II 

116TH CONGRESS 

1ST SESSION S. 2004 

To amend the Public Health Service Act to establish insulin assistance 

programs, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 27, 2019 

Ms. SMITH (for herself and Mr. CRAMER) introduced the following bill; which 

was read twice and referred to the Committee on Finance 

A BILL 

To amend the Public Health Service Act to establish insulin 

assistance programs, and for other purposes. 

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 ‘‘Emergency Access to 

5 Insulin Act of 2019’’. 

6 SEC. 2. INSULIN ASSISTANCE PROGRAMS. 

7 (a) IN GENERAL.—Part B of title III of the Public 

8 Health Service Act (42 U.S.C. 243 et seq.) is amended 

9 by adding at the end the following: 


pamtmann on DSKBFK8HB2PROD with BILLS
2 

•S 2004 IS

1 ‘‘SEC. 320B. INSULIN ASSISTANCE PROGRAMS. 

2 ‘‘(a) ESTABLISHMENT OF PROGRAM OF GRANTS TO

3 STATES, INDIAN TRIBES, AND TRIBAL ORGANIZA4 TIONS.— 

5 ‘‘(1) IN GENERAL.—The Secretary, acting 

6 through the Director of the Centers for Disease 

7 Control and Prevention, shall, not later than 1 year 

8 after the date of enactment of this section, make 

9 grants to States, Indian tribes, and tribal organiza10 tions for the purpose of carrying out programs to as11 sist eligible individuals in obtaining insulin in ac12 cordance with paragraph (4). 

13 ‘‘(2) GRANT AND CONTRACT AUTHORITY FOR

14 STATES, INDIAN TRIBES, AND TRIBAL ORGANIZA15 TIONS.— 

16 ‘‘(A) IN GENERAL.—A State, Indian tribe, 

17 or tribal organization receiving a grant under 

18 paragraph (1) may, subject to subparagraph 

19 (B), expend the grant to carry out the purpose 

20 described in such paragraph through grants or 

21 contracts to public or private entities, including 

22 local governments. 

23 ‘‘(B) CERTAIN APPLICATIONS.—If a non24 profit private entity and a private entity that is 

25 not a nonprofit entity both submit applications 

26 to a State, Indian tribe, or tribal organization 


pamtmann on DSKBFK8HB2PROD with BILLS
3 

•S 2004 IS

1 to receive an award of a grant or contract 

2 under subparagraph (A), the State, Indian 

3 tribe, or tribal organization may give priority to 

4 the application submitted by the nonprofit pri5 vate entity in any case in which the State, In6 dian tribe, or tribal organization determines 

7 that the quality of such application is equiva8 lent to the quality of the application submitted 

9 by the other private entity. 

10 ‘‘(3) ALLOTMENT.—Each State, Indian tribe, 

11 or tribal organization that applies for a grant in ac12 cordance with subsection (e) shall receive a grant 

13 under this section in an amount that is equal to the 

14 sum of— 

15 ‘‘(A) a minimum amount determined by 

16 the Secretary; and 

17 ‘‘(B) an additional amount based on cri18 teria established by the Secretary, which may 

19 include the ability of the State, Indian tribe, or 

20 tribal organization to successfully assist individ21 uals in seeking eligibility for Federal or State22 funded programs as described in paragraph 

23 (4)(A)(iv). 

24 ‘‘(4) PROGRAM COMPONENTS.— 


pamtmann on DSKBFK8HB2PROD with BILLS
4 

•S 2004 IS

1 ‘‘(A) IN GENERAL.—A State, Indian tribe, 

2 or tribal organization carrying out a program 

3 supported by a grant under this subsection 

4 shall use the grant funds to— 

5 ‘‘(i) purchase insulin; 

6 ‘‘(ii) issue insulin cards to eligible in7 dividuals in accordance with subparagraph 

8 (B); 

9 ‘‘(iii) enter into agreements with phar10 macies— 

11 ‘‘(I) for such pharmacies to fill 

12 prescriptions for individuals displaying 

13 valid insulin cards that are issued in 

14 accordance with subparagraph (B) at 

15 no cost to such individuals; and 

16 ‘‘(II) for the State, Indian tribe, 

17 or tribal organization to pay such 

18 pharmacies for insulin filled for a pre19 scription described in subclause (I); 

20 and 

21 ‘‘(iv) assist individuals in seeking eli22 gibility for Federal or State-funded pro23 grams which may provide coverage for in24 sulin or otherwise assist such individuals in 

25 obtaining insulin. 


pamtmann on DSKBFK8HB2PROD with BILLS
5 

•S 2004 IS

1 ‘‘(B) INSULIN CARDS.— 

2 ‘‘(i) APPLICATION.—An eligible indi3 vidual seeking an insulin card through a 

4 program supported by a grant under this 

5 subsection shall submit an application to 

6 the State, Indian tribe, or tribal organiza7 tion receiving the grant, at such time, in 

8 such manner, and containing such infor9 mation as the State, Indian tribe, or tribal 

10 organization may reasonably require for 

11 purposes of this subsection, including— 

12 ‘‘(I) documentation indicating 

13 proof of— 

14 ‘‘(aa) in the case of a grant 

15 awarded to a State, residency in 

16 the State; 

17 ‘‘(bb) in the case of a grant 

18 awarded to an Indian tribe, mem19 bership in the Indian tribe; or 

20 ‘‘(cc) in the case of a grant 

21 awarded to a tribal organization, 

22 membership in the Indian tribe 

23 or Indian community served by 

24 the tribal organization; 


pamtmann on DSKBFK8HB2PROD with BILLS
6 

•S 2004 IS

1 ‘‘(II) a prescription for insulin 

2 that is prescribed to the individual; 

3 ‘‘(III) a statement that, to the 

4 best of the individual’s knowledge, the 

5 individual is an uninsured individual 

6 or an underinsured individual; and 

7 ‘‘(IV) if the individual is an 

8 underinsured individual, the name of 

9 the high-deductible health plan in 

10 which the individual is enrolled and 

11 any unique identifier of the plan, such 

12 as a policy number. 

13 ‘‘(ii) INITIAL CARD.— 

14 ‘‘(I) IN GENERAL.—A State, In15 dian tribe, or tribal organization car16 rying out a program supported by a 

17 grant under this subsection shall issue 

18 an initial insulin card to each indi19 vidual that submits an application to 

20 the State, Indian tribe, or tribal orga21 nization meeting the requirements 

22 under clause (i). 

23 ‘‘(II) TIMING.—A State, Indian 

24 tribe, or tribal organization that re25 ceives an application under clause (i) 


pamtmann on DSKBFK8HB2PROD with BILLS
7 

•S 2004 IS

1 from an individual shall issue an ini2 tial insulin card to such individual not 

3 later than 5 business days after re4 ceiving such application. 

5 ‘‘(III) SUPPLY.—An initial insu6 lin card issued to an individual under 

7 this clause shall be valid for an ap8 proximate 7-day supply of insulin that 

9 is appropriate for the individual based 

10 on the prescription for the individual 

11 provided in the application under 

12 clause (i) and packaging and proc13 essing practices for insulin. 

