SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Medicare Part D 
Patient Safety and Drug Abuse Prevention Act of 2013''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Establishing PDP safety program to prevent fraud and abuse in 
                            Medicare prescription drug plans.
Sec. 3. Part D suspension of claims payment.
Sec. 4. Improving activities of Medicare Drug Integrity Contractors 
                            (MEDICs).
Sec. 5. Requiring e-prescribing for coverage of covered part D 
                            controlled substances.

SEC. 2. ESTABLISHING PDP SAFETY PROGRAM TO PREVENT FRAUD AND ABUSE IN 
              MEDICARE PRESCRIPTION DRUG PLANS.

    (a) PDP Safety Program.--Section 1860D-4(c) of the Social Security 
Act (42 U.S.C. 1395w-104(c)) is amended--
            (1) in paragraph (1)(D)--
                    (A) by inserting ``, designed to'' after 
                ``program''; and
                    (B) by inserting ``, that includes the procedures 
                described in paragraph (4)'' after ``waste''; and
            (2) by adding at the end the following:
            ``(4) Safe pharmacy access program.--
                    ``(A) PDP sponsor procedures.--A PDP sponsor (or an 
                MA organization offering an MA-PD plan) shall have in 
                place procedures designed--
                            ``(i) to identify an individual who has 
                        obtained coverage for a covered part D drug 
                        that is a frequently abused schedule II, III, 
                        IV, or V controlled substance, as determined in 
                        accordance with utilization guidelines 
                        established by the Secretary and the sponsor 
                        (or MA organization), and to notify such 
                        individuals that they have been so identified;
                            ``(ii) to contract with pharmacies 
                        authorized to dispense such controlled 
                        substances to create a safe pharmacy network 
                        that meets the criteria specified in 
                        subparagraph (C);
                            ``(iii) taking into account the location of 
                        the individual's residence (or residences), 
                        work site, mobility, and other relevant 
                        factors, to limit coverage to schedule II, III, 
                        IV, or V controlled substances for some or all 
                        classes of covered part D drugs for an 
                        individual identified under clause (i) (or 
                        under subparagraph (B)) to drugs dispensed by 
                        one or more pharmacies contracted with under 
                        clause (ii);
                            ``(iv) to provide to the Secretary the 
                        name, and other information that the Secretary 
                        may require, of individuals so identified and 
                        of the fact of such individual's disenrollment 
                        (if any) from the plan of the sponsor (or the 
                        MA-PD plan offered by the MA organization);
                            ``(v) to provide for an appeals process 
                        whereby an individual so identified may appeal 
                        such identification on the basis that the 
                        identification was not appropriate;
                            ``(vi) to provide for a process whereby an 
                        individual so identified may petition for the 
                        termination of such identification on the basis 
                        that the limitation on coverage is no longer 
                        necessary to prevent fraud and abuse by the 
                        individual; and
                            ``(vii) to provide that coverage shall be 
                        provided for a schedule II, III, IV, or V 
                        controlled substance only if it prescribed in 
                        accordance with an electronic prescribing 
                        program under subsection (e), except in such 
                        exceptional circumstances as the Secretary may 
                        permit.
                    ``(B) Sharing information for subsequent plan 
                enrollments.--The Secretary shall share information, 
                with respect to the identity of an individual 
                identified under subparagraph (A)(i) who disenrolls 
                from a plan under subparagraph (A)(iv), with a PDP 
                sponsor (or MA organization) that subsequently enrolls 
                such individual under another plan in order that the 
                provisions of subparagraph (A)(iii) would apply under 
                such subsequent enrollment.
                    ``(C) Safe pharmacy network criteria.--The criteria 
                specified in this subparagraph for a safe pharmacy 
                network are the following:
                            ``(i) The pharmacies in the network are 
                        able to properly monitor the usage of schedule 
                        II, III, IV, and V controlled substances.
                            ``(ii) Such pharmacies and network meet 
                        such other drug safety criteria as the 
                        Secretary or the PDP sponsor (or MA 
                        organization) determines to be appropriate, 
                        such as use of a State prescription drug 
                        monitoring program, if such a program is 
                        available in the State.''.
    (b) Dual Eligibles.--Section 1860D-1(b)(3)(D) of the Social 
Security Act (42 U.S.C. 1395w-101(b)(3)(D)) is amended by inserting ``, 
subject to such limits as the Secretary may establish for individuals 
identified pursuant to section 1860D-4(c)(4)(A)(i)'' after ``the 
Secretary''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to plan years beginning after the date that is 8 
months after the date of the enactment of this Act.

SEC. 3. PART D SUSPENSION OF CLAIMS PAYMENT.

