I 
117TH CONGRESS 
1ST SESSION H. R. 5463 
To increase reporting requirements and transparency requirements in the 
340B Drug Pricing Program, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 30, 2021 
Mr. ROSENDALE introduced the following bill; which was referred to the Com-
mittee 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 require-
ments in the 340B Drug Pricing Program, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Drug Pricing Trans-
parency and Accountability Act’’. 
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SEC. 2. MORATORIUM ON REGISTRATION OF NEW NON- 
RURAL SECTION 340B HOSPITALS. 
Section 340B(a) of the Public Health Service Act (42 
U.S.C. 256b(a)) is amended— 
(1) in paragraph (4)(L), by striking ‘‘A sub-
section (d) hospital’’ and inserting ‘‘Subject to para-
graph (11), a subsection (d) hospital’’; and 
(2) by adding at the end the following: 
‘‘(11) MORATORIUM ON REGISTRATION OF CER-
TAIN HOSPITALS.—During the 2-year period begin-
ning on the date of the enactment of this para-
graph— 
‘‘(A) an entity described in paragraph 
(4)(L) shall not be considered a covered entity 
under this section unless such entity was a cov-
ered entity on such date (as evidenced by the 
entity having been identified as a covered entity 
as of such date under the covered entity identi-
fication system established under subsection 
(d)(2)(B)(iv)); and 
‘‘(B) no site shall be added to the covered 
entity identification system established under 
subsection (d)(2)(B)(iv) or be permitted to 
begin participating in the drug discount pro-
gram under this section, as a ‘child site’ or oth-
erwise, on the basis of association with a cov-
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ered entity described in paragraph (4)(L) un-
less such site was identified as a child site as 
of December 31, 2020, under the system estab-
lished under subsection (d)(2)(B)(iv). 
‘‘(12) REGULATIONS
TO
BE
ISSUED
DURING 
THE MORATORIUM PERIOD TO IMPLEMENT STATU-
TORY REQUIREMENTS CLARIFYING HOSPITAL ELIGI-
BILITY CRITERIA AND HOSPITAL CHILD SITE STAND-
ARDS AND ENHANCING HOSPITAL TRANSPARENCY.— 
‘‘(A) ISSUANCE OF REGULATIONS.— 
‘‘(i) IN GENERAL.—During the mora-
torium period under paragraph (11), the 
Secretary shall promulgate regulations 
through notice and comment rulemaking to 
implement the standards and requirements 
described in subparagraph (B). 
‘‘(ii) DEADLINE.—Such final regula-
tions shall be promulgated and take ef-
fect— 
‘‘(I) before the end date of the 
moratorium described in paragraph 
(11); or 
‘‘(II) in the event that any of 
such regulations have not taken effect 
by such end date, the moratorium 
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under subparagraph (11) shall be ex-
tended until such regulations are final 
and effective. 
‘‘(iii) LIMITATION.—The authority to 
promulgate regulations under this para-
graph is limited to setting forth the details 
necessary and appropriate to carry out the 
requirements of subparagraph (B) effi-
ciently, effectively, and in conformity with 
such subparagraph. 
‘‘(B) STANDARDS AND REQUIREMENTS.— 
‘‘(i) HOSPITAL
CHILD
SITE
STAND-
ARDS.— 
‘‘(I) IN GENERAL.—Hospitals de-
scribed in subparagraphs (L) and (M) 
of paragraph (4) may register off- 
campus outpatient facilities associated 
with the hospital (also known as ‘child 
sites’) to participate in the drug dis-
count program under this section (be-
ginning after the moratorium under 
paragraph (11) ends), if— 
‘‘(aa) the site is listed on the 
hospital’s most recently filed 
Medicare cost report on a line 
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that is reimbursable under the 
Medicare program (or, if the hos-
pital is a children’s hospital that 
does not file a Medicare cost re-
port, the hospital submits to the 
Secretary a signed statement cer-
tifying that the facility would be 
correctly included on a reimburs-
able line of a Medicare cost re-
port if the hospital filed a cost 
report); 
‘‘(bb) such cost report dem-
onstrates that the services pro-
vided at the facility have associ-
ated costs and charges for hos-
pital outpatient department serv-
ices under title XVIII of the So-
cial Security Act (or, if the hos-
pital is a children’s hospital that 
does not file a Medicare cost re-
port, the hospital submits to the 
Secretary a signed statement cer-
tifying that the services provided 
at the facility include or consist 
solely of outpatient services); 
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‘‘(cc) the facility is wholly 
owned by the covered entity; 
‘‘(dd) 
the 
Secretary 
has 
made a determination, under the 
process 
described 
in 
section 
413.65(b) of title 42, Code of 
Federal Regulations (or any suc-
cessor regulations), that the facil-
ity meets the Medicare provider- 
based standards under section 
413.65 of title 42, Code of Fed-
eral Regulations (or any suc-
cessor regulations); 
‘‘(ee) the facility provides a 
full range of outpatient services, 
in addition to drugs; and 
‘‘(ff) the facility adheres to 
the charity care policy and any 
sliding fee scale policy of the par-
ent hospital. 