14 ‘‘(iii) 3-MONTH CARDS.—Not later 

15 than 12 business days after an individual 

16 submits an application under clause (i) to 

17 a State, Indian tribe, or tribal organiza18 tion, the State, Indian tribe, or tribal orga19 nization shall— 

20 ‘‘(I) determine whether the indi21 vidual is an eligible individual; and 

22 ‘‘(II) if the individual is an eligi23 ble individual, issue the individual an 

24 insulin card that is valid for an ap25 proximate 90-day supply of insulin 


pamtmann on DSKBFK8HB2PROD with BILLS
8 

•S 2004 IS

1 that is appropriate for the individual 

2 based on the prescription provided in 

3 the application under clause (i) and 

4 packaging and processing practices 

5 for insulin. 

6 ‘‘(iv) RENEWAL OF CARDS.— 

7 ‘‘(I) 3-MONTH CARDS.—An eligi8 ble individual that is issued an insulin 

9 card under clause (iii) may apply to 

10 renew such card in accordance with a 

11 process established by the State, In12 dian tribe, or tribal organization. 

13 ‘‘(II) LIMITATION.—An indi14 vidual that submits an application 

15 under clause (i) and is denied an insu16 lin card under clause (ii) or (iii) may 

17 not submit another application under 

18 clause (i) for the 1-year period begin19 ning on the date on which the indi20 vidual is denied such card. 

21 ‘‘(b) REQUIREMENT OF MATCHING FUNDS.— 

22 ‘‘(1) IN GENERAL.—The Secretary may not 

23 make a grant under subsection (a) unless the State, 

24 Indian tribe, or tribal organization involved agrees, 

25 with respect to the costs to be incurred by the State, 


pamtmann on DSKBFK8HB2PROD with BILLS
9 

•S 2004 IS

1 Indian tribe, or tribal organization in carrying out 

2 the purpose described in subsection (a)(1), to make 

3 available non-Federal contributions (in cash or in 

4 kind under paragraph (2)) toward such costs in an 

5 amount equal to not less than $1 for each $3 of 

6 Federal funds provided in the grant. Such contribu7 tions may be made directly or through donations 

8 from public or private entities. 

9 ‘‘(2) DETERMINATION OF AMOUNT OF NON10 FEDERAL CONTRIBUTION.— 

11 ‘‘(A) IN GENERAL.—Non-Federal contribu12 tions required in paragraph (1) may be in cash 

13 or in kind, fairly evaluated, including equipment 

14 or services (and excluding indirect or overhead 

15 costs). Amounts provided by the Federal Gov16 ernment, or services assisted or subsidized to 

17 any significant extent by the Federal Govern18 ment, may not be included in determining the 

19 amount of such non-Federal contributions. 

20 ‘‘(B) MAINTENANCE OF EFFORT.—In 

21 making a determination of the amount of non22 Federal contributions for purposes of paragraph 

23 (1), the Secretary may include only non-Federal 

24 contributions in excess of the average amount 

25 of non-Federal contributions made by the State, 


pamtmann on DSKBFK8HB2PROD with BILLS
10 

•S 2004 IS

1 Indian tribe, or tribal organization involved to2 ward the purpose described in subsection (a)(1) 

3 for the 2-year period preceding the first fiscal 

4 year for which the State, Indian tribe, or tribal 

5 organization is applying to receive a grant 

6 under subsection (a). 

7 ‘‘(C) INCLUSION OF RELEVANT NON-FED8 ERAL CONTRIBUTIONS FOR MEDICAID.—In 

9 making a determination of the amount of non10 Federal contributions for purposes of paragraph 

11 (1), the Secretary shall, subject to subpara12 graphs (A) and (B) of this paragraph, include 

13 any non-Federal amounts expended pursuant to 

14 title XIX of the Social Security Act by the 

15 State, Indian tribe, or tribal organization re16 lated to insulin dispensed to individuals eligible 

17 for medical assistance under such title. 

18 ‘‘(c) ADDITIONAL REQUIRED AGREEMENTS.— 

19 ‘‘(1) STATEWIDE PROVISION OF SERVICES.— 

20 ‘‘(A) IN GENERAL.—The Secretary may 

21 not make a grant under subsection (a) unless 

22 the State, Indian tribe, or tribal organization 

23 involved agrees that services and activities 

24 under the grant will be made available through25 out the State (including availability to members 


pamtmann on DSKBFK8HB2PROD with BILLS
11 

•S 2004 IS

1 of any Indian tribe or tribal organization in the 

2 State), Indian tribe, or tribal organization. 

3 ‘‘(B) WAIVER.— 

4 ‘‘(i) IN GENERAL.—The Secretary 

5 may waive the requirement established in 

6 subparagraph (A) for a State, Indian tribe, 

7 or tribal organization if the Secretary de8 termines that compliance by the State, In9 dian tribe, or tribal organization with the 

10 requirement would result in an inefficient 

11 allocation of resources with respect to car12 rying out the purpose described in sub13 section (a)(1). 

14 ‘‘(ii) INDIAN TRIBES AND TRIBAL OR15 GANIZATIONS.—If an Indian tribe or tribal 

16 organization is receiving a grant under 

17 subsection (a) and the State in which the 

18 tribe or organization is located is receiving 

19 a grant under subsection (a), the require20 ment under subparagraph (A) for the 

21 State regarding availability to the tribe or 

22 organization is deemed to have been 

23 waived under this subparagraph. 

24 ‘‘(2) RELATIONSHIP TO ITEMS AND SERVICES

25 UNDER OTHER PROGRAMS.— 


pamtmann on DSKBFK8HB2PROD with BILLS
12 

•S 2004 IS

1 ‘‘(A) IN GENERAL.—The Secretary may 

2 not make a grant under subsection (a) unless 

3 the State, Indian tribe, or tribal organization 

4 involved agrees that the grant will not be ex5 pended to make payment for any item or serv6 ice to the extent that payment has been made, 

7 or can reasonably be expected to be made, with 

8 respect to such item or service— 

9 ‘‘(i) except as provided in subpara10 graph (B), under any State compensation 

11 program, under an insurance policy, or 

12 under any Federal or State health benefits 

13 program; or 

14 ‘‘(ii) by an entity that provides health 

15 services on a prepaid basis. 

16 ‘‘(B) EXCEPTION.—The requirement under 

17 subparagraph (A)(i) shall not apply with re18 spect to coverage under a high-deductible health 

19 plan. 

