II 

116TH CONGRESS 

1ST SESSION S. 2199 

To provide patient protections with respect to the cost of insulin. 

IN THE SENATE OF THE UNITED STATES 

JULY 22, 2019 

Mrs. SHAHEEN (for herself, Ms. COLLINS, Mr. CARPER, and Mr. CRAMER) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To provide patient protections with respect to the cost of 

insulin. 

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 ‘‘Insulin Price Reduc5 tion Act’’. 

6 SEC. 2. INSULIN PRICE PROTECTIONS. 

7 (a) IN GENERAL.—Subpart II of part A of title 

8 XXVII of the Public Health Service Act (42 U.S.C. 

9 300gg–11 et seq.) is amended by adding at the end the 

10 following: 


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1 ‘‘SEC. 2729A. INSULIN PRICE PROTECTIONS. 

2 ‘‘(a) CONTRACTING REQUIREMENTS.— 

3 ‘‘(1) IN GENERAL.— 

4 ‘‘(A) REQUIREMENT.—Except as provided 

5 in subparagraph (B), a group health plan or a 

6 health insurance issuer offering group or indi7 vidual health insurance coverage shall not, and 

8 shall ensure that any entity that provides phar9 macy benefits management services under a 

10 contract with any such health plan or health in11 surance coverage does not, directly or indirectly, 

12 receive from a manufacturer of certified insulin 

13 a rebate, reduction in price, or other remunera14 tion with respect to such insulin received by an 

15 enrollee in the plan or coverage and covered by 

16 the plan or coverage. 

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

18 subparagraph (A) shall not apply to— 

19 ‘‘(i) any such reduction in price that 

20 is reflected at the point of sale to the en21 rollee; or 

22 ‘‘(ii) any remuneration that is a flat 

23 fee-based service fee that a manufacturer 

24 of such insulin pays to a pharmacy benefit 

25 manager for services rendered to the man26 ufacturer that relate to arrangements by 


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1 the pharmacy benefit manager to provide 

2 pharmacy benefit management services to 

3 a health plan or health insurance issuer, if 

4 certain conditions established by the Sec5 retary are met, including requirements 

6 that the fees are transparent to the health 

7 plan or health insurance issuer. 

8 ‘‘(2) APPLICABILITY.—The restriction under 

9 paragraph (1) shall apply with respect to insulin de10 scribed in paragraph (1), for which the manufac11 turer has certified the list price in accordance with 

12 section 5(b) of the Insulin Price Reduction Act with 

13 respect to— 

14 ‘‘(A) any plan year in which the list price 

15 for insulin is certified under section 5(b)(2)(A) 

16 of the Insulin Price Reduction Act; and 

17 ‘‘(B) each subsequent plan year during 

18 which the manufacturer limits any increase in 

19 the list price to the price that gave rise to the 

20 restriction under paragraph (1), adjusted by 

21 not more than the price change in the medical 

22 care component of the consumer price index for 

23 all urban consumers (U.S. city average), as cer24 tified under section 5(b)(2)(B) of the Insulin 

25 Price Reduction Act. 


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1 ‘‘(b) DEDUCTIBLE LIMITATION.—A group health 

2 plan or a health insurance issuer offering group or indi3 vidual health insurance coverage shall not apply any de4 ductible amount that otherwise is applicable to prescrip5 tion drugs with respect to coverage of certified insulin 

6 under such plan or coverage, during the period described 

7 in subsection (a)(2). 

8 ‘‘(c) HOLD HARMLESS.—In the first 2 plan years 

9 during which paragraph (1) applies with respect to an in10 sulin certified under section 5(b) of the Insulin Price Re11 duction Act, a group health plan or a health insurance 

12 issuer offering group or individual health insurance cov13 erage shall not, and shall ensure that any entity that pro14 vides pharmacy benefits management services under a 

15 contract with such health plan or health insurance cov16 erage does not— 

17 ‘‘(1) remove such insulin from the formulary 

18 applicable to the plan or coverage; 

