I 

118TH CONGRESS 

1ST SESSION H. R. 198 

To increase reporting requirements and transparency requirements in the 

340B Drug Pricing Program, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 9, 2023 

Mr. ROSENDALE 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 increase reporting requirements and transparency requirements in the 340B Drug Pricing Program, 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 ‘‘Drug Pricing Trans5 parency and Accountability Act’’. 


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1 SEC. 2. MORATORIUM ON REGISTRATION OF NEW NON2 RURAL SECTION 340B HOSPITALS. 

3 Section 340B(a) of the Public Health Service Act (42 

4 U.S.C. 256b(a)) is amended— 

5 (1) in paragraph (4)(L), by striking ‘‘A sub6 section (d) hospital’’ and inserting ‘‘Subject to para7 graph (11), a subsection (d) hospital’’; and 

8 (2) by adding at the end the following: 

9 ‘‘(11) MORATORIUM ON REGISTRATION OF CER10 TAIN HOSPITALS.—During the 2-year period begin11 ning on the date of the enactment of this para12 graph— 

13 ‘‘(A) an entity described in paragraph 

14 (4)(L) shall not be considered a covered entity 

15 under this section unless such entity was a cov16 ered entity on such date (as evidenced by the 

17 entity having been identified as a covered entity 

18 as of such date under the covered entity identi19 fication system established under subsection 

20 (d)(2)(B)(iv)); and 

21 ‘‘(B) no site shall be added to the covered 

22 entity identification system established under 

23 subsection (d)(2)(B)(iv) or be permitted to 

24 begin participating in the drug discount pro25 gram under this section, as a ‘child site’ or oth26 erwise, on the basis of association with a covVerDate Sep 11 2014 00:06 Jan 20, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H198.IH H198

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1 ered entity described in paragraph (4)(L) un2 less such site was identified as a child site as 

3 of December 31, 2020, under the system estab4 lished under subsection (d)(2)(B)(iv). 

5 ‘‘(12) REGULATIONS TO BE ISSUED DURING

6 THE MORATORIUM PERIOD TO IMPLEMENT STATU7 TORY REQUIREMENTS CLARIFYING HOSPITAL ELIGI8 BILITY CRITERIA AND HOSPITAL CHILD SITE STAND9 ARDS AND ENHANCING HOSPITAL TRANSPARENCY.— 

10 ‘‘(A) ISSUANCE OF REGULATIONS.— 

11 ‘‘(i) IN GENERAL.—During the mora12 torium period under paragraph (11), the 

13 Secretary shall promulgate regulations 

14 through notice and comment rulemaking to 

15 implement the standards and requirements 

16 described in subparagraph (B). 

17 ‘‘(ii) DEADLINE.—Such final regula18 tions shall be promulgated and take ef19 fect— 

20 ‘‘(I) before the end date of the 

21 moratorium described in paragraph 

22 (11); or 

23 ‘‘(II) in the event that any of 

24 such regulations have not taken effect 

25 by such end date, the moratorium 


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1 under subparagraph (11) shall be ex2 tended until such regulations are final 

3 and effective. 

4 ‘‘(iii) LIMITATION.—The authority to 

5 promulgate regulations under this para6 graph is limited to setting forth the details 

7 necessary and appropriate to carry out the 

8 requirements of subparagraph (B) effi9 ciently, effectively, and in conformity with 

10 such subparagraph. 

11 ‘‘(B) STANDARDS AND REQUIREMENTS.— 

12 ‘‘(i) HOSPITAL CHILD SITE STAND13 ARDS.— 

14 ‘‘(I) IN GENERAL.—Hospitals de15 scribed in subparagraphs (L) and (M) 

16 of paragraph (4) may register off17 campus outpatient facilities associated 

18 with the hospital (also known as ‘child 

19 sites’) to participate in the drug dis20 count program under this section (be21 ginning after the moratorium under 

22 paragraph (11) ends), if— 

23 ‘‘(aa) the site is listed on the 

24 hospital’s most recently filed 

25 Medicare cost report on a line 


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1 that is reimbursable under the 