20 ‘‘(3) LIMITATION ON ADMINISTRATIVE EX21 PENSES.—The Secretary may not make a grant 

22 under subsection (a) unless the State, Indian tribe, 

23 or tribal organization involved agrees that not more 

24 than 10 percent of the grant will be expended for 

25 administrative expenses with respect to the grant. 


pamtmann on DSKBFK8HB2PROD with BILLS
13 

•S 2004 IS

1 ‘‘(4) RECORDS AND AUDITS.—The Secretary 

2 may not make a grant under subsection (a) unless 

3 the State, Indian tribe, or tribal organization in4 volved agrees that— 

5 ‘‘(A) the State, Indian tribe, or tribal orga6 nization will establish such fiscal control and 

7 fund accounting procedures as may be nec8 essary to ensure the proper disbursal of, and 

9 accounting for, amounts received by the State, 

10 Indian tribe, or tribal organization under such 

11 subsection; 

12 ‘‘(B) upon request, the State, Indian tribe, 

13 or tribal organization will provide records main14 tained pursuant to subparagraph (A) to the 

15 Secretary or the Comptroller General of the 

16 United States for purposes of auditing the ex17 penditures by the State, Indian tribe, or tribal 

18 organization of the grant; and 

19 ‘‘(C) the State, Indian tribe, or tribal orga20 nization will keep such records as the Secretary 

21 shall prescribe, including— 

22 ‘‘(i) records that fully disclose— 

23 ‘‘(I) the amount and disposition 

24 by the State, Indian tribe, or tribal 


pamtmann on DSKBFK8HB2PROD with BILLS
14 

•S 2004 IS

1 organization of the proceeds of such 

2 grant; 

3 ‘‘(II) the total cost of the project 

4 or undertaking intended to be carried 

5 out through the grant; and 

6 ‘‘(III) the amount of that portion 

7 of the cost of the project or under8 taking supplied by sources other than 

9 the grant; and 

10 ‘‘(ii) such other records as the Sec11 retary determines appropriate for facili12 tating an effective audit of grants awarded 

13 under this section. 

14 ‘‘(5) REPORTS.— 

15 ‘‘(A) REPORTS TO THE SECRETARY.—The 

16 Secretary may not make a grant under sub17 section (a) unless the State, Indian tribe, or 

18 tribal organization involved agrees to submit to 

19 the Secretary such reports as the Secretary 

20 may require with respect to the grant, including 

21 a report on— 

22 ‘‘(i) the types of problems and inquir23 ies encountered by individuals applying for 

24 or receiving insulin through a program 

25 supported by such grant; 


pamtmann on DSKBFK8HB2PROD with BILLS
15 

•S 2004 IS

1 ‘‘(ii) the number of insulin products 

2 dispensed and the unit costs for those 

3 products during the period covered by the 

4 report; 

5 ‘‘(iii) the number of pharmacies par6 ticipating in the program during the period 

7 covered by the report; 

8 ‘‘(iv) summary data on the individuals 

9 applying for or receiving insulin through 

10 the program; and 

11 ‘‘(v) any other information the Sec12 retary shall determine necessary to provide 

13 oversight of the grants made under this 

14 section. 

15 ‘‘(B) HIGH-DEDUCTIBLE HEALTH

16 PLANS.—The Secretary may not make a grant 

17 under subsection (a) unless the State, Indian 

18 tribe, or tribal organization involved agrees to, 

19 as soon as practicable after each time the State, 

20 Indian tribe, or tribal organization provides 

21 payment to a pharmacy for insulin for an 

22 underinsured individual, submit to the high-de23 ductible health plan in which the individual is 

24 enrolled information on the amount of such 


pamtmann on DSKBFK8HB2PROD with BILLS
16 

•S 2004 IS

1 payment in order for such plan to comply with 

2 the requirements under section 2710. 

3 ‘‘(d) DESCRIPTION OF INTENDED USES OF

4 GRANT.—The Secretary may not make a grant under sub5 section (a) unless— 

6 ‘‘(1) the State, Indian tribe, or tribal organiza7 tion involved submits to the Secretary a description 

8 of the purposes for which the State, Indian tribe, or 

9 tribal organization intends to expend the grant; 

10 ‘‘(2) the description identifies the populations, 

11 areas, and localities in the State, or under the juris12 diction of the Indian tribe or tribal organization, 

13 with a need for a program to assist individuals in 

14 obtaining insulin in accordance with subsection (a); 

15 ‘‘(3) the description provides information relat16 ing to the services and activities to be provided, in17 cluding a description of the manner in which the 

18 services and activities will be coordinated with any 

19 similar services or activities of public or private enti20 ties; and 

21 ‘‘(4) the description provides assurances that 

22 the grant funds will be used in the most cost-effec23 tive manner. 

24 ‘‘(e) REQUIREMENT OF SUBMISSION OF APPLICA25 TION.—The Secretary may not make a grant under subVerDate Sep 11 2014 01:43 Jul 02, 2019 Jkt 089200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S2004.IS S2004

pamtmann on DSKBFK8HB2PROD with BILLS
17 

•S 2004 IS

1 section (a) unless an application for the grant is submitted 

2 to the Secretary, the application contains the description 

3 of intended uses required under subsection (d), and the 

4 application is in such form, is made in such manner, and 

5 contains such agreements, assurances, and information as 

6 the Secretary determines to be necessary to carry out this 

7 section. 

8 ‘‘(f) TECHNICAL ASSISTANCE AND PROVISION OF

9 SUPPLIES AND SERVICES IN LIEU OF GRANT FUNDS.— 

10 ‘‘(1) TECHNICAL ASSISTANCE.—The Secretary 

11 may provide training and technical assistance with 

12 respect to the planning, development, and operation 

13 of any program or service carried out pursuant to 

14 subsection (a). The Secretary may provide such 

15 technical assistance directly or through grants to, or 

16 contracts with, public or private entities. 

17 ‘‘(2) PROVISION OF SUPPLIES AND SERVICES IN

18 LIEU OF GRANT FUNDS.— 

19 ‘‘(A) IN GENERAL.—Upon the request of a 

20 State, Indian tribe, or tribal organization re21 ceiving a grant under subsection (a), the Sec22 retary may, subject to subparagraph (B), pro23 vide supplies, equipment, and services for the 

24 purpose of aiding the State, Indian tribe, or 

25 tribal organization in carrying out such subVerDate Sep 11 2014 01:43 Jul 02, 2019 Jkt 089200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\S2004.IS S2004

pamtmann on DSKBFK8HB2PROD with BILLS
18 

•S 2004 IS

1 section and, for such purpose, may detail to the 

2 State, Indian tribe, or tribal organization any 

3 officer or employee of the Department of 

4 Health and Human Services. 

5 ‘‘(B) CORRESPONDING REDUCTION IN PAY6 MENTS.—With respect to a request described in 

7 subparagraph (A), the Secretary shall reduce 

8 the amount of payments under the grant under 

9 subsection (a) to the State, Indian tribe, or 

10 tribal organization involved by an amount equal 

11 to the costs of detailing personnel (including 

12 pay, allowances, and travel expenses) and the 

13 fair market value of any supplies, equipment, or 

14 services provided by the Secretary. The Sec15 retary shall, for the payment of expenses in16 curred in complying with such request, expend 

17 the amounts withheld. 

18 ‘‘(g) EVALUATIONS AND REPORTS.— 

19 ‘‘(1) EVALUATIONS.—The Secretary shall, di20 rectly or through contracts with public or private en21 tities, provide for annual evaluations of programs 

22 carried out pursuant to subsection (a). Such evalua23 tions shall include evaluations of— 

24 ‘‘(A) the extent to which States, Indian 

25 tribes, and tribal organizations carrying out 


pamtmann on DSKBFK8HB2PROD with BILLS
19 

•S 2004 IS

1 such programs are in compliance with sub2 section (a) and with subsection (c)(1); and 

3 ‘‘(B) the extent to which each State, In4 dian tribe, or tribal organization receiving a 

5 grant under this section is in compliance with 

6 subsection (b), including identification of— 

7 ‘‘(i) the amount of the non-Federal 

8 contributions by the State, Indian tribe, or 

9 tribal organization for the preceding fiscal 

10 year, disaggregated according to the source 

11 of the contributions; and 

12 ‘‘(ii) the proportion of such amount of 

13 non-Federal contributions relative to the 

14 amount of Federal funds provided through 

15 the grant to the State, Indian tribe, or 

16 tribal organization for the preceding fiscal 

17 year. 

