Affordable Insulin for All Act
This bill addresses insulin affordability.
For example, the bill requires the Department of Health and Human Services (HHS) to enter into agreements with insulin manufacturers to enable individuals with diagnosed diabetes to access Medicaid prices for insulin drugs.
Additionally, Medicare and private insurance plans must cap cost-sharing at $10 per month for insulin drugs, and HHS must revise regulations to exclude payments made for insulin drugs from the denominator of the medical loss ratio.
The bill also (1) eliminates a safe harbor for certain rebates, discounts, or price concessions for insulin drugs paid by a drug manufacturer to a pharmacy benefit manager for purposes of federal health care fraud and abuse laws; and (2) prohibits certain drug pricing activities related to supplemental rebates and spread pricing in Medicaid.
The Government Accountability Office must report on the feasibility and affordability of direct manufacturing by the federal government.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5749 Introduced in House (IH)]
<DOC>
116th CONGRESS
2d Session
H. R. 5749
To amend title XI of the Social Security Act to establish the American
Insulin Program to provide for lower prices for insulin drugs, to
maintain effort throughout the insulin supply chain, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 4, 2020
Mr. Crist 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 title XI of the Social Security Act to establish the American
Insulin Program to provide for lower prices for insulin drugs, to
maintain effort throughout the insulin supply chain, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Affordable Insulin for All Act''.
SEC. 2. PROVIDING FOR LOWER PRICES FOR INSULIN DRUGS.
Part A of title XI of the Social Security Act (42 U.S.C. 1301) is
amended by adding at the end the following new section:
``SEC. 1150C. ESTABLISHMENT OF PROGRAM.
``(a) In General.--The Secretary shall establish an American
Insulin Program (in this section referred to as the `program') by not
later than 30 days after the date of the enactment of this section.
Under the program, the Secretary shall enter into agreements described
in subsection (b) with manufacturers and provide for the performance of
duties described in subsection (c). The Secretary shall establish a
model agreement for use under the program by not later than 20 days
after the date of the enactment of this section, in consultation with
manufacturers, and allow for comment on such model agreement.
``(b) Terms of Agreement.--
``(1) In general.--
``(A) Agreement.--An agreement under this section
shall require the manufacturer to provide applicable
individuals access to Medicaid prices for insulin drugs
of the manufacturer.
``(B) Provision of discounted prices as the point-
of-sale.--
``(i) In general.--Subject to clause (ii),
such Medicaid prices shall be provided to the
applicable beneficiary at the pharmacy or by
the mail order service at the point-of-sale of
an insulin drug.
``(ii) Certification of unsustainable
revenues.--
``(I) In general.--In the case the
Secretary submits to Congress a
certification that net revenues from
the sale of insulin drugs by
manufacturers with an agreement under
this section is unsustainable because
such manufactures will be unable to
meet the demand for insulin drugs in
the United States, subject to subclause
(II), the Secretary may increase the
Medicaid price by 5 percent.
``(II) Limitation.--The Secretary
may not increase the Medicaid price in
accordance with subclause (I) more than
3 times.
``(III) Applicability of price
increase.--An increase to the Medicaid
price of insulin drugs described in
subclause (I) shall apply to the sale
of insulin drugs 90 days after the date
of a certification described in such
subclause.
``(C) Timing of agreement.--
``(i) Special rule for 2021.--In order for
an agreement with a manufacturer to be in
effect under this section with respect to the
period beginning on January 1, 2021, and ending
on December 31, 2021, the manufacturer shall
enter into such agreement not later than 30
days after the date of the establishment of a
model agreement under subsection (a).
``(ii) 2022 and subsequent years.--In order
for an agreement with a manufacturer to be in
effect under this section with respect to plan
year 2022 or a subsequent plan year, the
manufacturer shall enter into such agreement
(or such agreement shall be renewed under
paragraph (4)(A)) not later than January 30 of
the preceding year.
``(2) Provision of appropriate data.--Each manufacturer
with an agreement in effect under this section shall collect
and have available appropriate data, as determined by the
Secretary, to ensure that it can demonstrate to the Secretary
compliance with the requirements under the program.
