II 

118TH CONGRESS 

1ST SESSION S. 1139 

To amend title XVIII of the Social Security Act to apply prescription drug 

inflation rebates to drugs furnished in the commercial market and to 

change the base year for rebate calculations. 

IN THE SENATE OF THE UNITED STATES 

MARCH 30, 2023 

Ms. CORTEZ MASTO (for herself, Ms. KLOBUCHAR, Mr. REED, Ms. BALDWIN, 

Mr. BROWN, Ms. STABENOW, Ms. SMITH, Mr. WELCH, and Mr. 

BLUMENTHAL) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To amend title XVIII of the Social Security Act to apply 

prescription drug inflation rebates to drugs furnished 

in the commercial market and to change the base year 

for rebate calculations. 

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 ‘‘Lower Drug Costs for 

5 Families Act’’. 


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1 SEC. 2. APPLICATION OF PRESCRIPTION DRUG INFLATION 

2 REBATES TO DRUGS FURNISHED IN THE 

3 COMMERCIAL MARKET; CHANGE OF BASE 

4 YEAR FOR REBATE CALCULATIONS. 

5 (a) PART B DRUGS.— 

6 (1) APPLICATION OF PRESCRIPTION DRUG IN7 FLATION REBATES TO DRUGS FURNISHED IN THE

8 COMMERCIAL MARKET.—Section 1847A(i) of the So9 cial Security Act (42 U.S.C. 1395w–3a(i)) is amend10 ed— 

11 (A) in paragraph (1)(A)(i), by striking 

12 ‘‘units’’ and inserting ‘‘billing units’’; 

13 (B) in paragraph (2)(A), by striking ‘‘for 

14 which payment is made under this part’’ and 

15 inserting ‘‘that would be payable under this 

16 part if such drug were furnished to an indi17 vidual enrolled under this part’’; and 

18 (C) in paragraph (3)— 

19 (i) in subparagraph (A)(i), by striking 

20 ‘‘units’’ and inserting ‘‘billing units’’; and 

21 (ii) by striking subparagraph (B) and 

22 inserting the following: 

23 ‘‘(B) TOTAL NUMBER OF BILLING

24 UNITS.—For purposes of subparagraph (A)(i), 

25 the total number of billing units with respect to 


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1 a part B rebatable drug is determined as fol2 lows: 

3 ‘‘(i) Determine the total number of 

4 units equal to— 

5 ‘‘(I) the total number of units, as 

6 reported under subsection (c)(1)(B) 

7 for each National Drug Code of such 

8 drug during the calendar quarter that 

9 is two calendar quarters prior to the 

10 calendar quarter as described in sub11 paragraph (A), minus 

12 ‘‘(II) the total number of units 

13 with respect to each National Drug 

14 Code of such drug for which payment 

15 was made under a State plan under 

16 title XIX (or waiver of such plan), as 

17 reported by States under section 

18 1927(b)(2)(A) for the rebate period 

19 that is the same calendar quarter as 

20 described in subclause (I). 

21 ‘‘(ii) Convert the units determined 

22 under clause (i) to billing units for the bill23 ing and payment code of such drug, using 

24 a methodology similar to the methodology 

25 used under this section, by dividing the 


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1 units determined under clause (i) for each 

2 National Drug Code of such drug by the 

3 billing unit for the billing and payment 

4 code of such drug. 

5 ‘‘(iii) Compute the sum of the billing 

6 units for each National Drug Code of such 

7 drug in clause (ii).’’. 

8 (2) CHANGE OF BASE YEAR FOR REBATE CAL9 CULATION.—Section 1847A(i) of the Social Security 

10 Act (42 U.S.C. 1395w–3a(i)) is amended— 

11 (A) in paragraph (3)— 

12 (i) in subparagraph (D), by striking 

13 ‘‘July 1, 2021’’ and inserting ‘‘July 1, 

14 2016’’; and 

15 (ii) in subparagraph (E), by striking 

16 ‘‘January 2021’’ and inserting ‘‘January 

17 2016’’; and 

18 (B) in paragraph (4)— 

19 (i) in subparagraph (A)— 

20 (I) by striking ‘‘December 1, 

21 2020’’ and inserting ‘‘December 31, 

22 2015’’; and 

23 (II) by striking ‘‘January 2021’’ 

24 and inserting ‘‘January 2016’’; 


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1 (ii) in subparagraph (B), by striking 

2 ‘‘December 1, 2020’’ and inserting ‘‘De3 cember 31, 2015’’; and 

4 (iii) in subparagraph (C), by striking 

5 ‘‘January 2021’’ and inserting ‘‘January 

6 2016’’. 

