I 

116TH CONGRESS 

1ST SESSION H. R. 4769 

To amend part D of title XVIII of the Social Security Act to deliver a 

meaningful benefit and lower prescription drug prices under the Medicare 

program. 

IN THE HOUSE OF REPRESENTATIVES 

OCTOBER 21, 2019 

Ms. SCHAKOWSKY 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 part D of title XVIII of the Social Security 

Act to deliver a meaningful benefit and lower prescription 

drug prices under the Medicare program. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Medicare Prescription 

5 Drug Savings and Choice Act of 2019’’. 


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1 SEC. 2. ESTABLISHMENT OF MEDICARE OPERATED PRE2 SCRIPTION DRUG PLAN OPTION. 

3 (a) IN GENERAL.—Subpart 2 of part D of title XVIII 

4 of the Social Security Act is amended by inserting after 

5 section 1860D–11 (42 U.S.C. 1395w–111) the following 

6 new section: 

7 ‘‘MEDICARE OPERATED PRESCRIPTION DRUG PLAN

8 OPTION

9 ‘‘SEC. 1860D–11A. (a) IN GENERAL.—Notwith10 standing any other provision of this part, for each year 

11 (beginning with 2021), in addition to any plans offered 

12 under section 1860D–11, the Secretary shall offer one or 

13 more Medicare operated prescription drug plans (as de14 fined in subsection (d)) with a service area that consists 

15 of the entire United States and shall enter into negotia16 tions in accordance with subsection (c) with pharma17 ceutical manufacturers to reduce the purchase cost of cov18 ered part D drugs for eligible part D individuals who en19 roll in such a plan. 

20 ‘‘(b) ENROLLMENT.—Notwithstanding subpara21 graphs (C) and (D) of section 1860D–1(b)(1), a Medicare 

22 operated prescription drug plan offered under this section 

23 shall serve as the default prescription drug plan for all 

24 part D enrollees unless another prescription drug plan is 

25 selected. 


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1 ‘‘(c) NEGOTIATIONS.—Notwithstanding section 

2 1860D–11(i), for purposes of offering a Medicare operated 

3 prescription drug plan under this section, the Secretary 

4 shall negotiate with pharmaceutical manufacturers with 

5 respect to the purchase price of covered part D drugs in 

6 a Medicare operated prescription drug plan and shall en7 courage the use of more affordable therapeutic equivalents 

8 to the extent such practices do not override medical neces9 sity as determined by the prescribing physician. To the 

10 extent practicable and consistent with the previous sen11 tence, the Secretary shall implement negotiation and in12 centive strategies similar to those used by other Federal 

13 purchasers of prescription drugs to reduce the purchase 

14 cost of covered Part D drugs, and other strategies, as de15 scribed in subsection (f), which may include the use of a 

16 pricing scale based on an international price index. 

17 ‘‘(d) MEDICARE OPERATED PRESCRIPTION DRUG

18 PLAN DEFINED.—For purposes of this part, the term 

19 ‘Medicare operated prescription drug plan’ means a com20 prehensive prescription drug plan that offers qualified pre21 scription drug coverage and access to negotiated prices de22 scribed in section 1860D–2(a)(1)(A). Such a plan may 

23 offer supplemental prescription drug coverage in the same 

24 manner as other qualified prescription drug coverage of25 fered by other prescription drug plans. 


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1 ‘‘(e) MONTHLY BENEFICIARY PREMIUM.— 

2 ‘‘(1) QUALIFIED PRESCRIPTION DRUG COV3 ERAGE.—The monthly beneficiary premium for 

4 qualified prescription drug coverage and access to 

5 negotiated prices described in section 1860D– 

6 2(a)(1)(A) to be charged under a Medicare operated 

7 prescription drug plan shall be uniform nationally. 

8 Such premium for months in 2021 and each suc9 ceeding year shall be based on the average monthly 

10 per capita actuarial cost of offering the Medicare op11 erated prescription drug plan for the year involved, 

12 including administrative expenses. 

13 ‘‘(2) SUPPLEMENTAL PRESCRIPTION DRUG COV14 ERAGE.—Insofar as a Medicare operated prescrip15 tion drug plan offers supplemental prescription drug 

16 coverage, the Secretary may adjust the amount of 

17 the premium charged under paragraph (1). 

