Pharmacy DIR Reform To Reduce Senior Drug Costs Act

II 117TH CONGRESS 1ST SESSION S. 1909 To amend title XVIII of the Social Security Act to reform requirements with respect to direct and indirect remuneration under Medicare part D, and for other purposes. IN THE SENATE OF THE UNITED STATES MAY 27, 2021 Mr. TESTER (for himself, Mrs. CAPITO, Mr. BROWN, and Mr. LANKFORD) in- troduced the following bill; which was read twice and referred to the Com- mittee on Finance A BILL To amend title XVIII of the Social Security Act to reform requirements with respect to direct and indirect remu- neration under Medicare part D, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Pharmacy DIR Reform 4 To Reduce Senior Drug Costs Act’’. 5 VerDate Sep 11 2014 22:14 Jun 15, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1909.IS S1909 pamtmann on DSKBC07HB2PROD with BILLS 2 •S 1909 IS SEC. 2. REQUIRING PHARMACY-NEGOTIATED PRICE CON- 1 CESSIONS, PAYMENT, AND FEES TO BE IN- 2 CLUDED IN NEGOTIATED PRICES AT THE 3 POINT-OF-SALE UNDER PART D OF THE MEDI- 4 CARE PROGRAM. 5 Section 1860D–2(d)(1)(B) of the Social Security Act 6 (42 U.S.C. 1395w–102(d)(1)(B)) is amended— 7 (1) by striking ‘‘PRICES.—For purposes’’ and 8 inserting ‘‘PRICES.— 9 ‘‘(i) IN GENERAL.—For purposes’’; 10 and 11 (2) by adding at the end the following new 12 clause: 13 ‘‘(ii) PRICES NEGOTIATED WITH 14 PHARMACY AT POINT-OF-SALE.—For plan 15 years beginning on or after January 1, 16 2022, a negotiated price for a covered part 17 D drug described in clause (i) shall include 18 price concessions, payments, and fees nego- 19 tiated with such pharmacy as defined by 20 the Secretary, but shall not include incen- 21 tive payments based on pharmacy perform- 22 ance paid or to be paid to such pharmacy. 23 Such negotiated price shall be provided at 24 the point-of-sale of such drug.’’. 25 VerDate Sep 11 2014 22:14 Jun 15, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1909.IS S1909 pamtmann on DSKBC07HB2PROD with BILLS 3 •S 1909 IS SEC. 3. DISCLOSURE TO PHARMACY OF POST-POINT-OF- 1 SALE PHARMACY PRICE CONCESSIONS AND 2 INCENTIVE PAYMENTS. 3 Section 1860D–2(d)(2) of the Social Security Act (42 4 U.S.C. 1395w–102(d)(2)) is amended— 5 (1) by striking ‘‘DISCLOSURE.—A PDP spon- 6 sor’’ and inserting ‘‘DISCLOSURE.— 7 ‘‘(A) TO THE SECRETARY.—A PDP spon- 8 sor’’; and 9 (2) by adding at the end the following new sub- 10 paragraph: 11 ‘‘(B) TO PHARMACIES.— 12 ‘‘(i) IN GENERAL.—For plan year 13 2022 and subsequent plan years, a PDP 14 sponsor offering a prescription drug plan 15 and an MA organization offering an MA– 16 PD plan shall report any pharmacy price 17 concession or incentive payment that oc- 18 curs with respect to a pharmacy after pay- 19 ment for covered part D drugs at the 20 point-of-sale, including by an intermediary 21 organization with which a PDP sponsor or 22 MA organization has contracted, to the 23 pharmacy. 24 ‘‘(ii) TIMING.—The reporting of price 25 concessions and incentive payments to a 26 VerDate Sep 11 2014 22:14 Jun 15, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1909.IS S1909 pamtmann on DSKBC07HB2PROD with BILLS 4 •S 1909 IS pharmacy under clause (i) shall be made 1 on a periodic basis (but in no case less fre- 2 quently than annually). 3 ‘‘(iii) CLAIM LEVEL.—The reporting 4 of price concessions and incentive pay- 5 ments to a pharmacy under clause (i) shall 6 be at the claim level or approximated at 7 the claim level if the price concession or in- 8 centive payment was applied at a level 9 other than at the claim level.’’. 