19 ‘‘(2) impose higher cost-sharing with respect to 

20 such insulin than the cost-sharing that applied with 

21 respect to the insulin in the year in which the list 

22 price reduction certification was provided under sec23 tion 5(b)(2)(A) of the Insulin Price Reduction Act; 

24 ‘‘(3) impose any prior authorization require25 ments for coverage of such insulin that were not apVerDate Sep 11 2014 05:59 Jul 26, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2199.IS S2199

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1 plied during the year in which the list price reduc2 tion certification was provided under such section 

3 5(b)(2)(A); or 

4 ‘‘(4) establish a step therapy requirement for 

5 such insulin that was not applied during the year in 

6 which the list price reduction certification was pro7 vided under such section 5(b)(2)(A). 

8 ‘‘(d) DEFINITIONS.—In this section— 

9 ‘‘(1) the term ‘certified insulin’ means, with re10 spect to a year, insulin that has been certified under 

11 section 5(b) of the Insulin Price Reduction Act for 

12 the year; 

13 ‘‘(2) the term ‘insulin’ means any insulin prod14 uct approved by the Food and Drug Administration 

15 to improve glycemic control in patients with diabetes 

16 mellitus; 

17 ‘‘(3) the term ‘list price’ has the meaning given 

18 the term ‘wholesale acquisition cost’ in section 

19 1847A(c)(6)(B) of the Social Security Act; and 

20 ‘‘(4) the term ‘rebate’ means any discount, 

21 price concession, or fee, other than the fee described 

22 in section (a)(1)(B), the terms of which are fixed at 

23 the time of the sale and disclosed, but which is not 

24 received at the time of the sale.’’. 


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1 (b) CONFORMING AMENDMENT.—Paragraph (2) of 

2 section 223(d) of the Internal Revenue Code of 1986 is 

3 amended by redesignating subparagraph (D) as subpara4 graph (E) and by inserting after subparagraph (C) the 

5 following new subparagraph: 

6 ‘‘(D) SAFE HARBOR FOR ABSENCE OF DE7 DUCTIBLE FOR INSULIN.—A plan shall not fail 

8 to be treated as a high deductible health plan 

9 by reason of exempting insulin from any de10 ductible pursuant to section 2729A(b) of the 

11 Public Health Service Act during the period de12 scribed in section 2729A(a)(2) of such Act.’’. 

13 (c) EFFECTIVE DATE.—The amendments made by 

14 subsections (a) and (b) shall take effect with respect to 

15 plan years beginning on or after January 1, 2022. 

16 SEC. 3. INSULIN PRICE PROTECTIONS UNDER MEDICARE 

17 PART D. 

18 Section 1860D–4 of the Social Security Act (42 

19 U.S.C. 1395w–104) is amended— 

20 (1) by redesignating the subsection (m) as 

21 added by section 6063(c) of the SUPPORT for Pa22 tients and Communities Act (Public Law 115–271) 

23 as subsection (n); and 

24 (2) by adding at the end the following new sub25 section: 


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1 ‘‘(o) LIMITATION ON REBATES, PRICE REDUCTIONS, 

2 OR OTHER REMUNERATION FOR CERTIFIED INSULIN.— 

3 ‘‘(1) LIMITATION.— 

4 ‘‘(A) IN GENERAL.—Subject to subpara5 graphs (B) and (C), for plan year 2022 and 

6 subsequent plan years, a PDP sponsor and a 

7 Medicare Advantage organization shall ensure 

8 that each prescription drug plan or MA–PD 

9 plan offered by the sponsor or organization, and 

10 any entity that provides pharmacy benefits 

11 management services under a contract with the 

12 prescription drug plan or MA–PD plan offered 

13 by the sponsor or organization, does not, di14 rectly or indirectly, receive from a manufacturer 

15 of certified insulin a rebate, reduction in price, 

16 or other remuneration with respect to certified 

17 insulin that is covered by the plan. 

