Fairness for Patient Medications Act

I 118TH CONGRESS 1ST SESSION H. R. 3285 To establish patient protections with respect to highly rebated drugs. IN THE HOUSE OF REPRESENTATIVES MAY 15, 2023 Mr. GRIFFITH introduced the following bill; which was referred to the Com- mittee on Energy and Commerce, and in addition to the Committees on Education and the Workforce, and 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 con- cerned A BILL To establish patient protections with respect to highly rebated drugs. 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 ‘‘Fairness for Patient 4 Medications Act’’. 5 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 2 •HR 3285 IH SEC. 2. REQUIREMENTS WITH RESPECT TO COST-SHARING 1 FOR HIGHLY REBATED DRUGS. 2 (a) PHSA.—Part D of title XXVII of the Public 3 Health Service Act (42 U.S.C. 300gg–111 et seq.) is 4 amended by adding at the end the following: 5 ‘‘SEC. 2799A–11. REQUIREMENTS WITH RESPECT TO COST- 6 SHARING FOR HIGHLY REBATED DRUGS. 7 ‘‘(a) IN GENERAL.—No later than April 1, 2024, and 8 annually thereafter, the Secretary shall certify (or recer- 9 tify, if applicable) as a ‘highly rebated drug’ any drug 10 identified in reports submitted under sections 2799A–10, 11 725 of the Employee Retirement Income Security Act, and 12 9825 of the Internal Revenue Code of 1986 for which total 13 rebates, reductions in price, and other forms of remunera- 14 tion in the previous year aggregated across all commercial 15 markets exceeded 50 percent of total annual spending on 16 such drug in such year. 17 ‘‘(b) DEDUCTIBLE AND COST-SHARING LIMITATIONS 18 FOR CERTIFIED DRUGS.—For plan years that begin on 19 or after January 1, 2025, a group health plan or a health 20 insurance issuer offering group or individual health insur- 21 ance coverage (or entity that provides pharmacy benefits 22 management services on behalf of such a plan or issuer) 23 that provides coverage of any highly rebated drug shall 24 not impose cost-sharing in excess of, per 30-day supply, 25 the quotient of the annual net price paid by such group 26 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 3 •HR 3285 IH health plan or health insurance issuer (or entity that pro- 1 vides pharmacy benefits management services on behalf 2 of such a plan or issuer), in the most recent calendar year 3 for which a final net price has been calculated by such 4 plan or coverage (or entity that provides pharmacy benefit 5 management services on behalf of such plan or issuer), 6 per 30-day supply of such specific highly rebated drug, 7 divided by 12. 8 ‘‘(c) HIGHLY REBATED DRUG PREVIOUSLY SUBJECT 9 TO FORMULARY EXCLUSION.—Beginning on January 1, 10 2025, in the case of a specific highly rebated drug covered 11 by a group health plan or health insurance issuer offering 12 group or individual health insurance coverage (or entity 13 that provides pharmacy benefits management services on 14 behalf of such plan or issuer) that provides coverage of 15 a specific highly rebated drug that was not covered in the 16 previous year, such group health plan or health insurance 17 issuer shall not receive from a drug manufacturer a reduc- 18 tion in price or other remuneration with respect to such 19 specific highly rebated drug received by an enrollee in the 20 plan or coverage and covered by the plan or coverage, un- 21 less— 22 ‘‘(1) any such reduction in price is reflected at 23 the point of sale to the enrollee; and 24 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 4 •HR 3285 IH ‘‘(2) any such other remuneration is a flat fee- 1 based service fee not contingent on total volume of 2 sales that a manufacturer of prescription drugs pays 3 to an entity that provides pharmacy benefits man- 4 agement services. 5 ‘‘(d) DEFINITIONS.—In this section: 6 ‘‘(1) ENTITY THAT PROVIDES PHARMACY BENE- 7 FITS MANAGEMENT SERVICES.—The term ‘entity 8 that provides pharmacy benefits management serv- 9 ices’ means— 10 ‘‘(A) any entity that, pursuant to a written 11 agreement with a group health plan or a health 12 insurance issuer offering group or individual 13 health insurance coverage, directly or through 14 an intermediary— 15 ‘‘(i) acts as a price negotiator on be- 16 half of the plan or coverage; or 17 ‘‘(ii) manages the prescription drug 18 benefits provided by the plan or coverage, 19 which may include the processing and pay- 20 ment of claims for prescription drugs, the 21 performance of drug utilization review, the 22 processing of drug prior authorization re- 23 quests, the adjudication of appeals or 24 grievances related to the prescription drug 25 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 5 •HR 3285 IH benefit, contracting with network phar- 1 macies, controlling the cost of covered pre- 2 scription drugs, or the provision of related 3 services; or 4 ‘‘(B) any entity that is owned, affiliated, or 5 related under a common ownership structure 6 with an entity described in subparagraph (A). 