Federal

Access to Prescription Digital Therapeutics Act of 2023

Source: Congress.gov · 1,501 words in original text

What This Bill Does

This bill allows Medicare and Medicaid to pay for prescription digital therapeutics, which are software-based medical products that have government approval to treat, manage or prevent diseases. The bill requires the government to create payment rules and coding systems for these digital treatments and orders manufacturers to report pricing information.

Who It Affects

Manufacturers of prescription digital therapeutics, Medicare beneficiaries (people age 65 and older and some disabled people), Medicaid beneficiaries (low-income individuals), and the federal government.

Key Provisions

• Prescription digital therapeutics can be covered by Medicare starting January 1, 2024, if they are approved by the government and primarily use software to work (Sec. 2(b)). • The Secretary of Health and Human Services must create a payment method for these digital products within one year, which can be a one-time payment or ongoing payments (Sec. 2(c)). • The Secretary must establish special identification codes (HCPCS codes) for these products within two years and can use temporary codes until permanent ones exist (Sec. 2(c)). • Manufacturers must report to the government starting January 1, 2024, and every year after, listing the prices paid by private insurance companies, how many people used the product, and how much was distributed (Sec. 2(c)). • Manufacturers who fail to report or provide false information can be fined up to $10,000 per day for each violation (Sec. 2(c)). • Medicaid must cover prescription digital therapeutics (Sec. 3).

What Changes

If this bill becomes law, Medicare will begin paying for prescription digital therapeutics on January 1, 2024. The government will need to decide how much to pay manufacturers. Medicaid will also cover these products. Manufacturers will have to share their pricing data with the government every year or face penalties.

Important Definitions

• Prescription digital therapeutic: A product, device, internet application or technology that has government approval, is designed to prevent, manage or treat a medical disease or condition, and primarily works through software. • HCPCS: Healthcare Common Procedure Coding System, the system used to identify and code medical items and services. • Actual list charge: The public price for a prescription digital therapeutic on the first day it is available for purchase by a private insurance company. • Manufacturer: A company that makes medical devices, as defined by federal regulations. • Private payor: An insurance company that is not the government.

Effective Date

Coverage begins January 1, 2024 (Sec. 2(b)). Manufacturer reporting begins January 1, 2024 (Sec. 2(c)).