7 (3) EFFECTIVE DATE.—The amendments made 

8 by this subsection shall take effect as if included in 

9 the enactment of section 11101 of Public Law 117– 

10 169. 

11 (b) COVERED PART D DRUGS.— 

12 (1) APPLICATION OF PRESCRIPTION DRUG IN13 FLATION REBATES TO DRUGS FURNISHED IN THE

14 COMMERCIAL MARKET.—Section 1860D–14B of the 

15 Social Security Act (42 U.S.C. 1395w–114b) is 

16 amended— 

17 (A) in subsection (b)— 

18 (i) in paragraph (1)— 

19 (I) in subparagraph (A)(i), by 

20 striking ‘‘the total number of units’’ 

21 and all that follows through the semi22 colon and inserting the following: ‘‘the 

23 total number of units that are used to 

24 calculate the average manufacturer 

25 price of such dosage form and 


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1 strength with respect to such part D 

2 rebatable drug, as reported by the 

3 manufacturer of such drug under sec4 tion 1927 for each month, with re5 spect to such period;’’; and 

6 (II) by striking subparagraph (B) 

7 and inserting the following: 

8 ‘‘(B) EXCLUDED UNITS.—For purposes of 

9 subparagraph (A)(i), the Secretary shall exclude 

10 from the total number of units for a dosage 

11 form and strength with respect to a part D 

12 rebatable drug, with respect to an applicable pe13 riod, the following: 

14 ‘‘(i) Units of each dosage form and 

15 strength of such part D rebatable drug for 

16 which payment was made under a State 

17 plan under title XIX (or waiver of such 

18 plan), as reported by States under section 

19 1927(b)(2)(A). 

20 ‘‘(ii) Units of each dosage form and 

21 strength of such part D rebatable drug for 

22 which a rebate is paid under section 

23 1847A(i). 

24 ‘‘(iii) Beginning with plan year 2026, 

25 units of each dosage form and strength of 


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1 such part D rebatable drug for which the 

2 manufacturer provides a discount under 

3 the program under section 340B of the 

4 Public Health Service Act.’’; and 

5 (ii) in paragraph (6), by striking ‘‘IN6 FORMATION.—The Secretary’’ and all that 

7 follows through ‘‘rebatable covered part D 

8 drug dispensed’’ and inserting the fol9 lowing: ‘‘AMP REPORTS.—The Secretary 

10 shall provide for a method and process 

11 under which, in the case of a manufacturer 

12 of a part D rebatable drug that submits 

13 revisions to information submitted under 

14 section 1927 by the manufacturer with re15 spect to such drug’’; and 

16 (B) by striking subsection (d) and insert17 ing the following: 

18 ‘‘(d) INFORMATION.—For purposes of carrying out 

19 this section, the Secretary shall use information submitted 

20 by manufacturers under section 1927(b)(3) and informa21 tion submitted by States under section 1927(b)(2)(A).’’. 

22 (2) CHANGE OF BASE YEAR FOR REBATE CAL23 CULATION.—Section 1860D–14B of the Social Secu24 rity Act (42 U.S.C. 1395w–114b) is amended— 

25 (A) in subsection (b)(5)— 


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1 (i) in subparagraph (A)— 

2 (I) by striking ‘‘October 1, 2021’’ 

3 and inserting ‘‘October 1, 2016’’; and 

4 (II) by striking ‘‘January 2021’’ 

5 and inserting ‘‘January 2016’’; and 

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

7 ‘‘January 2021’’ and inserting ‘‘January 

8 2016’’; and 

9 (B) in subsection (g)— 

10 (i) in paragraph (3)— 

11 (I) by striking ‘‘January 1, 

12 2021’’ and inserting ‘‘January 1, 

13 2016’’; and 

14 (II) by striking ‘‘October 1, 

15 2021’’ and inserting ‘‘October 1, 

16 2016’’; and 

17 (ii) in paragraph (4), by striking 

18 ‘‘January 2021’’ and inserting ‘‘January 

19 2016’’. 

20 (3) EFFECTIVE DATE.—The amendments made 

21 by this subsection shall take effect as if included in 

22 the enactment of section 11102 of Public Law 117– 

23 169. 

Æ 


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