18 ‘‘(2) REPORTS TO CONGRESS.—The Secretary 

19 shall, not later than 1 year after the date of the en20 actment of the Emergency Access to Insulin Act of 

21 2019, and annually thereafter, submit to the Com22 mittee on Health, Education, Labor, and Pensions 

23 of the Senate and the Committee on Energy and 

24 Commerce of the House of Representatives a report 

25 summarizing evaluations carried out under paraVerDate Sep 11 2014 01:43 Jul 02, 2019 Jkt 089200 PO 00000 Frm 00019 Fmt 6652 Sfmt 6201 E:\BILLS\S2004.IS S2004

pamtmann on DSKBFK8HB2PROD with BILLS
20 

•S 2004 IS

1 graph (1) during the preceding fiscal year and mak2 ing such recommendations for administrative and 

3 legislative initiatives with respect to this section as 

4 the Secretary determines to be appropriate, includ5 ing recommendations regarding compliance by the 

6 States, Indian tribes, and tribal organizations with 

7 subsection (a) and with subsection (c)(1). 

8 ‘‘(h) FUNDING FOR GENERAL PROGRAM.— 

9 ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.— 

10 For the purpose of carrying out this section, there 

11 are authorized to be appropriated such sums as may 

12 be necessary. 

13 ‘‘(2) SET-ASIDE FOR TECHNICAL ASSISTANCE

14 AND PROVISION OF SUPPLIES AND SERVICES.—Of 

15 the amounts appropriated under paragraph (1) for 

16 a fiscal year, the Secretary shall reserve not more 

17 than 20 percent for carrying out subsection (f). 

18 ‘‘(i) SUNSET.—The authority to award grants under 

19 subsection (a) shall be effective beginning on the date of 

20 enactment of the Emergency Access to Insulin Act of 2019 

21 and ending on the date that is 5 years after such date. 

22 ‘‘(j) DEFINITIONS.—For purposes of this section: 

23 ‘‘(1) ELIGIBLE INDIVIDUAL.—The term ‘eligible 

24 individual’, with respect to a program supported by 

25 a State, Indian tribe, or tribal organization receiving 


pamtmann on DSKBFK8HB2PROD with BILLS
21 

•S 2004 IS

1 a grant under this section, means an uninsured indi2 vidual or an underinsured individual— 

3 ‘‘(A)(i) in the case of a grant to a State, 

4 who is a resident of the State; 

5 ‘‘(ii) in the case of a grant to an Indian 

6 tribe, who is a member of such tribe; or 

7 ‘‘(iii) in the case of a grant to a tribal or8 ganization, who is a member of the Indian tribe 

9 or Indian community served by the tribal orga10 nization; and 

11 ‘‘(B) who has a valid prescription for insu12 lin that is prescribed to such individual. 

13 ‘‘(2) GROUP HEALTH INSURANCE COVERAGE; 

14 GROUP HEALTH PLAN; HEALTH INSURANCE

15 ISSUER.—The terms ‘group health insurance cov16 erage’, ‘group health plan’, and ‘health insurance 

17 issuer’ have the meanings given such terms in sec18 tion 2791. 

19 ‘‘(3) HIGH-DEDUCTIBLE HEALTH PLAN.—The 

20 term ‘high-deductible health plan’ means a group 

21 health plan or group or individual health insurance 

22 coverage (offered by a health insurance issuer) that 

23 meets criteria established by the Secretary. 

24 ‘‘(4) INDIAN TRIBE.—The term ‘Indian tribe’ 

25 has the meaning given such term in section 4 of the 


pamtmann on DSKBFK8HB2PROD with BILLS
22 

•S 2004 IS

1 Indian Health Care Improvement Act (25 U.S.C. 

2 1603). 

3 ‘‘(5) INDIVIDUAL HEALTH INSURANCE COV4 ERAGE.—The term ‘individual health insurance cov5 erage’ has the meaning given such term in section 

6 2791. 

7 ‘‘(6) TRIBAL ORGANIZATION.—The term ‘tribal 

8 organization’ has the meaning given such term in 

9 section 4 of the Indian Health Care Improvement 

10 Act (25 U.S.C. 1603). 

11 ‘‘(7) UNDERINSURED INDIVIDUAL.—The term 

12 ‘underinsured individual’ means an individual who is 

13 enrolled in a high-deductible health plan. 

14 ‘‘(8) UNINSURED INDIVIDUAL.—The term ‘un15 insured individual’ means an individual who does not 

16 have minimum essential coverage as defined in sec17 tion 5000A(f)(1) of the Internal Revenue Code of 

18 1986 or coverage under a medical care program of 

19 the Indian Health Service or of a tribal organization 

20 or urban Indian organization. 

21 ‘‘(9) URBAN INDIAN ORGANIZATION.—The term 

22 ‘urban Indian organization’ has the meaning given 

23 such term in section 4 of the Indian Health Care 

24 Improvement Act.’’. 


pamtmann on DSKBFK8HB2PROD with BILLS
23 

•S 2004 IS

1 (b) EXEMPTING PRICES USED UNDER AN INSULIN

2 ASSISTANCE PROGRAM FROM BEST PRICE AND AVERAGE

3 MANUFACTURER PRICE UNDER THE MEDICAID DRUG

4 REBATE PROGRAM.—Section 1927 of the Social Security 

5 Act (42 U.S.C. 1396r–8) is amended— 

6 (1) in subsection (c)(1)(C)(i)(III), by inserting 

7 ‘‘or under an insulin assistance program supported 

8 under section 320B of the Public Health Service 

9 Act’’ after ‘‘State pharmaceutical assistance pro10 gram’’; and 

11 (2) in subsection (k)(1)(B)(i)— 

12 (A) in subclause (IV), by striking ‘‘; and’’ 

13 and inserting a semicolon; 

14 (B) in subclause (V), by striking the period 

15 at the end and inserting ‘‘; and’’; and 

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

17 subclause: 

18 ‘‘(VI) any prices used under an 

19 insulin assistance program supported 

20 under section 320B of the Public 

21 Health Service Act.’’. 

22 (c) DEDUCTIBLES FOR UNDERINSURED INDIVIDUALS

23 PARTICIPATING IN INSULIN ASSISTANCE PROGRAMS.— 

24 Subpart I of part A of title XXVII of the Public Health 


pamtmann on DSKBFK8HB2PROD with BILLS
24 

•S 2004 IS

1 Service Act (42 U.S.C. 300gg et seq.) is amended by add2 ing at the end the following: 

3 ‘‘SEC. 2710. DEDUCTIBLES FOR UNDERINSURED INDIVID4 UALS PARTICIPATING IN INSULIN ASSIST5 ANCE PROGRAMS. 

