
 o!r types ( ph>macies or provid]s z    
def9$ by ! ph>macy b5efit manag]2  7dd7 
! av]age :olesale acquisition co/1 li/$ 
z co/ p] day's supply1 co/ p] dosage    
unit1 & co/ p] typical c\rse ( treatm5t 
7z applicable72  7ee7 ! av]age :olesale 
price = ! drug1 li/$ z co/ p] day's     
supply1 co/ p] dosage unit1 & co/ p]    
typical c\rse ( treatm5t 7z applicable72

  7ff7 ! total out-(-pocket sp5d+ by    
plan enrollees on su* drug aft]         
application ( any b5efits "u ! plan1    
includ+ plan enrollee sp5d+ ?r\gh       
copaym5ts1 co9surance1 & d$uctibles2    
7gg7 total rebates paid by ! manufactur]
 on ! drug z report$ "u ! ,detail$ ,,dir
 ,report 7or any successor report7      
submitt$ by su* sponsor to ! ,c5t]s =   
,m$ic>e  ,m$icaid ,s]vices2  7hh7 all   
o!r direct or indirect remun]ation on ! 
drug z report$ "u ! ,detail$ ,,dir      
,report 7or any successor report7       
submitt$ by su* sponsor to ! ,c5t]s =   
,m$ic>e  ,m$icaid ,s]vices2  7ii7 !     
av]age ph>macy reimbursem5t am\nt *>g$  
to ! plan = ! drug by disp5s+ *annel    
id5tifi$ 9 item 7cc72  7jj7 ! av]age    
,national ,av]age ,drug ,acquisition    
,co/ 7,,nadac7 = retail community       
ph>macies2 &  7kk7 total                
manufactur]-d]iv$ rev5ue1 inclusive (   
bona fide s]vice fees1 reta9$ by !      
ph>macy b5efit manag] & any affiliate ( 
su* ph>macy b5efit manag] attributable  

to ! drug4  7,,ii7 ,9 ! case ( a ph>macy
 b5efit manag] t has an affiliate t is a
 retail1 mail ord]1 or specialty        
ph>macy1 ) respect to drugs cov]$ by su*
 plan t 7 disp5s$1 ! foll[+ in=mation3  
7aa7 ,! p]c5tage ( total prescriptions t
 7 disp5s$ by ph>macies t are an        
affiliate ( ! ph>macy b5efit manag] =   
ea* drug4  7bb7 ,! int]qu>tile range ( !
 total comb9$ co/s paid by ! plan & plan
 enrollees1 p] dosage unit1 p] c\rse (  
treatm5t1 p] #cj-;day supply1 & p]      
#ij-;day supply = ea* drug disp5s$ by   
ph>macies t are n ) an affiliate ( !    
ph>macy b5efit manag] & t are includ$ 9 
! ph>macy network ( su* plan4  7cc7 ,!  
int]qu>tile range ( ! total comb9$ co/s 
paid by ! plan & plan enrollees1 p]     
dosage unit1 p] c\rse ( treatm5t1 p]    
#cj-;day supply1 & p] #ij-;day supply = 
ea* drug disp5s$ by ph>macies t are an  
affiliate ( ! ph>macy b5efit manag] t   
are includ$ 9 ! ph>macy network ( su*   
plan4  7dd7 ,! l[e/ total comb9$ co/    
paid by ! plan & plan enrollees1 p]     

dosage unit1 p] c\rse ( treatm5t1 p]    
#cj-;day supply1 & p] #ij-;day supply1 =
 ea* drug t is available f any ph>macy  
includ$ 9 ! network ( ! plan4  7ee7 ,!  
diff]5ce betwe5 ! av]age acquisition co/
 ( ! affiliate t initially acquires !   
drug & ! am\nt report$ "u subclause     
7,i77jj7 = ea* drug4  7ff7 ,a li/ (     
prescription drugs = :i* ! ph>macy      
b5efit manag] or an affiliate ( !       
ph>macy b5efit manag] _h a contract or  
o!r arrangem5t ) a cov]$ entity "u      
section #cdj;,b ( ! ,public ,heal?      
,s]vice ,act 9 ! s]vice area ( su* plan4
  7,,iii7 ,:]e a drug approv$ "u section
 #eje7;c7 ( ! ,f$]al ,food1 ,drug1 &    
,cosmetic ,act 7ref]r$ to 9 ?is         
subclause z ! li/$ drug7 is cov]$ by !  
plan1 ! foll[+ in=mation3 7aa7 ,a li/ ( 
curr5tly m>ket$ g5]ic drugs approv$ "u  
section #eje7;j7 ( ! ,f$]al ,food1      
,drug1 & ,cosmetic ,act pursuant to an  
application t ref]5ces su* li/$ drug t  
are n cov]$ by ! plan1 are cov]$ on a   
=mul>y ti] typically associat$ ) high]  