10 SEC. 4. ESTABLISHMENT OF PHARMACY PERFORMANCE 11 MEASURES UNDER MEDICARE PART D. 12 Section 1860D–4(c) of the Social Security Act (42 13 U.S.C. 1395w–104(c)) is amended— 14 (1) by redesignating paragraph (6), as added by 15 section 50354 of division E of the Bipartisan Budg- 16 et Act of 2018 (Public Law 115–123), as paragraph 17 (7); and 18 (2) by adding at the end the following new 19 paragraph: 20 ‘‘(8) APPLICATION OF STANDARDIZED PHAR- 21 MACY PERFORMANCE MEASURES.— 22 ‘‘(A) IN GENERAL.—A PDP sponsor and 23 MA–PD plan that makes incentive payments to 24 a pharmacy or receives price concessions paid 25 VerDate Sep 11 2014 22:14 Jun 15, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1909.IS S1909 pamtmann on DSKBC07HB2PROD with BILLS 5 •S 1909 IS by a pharmacy based on performance measures 1 shall, for the purposes of such incentive pay- 2 ments and price concessions with respect to cov- 3 ered part D drugs dispensed by such pharmacy, 4 only use measures— 5 ‘‘(i) established or adopted by the Sec- 6 retary under subparagraph (B), as listed 7 under clause (ii) of such subparagraph; 8 and 9 ‘‘(ii) that are relevant to the perform- 10 ance of such pharmacy with respect to 11 areas that the pharmacy can impact based 12 on covered part D drugs dispensed and 13 managed. 14 ‘‘(B) STANDARDIZED PHARMACY PER- 15 FORMANCE MEASURES.— 16 ‘‘(i) IN GENERAL.—Notwithstanding 17 any other provision of law, the Secretary 18 shall establish or adopt standardized phar- 19 macy performance measures from one or 20 more multi-stakeholder, consensus organi- 21 zations representing all pharmacy types 22 (including specialty pharmacies) to be used 23 by a PDP sponsor and MA–PD plan for 24 the purposes of determining incentive pay- 25 VerDate Sep 11 2014 22:14 Jun 15, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1909.IS S1909 pamtmann on DSKBC07HB2PROD with BILLS 6 •S 1909 IS ments and price concessions described in 1 subparagraph (A). Such measures shall be 2 evidence-based and focus on pharmacy per- 3 formance on patient health outcomes and 4 other areas, as determined by the Sec- 5 retary, that the pharmacy can impact 6 based on covered part D drugs dispensed 7 and managed. 8 ‘‘(ii) MAINTENANCE OF LIST.—The 9 Secretary shall maintain a single list of 10 measures established or adopted under this 11 subparagraph and measures shall be evalu- 12 ated and updated on an ongoing basis 13 through stakeholder consensus organiza- 14 tions to ensure they are transparent, 15 achievable, and clinically meaningful. 16 ‘‘(iii) APPLICATION TO STAR RAT- 17 INGS.—The Secretary shall require the de- 18 velopment of measures to apply in the star 19 rating system under this part to assess the 20 use of a standard set of pharmacy per- 21 formance measures by PDP sponsors and 22 MA–PD plans. 23 ‘‘(C) SPECIALTY PHARMACY.—For pur- 24 poses of subparagraph (B)(i), the Secretary 25 VerDate Sep 11 2014 22:14 Jun 15, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1909.IS S1909 pamtmann on DSKBC07HB2PROD with BILLS 7 •S 1909 IS shall, not later than December 31, 2022, define 1 the term ‘specialty pharmacy’ in consultation 2 with relevant stakeholders. 3 ‘‘(D) EFFECTIVE DATE.—The requirement 4 under subparagraph (A) shall take effect for 5 plan years beginning on January 1, 2022, or 6 such earlier date specified by the Secretary if 7 the Secretary determines there are sufficient 8 measures established or adopted under subpara- 9 graph (B) for the purposes of the requirement 10 under subparagraph (A).’’. 11 Æ VerDate Sep 11 2014 22:14 Jun 15, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\S1909.IS S1909 pamtmann on DSKBC07HB2PROD with BILLS