6 ‘‘(a) IN GENERAL.—A group health plan that is a 

7 high-deductible health plan and a health insurance issuer 

8 offering a high-deductible health plan shall, with respect 

9 to any individual who is enrolled in such plan and obtains 

10 insulin during a plan year through an insulin card issued 

11 to the individual by a State, Indian tribe, or tribal organi12 zation carrying out an insulin assistance program under 

13 section 320B, count the amount the State, Indian tribe, 

14 or tribal organization pays a pharmacy for insulin for such 

15 individual for such plan year towards any deductible or 

16 other out-of-pocket expenses required to be paid under the 

17 plan. 

18 ‘‘(b) HIGH-DEDUCTIBLE HEALTH PLAN.—For pur19 poses of this section, the term ‘high-deductible health plan’ 

20 has the meaning given such term in section 320B(j).’’. 

21 SEC. 3. ANNUAL FEES APPLICABLE TO INSULIN MANUFAC22 TURERS. 

23 (a) DEFINITIONS.—For purposes of this section: 

24 (1) ANNUAL PAYMENT DATE.—The term ‘‘an25 nual payment date’’ means, with respect to a calVerDate Sep 11 2014 23:54 Jul 03, 2019 Jkt 089200 PO 00000 Frm 00024 Fmt 6652 Sfmt 6201 E:\BILLS\S2004.IS S2004

pamtmann on DSKBFK8HB2PROD with BILLS
25 

•S 2004 IS

1 endar year, the date determined by the Secretary, 

2 but in no event later than September 30 of such cal3 endar year. 

4 (2) COVERED ENTITY.—The term ‘‘covered en5 tity’’, with respect to a calendar year, means an en6 tity that— 

7 (A) is the holder of an application ap8 proved under subsection (c) of section 505 of 

9 the Federal Food, Drug, and Cosmetic Act (21 

10 U.S.C. 355), or of a license issued under sub11 section (a) of section 351 of the Public Health 

12 Service Act (42 U.S.C. 262), for an insulin 

13 product; and 

14 (B) during the preceding calendar year, 

15 manufactured any insulin product that was sold 

16 in commerce and covered by a Federal health 

17 program at least once during such preceding 

18 calendar year. 

19 (3) INSPECTOR GENERAL.—The term ‘‘Inspec20 tor General’’ means the Inspector General of the De21 partment of Health and Human Services. 

22 (4) SECRETARY.—The term ‘‘Secretary’’ means 

23 the Secretary of Health and Human Services. 

24 (b) IMPOSITION OF FEE.—Each covered entity for a 

25 calendar year, beginning in 2020 and ending in 2024, 


pamtmann on DSKBFK8HB2PROD with BILLS
26 

•S 2004 IS

1 shall pay to the Secretary not later than the annual pay2 ment date of such calendar year a fee in an amount deter3 mined under subsection (c). 

4 (c) AMOUNT OF FEES.— 

5 (1) TOTAL AMOUNT.—The Secretary shall en6 sure that the total amount in fees assessed under 

7 subsection (b)— 

8 (A) for calendar year 2020, equals the 

9 total amount the Secretary estimates as the 

10 total expenditures for carrying out section 

11 320B of the Public Health Service Act for such 

12 calendar year; and 

13 (B) for each of calendar years 2021 

14 through 2024, equals the total amount of ex15 penditures the Secretary determines for car16 rying out such section for the preceding cal17 endar year. 

18 (2) DETERMINATION OF FEES FOR EACH MAN19 UFACTURER.— 

20 (A) FORMULA.—With respect to each cov21 ered entity, the fee under this section for a cal22 endar year shall be equal to an amount that 

23 bears the same ratio to the total amount as24 sessed under subsection (b) for such year as the 

25 covered entity’s sales of insulin products taken 


pamtmann on DSKBFK8HB2PROD with BILLS
27 

•S 2004 IS

1 into account during the preceding calendar 

2 year, bears to the aggregate sales of insulin 

3 products of all covered entities taken into ac4 count during such preceding calendar year. 

5 (B) SALES OF INSULIN PRODUCTS.— 

6 (i) IN GENERAL.—For purposes of 

7 this paragraph, the sales of insulin prod8 ucts taken into account during any cal9 endar year with respect to any covered en10 tity shall be determined based on the total 

11 number of units of the insulin product 

12 which were sold in commerce in the pre13 ceding calendar year based on— 

14 (I) for a fee assessed for calendar 

15 year 2020, information obtained by 

16 the Secretary under clause (ii); and 

17 (II) for a fee assessed for each of 

18 calendar years 2021 through 2024, 

19 the information provided in the an20 nual reports issued by the Inspector 

21 General and made public under sec22 tion 4(e)(1). 

23 (ii) FEES ASSESSED FOR CALENDAR

24 YEAR 2020.—For purposes of clause (i)(I), 

25 the Secretary shall require each covered 


pamtmann on DSKBFK8HB2PROD with BILLS
28 

•S 2004 IS

1 entity to submit to the Secretary informa2 tion on the total number of units of the in3 sulin product manufactured by the entity 

4 that were sold in commerce in calendar 

5 year 2019. 

6 (d) DEPOSIT.—The Secretary shall deposit amounts 

7 received through fees assessed under subsection (b) into 

8 the general fund of the Treasury. 

9 (e) ENFORCEMENT.—The Secretary may bring an ac10 tion in any court of competent jurisdiction to recover the 

11 amount of any fee that is assessed under subsection (b) 

12 for a calendar year and not paid by the annual payment 

13 date. 

14 SEC. 4. IDENTIFICATION OF INSULIN PRICE SPIKES; APPLI15 CATION OF EXCISE TAX. 

16 (a) DEFINITIONS.—In this section: 

17 (1) APPLICABLE ENTITY.—The term ‘‘applica18 ble entity’’ means the holder of an application ap19 proved under subsection (c) or (j) of section 505 of 

20 the Federal Food, Drug, and Cosmetic Act (21 

21 U.S.C. 355), or of a license issued under subsection 

22 (a) or (k) of section 351 of the Public Health Serv23 ice Act (42 U.S.C. 262), for an insulin product. 


pamtmann on DSKBFK8HB2PROD with BILLS
29 

•S 2004 IS

1 (2) COMMERCE.—The term ‘‘commerce’’ has 

2 the meaning given such term in section 4 of the 

3 Federal Trade Commission Act (15 U.S.C. 44). 

4 (3) INSPECTOR GENERAL.—The term ‘‘Inspec5 tor General’’ means the Inspector General of the De6 partment of Health and Human Services. 

7 (4) PRICE SPIKE.— 

8 (A) IN GENERAL.—The term ‘‘price spike’’ 

9 means an increase in the wholesale acquisition 

10 cost in commerce of an insulin product for 

11 which the price spike percentage is equal to or 

12 greater than the applicable price increase allow13 ance. 

14 (B) PRICE SPIKE PERCENTAGE.—The 

15 price spike percentage is the percentage (if any) 

16 by which— 

17 (i) the wholesale acquisition cost of an 

18 insulin product in commerce for the cal19 endar year; exceeds 

20 (ii) the wholesale acquisition cost of 

21 such insulin product in commerce for the 

22 calendar year preceding such year. 