2 Medicare program (or, if the hos3 pital is a children’s hospital that 

4 does not file a Medicare cost re5 port, the hospital submits to the 

6 Secretary a signed statement cer7 tifying that the facility would be 

8 correctly included on a reimburs9 able line of a Medicare cost re10 port if the hospital filed a cost 

11 report); 

12 ‘‘(bb) such cost report dem13 onstrates that the services pro14 vided at the facility have associ15 ated costs and charges for hos16 pital outpatient department serv17 ices under title XVIII of the So18 cial Security Act (or, if the hos19 pital is a children’s hospital that 

20 does not file a Medicare cost re21 port, the hospital submits to the 

22 Secretary a signed statement cer23 tifying that the services provided 

24 at the facility include or consist 

25 solely of outpatient services); 


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1 ‘‘(cc) the facility is wholly 

2 owned by the covered entity; 

3 ‘‘(dd) the Secretary has 

4 made a determination, under the 

5 process described in section 

6 413.65(b) of title 42, Code of 

7 Federal Regulations (or any suc8 cessor regulations), that the facil9 ity meets the Medicare provider10 based standards under section 

11 413.65 of title 42, Code of Fed12 eral Regulations (or any suc13 cessor regulations); 

14 ‘‘(ee) the facility provides a 

15 full range of outpatient services, 

16 in addition to drugs; and 

17 ‘‘(ff) the facility adheres to 

18 the charity care policy and any 

19 sliding fee scale policy of the par20 ent hospital. 

21 ‘‘(II) DE-REGISTRATION.—If at 

22 any time following registration one or 

23 more of the standards listed above are 

24 no longer satisfied, a registered hos25 pital shall immediately notify the SecVerDate Sep 11 2014 00:06 Jan 20, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H198.IH H198

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1 retary, de-register the facility, and 

2 keep the facility from making any 

3 purchases under the drug discount 

4 program under this section or rep5 resenting to third parties that it may 

6 purchase under such program. 

7 ‘‘(ii) HOSPITAL ELIGIBILITY STAND8 ARDS FOR HOSPITALS NOT OWNED OR OP9 ERATED BY A UNIT OF STATE OR LOCAL

10 GOVERNMENT.—For purposes of subpara11 graph (L)(i) of paragraph (4): 

12 ‘‘(I) A private hospital has been 

13 formally granted governmental powers 

14 by a unit of State or local government 

15 if the Secretary receives a certification 

16 from a State or local governmental 

17 entity that such governmental entity 

18 has formally delegated, through State 

19 or local statute or regulation or, if 

20 permitted by applicable State or local 

21 law, through a contract with a State 

22 or local government, to the hospital 

23 such a power, described in detail in 

24 the certification. 


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1 ‘‘(II) A private hospital has a 

2 contract with a State or local govern3 ment to provide health care services to 

4 low-income individuals who are not 

5 entitled to benefits under Medicare or 

6 Medicaid if— 

7 ‘‘(aa) the hospital submits a 

8 copy of the contract to the Sec9 retary for review; 

10 ‘‘(bb) the Secretary deter11 mines that the contract creates 

12 an enforceable obligation for the 

13 hospital to provide direct medical 

14 care to low-income individuals in15 eligible for Medicare and Med16 icaid in an amount that rep17 resents at least 15 percent of the 

18 hospital’s total costs for all items 

19 and services furnished at such 

20 hospital; and 

21 ‘‘(cc) the contract is avail22 able to the public as part of the 

23 information describing the hos24 pital in the covered entity identiVerDate Sep 11 2014 00:06 Jan 20, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H198.IH H198

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1 fication system established under 

2 subsection (d)(2)(B)(iv). 

3 ‘‘(III) If at any time a hospital 

4 not owned or operated by a unit of 

5 State or local government no longer 

6 meets one or more requirements 

7 under subclause (I) or (II), the hos8 pital shall immediately notify the Sec9 retary, dis-enroll from the drug dis10 count program under this section, and 

11 stop making purchases under such 

12 program and representing to third 

13 parties that it may purchase under 

14 such program. 