7 ‘‘(2) NET PRICE.—The term ‘net price’, with 8 respect to a prescription drug, means the final price 9 paid by a group health plan or health insurance 10 issuer offering group or individual health insurance 11 coverage (or entity that provides pharmacy benefits 12 management services on behalf of such a plan or 13 issuer) after applying any rebates and other remu- 14 neration under the plan or coverage from drug man- 15 ufacturers during the plan year. 16 ‘‘(e) SPECIFICATION.—A health insurance plan will 17 not fail to be treated as an HDHP for complying with 18 the cost-sharing cap in this section.’’. 19 (b) ERISA.— 20 (1) IN GENERAL.—Subpart B of part 7 of sub- 21 title B of title I of the Employee Retirement Income 22 Security Act of 1974 (29 U.S.C. 1185 et seq.) is 23 amended by adding at the end the following: 24 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 6 •HR 3285 IH ‘‘SEC. 725. REQUIREMENTS WITH RESPECT TO COST-SHAR- 1 ING FOR HIGHLY REBATED DRUGS. 2 ‘‘(a) IN GENERAL.—No later than April 1, 2024, and 3 annually thereafter, the Secretary shall certify (or recer- 4 tify, if applicable) as a ‘highly rebated drug’ any drug 5 identified in reports submitted under sections 725, 6 2799A–10 of the Public Health Service Act, and 9825 of 7 the Internal Revenue Code of 1986 for which total rebates, 8 reductions in price, and other forms of remuneration in 9 the previous year aggregated across all commercial mar- 10 kets exceeded 50 percent of total annual spending on such 11 drug in such year. 12 ‘‘(b) DEDUCTIBLE AND COST-SHARING LIMITATIONS 13 FOR CERTIFIED DRUGS.—For plan years that begin on 14 or after January 1, 2025, a group health plan or a health 15 insurance issuer offering group health insurance coverage 16 (or entity that provides pharmacy benefits management 17 services on behalf of such a plan or issuer) that provides 18 coverage of any highly rebated drug shall not impose cost- 19 sharing in excess of, per 30-day supply, the quotient of 20 the annual net price paid by such group health plan or 21 health insurance issuer (or entity that provides pharmacy 22 benefits management services on behalf of such a plan or 23 issuer), in the most recent calendar year for which a final 24 net price has been calculated by such plan or coverage (or 25 entity that provides pharmacy benefit management serv- 26 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 7 •HR 3285 IH ices on behalf of such plan or issuer), per 30-day supply 1 of such specific highly rebated drug, divided by 12. 2 ‘‘(c) HIGHLY REBATED DRUG PREVIOUSLY SUBJECT 3 TO FORMULARY EXCLUSION.—Beginning on January 1, 4 2025, in the case of a specific highly rebated drug covered 5 by a group health plan or health insurance issuer offering 6 group health insurance coverage (or entity that provides 7 pharmacy benefits management services on behalf of such 8 plan or issuer) that provides coverage of a specific highly 9 rebated drug that was not covered in the previous year, 10 such group health plan or health insurance issuer shall 11 not receive from a drug manufacturer a reduction in price 12 or other remuneration with respect to such specific highly 13 rebated drug received by an enrollee in the plan or cov- 14 erage and covered by the plan or coverage, unless— 15 ‘‘(1) any such reduction in price is reflected at 16 the point of sale to the enrollee; and 17 ‘‘(2) any such other remuneration is a flat fee- 18 based service fee not contingent on total volume of 19 sales that a manufacturer of prescription drugs pays 20 to an entity that provides pharmacy benefits man- 21 agement services. 22 ‘‘(d) DEFINITIONS.—In this section: 23 ‘‘(1) ENTITY THAT PROVIDES PHARMACY BENE- 24 FITS MANAGEMENT SERVICES.