co/-%>+ ?an ! li/$ drug1 or are subject 
to utilization managem5t t ! li/$ drug  
is n subject to4  7bb7 ,! e/imat$ av]age
 b5efici>y co/-%>+ "u ! plan = a        
#cj-;day supply ( ! li/$ drug4  7cc7 ,! 
e/imat$ av]age co/-%>+ t a b5efici>y    
w\ld h paid = a #cj-;day supply ( ea* ( 
! g5]ic drugs describ$ 9 item 7aa71 _h !
 plan provid$ cov]age = su* drugs on !  
same =mul>y ti] z ! li/$ drug4  7dd7 ,a 
writt5 ju/ification = provid+ m         
favorable cov]age ( ! li/$ drug ?an !   
g5]ic drugs describ$ 9 item 7aa74       
7,,iv7 ,:]e a ref]5ce product 7z def9$ 9
 section #cea7;i7 ( ! ,public ,heal?    
,s]vice ,act7 is cov]$ by ! plan1 !     
foll[+ in=mation3 7aa7 ,a li/ ( curr5tly
 m>ket$ biosimil> biological products   
lic5s$ "u section #cea7k7 ( ! ,public   
,heal? ,s]vice ,act pursuant to an      
application t ref]s to su* ref]5ce      
product t are n cov]$ by ! plan1 are    
cov]$ on a =mul>y ti] typically         
associat$ ) high] co/-%>+ ?an ! ref]5ce 
product1 or are subject to utilization  

managem5t t ! ref]5ce product is n      
subject to4  7bb7 ,! e/imat$ av]age     
b5efici>y co/-%>+ "u ! plan = a #cj-;day
 supply ( ! ref]5ce product4  7cc7 ,!   
e/imat$ av]age co/-%>+ t a b5efici>y    
w\ld h paid = a #cj-;day supply ( ea* ( 
! biosimil> biological products describ$
 9 item 7aa71 _h ! plan provid$ cov]age 
= su* products on ! same =mul>y ti] z ! 
ref]5ce product4  7dd7 ,a writt5        
ju/ification = provid+ m favorable      
cov]age ( ! ref]5ce product ?an !       
biosimil> biological product describ$ 9 
item 7aa74  7,v7 ,total gross sp5d+ on  
prescription drugs by ! plan1 n net (   
rebates1 fees1 disc\nts1 or o!r direct  
or indirect remun]ation4  7,,vi7 ,!     
total am\nt reta9$ by ! ph>macy b5efit  
manag] or an affiliate ( su* ph>macy    
b5efit manag] 9 rev5ue relat$ to        
utilization ( prescription drugs "u t   
plan1 inclusive ( bona fide s]vice fees4
  7,,vii7 ,! total sp5d+ on prescription
 drugs net ( rebates1 fees1 disc\nts1 or
 o!r direct & indirect remun]ation by ! 

plan4  7,,viii7 ,an explanation ( any   
b5efit design p>amet]s "u su* plan t    
enc\rage plan enrollees to fill         
prescriptions at ph>macies t are an     
affiliate ( su* ph>macy b5efit manag]1  
su* z mail & specialty home deliv]y     
programs1 & retail & mail auto-refill   
programs4  7,,ix7 ,a li/ ( all brok]s1  
consultants1 advisors1 & auditors t     
receive comp5sation f ! ph>macy b5efit  
manag] or an affiliate ( su* ph>macy    
b5efit manag] = ref]rals1 consult+1     
audit+1 or o!r s]vices (f]$ to ,,pdp    
sponsors relat$ to ph>macy b5efit       
managem5t s]vices4  7,x7 ,a li/ ( all   
ph>macies1 :olesal]s1 di/ributors1      
private label]s1 provid]s1 gr\p pur*as+ 
organizations1 heal? plans1 or any o!r  
entity t is an affiliate ( ! ph>macy    
b5efit manag]4  7,,xi7 ,a summ>y docum5t
 submitt$ 9 a /&>diz$ template develop$ 
by ! ,secret>y t includes su* in=mation 
describ$ 9 subclauses 7,i7 ?r\gh 7,x74  
7ii7 ,/&>d =mats ,n lat] ?an ,june #a1  
#bjbe1 ! ,secret>y %all specify /&>d    

