Promoting Transparency and Healthy Competition in Medicare Act

To amend title XVIII of the Social Security Act to promote transparency of common ownership interests under parts C and D of the Medicare program. 1. Short title This Act may be cited as the Promoting Transparency and Healthy Competition in Medicare Act 2. Promoting transparency of common ownership interests under parts C and D of the Medicare program (a) Medicare Advantage Section 1857(e) of the Social Security Act ( 42 U.S.C. 1395w–27(e) (6) Required disclosure of certain information relating to health care provider ownership (A) In general For plan years beginning on or after January 1, 2025, a contract under this section with an MA organization shall require the organization to report to the Secretary, not later than 1 year after the last day of such plan year, the information described in subparagraph (B) with respect to such plan year. (B) Information described For purposes of subparagraph (A), the information described in this subparagraph is, with respect to an MA organization and a plan year, the following: (i) The number of items and services furnished during such plan year by each specified provider (as defined in subparagraph (C)) for which payment was made by such organization. (ii) The number of items and services furnished during such plan year by providers of services or suppliers not described in clause (i) for which payment was made by such organization. (iii) The average per-enrollee number of qualifying diagnoses (as defined in subparagraph (C)) made during such plan year by specified providers (including through chart reviews and health risk assessments) with respect to individuals enrolled under an MA plan offered by such organization, broken down by site of service of such providers, as specified by the Secretary. (iv) The average per-enrollee number of qualifying diagnoses made during such plan year by providers of services and suppliers not described in clause (iii) (including through such reviews and assessments) with respect to such individuals, broken down by site of service of such providers. (v) The average risk score (as calculated under the methodology described in subparagraph (C)(i)) for such an individual for such plan year who received items and services from a specified provider during such plan year. (vi) The average risk score for such an individual for such plan year who did not receive items and services from a specified provider during such plan year. (vii) The average risk score for such an individual for such plan year who received a health risk assessment from an assessment entity that was a specified assessment entity during such plan year. (viii) The average risk score for such an individual for such plan year who received a health risk assessment from an assessment entity that was not a specified assessment entity during such plan year. (ix) The number of prior authorization requests for an item or service submitted to such organization during such plan year, the number of such requests that were approved, the number of such requests that were denied, and the number of such denied requests that were subsequently appealed and then approved, broken down by whether the entity proposing to furnish such item or service was a specified provider or not a specified provider. (x) The total amount of incentive-based payments made to, and the total amount of shared losses recoupments collected from, specified providers during such plan year. (xi) The total amount of incentive-based payments made to, and the total amount of shared losses recoupments collected from, providers of services and suppliers not described in clause (x) during such plan year. (xii) For each MA plan offered by such organization during such plan year— (I) the total amount of payments made under section 1853(a)(1) to such organization for coverage of individuals under such plan, and the total amount of payments made by such individuals to such organization for coverage under such plan; (II) the total amount expended under such plan as payment for items and services furnished by each specified provider during such year; (III) the total amount expended under such plan as payment for items and services furnished by providers of services or suppliers not described in subclause (II) during such year; (IV) the medical loss ratio under such plan with respect to individuals furnished an item or service from a specified provider during such year; and (V) the medical loss ratio under such plan with respect to individuals not described in subclause (IV). (C) Definitions In this paragraph: (i) Assessment entity The term assessment entity (ii) Qualifying diagnosis The term qualifying diagnosis (iii) Specified assessment entity The term specified assessment entity (iv) Specified provider The term specified provider (D) Nonapplication of Paperwork Reduction Act Chapter 35 . (b) Pharmacy benefit manager and pharmacy information Section 1860D–12(b) of the Social Security Act ( 42 U.S.C. 1395w–112(b) (9) Provision of information relating to pharmacy ownership (A) In general For plan years beginning on or after January 1, 2025, a contract entered into under