``(3) Compliance with requirements for administration of
program.--Each manufacturer with an agreement in effect under
this section shall comply with requirements imposed by the
Secretary or a third party with a contract under subsection
(d)(3), as applicable, for purposes of administering the
program, including any determination under clause (i) of
subsection (c)(1)(A) or procedures established under such
subsection (c)(1)(A).
``(4) Length of agreement.--
``(A) In general.--An agreement under this section
shall be effective for an initial period of not less
than 18 months and shall be automatically renewed for a
period of not less than 1 year unless terminated under
subparagraph (B).
``(B) Termination.--
``(i) By the secretary.--The Secretary may
provide for termination of an agreement under
this section for a knowing and willful
violation of the requirements of the agreement
or other good cause shown. Such termination
shall not be effective earlier than 30 days
after the date of notice to the manufacturer of
such termination. The Secretary shall provide,
upon request, a manufacturer with a hearing
concerning such a termination, and such hearing
shall take place prior to the effective date of
the termination with sufficient time for such
effective date to be repealed if the Secretary
determines appropriate.
``(ii) By a manufacturer.--A manufacturer
may terminate an agreement under this section
for any reason. Any such termination shall be
effective, with respect to a plan year--
``(I) if the termination occurs
before January 30 of a plan year, as of
the day after the end of the plan year;
and
``(II) if the termination occurs on
or after January 30 of a plan year, as
of the day after the end of the
succeeding plan year.
``(iii) Effectiveness of termination.--Any
termination under this subparagraph shall not
affect discounts for insulin drugs of the
manufacturer that are due under the agreement
before the effective date of its termination.
``(iv) Notice to third party.--The
Secretary shall provide notice of such
termination to a third party with a contract
under subsection (d)(3) within not less than 30
days before the effective date of such
termination.
``(c) Duties Described.--The duties described in this subsection
are the following:
``(1) Administration of program.--Administering the
program, including--
``(A) the determination of the amount of the
Medicaid price of an insulin drug of a manufacturer for
applicable individuals in each State;
``(B) except as provided in subparagraph (C), the
establishment of procedures under which Medicaid prices
are provided to applicable individuals at pharmacies or
by mail order service at the point-of-sale of an
insulin drug;
``(C) in the case where, during the period
beginning on January 1, 2022, and ending on December
31, 2022, it is not practicable to provide such
Medicaid prices at the point-of-sale (as described in
subparagraph (B)), the establishment of procedures to
provide such Medicaid prices as soon as practicable
after the point-of-sale;
``(D) the establishment of procedures to ensure
that, not later than the applicable number of calendar
days after the dispensing of an insulin drug by a
pharmacy or mail order service, the pharmacy or mail
order service is reimbursed for an amount equal to the
difference between--
``(i) the negotiated price of the insulin
drug; and
``(ii) the Medicaid price of the insulin
drug; and
``(E) providing a reasonable dispute resolution
mechanism to resolve disagreements between
manufacturers, applicable individuals, and the third
party with a contract under subsection (d)(3).
``(2) Monitoring compliance.--
``(A) In general.--The Secretary shall monitor
compliance by a manufacturer with the terms of an
agreement under this section.
``(B) Notification.--If a third party with a
contract under subsection (d)(3) determines that the
manufacturer is not in compliance with such agreement,
the third party shall notify the Secretary of such
noncompliance for appropriate enforcement under
subsection (e).
``(3) Collection of data from state medicaid programs.--The
Secretary may collect appropriate data from each State Medicaid
program under title XIX in a timeframe that allows for Medicaid
prices to be provided for applicable drugs under this section.
``(d) Administration.--
``(1) In general.--Subject to paragraph (2), the Secretary
shall provide for the implementation of this section, including
the performance of the duties described in subsection (c).
``(2) Limitation.--
``(A) In general.--Subject to subparagraph (B), in
providing for such implementation, the Secretary shall
not receive or distribute any funds of a manufacturer
under the program.