=mats = ph>macy b5efit manag]s to submit
 annual reports requir$ "u clause 7i74  
7iii7 ,confid5tiality  7,i7 ,9 g5]al    
,in=mation disclos$ by a ph>macy b5efit 
manag] or ,,pdp sponsor "u ?is          
subsection t is n o!rwise publicly      
available %all n be disclos$ by !       
,secret>y or a ,,pdp sponsor receiv+ !  
in=mation1 except t ! ,secret>y may     
disclose ! in=mation = ! foll[+         
purposes3 7aa7 ,z ! ,secret>y det]m9es  
to be necess>y to c>ry out ?is "p4  7bb7
 ,to p]mit ! ,comptroll] ,g5]al to      
review ! in=mation provid$4  7cc7 ,to   
p]mit ! ,director ( ! ,congressional    
,budget ,(fice to review ! in=mation    
provid$4  7dd7 ,to p]mit ! ,executive   
,director ( ! ,m$ic>e ,paym5t ,advisory 
,commission to review ! in=mation       
provid$4  7ee7 ,to ! ,attorney ,g5]al = 
! purposes ( conduct+ ov]sight &        
en=cem5t "u ?is title4  7,,ii7          
,re/riction on use ( in=mation ,!       
,secret>y1 ! ,comptroll] ,g5]al1 !      
,director ( ! ,congressional ,budget    

,(fice1 & ! ,executive ,director ( !    
,m$ic>e ,paym5t ,advisory ,commission   
%all n report on or disclose in=mation  
disclos$ pursuant to subclause 7,i7 to !
 public 9 a mann] t w\ld id5tify a      
specific ph>macy b5efit manag]1         
affiliate1 ,,pdp sponsor1 or plan1 or   
prices *>g$ = specific drugs4  7,c7     
,audit rights  7i7 ,9 g5]al ,n less ?an 
once a ye>1 at ! reque/ ( ! ,,pdp       
sponsor1 ! ph>macy b5efit manag] %all   
all[ = an audit ( ! ph>macy b5efit      
manag] to ensure compliance ) all t]ms &
 conditions "u ! contract & ! accuracy (
 in=mation report$ "u subp>agraph 7,b74 
7ii7 ,auditor ,! ,,pdp sponsor %all h ! 
"r to select an auditor4 ,! ph>macy     
b5efit manag] %all n impose any         
limitations on ! selection ( su*        
auditor4  7iii7 ,provision ( in=mation  
,! ph>macy b5efit manag] %all make      
available to su* auditor all records1   
data1 contracts1 & o!r in=mation        
necess>y to confirm ! accuracy (        
in=mation provid$ "u subp>agraph 7,b71  

subject to reasonable re/rictions on h[ 
su* in=mation mu/ be report$ 7z det]m9$ 
by ! ,secret>y7 to prev5t r$isclosure ( 
su* in=mation4  7iv7 ,tim+ ,! ph>macy   
b5efit manag] mu/ provide in=mation "u  
clause 7iii7 & o!r in=mation1 data1 &   
records relevant to ! audit to su*      
auditor )9 #f mon?s ( ! initiation ( !  
audit & respond to reque/s = additional 
in=mation f su* auditor )9 #cj days aft]
 ! reque/ = additional in=mation4  7v7  
,in=mation f affiliates ,! ph>macy      
b5efit manag] %all be responsible =     
provid+ to su* auditor in=mation requir$
 to be report$ "u subp>agraph 7,b7 t is 
own$ or held by an affiliate ( su*      
ph>macy b5efit manag]4  7,d7 ,en=cem5t  
,! ph>macy b5efit manag] %all-- 7i7     
reimburse ! ,,pdp sponsor = any civil   
money p5alty impos$ on ! ,,pdp sponsor z
 a result ( ! failure ( ! ph>macy b5efit
 manag] to meet ! requirem5ts ( ?is     
p>agraph t are applicable to ! ph>macy  
b5efit manag] "u ! agreem5t2 &  7ii7 be 
subject to punitive rem$ies = brea* (   