23 (C) APPLICABLE PRICE INCREASE ALLOW24 ANCE.—The applicable price increase allowance 

25 for any calendar year is the percentage (roundVerDate Sep 11 2014 01:43 Jul 02, 2019 Jkt 089200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\S2004.IS S2004

pamtmann on DSKBFK8HB2PROD with BILLS
30 

•S 2004 IS

1 ed to the nearest one-tenth of 1 percent) by 

2 which the C–CPI–U (as defined in section 

3 1(f)(6) of the Internal Revenue Code of 1986) 

4 for that year exceeds the C–CPI–U for the pre5 ceding calendar year. 

6 (5) PRICE SPIKE REVENUE.— 

7 (A) IN GENERAL.—The price spike revenue 

8 for any calendar year is an amount equal to— 

9 (i) the gross price spike revenue, 

10 minus 

11 (ii) the adjustment amount. 

12 (B) GROSS PRICE SPIKE REVENUE.—The 

13 gross price spike revenue for any calendar year 

14 is an amount equal to the product of— 

15 (i) an amount equal to the difference 

16 between clause (i) of paragraph (4)(B) and 

17 clause (ii) of such paragraph; and 

18 (ii) the total number of units of the 

19 insulin product which were sold in com20 merce in such calendar year. 

21 (C) ADJUSTMENT AMOUNT.—The adjust22 ment amount is the amount, if any, of the gross 

23 price spike revenue which the Inspector General 

24 has determined is due solely to an increase in 


pamtmann on DSKBFK8HB2PROD with BILLS
31 

•S 2004 IS

1 the cost of the inputs necessary to manufacture 

2 the insulin product subject to the price spike. 

3 (b) SUBMISSION BY PHARMACEUTICAL COMPANIES

4 OF INFORMATION TO INSPECTOR GENERAL.— 

5 (1) IN GENERAL.—For each insulin product, 

6 the applicable entity shall submit to the Inspector 

7 General a quarterly report that includes the fol8 lowing: 

9 (A) For each insulin product of the appli10 cable entity— 

11 (i) the total number of units of the in12 sulin product which were sold in commerce 

13 in the preceding calendar quarter; 

14 (ii) the average and median wholesale 

15 acquisition cost per unit of such insulin 

16 product in commerce in the preceding cal17 endar quarter, disaggregated by month; 

18 and 

19 (iii) the gross revenues from sales of 

20 such insulin product in commerce in the 

21 preceding calendar quarter. 

22 (B) Such information related to increased 

23 input costs or public health considerations as 

24 the applicable entity may wish the Inspector 

25 General to consider in making a determination 


pamtmann on DSKBFK8HB2PROD with BILLS
32 

•S 2004 IS

1 under clause (ii) of subsection (c)(2)(B) or an 

2 assessment in clause (iii) of such subsection for 

3 the preceding calendar quarter. 

4 (C) Such information related to any antici5 pated increased input costs for the subsequent 

6 calendar quarter as the applicable entity may 

7 wish the Inspector General to consider in mak8 ing a determination under clause (ii) of sub9 section (c)(2)(B) or an assessment in clause 

10 (iii) of such subsection for such calendar quar11 ter. 

12 (2) PENALTY FOR FAILURE TO SUBMIT.— 

13 (A) IN GENERAL.—An applicable entity de14 scribed in paragraph (1) that fails to submit in15 formation to the Inspector General regarding 

16 an insulin product, as required by such para17 graph, before the date specified in paragraph 

18 (3) shall be liable for a civil penalty, as deter19 mined under subparagraph (B). 

20 (B) AMOUNT OF PENALTY.—The amount 

21 of the civil penalty shall be equal to the product 

22 of— 

23 (i) an amount, as determined appro24 priate by the Inspector General, which is— 


pamtmann on DSKBFK8HB2PROD with BILLS
33 

•S 2004 IS

1 (I) not less than 0.5 percent of 

2 the gross revenues from sales of the 

3 insulin product described in subpara4 graph (A) for the preceding calendar 

5 year; and 

6 (II) not greater than 1 percent of 

7 the gross revenues from sales of such 

8 insulin product for the preceding cal9 endar year; and 

10 (ii) the number of days in the period 

11 between— 

12 (I) the applicable date specified 

13 in paragraph (3); and 

14 (II) the date on which the In15 spector General receives the informa16 tion described in paragraph (1) from 

17 the applicable entity. 

18 (3) SUBMISSION DEADLINE.—An applicable en19 tity shall submit each quarterly report described in 

20 paragraph (1) not later than January 17, April 18, 

21 June 15, and September 15 of each calendar year. 

22 (c) ASSESSMENT BY INSPECTOR GENERAL.— 

23 (1) IN GENERAL.—Not later than the last day 

24 in February of each year, the Inspector General, in 


pamtmann on DSKBFK8HB2PROD with BILLS
34 

•S 2004 IS

1 consultation with other relevant Federal agencies 

2 (including the Federal Trade Commission), shall— 

3 (A) complete an assessment of the infor4 mation the Inspector General received pursuant 

5 to subsection (b)(1) with respect to sales of in6 sulin products in the preceding calendar year; 

7 and 

8 (B) in the case of any insulin product 

9 which satisfies the conditions described in para10 graph (1) or (2) of subsection (d), submit a rec11 ommendation to the Secretary of Health and 

12 Human Services that such insulin product be 

13 exempted from application of the tax imposed 

14 under section 4192 of the Internal Revenue 

15 Code of 1986 (as added by subsection (g)) for 

16 such year. 

17 (2) ELEMENTS.—The assessment required by 

18 paragraph (1)(A) shall include the following: 

19 (A) Identification of each price spike relat20 ing to an insulin product in the preceding cal21 endar year. 

22 (B) For each price spike identified under 

23 subparagraph (A)— 

24 (i) a determination of the price spike 

25 revenue; 


pamtmann on DSKBFK8HB2PROD with BILLS
35 

•S 2004 IS

1 (ii) a determination regarding the ac2 curacy of the information submitted by the 

3 applicable entity regarding increased input 

4 costs; and 

5 (iii) an assessment of the rationale of 

6 the applicable entity for the price spike. 

7 (d) EXEMPTION OF CERTAIN INSULIN PRODUCTS.— 

8 (1) IN GENERAL.—The Secretary of Health and 

9 Human Services, upon recommendation of the In10 spector General pursuant to subsection (c)(1)(B), 

11 may exempt any insulin product which has been sub12 ject to a price spike during the preceding calendar 

13 year from application of the tax imposed under sec14 tion 4192 of the Internal Revenue Code of 1986 for 

15 such year, if the Secretary determines that, based on 

16 information submitted pursuant to subsection 

17 (b)(1)(B), a for-cause price increase exemption 

18 should apply. 

19 (2) CLARIFICATION.—In considering, under 

20 paragraph (1)(A), information submitted pursuant 

21 to subsection (b)(1)(B), the Secretary— 

22 (A) has the discretion to determine that 

23 such information does not warrant a for-cause 

24 price increase exemption; and 


pamtmann on DSKBFK8HB2PROD with BILLS
36 

•S 2004 IS

1 (B) shall exclude from such consideration 

2 any information submitted by the applicable en3 tity threatening to curtail or limit production of 

4 the insulin product if the Secretary does not 

5 grant an exemption from the application of the 

6 tax under section 4192 of the Internal Revenue 

7 Code of 1986. 

8 (e) REPORTS BY INSPECTOR GENERAL.— 

9 (1) PUBLIC REPORT.— 

10 (A) IN GENERAL.—Not later than the last 

11 day in February of each year, subject to sub12 paragraph (C), the Inspector General shall 

13 issue a report containing the information de14 scribed in subparagraph (B) to be made avail15 able to the public, including on the Internet 

16 website of the Inspector General. 