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

19 subparagraph (A) shall not apply to— 

20 ‘‘(i) any such reduction in price that 

21 is reflected at the point of sale to the bene22 ficiary; or 

23 ‘‘(ii) any remuneration that is a flat 

24 fee-based service fee that a manufacturer 

25 of such certified insulin pays to a pharVerDate Sep 11 2014 05:59 Jul 26, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2199.IS S2199

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1 macy benefit manager for services rendered 

2 to the manufacturer that relate to arrange3 ments by the pharmacy benefit manager to 

4 provide pharmacy benefit management 

5 services to a prescription drug plan or 

6 MA–PD plan, if certain conditions estab7 lished by the Secretary are met, including 

8 requirements that the fees are transparent 

9 to the prescription drug plan or MA–PD 

10 plan. 

11 ‘‘(C) HOLD HARMLESS FOR FIRST 2 YEARS

12 THAT AN INSULIN IS CERTIFIED.—In the first 

13 2 plan years during which paragraph (2) ap14 plies with respect to a certified insulin, a PDP 

15 sponsor and a Medicare Advantage organization 

16 shall not, and shall ensure that any entity that 

17 provides pharmacy benefits management serv18 ices under a contract with such sponsor or or19 ganization does not— 

20 ‘‘(i) remove such insulin from the for21 mulary applicable to the prescription drug 

22 plan or MA–PD plan; 

23 ‘‘(ii) impose higher cost-sharing with 

24 respect to such insulin than the cost-shar25 ing that applied with respect to the cerVerDate Sep 11 2014 05:59 Jul 26, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2199.IS S2199

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1 tified insulin in the year in which the list 

2 price reduction certification was provided 

3 under section 5(b)(2)(A) of the Insulin 

4 Price Reduction Act; 

5 ‘‘(iii) impose any prior authorization 

6 requirements for coverage of the certified 

7 insulin that were not applied during the 

8 year in which the list price reduction cer9 tification was provided under such section 

10 5(b)(2)(A); or 

11 ‘‘(iv) establish a step therapy require12 ment for the certified insulin that was not 

13 applied during the year in which the list 

14 price reduction certification was provided 

15 under such section 5(b)(2)(A). 

16 ‘‘(2) DEFINITIONS.—In this section: 

17 ‘‘(A) CERTIFIED INSULIN.—The term ‘cer18 tified insulin’ means, with respect to a year, in19 sulin that has been certified under section 5(b) 

20 of the Insulin Price Reduction Act for the year. 

21 ‘‘(B) INSULIN.—The term ‘insulin’ means 

22 any insulin product approved by the Food and 

23 Drug Administration to improve glycemic con24 trol in patients with diabetes mellitus. 


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1 ‘‘(C) LIST PRICE.—The term ‘list price’ 

2 has the meaning given the term ‘wholesale ac3 quisition cost’ in section 1847A(c)(6)(B). 

4 ‘‘(D) REBATE.—The term ‘rebate’ means 

5 any discount, price concession, or fee, other 

6 than the fee described in paragraph (1)(B), the 

7 terms of which are fixed at the time of the sale 

8 and disclosed, but which is not received at the 

9 time of the sale.’’. 

10 SEC. 4. APPLICABILITY OF PRE-LIST PRICE REDUCTION 

11 AMP TO MEDICAID MINIMUM REBATE 

12 AMOUNTS. 

13 Section 1927(c) of the Social Security Act (42 U.S.C. 

14 1396r–8(c)) is amended— 

15 (1) in paragraph (1)(A), in the matter pre16 ceding clause (i), by inserting ‘‘and paragraph (5)’’ 

17 after ‘‘paragraph (2)’’; 

18 (2) in paragraph (3)(A), in the matter pre19 ceding clause (i), by inserting ‘‘and paragraph (5)’’ 

20 after ‘‘subparagraph (C)’’; and 

21 (3) by adding at the end the following new 

22 paragraph: 

23 ‘‘(5) SPECIAL RULE FOR DETERMINING MIN24 IMUM BASIC REBATES FOR INSULIN.— 


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1 ‘‘(A) IN GENERAL.—In determining the 

2 amount of the rebate specified in this sub3 section for a dosage form and strength of a cov4 ered outpatient drug described in subparagraph 

5 (B) for any rebate period occurring after April 

6 30, 2020, paragraph (1)(A)(ii)(II) or paragraph 

7 (3)(A)(i) (as applicable) shall be applied by sub8 stituting— 

9 ‘‘(i) the pre-reduction average manu10 facturer price (as defined in subparagraph 

11 (C)) for the dosage form and strength of 

12 the drug for the rebate period; for 

13 ‘‘(ii) the average manufacturer price 

14 for the dosage form and strength of the 

15 drug for the rebate period. 