18 ‘‘(f) USE OF NEGOTIATION AND BENEFIT DESIGN

19 INCENTIVES.— 

20 ‘‘(1) IN GENERAL.—With respect to the oper21 ation of a Medicare operated prescription drug plan 

22 and in negotiating with respect to the purchase price 

23 of covered part D drugs in such plan, the Secretary 

24 shall reward value, increase appropriate use of 


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1 drugs, and ensure patient safety and access to medi2 cations. 

3 ‘‘(2) ROLE OF AHRQ.—The Director of the 

4 Agency for Healthcare Research and Quality, in co5 ordination with the Administrator of the Centers for 

6 Medicare & Medicaid Services, shall be responsible 

7 for assessing the clinical benefit of covered part D 

8 drugs and making recommendations to the Secretary 

9 regarding the negotiated prices of covered drugs and 

10 any appropriate tiering or incentive strategies under 

11 the plan. In conducting such assessments and mak12 ing such recommendations, the Director shall carry 

13 out the following activities: 

14 ‘‘(A) Consider the comparable inter15 national price of such drugs based upon the me16 dian retail list price of such drug (which shall 

17 be, as practicable, the volume-weighted price for 

18 comparable units and dosage forms) among a 

19 category of at least the following peer reference 

20 countries: Canada, the United Kingdom, 

21 France, Japan, Australia, and Germany. 

22 ‘‘(B) Consider safety concerns and post23 market data, including those identified by the 

24 Food and Drug Administration and from na25 tional health registries. 


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1 ‘‘(C) Use available data and evaluations, 

2 including from research supported by the Na3 tional Institutes of Health, with priority given 

4 to randomized controlled trials, to examine clin5 ical effectiveness, comparative effectiveness, 

6 safety, and enhanced compliance with a drug 

7 regimen. 

8 ‘‘(D) Use the same classes of drugs devel9 oped by United States Pharmacopeia for this 

10 part. 

11 ‘‘(E) Consider evaluations made by— 

12 ‘‘(i) the Director under section 1013 

13 of the Medicare Prescription Drug, Im14 provement, and Modernization Act of 

15 2003; 

16 ‘‘(ii) other Federal entities, such as 

17 the Secretary of Veterans Affairs; and 

18 ‘‘(iii) other private and public entities, 

19 which may include the Drug Effectiveness 

20 Review Project and Medicaid programs. 

21 ‘‘(F) Consider recommendations made by 

22 the advisory committee pursuant to paragraph 

23 (3)(F). 

24 ‘‘(G) Recommend to the Secretary those 

25 drugs in a class that provide a greater clinical 


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1 benefit, including fewer safety concerns or less 

2 risk of side-effects, than another drug in the 

3 same class. 

4 ‘‘(3) USE OF ADVISORY COMMITTEE.— 

5 ‘‘(A) IN GENERAL.—The Secretary shall 

6 establish and appoint an advisory committee (in 

7 this paragraph referred to as the ‘advisory com8 mittee’)— 

9 ‘‘(i) to review petitions from drug 

10 manufacturers, health care provider orga11 nizations, patient groups, and other enti12 ties regarding negotiated prices; and 

13 ‘‘(ii) to recommend any changes in 

14 order to further negotiations with respect 

15 to such prices. 

16 ‘‘(B) COMPOSITION.—Subject to subpara17 graph (C), the advisory committee shall be com18 posed of 9 members and shall include represent19 atives of physicians, pharmacists, consumers, 

20 and others with expertise in evaluating prescrip21 tion drugs. The Secretary shall select members 

22 based on their knowledge of pharmaceuticals 

23 and the Medicare population. Members shall be 

24 deemed to be special Government employees for 

25 purposes of applying the conflict of interest proVerDate Sep 11 2014 18:56 Oct 28, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4769.IH H4769

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1 visions under section 208 of title 18, United 

2 States Code, and no waiver of such provisions 

3 for such a member shall be permitted. 