17 (B) CONTENTS.—The report issued under 

18 subparagraph (A) shall include the following: 

19 (i) The information received under 

20 subsection (b)(1) with respect to the pre21 ceding calendar year. 

22 (ii) The price spikes identified under 

23 subparagraph (A) of subsection (c)(2). 


pamtmann on DSKBFK8HB2PROD with BILLS
37 

•S 2004 IS

1 (iii) The price spike revenue deter2 minations made under subparagraph (B)(i) 

3 of such subsection. 

4 (iv) The determinations and assess5 ments made under clauses (ii) and (iii) of 

6 subparagraph (B) of such subsection. 

7 (C) PROPRIETARY INFORMATION.—The In8 spector General shall ensure that any informa9 tion made public in accordance with subpara10 graph (A) excludes trade secrets and confiden11 tial commercial information. 

12 (2) REPORT TO INTERNAL REVENUE SERV13 ICE.— 

14 (A) IN GENERAL.—Subject to subpara15 graph (C), not later than the last day in Feb16 ruary of each year, the Inspector General shall 

17 transmit to the Internal Revenue Service a re18 port on the findings of the Inspector General 

19 with respect to the information the Inspector 

20 General received under subsection (b)(1) with 

21 respect to the preceding calendar year and the 

22 assessment carried out by the Inspector General 

23 under subsection (c)(1)(A) with respect to such 

24 information. 


pamtmann on DSKBFK8HB2PROD with BILLS
38 

•S 2004 IS

1 (B) CONTENTS.—The report transmitted 

2 under subparagraph (A) shall include the infor3 mation described in paragraph (1)(B). 

4 (C) NOTICE AND OPPORTUNITY FOR HEAR5 ING.— 

6 (i) IN GENERAL.—No report shall be 

7 transmitted to the Internal Revenue Serv8 ice under subparagraph (A) with respect to 

9 an insulin product unless the Inspector 

10 General has provided the applicable entity 

11 with— 

12 (I) the assessment of such insulin 

13 product under subsection (c)(1)(A); 

14 and 

15 (II) notice of their right to a 

16 hearing in regards to such assess17 ment. 

18 (ii) NOTICE.—The notice required 

19 under clause (i) shall be provided to the 

20 applicable entity not later than 30 days 

21 after completion of the assessment under 

22 subsection (c)(1)(A). 

23 (iii) REQUEST FOR HEARING.—Sub24 ject to clause (v), an applicable entity may 

25 request a hearing before the Secretary of 


pamtmann on DSKBFK8HB2PROD with BILLS
39 

•S 2004 IS

1 Health and Human Services not later than 

2 30 days after the date on which the notice 

3 under clause (ii) is received. 

4 (iv) COMPLETION OF HEARING.—In 

5 the case of an applicable entity which re6 quests a hearing pursuant to clause (iii), 

7 the Secretary of Health and Human Serv8 ices shall, not later than 12 months after 

9 the date on which the assessment under 

10 subsection (c)(1)(A) was completed by the 

11 Inspector General— 

12 (I) make a final determination in 

13 regards to the accuracy of such as14 sessment; and 

15 (II) provide the report described 

16 in subparagraph (B) to the Internal 

17 Revenue Service. 

18 (v) LIMITATION.—An applicable entity 

19 may request a hearing under clause (iii) 

20 with respect to a particular insulin product 

21 only once within a 5-year period. 

22 (f) NOTIFICATION.—The Secretary of the Treasury 

23 shall notify, at such time and in such manner as the Sec24 retary of the Treasury shall provide, each applicable entity 

25 in regard to any insulin product which has been deterVerDate Sep 11 2014 23:54 Jul 03, 2019 Jkt 089200 PO 00000 Frm 00039 Fmt 6652 Sfmt 6201 E:\BILLS\S2004.IS S2004

pamtmann on DSKBFK8HB2PROD with BILLS
40 

•S 2004 IS

1 mined to have been subject to a price spike during the 

2 preceding calendar year and the amount of the tax im3 posed on such applicable entity pursuant to section 4192 

4 of the Internal Revenue Code of 1986. 

5 (g) EXCISE TAX ON INSULIN PRODUCTS SUBJECT TO

6 PRICE SPIKES.— 

7 (1) IN GENERAL.—Subchapter E of chapter 32 

8 of the Internal Revenue Code of 1986 is amended by 

9 adding at the end the following new section: 

10 ‘‘SEC. 4192. INSULIN PRODUCTS SUBJECT TO PRICE SPIKES. 

11 ‘‘(a) IMPOSITION OF TAX.— 

12 ‘‘(1) IN GENERAL.—Subject to paragraph (3), 

13 for each taxable insulin product sold by an applica14 ble entity during the calendar year, there is hereby 

15 imposed on such entity a tax equal to the greater 

16 of— 

17 ‘‘(A) the annual price spike tax for such 

18 insulin product, or 

19 ‘‘(B) subject to paragraph (2), the cumu20 lative price spike tax for such insulin product. 

21 ‘‘(2) LIMITATION.—In the case of a taxable in22 sulin product for which the applicable period (as de23 termined under subsection (c)(2)(E)(i)) is less than 

24 2 calendar years, the cumulative price spike tax shall 

25 not apply. 


pamtmann on DSKBFK8HB2PROD with BILLS
41 

•S 2004 IS

1 ‘‘(3) EXEMPTION.—For any calendar year in 

2 which the Secretary of Health and Human Services 

3 has provided an exemption for a taxable insulin 

4 product pursuant to section 4(d) of the Emergency 

5 Access to Insulin Act of 2019, the amount of the tax 

6 determined under paragraph (1) for such insulin 

7 product for such calendar year shall be reduced to 

8 zero. 

9 ‘‘(b) ANNUAL PRICE SPIKE TAX.— 

10 ‘‘(1) IN GENERAL.—The amount of the annual 

11 price spike tax shall be equal to the applicable per12 centage of the price spike revenue received by the 

13 applicable entity on the sale of the taxable insulin 

14 product during the calendar year. 

15 ‘‘(2) APPLICABLE PERCENTAGE.—For purposes 

16 of paragraph (1), the applicable percentage shall be 

17 equal to— 

18 ‘‘(A) in the case of a taxable insulin prod19 uct which has been subject to a price spike per20 centage greater than the applicable price in21 crease allowance (as defined in section 

22 4(a)(4)(C) of the Emergency Access to Insulin 

23 Act of 2019) but less than 15 percent, 50 per24 cent, 


pamtmann on DSKBFK8HB2PROD with BILLS
42 

•S 2004 IS

1 ‘‘(B) in the case of a taxable insulin prod2 uct which has been subject to a price spike per3 centage equal to or greater than 15 percent but 

4 less than 20 percent, 75 percent, and 

5 ‘‘(C) in the case of a taxable insulin prod6 uct which has been subject to a price spike per7 centage equal to or greater than 20 percent, 

8 100 percent. 