16 ‘‘(B) DRUGS DESCRIBED.—A covered out17 patient drug is described in this subparagraph 

18 for a rebate period if the drug is insulin for 

19 which, throughout such rebate period, the man20 ufacturer has certified the list price for each 

21 dosage form and strength of such drug in ac22 cordance with section 5(b) of the Insulin Price 

23 Reduction Act. 

24 ‘‘(C) PRE-REDUCTION AVERAGE MANUFAC25 TURER PRICE.—For purposes of this paraVerDate Sep 11 2014 05:59 Jul 26, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S2199.IS S2199

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1 graph, the term ‘pre-reduction average manu2 facturer price’ means, with respect to each dos3 age form and strength of a covered outpatient 

4 drug described in subparagraph (B) and a re5 bate period— 

6 ‘‘(i) the average manufacturer price 

7 for such drug for the calendar quarter be8 ginning July 1, 2019; increased by 

9 ‘‘(ii) the percentage by which the con10 sumer price index for all urban consumers 

11 (United States city average) for the month 

12 before the month in which the rebate pe13 riod begins exceeds such index for Sep14 tember 2019.’’. 

15 SEC. 5. LIST PRICE DATA SUBMISSIONS. 

16 (a) INITIAL SUBMISSION.— 

17 (1) IN GENERAL.—Not later than April 30, 

18 2020, any manufacturer of insulin wishing to receive 

19 certification under this section shall submit to the 

20 Secretary— 

21 (A) data on the list price of any insulin 

22 manufactured by the manufacturer during the 

23 period beginning on January 1, 2000 (or the 

24 first date on which such manufacturer begins 


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1 manufacturing such insulin), through the list 

2 price applicable at the time of the report; and 

3 (B) a certification that such data is accu4 rate. 

5 (2) LATER SUBMISSIONS.—Any manufacturer 

6 of insulin that does not submit the information de7 scribed in paragraph (1) by the date described in 

8 such paragraph may later submit the information 

9 described in subparagraphs (A) and (B) of para10 graph (1) to the Secretary. Such a manufacturer 

11 who submits such information pursuant to this para12 graph is eligible to certify its list price for the appli13 cable insulin under subsection (b)(2)(A)(ii) with re14 spect to the first plan year that begins at least 15 

15 months after the date of submission under this para16 graph. 

17 (b) ANNUAL PRICE CERTIFICATION.— 

18 (1) IN GENERAL.—Any manufacturer of insulin 

19 who submits information in accordance with sub20 section (a) is eligible for certification under this sub21 section. 

22 (2) REQUIREMENTS.— 

23 (A) FIRST CERTIFICATION.— 

24 (i) INITIAL ELIGIBILITY FOR CERTIFI25 CATION.—A manufacturer of insulin who 


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1 submits information under subsection 

2 (a)(1) is considered certified under this 

3 subsection for plan year 2022 if such man4 ufacturer, not later than September 30, 

5 2020, submits to the Secretary a certifi6 cation that the manufacturer reduced its 

7 list price for insulin to an amount that is 

8 no greater than the list price for the same 

9 insulin that applied as of July 1, 2006. 

10 (ii) LATER CERTIFICATION.—A manu11 facturer of insulin that submitted informa12 tion under subsection (a)(2) not later than 

13 September 30 of the calendar year that is 

14 2 years prior to the applicable plan year, 

15 is considered certified under this sub16 section for the applicable plan year if such 

17 manufacturer submits to the Secretary a 

18 certification, not later than September 30 

19 of such calendar year, that the manufac20 turer reduced its list price for insulin to 

21 the amount that is no greater than the list 

22 price for the same insulin that applied as 

23 of July 1, 2006, increased by not more 

24 than the rate by which the medical care 

25 component of the consumer price index for 


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1 all urban consumers (U.S. city average) in2 creased between September 30, 2020, and 

3 the date on which the certification is sub4 mitted. 