15 ‘‘(iii) HOSPITAL TRANSPARENCY RE16 QUIREMENTS.— 

17 ‘‘(I) HOSPITAL REQUIREMENTS

18 TO IDENTIFY SECTION 340B DRUGS.— 

19 In the case of covered entity hospitals 

20 described in subparagraph (L) of 

21 paragraph (4): 

22 ‘‘(aa) Claims for covered 

23 outpatient drugs purchased 

24 under the drug discount program 

25 under this section shall be subVerDate Sep 11 2014 00:06 Jan 20, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H198.IH H198

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1 mitted to public and private 

2 payors using the 340B modifier 

3 established by the Secretary 

4 under the prospective payment 

5 system for hospital outpatient de6 partment services, in conform7 ance with paragraph (22) of sec8 tion 1833(t) of the Social Secu9 rity Act, subsection (h) of 

10 1847A, subparagraph (F) of sec11 tion 1927(a)(5), and paragraph 

12 (5) of section 1857(g), that is 

13 ‘JG’. 

14 ‘‘(bb) Such hospitals shall 

15 report to the Secretary on an an16 nual basis, in a form and manner 

17 specified by the Secretary— 

18 ‘‘(AA) the hospital’s ag19 gregate annual revenue from 

20 drugs purchased under the 

21 program under this section, 

22 minus its aggregate annual 

23 acquisition costs for such 

24 drugs, broken out by hos25 pital and by each child site; 


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1 ‘‘(BB) any dispensing 

2 fees paid by the hospital or 

3 child site to contract phar4 macies for such drugs; 

5 ‘‘(CC) the patient mix, 

6 broken down by expected 

7 payment source (including 

8 at least the Medicare pro9 gram under title XVIII of 

10 the Social Security Act, a 

11 State plan under the Med12 icaid program under title 

13 XIX of such Act, private in14 surance, and uninsured indi15 viduals), for each such hos16 pital, and each child site of 

17 the hospital listed in the 

18 covered entity information 

19 system established under 

20 subsection (d)(2)(B)(iv), and 

21 the costs incurred at each 

22 such hospital and site for 

23 charity care (as described in 

24 line 23 of Worksheet S– 

25 10—Hospital UncompenVerDate Sep 11 2014 00:06 Jan 20, 2023 Jkt 039200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H198.IH H198

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1 sated and Indigent Care 

2 Data to the Medicare cost 

3 report or as reported in any 

4 successor form); 

5 ‘‘(DD) the percent of 

6 total revenues (net of any 

7 discounts) at each site de8 rived from infusion or injec9 tion of physician-adminis10 tered drugs, including any 

11 associated items or services 

12 furnished incident-to the ad13 ministration of such drugs; 

14 and 

15 ‘‘(EE) with respect to 

16 such hospital and each child 

17 site of the hospital, the 

18 names of all third-party ven19 dors or other similar entities 

20 (including split fee vendors 

21 and contract pharmacies) 

22 that the covered entity con23 tracts with to provide serv24 ices associated with the pro25 gram under this section 


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1 (broken down by covered en2 tity and by each child site). 

3 ‘‘(II) PUBLIC AVAILABILITY.— 

4 The Secretary shall make the infor5 mation reported to the Secretary 

6 under subclause (I)(bb) available to 

7 the public (with redactions of any in8 formation the Secretary determines to 

9 be proprietary or confidential) in an 

10 annual compilation of the reported in11 formation available on the internet 

12 website of the Department of Health 

13 and Human Services, and as part of 

14 the information describing the hos15 pital and the relevant child site in the 

16 covered entity identification system 

17 established under subsection 

18 (d)(2)(B)(iv).’’. 

19 SEC. 3. 340B CLAIMS MODIFIER. 

20 (a) MEDICAID.—Section 1927(a)(5) of the Social Se21 curity Act (42 U.S.C. 1396r–8(a)(5)) is amended by add22 ing at the end the following: 

23 ‘‘(F) 340B CLAIMS MODIFIER.— 

24 ‘‘(i) IN GENERAL.—All claims sub25 mitted to a Medicaid fee-for-service proVerDate Sep 11 2014 00:06 Jan 20, 2023 Jkt 039200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\H198.IH H198

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1 gram or a medicaid managed care organi2 zation (as defined in section 