—The term ‘entity 25 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 8 •HR 3285 IH that provides pharmacy benefits management serv- 1 ices’ means— 2 ‘‘(A) any entity that, pursuant to a written 3 agreement with a group health plan or a health 4 insurance issuer offering group health insur- 5 ance coverage, directly or through an inter- 6 mediary— 7 ‘‘(i) acts as a price negotiator on be- 8 half of the plan or coverage; or 9 ‘‘(ii) manages the prescription drug 10 benefits provided by the plan or coverage, 11 which may include the processing and pay- 12 ment of claims for prescription drugs, the 13 performance of drug utilization review, the 14 processing of drug prior authorization re- 15 quests, the adjudication of appeals or 16 grievances related to the prescription drug 17 benefit, contracting with network phar- 18 macies, controlling the cost of covered pre- 19 scription drugs, or the provision of related 20 services; or 21 ‘‘(B) any entity that is owned, affiliated, or 22 related under a common ownership structure 23 with an entity described in subparagraph (A). 24 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 9 •HR 3285 IH ‘‘(2) NET PRICE.—The term ‘net price’, with 1 respect to a prescription drug, means the final price 2 paid by a group health plan or health insurance 3 issuer offering group health insurance coverage (or 4 entity that provides pharmacy benefits management 5 services on behalf of such a plan or issuer) after ap- 6 plying any rebates and other remuneration under 7 the plan or coverage from drug manufacturers dur- 8 ing the plan year. 9 ‘‘(e) SPECIFICATION.—A health insurance plan will 10 not fail to be treated as an HDHP for complying with 11 the cost-sharing cap in this section.’’. 12 (2) CLERICAL AMENMDNET.—The table of con- 13 tents in section 1 of the Employee Retirement In- 14 come Security Act of 1974 (29 U.S.C. 1001 et seq.) 15 is amended by inserting after the item related to 16 section 725 the following: 17 ‘‘Sec. 725. Requirements with respect to cost-sharing for highly rebated drugs.’’. (c) IRC.— 18 (1) IN GENERAL.—Subchapter B of chapter 19 100 of the Internal Revenue Code of 1986 is amend- 20 ed by adding at the end the following new section: 21 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 10 •HR 3285 IH ‘‘SEC. 9826. REQUIREMENTS WITH RESPECT TO COST-SHAR- 1 ING FOR HIGHLY REBATED DRUGS. 2 ‘‘(a) IN GENERAL.—No later than April 1, 2024, and 3 annually thereafter, the Secretary shall certify (or recer- 4 tify, if applicable) as a ‘highly rebated drug’ any drug 5 identified in reports submitted under sections 9825, 6 2799A–10 of the Public Health Service Act, and 725 of 7 the Employee Retirement Income Security Act for which 8 total rebates, reductions in price, and other forms of remu- 9 neration in the previous year aggregated across all com- 10 mercial markets exceeded 50 percent of total annual 11 spending on such drug in such year. 12 ‘‘(b) DEDUCTIBLE AND COST-SHARING LIMITATIONS 13 FOR CERTIFIED DRUGS.—For plan years that begin on 14 or after January 1, 2025, a group health plan (or entity 15 that provides pharmacy benefits management services on 16 behalf of such a plan) that provides coverage of any highly 17 rebated drug shall not impose cost-sharing in excess of, 18 per 30-day supply, the quotient of the annual net price 19 paid by such group health plan (or entity that provides 20 pharmacy benefits management services on behalf of such 21 a plan), in the most recent calendar year for which a final 22 net price has been calculated by such plan (or entity that 23 provides pharmacy benefit management services on behalf 24 of such plan), per 30-day supply of such specific highly 25 rebated drug, divided by 12. 26 VerDate Sep 11 2014 21:53 Jul 12, 2023 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H3285.IH H3285 pbinns on DSKJLVW7X2PROD with $$_JOB 11 •HR 3285 IH ‘‘(c) HIGHLY REBATED DRUG PREVIOUSLY SUBJECT 1 TO FORMULARY EXCLUSION.—Beginning on January 1, 2 2025, in the case of a specific highly rebated drug covered 3 by a group health plan (or entity that provides pharmacy 4 benefits management services on behalf of such plan) that 5 provides coverage of a specific highly rebated drug that 6 was not covered in the previous year, such group health 7 plan shall not receive from a drug manufacturer a reduc- 8 tion in price or other remuneration with respect to such 9 specific highly rebated drug received by an enrollee in the 10 plan and covered by the plan, unless— 11 ‘‘(1) any such reduction in price is reflected at 12 the point of sale to the enrollee; and 13 ‘‘(2) any such other remuneration is a flat fee- 14 based service fee not contingent on total volume of 15 sales that a manufacturer of prescription drugs pays 16 to an entity that provides pharmacy benefits man- 17 agement services. 18 ‘‘(d) DEFINITIONS.—In this section: 19 ‘‘(1) ENTITY THAT PROVIDES PHARMACY BENE- 20 FITS MANAGEMENT SERVICES.—The term ‘entity 21 that provides p [Text truncated for display. 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