5 (B) SUBSEQUENT CERTIFICATION.—For 

6 plan year 2023 and each plan year thereafter, 

7 a manufacturer of insulin who previously sub8 mitted a certification under clause (i) or (ii) of 

9 subparagraph (A) is considered certified under 

10 this subsection for the applicable plan year if 

11 such manufacturer submits, not later than Sep12 tember 30 of the calendar year that is 2 years 

13 prior to the applicable plan year, a certification 

14 that the manufacturer did not increase the list 

15 price for insulin previously certified under 

16 clause (i) or (ii) of subparagraph (A), by more 

17 than the rate by which the medical care compo18 nent of the consumer price index for all urban 

19 consumers (U.S. city average) increased since 

20 the initial certification under such clause (i) or 

21 (ii). 

22 (3) SPECIAL RULE FOR CERTAIN INSULIN.— 

23 (A) IN GENERAL.—In the case of a manu24 facturer of insulin that did not manufacture a 

25 particular insulin in 2006, such manufacturer 


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1 may be certified under this subsection with re2 spect to such insulin by submitting information 

3 under paragraph (2)(A) certifying that the list 

4 price of such insulin is no greater than the 

5 weighted average list price, in 2006, of, as ap6 plicable— 

7 (i)(I) all short-acting insulins; 

8 (II) all rapid-acting insulins; or 

9 (III) all long-acting insulins; or 

10 (ii) such other insulin categories, as 

11 the Secretary determines appropriate. 

12 (B) INCREASE.—The weighted averages 

13 under subparagraph (A) shall be increased in 

14 accordance with paragraph (2)(A)(ii), as appli15 cable. 

16 (4) APPLICATION TO AUTHORIZED GENERIC IN17 SULIN.—In the case of an insulin that is classified 

18 as an authorized generic drug, as defined in section 

19 505(t)(3) of the Federal Food, Drug and Cosmetic 

20 Act (21 U.S.C. 355(t)(3)), the manufacturer of such 

21 insulin may be certified under this section by sub22 mitting information under paragraph (1)(A) certi23 fying that the list price of such authorized generic 

24 insulin is no greater than the list price, as of July 

25 1, 2006, of the listed drug insulin product upon 


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1 which the authorized generic drug was based under 

2 section 505(t) of the Federal Food, Drug and Cos3 metic Act. The certification pursuant to this para4 graph applies only to the authorized generic drug in5 sulin, and does not apply with respect to the applica6 ble listed drug insulin. 

7 (c) AUDITS AND PENALTIES.—The Inspector General 

8 of the Department of Health and Human Services may 

9 audit the financial records and other relevant records of 

10 any manufacturer submitting data under subsections (a) 

11 and (b), and any manufacturer or officer, director, agent, 

12 or managing employee of such manufacturer that know13 ingly submits false or incomplete data shall be subject to 

14 a civil penalty for each insulin for which false or incom15 plete data are submitted in an amount not to exceed the 

16 greater of— 

17 (1) an amount equal to 2 times the total 

18 amount of rebates paid by the manufacturer to 

19 State Medicaid plans for the insulin for rebate peri20 ods occurring in calendar year 2018 under section 

21 1927 of the Social Security Act (42 U.S.C. 1396r– 

22 8); or 

23 (2) an alternative amount to be determined by 

24 the Secretary. 

25 (d) DEFINITIONS.—In this section— 


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1 (1) the term ‘‘insulin’’ means any insulin prod2 uct approved by the Food and Drug Administration 

3 to improve glycemic control in patients with diabetes 

4 mellitus; 

5 (2) the term ‘‘list price’’ has the meaning given 

6 the term ‘‘wholesale acquisition cost’’ in section 

7 1847A(c)(6)(B) of the Social Security Act (42 

8 U.S.C. 1395w–3a(c)(6)(B)); and 

9 (3) the term ‘‘Secretary’’ means the Secretary 

10 of Health and Human Services. 

Æ 


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