I 118TH CONGRESS 1ST SESSION H. R. 1458 To amend titles XVIII and XIX of the Social Security Act to provide for coverage of prescription digital therapeutics under such titles, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 8, 2023 Mr. HERN (for himself, Mr. THOMPSON of California, Mr. JOHNSON of Ohio, and Ms. MATSUI) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To amend titles XVIII and XIX of the Social Security Act to provide for coverage of prescription digital thera- peutics under such titles, 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 ‘‘Access to Prescription 4 Digital Therapeutics Act of 2023’’. 5 VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 1458 IH SEC. 2. COVERAGE AND PAYMENT OF PRESCRIPTION DIG- 1 ITAL THERAPEUTICS UNDER THE MEDICARE 2 PROGRAM. 3 (a) PRESCRIPTION DIGITAL THERAPEUTIC DE- 4 FINED.—Section 1861 of the Social Security Act (42 5 U.S.C. 1395x) is amended by adding at the end the fol- 6 lowing new subsection: 7 ‘‘(nnn) PRESCRIPTION DIGITAL THERAPEUTIC.— 8 The term ‘prescription digital therapeutic’ means a prod- 9 uct, device, internet application, or other technology 10 that— 11 ‘‘(1) is cleared or approved under section 12 510(k), 513(f)(2), or 515 of the Federal Food, 13 Drug, and Cosmetic Act; 14 ‘‘(2) has a cleared or approved indication for 15 the prevention, management, or treatment of a med- 16 ical disease, condition, or disorder; 17 ‘‘(3) primarily uses software to achieve its in- 18 tended result; and 19 ‘‘(4) is a device that is exempt from section 20 502(f)(1) of the Federal Food, Drug, and Cosmetic 21 Act under section 801.109 of title 21 of the Code of 22 Federal Regulations (or any successor regulation).’’. 23 (b) COVERAGE AS MEDICAL AND OTHER HEALTH 24 SERVICE.—Section 1861(s)(2) of the Social Security Act 25 (42 U.S.C. 1395x(s)(2)) is amended— 26 VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 1458 IH (1) in subparagraph (HH), by striking ‘‘and’’ 1 at the end; 2 (2) in subparagraph (II), by striking the period 3 at the end and inserting ‘‘; and’’; and 4 (3) by adding at the end the following new sub- 5 paragraph: 6 ‘‘(JJ) prescription digital therapeutics (as 7 defined in subsection (nnn)) furnished on or 8 after January 1, 2024;’’. 9 (c) REQUIREMENTS FOR PRESCRIPTION DIGITAL 10 THERAPEUTICS UNDER MEDICARE.—Part B of the Social 11 Security Act (42 U.S.C. 1395j et seq.) is amended by in- 12 serting after section 1834A the following new section: 13 ‘‘SEC. 1834B. REQUIREMENTS FOR PRESCRIPTION DIGITAL 14 THERAPEUTICS. 15 ‘‘(a) PAYMENT.— 16 ‘‘(1) IN GENERAL.—Not later than 1 year after 17 the date of enactment of this section, the Secretary 18 shall establish a payment methodology for manufac- 19 turers of prescription digital therapeutics, which 20 may consist of a one-time payment or periodic pay- 21 ments, as determined appropriate by the Secretary. 22 ‘‘(2) CONSIDERATIONS FOR PAYMENT METHOD- 23 OLOGY.—For purposes of establishing the payment 24 VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 1458 IH methodology under paragraph (1), the Secretary 1 shall consider— 2 ‘‘(A) the actual list charge of such pre- 3 scription digital therapeutic; 4 ‘‘(B) the weighted median (calculated by 5 arraying the distribution of all payment rates 6 reported for the most recent period for which 7 such rates were reported under subsection 8 (c)(1) for each prescription digital therapeutic 9 weighted by volume for each payor and each 10 manufacturer) for such prescription digital 11 therapeutic; 12 ‘‘(C) in the case of a prescription digital 13 therapeutic that requires ongoing use, the 14 amount for such ongoing use; and 15 ‘‘(D) other factors as determined by the 16 Secretary. 17 ‘‘(b) CODING.— 18 ‘‘(1) IN GENERAL.—Not later than 2 years 19 after the date of enactment of this section, the Sec- 20 retary shall establish product-specific HCPCS codes 21 for prescription digital therapeutic covered under 22 this title. 23 ‘‘(2) TEMPORARY CODE.—The Secretary shall 24 adopt temporary product-specific HCPCS codes for 25 VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 1458 IH purposes of providing payment under this title until 1 a permanent product-specific HCPCS code has been 2 established under paragraph (1). 3 ‘‘(c) MANUFACTURER REPORTING.— 4 ‘‘(1) IN GENERAL.—Beginning on January 1, 5 2024, each manufacturer of a prescription digital 6 therapeutic covered under this title shall submit to 7 the Secretary, at such time and in such manner as 8 specified by the Secretary, and annually thereafter, 9 a report describing— 10 ‘‘(A) the payment rate that was paid by 11 each private payor for each prescription digital 12 therapeutic during the period specified by the 13 Secretary; 14 ‘‘(B) the volume of such prescription dig- 15 ital therapeutic distributed to each such payor 16 for such period; and 17 ‘‘(C) the number of individual users of 18 such prescription digital therapeutic for such 19 period. 20 ‘‘(2) TREATMENT OF DISCOUNTS.—The pay- 21 ment rate reported by a manufacturer in accordance 22 with paragraph (1)(A) shall reflect all discounts, re- 23 bates, coupons, and other price concessions, includ- 24 ing those described in section 1847A(c)(3). 25 VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 1458 IH ‘‘(3) CIVIL MONETARY PENALTY.— 1 ‘‘(A) IN GENERAL.—If the Secretary deter- 2 mines that a manufacturer has failed to report, 3 or made a misrepresentation or omission in re- 4 porting, information under this subsection with 5 respect to a prescription digital therapeutic, the 6 Secretary may apply a civil money penalty in an 7 amount of up to $10,000 per day for each fail- 8 ure to report or each such misrepresentation or 9 omission. 10 ‘‘(B) APPLICATION.—The provisions of 11 section 1128A (other than subsections (a) and 12 (b)) shall apply to a civil money penalty under 13 this paragraph in the same manner as they 14 apply to a civil money penalty or proceeding 15 under section 1128A(a). 16 ‘‘(4) CONFIDENTIALITY.—Information reported 17 under this subsection shall be treated in the same 18 manner in which information is disclosed by a manu- 19 facturer or a wholesaler of a covered outpatient is 20 treated under section 1927(b)(3)(D). 21 ‘‘(d) DEFINITIONS.—For purposes of this section: 22 ‘‘(1) ACTUAL LIST CHARGE.—The term ‘actual 23 list charge’ means the publicly available payment 24 rate for a prescription digital therapeutic on the first 25 VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 1458 IH day that such prescription digital therapeutic is 1 available for purchase by a private payor. 2 ‘‘(2) HCPCS.—The term ‘HCPCS’ means, with 3 respect to an item, the code under the Healthcare 4 Common Procedure Coding System (HCPCS) (or a 5 successor code) for such item. 6 ‘‘(3) MANUFACTURER.—The term ‘manufac- 7 turer’ has the meaning given such term by section 8 820.3(o) of title 21, Code of Federal Regulations (or 9 any successor regulation). 10 ‘‘(4) PRESCRIPTION DIGITAL THERAPEUTIC.— 11 The term ‘prescription digital therapeutic’ has the 12 meaning given such term in section 1861(nnn). 13 ‘‘(5) PRIVATE PAYOR.—The term ‘private 14 payor’ has the meaning given such term in section 15 1834A(a)(8).’’. 16 SEC. 3. COVERAGE OF PRESCRIPTION DIGITAL THERA- 17 PEUTICS UNDER THE MEDICAID PROGRAM. 18 Section 1905(a) of the Social Security Act (42 U.S.C. 19 1396d(a)) is amended— 20 (1) in paragraph (30), by striking ‘‘; and’’ and 21 inserting a semicolon; 22 (2) by redesignating paragraph (31) as para- 23 graph (32); and 24 VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 1458 IH (3) by inserting the following paragraph after 1 paragraph (30): 2 ‘‘(31) prescription digital therapeutics (as de- 3 fined in section 1861(nnn)); and’’. 4 Æ VerDate Sep 11 2014 22:00 Mar 21, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6301 E:\BILLS\H1458.IH H1458 kjohnson on DSK79L0C42PROD with BILLS

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