contract = failure to comply ) !        
requirem5ts applicable "u ?is p>agraph4 
7#b7 ,c]tification ( compliance ,ea*    
,,pdp sponsor %all furni% to ! ,secret>y
 79 a "t & mann] specifi$ by !          
,secret>y7 an annual c]tification (     
compliance ) ?is subsection1 z well z   
su* in=mation z ! ,secret>y det]m9es    
necess>y to c>ry out ?is subsection4    
7#c7 ,def9itions ,= purposes ( ?is      
subsection3 7,a7 ,affiliate ,! t]m      
affiliate means any entity t is own$ by1
 controll$ by1 or relat$ "u a common    
own]%ip /ructure ) a ph>macy b5efit     
manag] 7includ+ an entity own$ or       
controll$ by ! ,,pdp sponsor7 or t acts 
z a contractor or ag5t to su* ph>macy   
b5efit manag]1 ins(> z su* contractor or
 ag5t p]=ms any ( ! functions describ$  
"u subp>agraph 7,b74  7,b7 ,ph>macy     
b5efit manag] ,! t]m ph>macy b5efit     
manag] means any p]son or entity t1 ei!r
 directly or ?r\gh an int]m$i>y1 acts z 
a price negotiator or gr\p pur*as] on   
behalf ( a ,,pdp sponsor or prescription

 drug plan1 or manages ! prescription   
drug b5efits provid$ by su* sponsor or  
plan1 includ+ ! process+ & paym5t (     
claims = prescription drugs1 ! p]=mance 
( drug utilization review1 ! process+ ( 
drug prior au?orization reque/s1 !      
adjudication ( appeals or grievances    
relat$ to ! prescription drug b5efit1   
contract+ ) network ph>macies1 controll+
 ! co/ ( cov]$ "p ,d drugs1 or !        
provision ( s]vices relat$ !reto4 ,su*  
t]m includes any p]son or entity t      
c>ries out "o or m ( ! activities       
describ$ 9 ! prec$+ s5t5ce1 irrespective
 ( :e!r su* p]son or entity calls itself
 a ph>macy b5efit manag]4  4  7#b7      
,,ma-,,pd plans ,section #aheg7;f77#c7 (
 ! ,social ,security ,act 7#db ,u4,s4,c4
 #aciew-#bg7;f77#c77 is am5d$ by add+ at
 ! end ! foll[+ new subp>agraph3  7,f7  
,ph>macy b5efit manag] report+          
requirem5ts ,= plan ye>s beg9n+ on or   
aft] ,janu>y #a1 #bjbh1 section         
#ahfj;,d-#ab7;h74  4  7b7 ,,gao /udy &  
report on c]ta9 report+ requirem5ts     

7#a7 ,/udy ,! ,comptroll] ,g5]al ( !    
,unit$ ,/ates 79 ?is subsection ref]r$  
to z ! ,comptroll] ,g5]al7 %all conduct 
a /udy on ,f$]al & ,/ate report+        
requirem5ts = heal? plans & ph>macy     
b5efit manag]s relat$ to ! transp>5cy ( 
prescription drug co/s & prices4 ,su*   
/udy %all include an analysis ( !       
foll[+3 7,a7 ,f$]al /atutory &          
regulatory report+ requirem5ts = heal?  
plans & ph>macy b5efit manag]s relat$ to
 prescription drug co/s & prices4  7,b7 
,/ate /atutory & regulatory report+     
requirem5ts = heal? plans & ph>macy     
b5efit manag]s relat$ to prescription   
drug co/s & prices4  7,c7 ,! ext5t to   
:i* ! /atutory & regulatory report+     
requirem5ts id5tifi$ 9 clauses 7i7 &    
7ii7 ov]lap & conflict4  7,d7 ,!        
res\rces requir$ by heal? plans &       
ph>macy b5efit manag]s to comply ) !    
report+ requirem5ts describ$ 9 clauses  
7i7 & 7ii74  7,e7 ,o!r items det]m9$    
appropriate by ! ,comptroll] ,g5]al4    
7#b7 ,report ,n lat] ?an #b ye>s aft]   

enactm5t1 ! ,comptroll] ,g5]al %all     
submit to ,congress a report conta9+ !  
results ( ! /udy conduct$ "u p>agraph   
7#a71 toge!r ) recomm5dations =         
legislation & adm9i/rative actions t    
w\ld /reaml9e & r$uce ! burd5 associat$ 
) ! report+ requirem5ts = heal? plans & 
ph>macy b5efit manag]s describ$ 9       
p>agraph 7#a74