‘‘(II) DE-REGISTRATION.—If at 
any time following registration one or 
more of the standards listed above are 
no longer satisfied, a registered hos-
pital shall immediately notify the Sec-
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retary, de-register the facility, and 
keep the facility from making any 
purchases under the drug discount 
program under this section or rep-
resenting to third parties that it may 
purchase under such program. 
‘‘(ii) HOSPITAL
ELIGIBILITY
STAND-
ARDS FOR HOSPITALS NOT OWNED OR OP-
ERATED BY A UNIT OF STATE OR LOCAL 
GOVERNMENT.—For purposes of subpara-
graph (L)(i) of paragraph (4): 
‘‘(I) A private hospital has been 
formally granted governmental powers 
by a unit of State or local government 
if the Secretary receives a certification 
from a State or local governmental 
entity that such governmental entity 
has formally delegated, through State 
or local statute or regulation or, if 
permitted by applicable State or local 
law, through a contract with a State 
or local government, to the hospital 
such a power, described in detail in 
the certification. 
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‘‘(II) A private hospital has a 
contract with a State or local govern-
ment to provide health care services to 
low-income individuals who are not 
entitled to benefits under Medicare or 
Medicaid if— 
‘‘(aa) the hospital submits a 
copy of the contract to the Sec-
retary for review; 
‘‘(bb) the Secretary deter-
mines that the contract creates 
an enforceable obligation for the 
hospital to provide direct medical 
care to low-income individuals in-
eligible for Medicare and Med-
icaid in an amount that rep-
resents at least 15 percent of the 
hospital’s total costs for all items 
and services furnished at such 
hospital; and 
‘‘(cc) the contract is avail-
able to the public as part of the 
information describing the hos-
pital in the covered entity identi-
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fication system established under 
subsection (d)(2)(B)(iv). 
‘‘(III) If at any time a hospital 
not owned or operated by a unit of 
State or local government no longer 
meets one or more requirements 
under subclause (I) or (II), the hos-
pital shall immediately notify the Sec-
retary, dis-enroll from the drug dis-
count program under this section, and 
stop making purchases under such 
program and representing to third 
parties that it may purchase under 
such program. 
‘‘(iii) HOSPITAL
TRANSPARENCY
RE-
QUIREMENTS.— 
‘‘(I) HOSPITAL
REQUIREMENTS 
TO IDENTIFY SECTION 340B DRUGS.— 
In the case of covered entity hospitals 
described in subparagraph (L) of 
paragraph (4): 
‘‘(aa) Claims for covered 
outpatient 
drugs 
purchased 
under the drug discount program 
under this section shall be sub-
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mitted to public and private 
payors using the 340B modifier 
established 
by 
the 
Secretary 
under the prospective payment 
system for hospital outpatient de-
partment services, in conform-
ance with paragraph (22) of sec-
tion 1833(t) of the Social Secu-
rity 
Act, 
subsection 
(h) 
of 
1847A, subparagraph (F) of sec-
tion 1927(a)(5), and paragraph 
(5) of section 1857(g), that is 
‘JG’. 
‘‘(bb) Such hospitals shall 
report to the Secretary on an an-
nual basis, in a form and manner 
specified by the Secretary— 
‘‘(AA) the hospital’s ag-
gregate annual revenue from 
drugs purchased under the 
program under this section, 
minus its aggregate annual 
acquisition costs for such 
drugs, broken out by hos-
pital and by each child site; 
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‘‘(BB) any dispensing 
fees paid by the hospital or 
child site to contract phar-
macies for such drugs; 
‘‘(CC) the patient mix, 
broken down by expected 
payment source (including 
at least the Medicare pro-
gram under title XVIII of 
the Social Security Act, a 
State plan under the Med-
icaid program under title 
XIX of such Act, private in-
surance, and uninsured indi-
viduals), for each such hos-
pital, and each child site of 
the hospital listed in the 
covered entity information 
system 
established 
under 
subsection (d)(2)(B)(iv), and 
the costs incurred at each 
such hospital and site for 
charity care (as described in 
line 23 of Worksheet S– 
10—Hospital 
Uncompen-
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sated and Indigent Care 
Data to the Medicare cost 
report or as reported in any 
successor form); 
‘‘(DD) the percent of 
total revenues (net of any 
discounts) at each site de-
rived from infusion or injec-
tion of physician-adminis-
tered drugs, including any 
associated items or services 
furnished incident-to the ad-
ministration of such drugs; 
and 
‘‘(EE) with respect to 
such hospital and each child 
site of the hospital, the 
names of all third-party ven-
dors or other similar entities 
(including split fee vendors 
and 
contract 
pharmacies) 
that the covered entity con-
tracts with to provide serv-
ices associated with the pro-
gram under this section 
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(broken down by covered en-
tity and by each child site). 
‘‘(II) PUBLIC
AVAILABILITY.— 
The Secretary shall make the infor-
mation reported to the Secretary 
under subclause (I)(bb) available to 
the public (with redactions of any in-
formation the Secretary determines to 
be proprietary or confidential) in an 
annual compilation of the reported in-
formation available on the internet 
website of the Department of Health 
and Human Services, and as part of 
the information describing the hos-
pital and the relevant child site in the 
covered entity identification system 
established 
under 
subsection 
(d)(2)(B)(iv).’’. 