    Amend 1860D-12(b)(4) of the Social Security Act (42 U.S.C. 1395w-
112(b)(4)) is amended by adding at the end the following new 
subparagraph:
                    ``(H) Suspension of payments pending investigation 
                of credible allegations of fraud by pharmacies.--
                            ``(i) In general.--A PDP sponsor may 
                        suspend payments and clean claim notifications 
                        to a pharmacy pending an investigation of a 
                        credible allegation of fraud (as defined in 
                        clause (ii)) against the pharmacy, unless the 
                        Secretary determines there is a good cause not 
                        to suspend payments.
                            ``(ii) Credible allegation of fraud 
                        defined.--In this subparagraph, the term 
                        `credible allegation of fraud' includes--
                                    ``(I) a complaint made on the 
                                Medicare fraud hotline;
                                    ``(II) detection of potential fraud 
                                through the analysis of claims data;
                                    ``(III) detection of potential 
                                fraud through identification of 
                                inappropriate dispensing through 
                                audits, civil false claims cases, and 
                                law enforcement investigations; and
                                    ``(IV) claims referred to Medicare 
                                drug integrity contractors (MEDICs).
                            ``(iii) Rule of construction.--Nothing in 
                        this subparagraph shall be construed as limited 
                        the authority of a PDP sponsor to conduct post-
                        claim payment review.''.

SEC. 4. IMPROVING ACTIVITIES OF MEDICARE DRUG INTEGRITY CONTRACTORS 
              (MEDICS).

    (a) In General.--Section 1893 of the Social Security Act (42 U.S.C. 
1395ddd) is amended by adding at the end the following new subsection:
    ``(j) Improving Activities of Medicare Drug Integrity Contractors 
(MEDICs).--
            ``(1) Access to in general.--Under contracts entered into 
        under this section (each in this subsection referred to as a 
        `MEDIC contract') with Medicare drug integrity contractors 
        (each in this subsection referred to as a `MEDIC'), the 
        Secretary shall authorize MEDICs to directly obtain 
        prescription and medical records from entities such as 
        pharmacies, PDP and physicians.
            ``(2) Requirement for acknowledgment of referrals.--If a 
        PDP sponsor refers information to a MEDIC for investigation, 
        under the MEDIC contract the MEDIC must acknowledge receipt of 
        the referral and must report back to the sponsor the result of 
        the MEDIC's investigation within 45 days of the date of the 
        referral and share such results with appropriate agencies, such 
        as law enforcement officials and State licensing authority.
            ``(3) Uniform annual report criteria.--In order to assess 
        the performance of MEDICs, the Secretary shall develop a 
        uniform reporting criteria for the annual reporting of the 
        results of investigations by MEDICs to the Secretary and to 
        Congress. Each such annual report shall include information on 
        the number of referrals for investigation made to a MEDIC, the 
        average time required for investigation, the results of the 
        investigation, and the number of results that were referred to 
        the Inspector General of the Department of Health and Human 
        Services and to State licensing officials for further 
        investigations.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on the date of the enactment of this Act and shall apply as 
quickly as possible to MEDIC contracts, including MEDIC contracts 
entered into before such date of enactment.

SEC. 5. REQUIRING E-PRESCRIBING FOR COVERAGE OF COVERED PART D 
              CONTROLLED SUBSTANCES.

    (a) In General.--Section 1860D-4(e) of the Social Security Act (42 
U.S.C. 1395w-104(e)) is amended by adding at the end the following:
            ``(7) Requirement of e-prescribing for controlled 
        substances.--Except in such emergent circumstances as the 
        Secretary may specify, coverage shall not be provided for a 
        covered part D drug under a prescription drug plan (or under an 
        MA-PD plan) for a schedule II, III, IV, or V controlled 
        substance unless the prescription for the drug has been 
        transmitted electronically in accordance with an electronic 
        prescription drug program that meets the requirements of 
        paragraph (2).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to coverage of drugs prescribed on or after January 1, 2015.
Medicare Part D Patient Safety and Drug Abuse Prevention Act of 2013 - Amends part D (Voluntary Prescription Drug Benefit Program) of title XVIII (Medicare) of the Social Security Act (SSA) to establish a safe pharmacy access program under which a prescription drug plan (PDP) sponsor (or a Medicare Advantage (MA) organization offering an MA-PD plan) shall have in place procedures designed to prevent fraud and abuse in the dispensing of certain controlled substances under Medicare part D. Allows a PDP sponsor to suspend payments and clean claim notifications to a pharmacy pending an investigation of a credible allegation of fraud against the pharmacy, unless the Secretary determines there is a good cause not to suspend payments. Directs the Secretary of Health and Human Services (HHS), under contracts entered into under the Medicare integrity program with Medicare drug integrity contractors (MEDICs), to authorize such MEDICs to obtain prescription and medical records directly from entities such as pharmacies, PDPs, and physicians. Requires a MEDIC to acknowledge receipt of a PDP sponsor referral of information for investigation, report back to the sponsor the investigation results within 45 days, and share them with appropriate agencies. Requires electronic transmission (e-prescribing) of prescriptions for certain covered Medicare part D controlled substances.
Medicare Part D Patient Safety and Drug Abuse Prevention Act of 2013