4 ‘‘(C) BANNED INDIVIDUALS.— 

5 ‘‘(i) DRUG COMPANY LOBBYISTS.—No 

6 former registered drug manufacturer lob7 byist— 

8 ‘‘(I) may be appointed to the ad9 visory committee; or 

10 ‘‘(II) may be employed by the ad11 visory committee during the 6-year 

12 period beginning on the date on which 

13 the registered lobbyist terminates its 

14 registration in accordance with section 

15 4(d) of the Lobbying Disclosure Act 

16 of 1995 (2 U.S.C. 1603(d)) or the 

17 agent terminates its status, as appli18 cable. 

19 ‘‘(ii) SENIOR EXECUTIVES OF LAW20 BREAKING COMPANIES.—No former senior 

21 executive of a covered entity (as defined in 

22 clause (iii))— 

23 ‘‘(I) may be appointed to the Ad24 visory Committee; or 


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1 ‘‘(II) may be employed by the 

2 Advisory Committee during the 6-year 

3 period beginning on the later of— 

4 ‘‘(aa) the date of the settle5 ment described in item (aa) of 

6 clause (iii)(II); or 

7 ‘‘(bb) the date on which the 

8 enforcement action described in 

9 item (bb) of such clause has con10 cluded. 

11 ‘‘(iii) COVERED ENTITY.—The term 

12 ‘covered entity’ means any entity that is— 

13 ‘‘(I) a drug manufacturer; and 

14 ‘‘(II)(aa) operating under Fed15 eral settlement including a Federal 

16 consent decree; or 

17 ‘‘(bb) the subject of an enforce18 ment action in a court of the United 

19 States or by an agency. 

20 ‘‘(D) CONSULTATION.—The advisory com21 mittee shall consult, as necessary, with physi22 cians who are specialists in treating the disease 

23 for which a drug is being considered. 

24 ‘‘(E) REQUEST FOR STUDIES.—The advi25 sory committee may request the Agency for 


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1 Healthcare Research and Quality or an aca2 demic or research institution to study and make 

3 a report on a petition described in subpara4 graph (A)(i) in order to assess cost-effective5 ness, clinical effectiveness, comparative effec6 tiveness, safety, and compliance with a drug 

7 regimen. 

8 ‘‘(F) RECOMMENDATIONS.—The advisory 

9 committee shall make recommendations to the 

10 Director of the Agency for Healthcare Research 

11 and Quality regarding the appropriate price at 

12 which to begin negotiations on a part D drug 

13 pursuant to this section. 

14 ‘‘(G) LIMITATIONS ON REVIEW OF MANU15 FACTURER PETITIONS.—The advisory com16 mittee shall not review a petition of a drug 

17 manufacturer under subparagraph (A)(i) with 

18 respect to a covered part D drug unless the pe19 tition is accompanied by the following: 

20 ‘‘(i) Raw data from clinical trials on 

21 the safety and effectiveness of the drug. 

22 ‘‘(ii) Any data from clinical trials con23 ducted using active controls on the drug or 

24 drugs that are the current standard of 

25 care. 


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1 ‘‘(iii) Any available data on compara2 tive effectiveness of the drug. 

3 ‘‘(iv) Any other information the Sec4 retary requires for the advisory committee 

5 to complete its review. 

6 ‘‘(g) INFORMING BENEFICIARIES.—The Secretary 

7 shall take steps to inform part D eligible individuals not 

8 previously enrolled in a Medicare operated drug plan (in9 cluding such individuals who are newly eligible to enroll 

10 under this part) regarding the enrollment of such indi11 vidual in a Medicare operated drug plan in accordance 

12 with this section, including providing information in the 

13 annual handbook and adding information to the official 

14 public Medicare website related to prescription drug cov15 erage available through this part. 

16 ‘‘(h) APPLICATION OF ALL OTHER REQUIREMENTS

17 FOR PRESCRIPTION DRUG PLANS.—Except as specifically 

18 provided in this section, any Medicare operated drug plan 

19 shall meet the same requirements as apply to any other 

20 prescription drug plan, including the requirements of sec21 tion 1860D–4(b)(1) relating to assuring pharmacy ac22 cess.’’. 

