Protecting Access to Diabetes Supplies Act of 2016

To amend title XVIII of the Social Security Act in order to strengthen rules in case of competition for diabetic testing strips, and for other purposes. 1. Short title This Act may be cited as the Protecting Access to Diabetes Supplies Act of 2016 2. Strengthening rules in case of competition for diabetic testing strips (a) Special rule in case of competition for diabetic testing strips (1) In general Paragraph (10) of section 1847(b) of the Social Security Act ( 42 U.S.C. 1395w–3(b) (A) in subparagraph (A), by striking the second sentence and inserting the following new sentence: With respect to bids to furnish such types of products on or after January 1, 2019, the volume for such types of products shall be determined by the Secretary through the use of multiple sources of data, including market based data measuring sales of diabetic testing strip products described in section 1861(n) that are not exclusively sold by, and marketed under the name of, a single retailer that is not the manufacturer of such products, from mail order, non-mail order, Medicare, and non-Medicare markets. (B) by adding at the end the following new subparagraphs: (C) Demonstration of ability to furnish types of diabetic testing strip products With respect to bids to furnish diabetic testing strip products on or after January 1, 2019, under the program described in subparagraph (A), the Secretary shall reject a bid submitted by an entity if the entity does not attest to the Secretary and demonstrate, through letters of intent with manufacturers, wholesalers, or other suppliers, or other evidence as the Secretary may specify, that the entity has the ability to obtain an inventory of the types and quantities of diabetic testing strip products that will allow the entity to furnish such products in a manner consistent with its bid. (D) Use of unlisted types in calculation of percentage With respect to bids to furnish diabetic testing strip products on or after January 1, 2019, in determining under subparagraph (A) whether a bid submitted by an entity under such subparagraph covers 50 percent (or such higher percentage as the Secretary may specify) of all types of diabetic testing strip products, the Secretary may not attribute a percentage to types of diabetic testing strip products that the Secretary does not identify by brand, model, and market share volume. (E) Adherence to demonstration (i) In general In the case of an entity that is furnishing diabetic testing strip products on or after January 1, 2019, under a contract entered into under the competition conducted pursuant to paragraph (1), the Secretary shall establish a process to monitor, on an ongoing basis, the extent to which such entity continues to cover the product types included in the entity's bid. (ii) Termination If the Secretary determines that an entity described in clause (i) fails to maintain in inventory, or otherwise maintain ready access to through requirements contracts or otherwise, a type of product included in the entity's bid, the Secretary may terminate such contract unless the Secretary finds that the failure of the entity to maintain inventory of, or ready access to, the product is the result of the discontinuation of the product by the product manufacturer or a market-wide shortage of the product. . (b) Codifying and Expanding Anti-Switching Rule Section 1847(b) of the Social Security Act ( 42 U.S.C. 1395w–3(b) (1) by redesignating paragraph (11) as paragraph (12); and (2) by inserting after paragraph (10) the following new paragraph: (11) Additional special rules in case of competition for diabetic testing strips (A) In general With respect to an entity that is furnishing diabetic testing strip products to individuals under a contract entered into under the competitive acquisition program established under this section, the entity shall furnish to each individual a brand of such strips that is compatible with the home blood glucose monitor selected by the individual. (B) Prohibition on influencing and incentivizing An entity described in subparagraph (A) may not attempt to influence or incentivize an individual to switch the brand of glucose monitor or diabetic testing strip product selected by the individual, including by— (i) persuading, pressuring, or advising the individual to switch; or (ii) furnishing information about alternative brands to the individual where the individual has not requested such information. (C) Provision of information (i) Standardized information Not later than January 1, 2019, the Secretary shall develop and make available to entities described in subparagraph (A) standardized information that describes the rights of an individual with respect to such an entity. The information described in the preceding sentence shall include information regarding— (I) the requirements established under subparagraphs (A) and (B); (II) the right of the individual to purchase diabetic testing strip products from another mail order supplier of such products or a retail pharmacy if the entity is not able to furnish the brand of such product that is compatible with the home blood glucose monitor selected by the individual; and (III) the right of the individual to return diabetic testing strip products furnished to the individual by the entity. (ii) Requirement With respect to diabetic testing strip products furnished on or after the date on which the Secretary develops the standardized information under clause (i), an entity described in subparagraph (A) may not communicate directly to an individual until the entity has verbally provided the individual with such standardized information. (D) Order refills With respect to diabetic testing strip products furnished on or after January 1, 2019, the Secretary shall require an entity furnishing diabetic testing strip products to an individual to contact and receive a request from the individual for such products not more than 14 days prior to dispensing a refill of such products to the individual. . (c) Implementation; non-Application of the Paperwork Reduction Act (1) Implementation Notwithstanding any other provision of law, the Secretary of Health and Human Services may implement the provisions of, and amendments made by, this section by program instruction or otherwise. (2) Non-application of the paperwork reduction act Chapter 35

Summary: Protecting Access to Diabetes Supplies Act of 2016 This bill amends title XVIII (Medicare) of the Social Security Act to modify provisions relating to Medicare's competitive acquisition program (through which rates are set through a competitive bidding program rather than by an established fee schedule) with respect to diabetic testing strips. Specifically, the bill requires the Centers for Medicare & Medicaid Services (CMS) to: use specified data to determine whether a bid satisfies certain requirements related to volume of coverage with respect to such products, reject a bid if the bidder does not demonstrate its ability to furnish such products in a manner consistent with its bid, and establish a process to monitor the extent to which an entity continues to cover the product types included in its bid. CMS may terminate a contract if it determines that an entity, for reasons other than product discontinuation or market-wide shortage, fails to maintain ready access to such products included its bid. In addition, the bill specifies that an entity furnishing such products to beneficiaries under the program: (1) must furnish to each beneficiary a brand of strips that is compatible with the beneficiary's home blood glucose monitor, (2) may not attempt to influence or incentivize a beneficiary to switch the brand of either type of product, and (3) must contact and receive a request from a beneficiary no more than 14 days prior to dispensing a refill to the beneficiary.