9 ‘‘(c) CUMULATIVE PRICE SPIKE TAX.— 

10 ‘‘(1) IN GENERAL.—The amount of the cumu11 lative price spike tax shall be equal to the applicable 

12 percentage of the cumulative price spike revenue re13 ceived by the applicable entity on the sale of the tax14 able insulin product during the calendar year. 

15 ‘‘(2) APPLICABLE PERCENTAGE.— 

16 ‘‘(A) IN GENERAL.—For purposes of para17 graph (1), the applicable percentage shall be 

18 equal to— 

19 ‘‘(i) in the case of a taxable insulin 

20 product which has been subject to a cumu21 lative price spike percentage greater than 

22 the cumulative price increase allowance but 

23 less than the first multi-year percentage, 

24 50 percent, 


pamtmann on DSKBFK8HB2PROD with BILLS
43 

•S 2004 IS

1 ‘‘(ii) in the case of a taxable insulin 

2 product which has been subject to a cumu3 lative price spike percentage equal to or 

4 greater than the first multi-year percent5 age but less than the second multi-year 

6 percentage, 75 percent, and 

7 ‘‘(iii) in the case of a taxable insulin 

8 product which has been subject to a cumu9 lative price spike percentage equal to or 

10 greater than the second multi-year percent11 age, 100 percent. 

12 ‘‘(B) CUMULATIVE PRICE SPIKE PERCENT13 AGE.—The cumulative price spike percentage is 

14 the percentage (if any) by which— 

15 ‘‘(i) the wholesale acquisition cost of 

16 the taxable insulin product in commerce 

17 for the preceding calendar year, exceeds 

18 ‘‘(ii) the wholesale acquisition cost of 

19 such insulin product in commerce for the 

20 base year. 

21 ‘‘(C) CUMULATIVE PRICE INCREASE AL22 LOWANCE.—For purposes of clause (i) of sub23 paragraph (A), the cumulative price increase al24 lowance for any calendar year is the percentage 

25 (rounded to the nearest one-tenth of 1 percent) 


pamtmann on DSKBFK8HB2PROD with BILLS
44 

•S 2004 IS

1 by which the C–CPI–U (as defined in section 

2 1(f)(6)) for that year exceeds the C–CPI–U for 

3 the base year. 

4 ‘‘(D) MULTI-YEAR PERCENTAGES.—For 

5 purposes of subparagraph (A), the first multi6 year percentage and second multi-year percent7 age shall be determined in accordance with the 

8 following table: 

‘‘Number of years in applicable period 

First 

multi-year 

percentage 

Second 

multi-year 

percentage 

2 years .................................................................... 17.5 22.5

3 years .................................................................... 20.0 25.0

4 years .................................................................... 22.5 27.5

5 years .................................................................... 25.0 30.0. 

9 ‘‘(E) APPLICABLE PERIOD AND BASE

10 YEAR.— 

11 ‘‘(i) APPLICABLE PERIOD.—The appli12 cable period shall be the lesser of— 

13 ‘‘(I) the 5 preceding calendar 

14 years, 

15 ‘‘(II) all calendar years beginning 

16 after the date of enactment of this 

17 section, or 

18 ‘‘(III) all calendar years in which 

19 the taxable insulin product was sold in 

20 commerce. 


pamtmann on DSKBFK8HB2PROD with BILLS
45 

•S 2004 IS

1 ‘‘(ii) BASE YEAR.—The base year 

2 shall be the calendar year immediately pre3 ceding the applicable period. 

4 ‘‘(3) CUMULATIVE PRICE SPIKE REVENUE.— 

5 For purposes of paragraph (1), the cumulative price 

6 spike revenue for any taxable insulin product shall 

7 be an amount equal to— 

8 ‘‘(A) an amount equal to the product of— 

9 ‘‘(i) an amount (not less than zero) 

10 equal to— 

11 ‘‘(I) the wholesale acquisition 

12 cost of such insulin product in com13 merce for the preceding calendar year, 

14 minus 

15 ‘‘(II) the wholesale acquisition 

16 cost of such insulin product in com17 merce for the base year, and 

18 ‘‘(ii) the total number of units of such 

19 insulin product which were sold in com20 merce in the preceding calendar year, 

21 minus 

22 ‘‘(B) an amount equal to the sum of the 

23 adjustment amounts, if any, determined under 

24 section 4(a)(5)(C) of the Emergency Access to 


pamtmann on DSKBFK8HB2PROD with BILLS
46 

•S 2004 IS

1 Insulin Act of 2019 for each calendar year dur2 ing the applicable period. 

3 ‘‘(d) DEFINITIONS.—For purposes of this section— 

4 ‘‘(1) TAXABLE INSULIN PRODUCT.—The term 

5 ‘taxable insulin product’ means an insulin product 

6 which has been identified by the Inspector General 

7 of the Department of Health and Human Services, 

8 under section 4(c)(2)(A) of the Emergency Access to 

9 Insulin Act of 2019, as being subject to a price 

10 spike. 

11 ‘‘(2) OTHER TERMS.—The terms ‘applicable en12 tity’, ‘price spike’, ‘price spike percentage’, and 

13 ‘price spike revenue’ have the same meaning given 

14 such terms under section 4(a) of the Emergency Ac15 cess to Insulin Act of 2019.’’. 

16 (2) CLERICAL AMENDMENTS.— 

17 (A) The heading of subchapter E of chap18 ter 32 of the Internal Revenue Code of 1986 is 

19 amended by striking ‘‘Medical Devices’’ 

20 and inserting ‘‘Certain Medical Devices 

21 and Insulin Products’’. 

22 (B) The table of subchapters for chapter 

23 32 of such Code is amended by striking the 

24 item relating to subchapter E and inserting the 

25 following new item: 

‘‘SUBCHAPTER E. CERTAIN MEDICAL DEVICES AND INSULIN PRODUCTS’’. 


pamtmann on DSKBFK8HB2PROD with BILLS
47 

•S 2004 IS

1 (C) The table of sections for subchapter E 

2 of chapter 32 of such Code is amended by add3 ing at the end the following new item: 

‘‘Sec. 4192. Insulin products subject to price spikes.’’. 

4 (3) EFFECTIVE DATE.—The amendments made 

5 by this subsection shall apply to sales after the date 

6 of the enactment of this Act. 

7 SEC. 5. BIOLOGICAL PRODUCT EXCLUSIVITY. 

8 (a) IN GENERAL.—Section 351(k)(7)(A) of the Pub9 lic Health Service Act (42 U.S.C. 262(k)(7)(A)) is amend10 ed by striking ‘‘12 years’’ and inserting ‘‘7 years’’. 

11 (b) CONFORMING AMENDMENTS.—Paragraphs 

12 (2)(A) and (3)(A) of section 351(m) of the Public Health 

13 Service Act (42 U.S.C. 262(m)) is amended by striking 

14 ‘‘12 years’’ each place it appears and inserting ‘‘7 years’’. 

Æ 


pamtmann on DSKBFK8HB2PROD with BILLS