3 1903(m)(1)(A)) for reimbursement of a 

4 unit of a covered outpatient drug subject 

5 to an agreement under section 340B of the 

6 Public Health Service Act shall include the 

7 340B modifier established by the Secretary 

8 under the prospective payment system for 

9 hospital outpatient department services 

10 under section 1833(t) that is ‘JG’ or the 

11 Submission Clarification Code of ‘20’ de12 veloped by the National Council for Pre13 scription Drug Programs (NCPDP). 

14 ‘‘(ii) DATA SHARING.—Each single 

15 State agency shall make available to a 

16 manufacturer of a covered outpatient drug 

17 any fee-for-service or managed care claim 

18 for reimbursement for a unit of such drug 

19 for the purpose of verifying the propriety 

20 of any claim for a rebate payment under 

21 an agreement under subsection (b) with re22 spect to such drug. At the manufacturer’s 

23 request, in lieu of making such a claim 

24 available to the manufacturer, the single 

25 State agency may instead provide a list of 


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1 claims (and relevant data concerning each 

2 claim) for covered outpatient drugs that 

3 were purchased under an agreement under 

4 section 340B of the Public Health Service 

5 Act or other summary data specified by 

6 the manufacturer. 

7 ‘‘(iii) REPORT.—Each single State 

8 agency shall publish an annual report on 

9 utilization of covered outpatient drugs sub10 ject to an agreement under section 340B 

11 of the Public Health Service Act by the 

12 Medicaid fee-for-service program or a med13 icaid managed care organization (as de14 fined in section 1903(m)(1)(A)) during the 

15 preceding calendar year. The State agency 

16 shall not include confidential patient-spe17 cific, drug-specific, or manufacturer-spe18 cific information in any such annual re19 port.’’. 

20 (b) MEDICARE.— 

21 (1) MEDICARE PART B.— 

22 (A) HOSPITAL OUTPATIENT DEPARTMENT

23 SERVICES.—Section 1833(t) of the Social Secu24 rity Act (42 U.S.C. 1395l) is amended by add25 ing at the end the following paragraph: 


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1 ‘‘(22) 340B CLAIMS MODIFIER.—All claims sub2 mitted under the system under this subsection for 

3 reimbursement of a unit of a covered outpatient 

4 drug subject to an agreement under section 340B of 

5 the Public Health Service Act shall include the 340B 

6 modifier established by the Secretary under such 

7 system that is ‘JG’ (or ‘TB’ in the case of a claim 

8 for reimbursement under such system submitted by 

9 a hospital described in subparagraph (M) or (N) of 

10 section 340B(a)(4) of the Public Health Service Act 

11 or a rural sole community hospital described in sub12 paragraph (O) of such section).’’. 

13 (B) OTHER PART B CLAIMS.—Section 

14 1847A of the Social Security Act (42 U.S.C. 

15 1395w–3a) is amended by adding the following 

16 new subsection: 

17 ‘‘(k) 340B CLAIMS MODIFIER.—All claims submitted 

18 under this part (other than under the prospective payment 

19 system for hospital outpatient department services under 

20 section 1833(t)) for reimbursement of a unit of a covered 

21 outpatient drug subject to an agreement under section 

22 340B of the Public Health Service Act shall include the 

23 340B modifier established by the Secretary under such 

24 payment system that is ‘JG’.’’. 


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1 (2) MEDICARE ADVANTAGE AND MEDICARE

2 PART D.—Section 1857(e) of the Social Security Act 

3 (42 U.S.C. 1395w–27(e)) is amended by adding at 

4 the end the following new paragraph: 

5 ‘‘(6) 340B CLAIMS MODIFIER.—All claims sub6 mitted to a Medicare Advantage organization or a 

7 PDP sponsor under this part and part D, respec8 tively, for reimbursement of a unit of a covered out9 patient drug subject to an agreement under section 

10 340B of the Public Health Service Act shall include 

11 the 340B modifier established by the Secretary 

12 under the prospective payment system for hospital 

13 outpatient department services under section 

14 1833(t) that is ‘JG’ or the Submission Clarification 

15 Code of ‘20’ developed by the National Council for 

16 Prescription Drug Programs (NCPDP).’’. 

17 (3) REPORT ON UTILIZATION UNDER MEDICARE

18 PART B.—The Secretary of Health and Human 

19 Services shall publish an annual report on utilization 

20 under part B of title XVIII of the Social Security 

21 Act (42 U.S.C. 1395j et seq.) of covered outpatient 

22 drugs purchased subject to an agreement under sec23 tion 340B of the Public Health Service Act (42 

24 U.S.C. 256b) during the preceding calendar year. 

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1 specific, drug-specific, or manufacturer-specific in2 formation in any such annual report. 