``(B) Exception.--The limitation under subparagraph
(A) shall not apply to the Secretary with respect to
insulin drugs dispensed during the period beginning on
January 1, 2022, and ending on December 31, 2022, but
only if the Secretary determines that the exception to
such limitation under this subparagraph is necessary in
order for the Secretary to begin implementation of this
section and provide applicable beneficiaries timely
access to Medicaid prices during such period.
``(3) Contract with third parties.--The Secretary shall
enter into a contract with 1 or more third parties to
administer the requirements established by the Secretary in
order to carry out this section. At a minimum, the contract
with a third party under the preceding sentence shall require
that the third party--
``(A) receive and transmit information between the
Secretary, manufacturers, and other individuals or
entities the Secretary determines appropriate;
``(B) receive, distribute, or facilitate the
distribution of funds of manufacturers to appropriate
individuals or entities in order to meet the
obligations of manufacturers under agreements under
this section;
``(C) provide adequate and timely information to
manufacturers, consistent with the agreement with the
manufacturer under this section, as necessary for the
manufacturer to fulfill its obligations under this
section; and
``(D) permit manufacturers to conduct periodic
audits, directly or through contracts, of the data and
information used by the third party to determine
discounts for insulin drugs of the manufacturer under
the program.
``(4) Performance requirements.--The Secretary shall
establish performance requirements for a third party with a
contract under paragraph (3) and safeguards to protect the
independence and integrity of the activities carried out by the
third party under the program under this section.
``(5) Implementation.--The Secretary may implement the
program under this section by program instruction or otherwise.
``(6) Administration.--Chapter 35 of title 44, United
States Code, shall not apply to the program under this section.
``(e) Enforcement.--
``(1) Audits.--Each manufacturer with an agreement in
effect under this section shall be subject to periodic audit by
the Secretary.
``(2) Civil monetary penalty.--
``(A) In general.--The Secretary shall impose a
civil money penalty on a manufacturer that fails to
provide individuals Medicaid prices for insulin drugs
of the manufacturer in accordance with such agreement
for each such failure in an amount the Secretary
determines is commensurate with the sum of--
``(i) the amount that the manufacturer
would have paid with respect to such discounts
under the agreement, which will then be used to
pay the discounts which the manufacturer had
failed to provide; and
``(ii) 25 percent of such amount.
``(B) Application.--The provisions of section 1128A
(other than subsections (a) and (b)) shall apply to a
civil money penalty under this paragraph in the same
manner as such provisions apply to a penalty or
proceeding under section 1128A(a).
``(f) Definitions.--In this section:
``(1) Applicable individual.--The term `applicable
individual' means an individual who has received a diagnosis of
diabetes.
``(2) Applicable number of calendar days.--The term
`applicable number of calendar days' means--
``(A) with respect to claims for reimbursement
submitted electronically, 14 days; and
``(B) with respect to claims for reimbursement
submitted otherwise, 30 days.
``(3) Insulin drug.--The term `insulin drug' means a
medication approved by the Food and Drug Administration to
treat high blood glucose.
``(4) Manufacturer.--The term `manufacturer' means, with
respect to insulin drugs, any entity which is engaged in the
production, preparation, propagation, compounding, conversion,
or processing of prescription drug products, either directly or
indirectly by extraction from substances of natural origin, or
independently by means of chemical synthesis, or by a
combination of extraction and chemical synthesis. Such term
does not include a wholesale distributor of insulin drugs or a
retail pharmacy licensed under State law.
``(5) Medicaid price.--
``(A) In general.--The term `Medicaid price' means,
with respect to an individual entitled to medical
assistance under title XIX, the net receipt specified
in subparagraph (B) for the dosage form and strength of
an insulin drug and any increase due to a certification
described in subsection (b)(1)(B)(ii)(I).
``(B) Net receipt specified.--For purposes of
subparagraph (A), the net receipt specified in this
subparagraph shall be equal to the product of--
``(i) the total number of units of each
dosage form and strength purchased under the
program in the rebate period (as determined by
the Secretary), and
``(ii) the amount that is the list price of
such drug during such rebate period,
less, the total amount of rebates that the manufacturer
paid with respect to such drug during such rebate
period.