this part with a PDP sponsor shall require the sponsor to report to the Secretary, not later than 1 year after the last day of such plan year, the information described in subparagraph (B) with respect to such plan year. (B) Information described For purposes of subparagraph (A), the information described in this subparagraph is, for each prescription drug plan offered by a PDP sponsor for a plan year, the following: (i) The negotiated price for each covered part D drug for which benefits are available under such plan for each network pharmacy (including an identification of whether each such pharmacy is a specified pharmacy). (ii) The average per-drug amount of direct and indirect remuneration paid by specified pharmacies for such covered part D drugs dispensed during such plan year under such plan. (iii) The average per-drug amount of direct and indirect remuneration paid by pharmacies not described in clause (ii) for such covered part D drugs dispensed during such plan year under such plan. (C) Definitions In this paragraph: (i) Direct and indirect remuneration The term direct and indirect remuneration (ii) Network pharmacy The term network pharmacy (iii) Negotiated price The negotiated price (iv) Specified pharmacy The term specified pharmacy (D) Nonapplication of Paperwork Reduction Act Chapter 35 (10) Provision of information by pharmacy benefit managers (A) In general For plan years beginning on or after January 1, 2025, a contract entered into under this part with a PDP sponsor shall prohibit such sponsor from entering into a contract with a specified pharmacy benefit manager for purposes of performing any service with respect to covered part D drugs dispensed under any prescription drug plan offered by such sponsor for such plan year unless such manager agrees to report to the Secretary, not later than 1 year after the last day of such plan year, the information described in subparagraph (B) with respect to each prescription drug plan for which such manager is providing any such service during such plan year, regardless of the sponsor of such plan. (B) Information described For purposes of subparagraph (A), the information described in this subparagraph is, with respect to a pharmacy benefit manager performing services under a prescription drug plan for a plan year, the following: (i) With respect to the total amount of pharmacy and manufacturer rebates collected by such manager (or collected on behalf of such plan by any other entity with a contract in effect with such manager for such collection) for all covered part D drugs dispensed under such plan during such plan year— (I) the total amount of such rebates passed through to the PDP sponsor of such plan; and (II) the total amount of such rebates retained by such manager or such other entities. (ii) The total amount paid by such manager to pharmacies for drugs furnished under such plan during such plan year. (iii) The total amount of payments made by such sponsor to such manager as reimbursement for such manager’s payments described in clause (ii). (iv) The total amount of payments made by such sponsor to such manager as fees for services furnished by such manager with respect to such plan for such plan year (not including payments described in clause (iii)). (v) The total amount of administrative costs incurred by such manager for furnishing such services under such plan for such plan year. (vi) A specification as to whether such manager is a specified pharmacy benefit manager with respect to the PDP sponsor of such plan. (C) Definition In this paragraph, the term specified pharmacy benefit manager . (c) Publication Not later than January 1, 2027, the Secretary of Health and Human Services shall establish a process under which information submitted to the Secretary pursuant to the amendments made by this section is publicly disclosed. Such process shall ensure that any information so disclosed does not identify a specific drug manufacturer, provider of services or supplier, pharmacy, pharmacy benefit manager, or any price charged with respect to a particular drug.

Summary: Promoting Transparency and Healthy Competition in Medicare Act This bill requires Medicare Advantage (MA) organizations and prescription drug plan (PDP) sponsors and pharmacy benefit managers (PBMs) under the Medicare prescription drug benefit to report certain information relating to their ownership interests in participating providers. Specifically, MA organizations must report on items and services, patient risk scores and associated diagnoses, prior authorization requests, and incentive payments with respect to providers in which the MA organization has an ownership interest as compared to other providers. Similarly, PDP sponsors under the Medicare prescription drug benefit must report on the prices of prescription drugs with respect to pharmacies in which the PDP sponsor has an ownership interest as compared to other pharmacies. The bill also prohibits PDP sponsors from contracting with PBMs in which the PDP sponsor has an ownership interest unless the PBM reports certain information on rebates and payments between the PBM, PDP sponsor, pharmacies, and drug manufacturers.