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

4 this section take effect on the date that is 6 months after 

5 the date of enactment of this Act and apply to claims sub6 mitted on or after that date. 

7 SEC. 4. REPORTS TO CONGRESS. 

8 Section 340B of the Public Health Service Act (42 

9 U.S.C. 256b) is amended by adding at the end the fol10 lowing: 

11 ‘‘(f) REPORTS TO CONGRESS.— 

12 ‘‘(1) OIG REPORT.—Not later than 2 years 

13 after the date of the enactment of this subsection, 

14 the Office of the Inspector General shall submit to 

15 Congress a final report on the level of charity care 

16 provided by covered entities described in subpara17 graph (L) of subsection (a)(4) and separately by 

18 child sites of such covered entities. 

19 ‘‘(2) GAO REPORTS.— 

20 ‘‘(A) INITIAL REPORT.—Not later than 1 

21 year after the date of the enactment of this 

22 subsection, the Comptroller General of the 

23 United States shall submit to Congress a re24 port— 


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1 ‘‘(i) analyzing the State and local gov2 ernment contracts intended to satisfy the 

3 requirement under subsection (a)(4)(L)(i) 

4 for a covered entity to qualify as an entity 

5 described in subparagraph (L) of sub6 section (a)(4); 

7 ‘‘(ii) assessing the amount of care 

8 such contracts obligate such entity to pro9 vide to low-income individuals ineligible for 

10 Medicare under title XVIII of the Social 

11 Security Act and Medicaid under title XIX 

12 of such Act; and 

13 ‘‘(iii) analyzing how these contracts 

14 define low-income individuals and whether 

15 the Secretary reviews such determinations. 

16 ‘‘(B) SUBSEQUENT REPORT.—Not later 

17 than 2 years after the date of the enactment of 

18 this subsection, the Comptroller General of the 

19 United States shall submit to Congress a final 

20 report on the difference between the aggregate 

21 gross reimbursement and aggregate acquisition 

22 costs received by each such covered entity (in23 cluding child sites of such entity) for drugs sub24 ject to an agreement under this section.’’. 


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1 SEC. 5. MEDICARE REQUIREMENT FOR HOSPITALS RE2 GARDING 340B DRUG INFORMATION. 

3 (a) IN GENERAL.—Section 1866(a)(1) of the Social 

4 Security Act (42 U.S.C. 1395cc(a)(1)) is amended— 

5 (1) in subparagraph (X), by striking ‘‘and’’ at 

6 the end; 

7 (2) in subparagraph (Y), by striking the period 

8 at the end and inserting ‘‘, and’’; and 

9 (3) by inserting after subparagraph (Y), the fol10 lowing new subparagraph: 

11 ‘‘(Z) in the case of a hospital that is a covered 

12 entity under subsection (a)(4) of section 340B of the 

13 Public Health Service Act, to include in any cost re14 port submitted to the Secretary under this title in15 formation on— 

16 ‘‘(i) the aggregate acquisition costs of the 

17 hospital for drugs, the purchase of which were 

18 attributed to the hospital, during the period 

19 covered by such cost report and for which the 

20 hospital received a discount under such section 

21 340B; and 

22 ‘‘(ii) the aggregate revenues the hospital 

23 received from all payors for such drugs, 

24 disaggregated by insurance status (including 

25 the Medicare program, the Medicaid program, 


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1 the Children’s Health Insurance Program, pri2 vate health insurance, and uninsured).’’. 

3 (b) EFFECTIVE DATE.—The amendments made by 

4 subsection (a) shall apply to contracts entered into or re5 newed on or after the date of the enactment of this Act. 

Æ 


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