``(6) Negotiated price.--The term `negotiated price' has
the meaning given such term in section 423.100 of title 42,
Code of Federal Regulations (as in effect on the date of
enactment of this section), except that such negotiated price
shall not include any dispensing fee for the applicable
drug.''.
SEC. 3. MAINTENANCE OF EFFORT THROUGHOUT THE INSULIN SUPPLY CHAIN.
(a) Elimination of PBM Rebates.--Section 1128B(b)(3) of the Social
Security Act (42 U.S.C. 1320a-7b(b)(3)) is amended--
(1) in subparagraph (E), by inserting ``(except for a
payment practice that permits rebates, discounts, or price
concessions for insulin drugs (as defined in section
1150C(f)(3)) to be paid by a manufacturer to a PBM (as defined
in section 1150A(a))'' before the semicolon at the end; and
(2) in subparagraph (J)--
(A) by moving the margin two ems to the left; and
(B) by inserting ``(except for an insulin drug)''
after ``section 1860D-14A(g)''.
(b) Exclusion of Insulin Payments From MLR.--Not later than 90 days
after the date of the enactment of this Act, the Secretary of Health
and Human Services shall exclude, beginning with plan years beginning
on or after January 1, 2021, from the denominator (as defined in
section 158.221(c) of title 45, Code of Federal Regulations) section of
a medical loss ratio (as calculated under section 158.221(a) of such
title) of a health insurance issuer (as defined in section 144.103 of
such title) the amount of payments that such issuer paid during a MLR
reporting year (as defined in section 144.103 of such title) for
insulin drugs through the promulgation of a regulation.
(c) Maximum Cost Sharing and Coinsurance for Insulin Drugs in
Certain Private Plans and Medicare.--
(1) PHSA amendment.--Subpart II of part A of title XXVII of
the Public Health Service Act (42 U.S.C. 300gg-11 et seq.) is
amended by inserting after section 2713 the following new
section:
``SEC. 2713A. COVERAGE OF INSULIN DRUGS.
``(a) In General.--Beginning with plan years beginning 90 days
after the date of the enactment of this section, a group health plan
and a health insurance issuer offering group or individual health
insurance coverage shall, at a minimum provide coverage and may impose
cost sharing for an insulin drug in accordance with subsection (b) for
an individual that is provided a prescription for such drug.
``(b) Cost Sharing.--Beginning with plan years beginning 90 days
after the date of the enactment of this section, the cost sharing
incurred under a plan or coverage described in subsection (a) for an
insulin drug may not exceed $10 for each 1-month period of coverage.
``(c) Insulin Drug Defined.--In this section, the term `insulin
drug' has the meaning given such term in section 1150C(f)(3) of the
Social Security Act.''.
(2) Medicare amendments.--
(A) Coinsurance limitation.--Section 1860D-2(b)(2)
of the Social Security Act (42 U.S.C. 1395w-102(b)(2))
is amended--
(i) in subparagraph (A), by striking
``Subject to subparagraphs (C) and (D)'' and
inserting ``Subject to subparagraphs (C), (D),
and (E)''; and
(ii) by adding at the end, the following
new subparagraph:
``(E) Coverage for insulin drugs.--Beginning with
plan years beginning 90 days after the date of the
enactment of this subparagraph, the coverage has
coinsurance (for costs above the annual deductible
specified in paragraph (1) and up to the initial
coverage limit under paragraph (3)) for an insulin drug
(as defined in section 1861(kkk)) is not more than $10
for each 1-month period of coverage.''.
(B) Insulin drug defined.--Section 1861 of the
Social Security Act (42 U.S.C. 1395x) is amended by
adding at the end the following new subsection:
``(kkk) Insulin Drug.--The term `insulin drug' has the meaning
given such term in section 1150C(f)(3) furnished on or after 90 days
after the date of the enactment of this subsection.''.