23 (b) CONFORMING AMENDMENTS.— 


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1 (1) Section 1860D–3(a) of the Social Security 

2 Act (42 U.S.C. 1395w–103(a)) is amended by add3 ing at the end the following new paragraph: 

4 ‘‘(4) AVAILABILITY OF THE MEDICARE OPER5 ATED PRESCRIPTION DRUG PLAN.—A Medicare op6 erated prescription drug plan (as defined in section 

7 1860D–11A(d)) shall be offered nationally in ac8 cordance with section 1860D–11A.’’. 

9 (2)(A) Section 1860D–3 of the Social Security 

10 Act (42 U.S.C. 1395w–103) is amended by adding 

11 at the end the following new subsection: 

12 ‘‘(c) PROVISIONS ONLY APPLICABLE IN 2006 

13 THROUGH 2020.—The provisions of this section shall only 

14 apply with respect to 2006 through 2020.’’. 

15 (B) Section 1860D–11(g) of such Act (42 

16 U.S.C. 1395w–111(g)) is amended by adding at the 

17 end the following new paragraph: 

18 ‘‘(8) NO AUTHORITY FOR FALLBACK PLANS

19 AFTER 2020.—A fallback prescription drug plan shall 

20 not be available after December 31, 2020.’’. 

21 (3) Section 1860D–13(c)(3) of the Social Secu22 rity Act (42 U.S.C. 1395w–113(c)(3)) is amended— 

23 (A) in the heading, by inserting ‘‘AND

24 MEDICARE OPERATED PRESCRIPTION DRUG

25 PLANS’’ after ‘‘FALLBACK PLANS’’; and 


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1 (B) by inserting ‘‘or a Medicare operated 

2 prescription drug plan’’ after ‘‘a fallback pre3 scription drug plan’’. 

4 (4) Section 1860D–16(b)(1) of the Social Secu5 rity Act (42 U.S.C. 1395w–116(b)(1)) is amended— 

6 (A) in subparagraph (C), by striking 

7 ‘‘and’’ after the semicolon at the end; 

8 (B) in subparagraph (D), by striking the 

9 period at the end and inserting ‘‘; and’’; and 

10 (C) by adding at the end the following new 

11 subparagraph: 

12 ‘‘(E) payments for expenses incurred with 

13 respect to the operation of Medicare operated 

14 prescription drug plans under section 1860D– 

15 11A.’’. 

16 (5) Section 1860D–41(a) of the Social Security 

17 Act (42 U.S.C. 1395w–151(a)) is amended by add18 ing at the end the following new paragraph: 

19 ‘‘(19) MEDICARE OPERATED PRESCRIPTION

20 DRUG PLAN.—The term ‘Medicare operated prescrip21 tion drug plan’ has the meaning given such term in 

22 section 1860D–11A(d).’’. 

23 (c) RULE OF CONSTRUCTION.—Nothing in this sec24 tion shall be interpreted to supersede any other negotiaVerDate Sep 11 2014 18:56 Oct 28, 2019 Jkt 099200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\H4769.IH H4769

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1 tion authority granted to the Secretary under Federal law 

2 with respect to prescription drug prices. 

3 SEC. 3. IMPROVED APPEALS PROCESS UNDER THE MEDI4 CARE OPERATED PRESCRIPTION DRUG PLAN. 

5 Section 1860D–4(h) of the Social Security Act (42 

6 U.S.C. 1305w–104(h)) is amended by adding at the end 

7 the following new paragraph: 

8 ‘‘(4) APPEALS PROCESS FOR MEDICARE OPER9 ATED PRESCRIPTION DRUG PLAN.— 

10 ‘‘(A) IN GENERAL.—The Secretary shall 

11 develop a well-defined process for appeals for 

12 denials of benefits under this part under the 

13 Medicare operated prescription drug plan (as 

14 defined in section 1860D–11A(d)). Such proc15 ess shall be efficient, impose minimal adminis16 trative burdens, and ensure the timely procure17 ment of medications. Medical necessity shall be 

18 based on professional medical judgment, the 

19 medical condition of the beneficiary, and other 

20 medical evidence. 

21 ‘‘(B) CONSULTATION IN DEVELOPMENT OF

22 PROCESS.—In developing the appeals process 

23 under subparagraph (A), the Secretary shall 

24 consult with consumer and patient groups, as 

25 well as other key stakeholders, to ensure the 


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1 goals described in subparagraph (A) are 

2 achieved.’’. 

Æ 


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