(d) Freezing of Supplemental Rebates in Medicaid.--Section 1902(a)
of the Social Security Act (42 U.S.C. 1396a(a)) is amended--
(1) in paragraph (85), by striking at the end ``and'';
(2) in paragraph (86), by striking the period at the end
and inserting ``; and''; and
(3) by inserting after paragraph (86), the following new
paragraph:
``(87) provide that the State may not--
``(A) secure from the manufacturer of a drug
payable under this title a supplemental rebate that is
not a rebate under section 1927 that exceeds the amount
of the supplemental rebate on the date of the enactment
of this paragraph; or
``(B) secure any other supplemental rebates.''.
(e) Elimination of Spread Pricing and Related Practices in
Medicaid.--
(1) In general.--Section 1927(e) of the Social Security Act
(42 U.S.C. 1396r-8(e)) is amended by adding at the end the
following:
``(6) Pass-through pricing required.--A contract between
the State and a pharmacy benefit manager (referred to in this
paragraph as a `PBM'), or a contract between the State and a
managed care entity or other specified entity (as such terms
are defined in section 1903(m)(9)(D)) that includes provisions
making the entity responsible for coverage of covered
outpatient drugs dispensed to individuals enrolled with the
entity, shall require that payment for such drugs and related
administrative services (as applicable), including payments
made by a PBM on behalf of the State or entity, is based on a
pass-through pricing model under which--
``(A) any payment made by the entity or the PBM (as
applicable) for such a drug--
``(i) is limited to--
``(I) ingredient cost; and
``(II) a professional dispensing
fee that is not less than the
professional dispensing fee that the
State plan or waiver would pay if the
plan or waiver was making the payment
directly;
``(ii) is passed through in its entirety by
the entity or PBM to the pharmacy that
dispenses the drug; and
``(iii) is made in a manner that is
consistent with section 1902(a)(30)(A) and
sections 447.512, 447.514, and 447.518 of title
42, Code of Federal Regulations (or any
successor regulation) as if such requirements
applied directly to the entity or the PBM;
``(B) payment to the entity or the PBM (as
applicable) for administrative services performed by
the entity or PBM is limited to a reasonable
administrative fee that covers the reasonable cost of
providing such services;
``(C) the entity or the PBM (as applicable) shall
make available to the State, and the Secretary upon
request, all costs and payments related to covered
outpatient drugs and accompanying administrative
services incurred, received, or made by the entity or
the PBM, including ingredient costs, professional
dispensing fees, administrative fees, post-sale and
post-in-voice fees. Discounts, or related adjustments
such as direct and indirect remuneration fees, and any
and all remuneration; and
``(D) any form of spread pricing whereby any amount
charged or claimed by the entity or the PBM (as
applicable) that is in excess of the amount paid to the
pharmacies on behalf of the entity, including any post-
sale or post-invoice fees, discounts, or related
adjustments such as direct and indirect remuneration
fees or assessments (after allowing for a reasonable
administrative fee as described in subparagraph (B)),
is not allowable for purposes of claiming Federal
matching payments under this title.''.
(2) Conforming amendment.--Clause (xiii) of section
1903(m)(2)(A) of such Act (42 U.S.C. 1396b(m)(2)(A)) is
amended--
(A) by striking ``and (III)'' and inserting
``(III)''; and
(B) by inserting before the period at the end the
following: ``, and (IV) pharmacy benefit management
services provided by the entity, or provided by a
pharmacy benefit manager on behalf of the entity under
a contract or other arrangement between the entity and
the pharmacy benefit manager, shall comply with the
requirements of section 1927(e)(6)''.
(3) Effective date.--The amendments made by this subsection
apply to contracts between States and managed care entities,
other specified entities, or pharmacy benefits managers that
are entered into or renewed on or after the date that is 90
days after the date of enactment of this Act.
SEC. 4. GAO REPORT.
Not later than 180 days after the date of the enactment of this
Act, the Comptroller General of the United States shall submit to
Congress a report on the feasibility and affordability of direct
manufacturing by the Federal Government.
<all>
Introduced in House
Introduced in House
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.
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.
Referred to the Subcommittee on Health.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line