SEC. 3. 340B CLAIMS MODIFIER. 
(a) MEDICAID.—Section 1927(a)(5) of the Social Se-
curity Act (42 U.S.C. 1396r–8(a)(5)) is amended by add-
ing at the end the following: 
‘‘(F) 340B CLAIMS MODIFIER.— 
‘‘(i) IN
GENERAL.—All claims sub-
mitted to a Medicaid fee-for-service pro-
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gram or a medicaid managed care organi-
zation 
(as 
defined 
in 
section 
1903(m)(1)(A)) for reimbursement of a 
unit of a covered outpatient drug subject 
to an agreement under section 340B of the 
Public Health Service Act shall include the 
340B modifier established by the Secretary 
under the prospective payment system for 
hospital outpatient department services 
under section 1833(t) that is ‘JG’ or the 
Submission Clarification Code of ‘20’ de-
veloped by the National Council for Pre-
scription Drug Programs (NCPDP). 
‘‘(ii) DATA
SHARING.—Each single 
State agency shall make available to a 
manufacturer of a covered outpatient drug 
any fee-for-service or managed care claim 
for reimbursement for a unit of such drug 
for the purpose of verifying the propriety 
of any claim for a rebate payment under 
an agreement under subsection (b) with re-
spect to such drug. At the manufacturer’s 
request, in lieu of making such a claim 
available to the manufacturer, the single 
State agency may instead provide a list of 
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claims (and relevant data concerning each 
claim) for covered outpatient drugs that 
were purchased under an agreement under 
section 340B of the Public Health Service 
Act or other summary data specified by 
the manufacturer. 
‘‘(iii) REPORT.—Each single State 
agency shall publish an annual report on 
utilization of covered outpatient drugs sub-
ject to an agreement under section 340B 
of the Public Health Service Act by the 
Medicaid fee-for-service program or a med-
icaid managed care organization (as de-
fined in section 1903(m)(1)(A)) during the 
preceding calendar year. The State agency 
shall not include confidential patient-spe-
cific, drug-specific, or manufacturer-spe-
cific information in any such annual re-
port.’’. 
(b) MEDICARE.— 
(1) MEDICARE PART B.— 
(A) HOSPITAL OUTPATIENT DEPARTMENT 
SERVICES.—Section 1833(t) of the Social Secu-
rity Act (42 U.S.C. 1395l) is amended by add-
ing at the end the following paragraph: 
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‘‘(22) 340B CLAIMS MODIFIER.—All claims sub-
mitted under the system under this subsection for 
reimbursement of a unit of a covered outpatient 
drug subject to an agreement under section 340B of 
the Public Health Service Act shall include the 340B 
modifier established by the Secretary under such 
system that is ‘JG’ (or ‘TB’ in the case of a claim 
for reimbursement under such system submitted by 
a hospital described in subparagraph (M) or (N) of 
section 340B(a)(4) of the Public Health Service Act 
or a rural sole community hospital described in sub-
paragraph (O) of such section).’’. 
(B) OTHER
PART
B
CLAIMS.—Section 
1847A of the Social Security Act (42 U.S.C. 
1395w–3a) is amended by adding the following 
new subsection: 
‘‘(h) 340B CLAIMS MODIFIER.—All claims submitted 
under this part (other than under the prospective payment 
system for hospital outpatient department services under 
section 1833(t)) for reimbursement of a unit of a covered 
outpatient drug subject to an agreement under section 
340B of the Public Health Service Act shall include the 
340B modifier established by the Secretary under such 
payment system that is ‘JG’.’’. 
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(2) MEDICARE
ADVANTAGE
AND
MEDICARE 
PART D.—Section 1857(e) of the Social Security Act 
(42 U.S.C. 1395w–27(e)) is amended by adding at 
the end the following new paragraph: 
‘‘(5) 340B CLAIMS MODIFIER.—All claims sub-
mitted to a Medicare Advantage organization or a 
PDP sponsor under this part and part D, respec-
tively, for reimbursement of a unit of a covered out-
patient drug subject to an agreement under section 
340B of the Public Health Service Act shall include 
the 340B modifier established by the Secretary 
under the prospective payment system for hospital 
outpatient 
department 
services 
under 
section 
1833(t) that is ‘JG’ or the Submission Clarification 
Code of ‘20’ developed by the National Council for 
Prescription Drug Programs (NCPDP).’’. 
(3) REPORT ON UTILIZATION UNDER MEDICARE 
PART
B.—The Secretary of Health and Human 
Services shall publish an annual report on utilization 
under part B of title XVIII of the Social Security 
Act (42 U.S.C. 1395j et seq.) of covered outpatient 
drugs purchased subject to an agreement under sec-
tion 340B of the Public Health Service Act (42 
U.S.C. 256b) during the preceding calendar year. 
The Secretary shall not include confidential patient- 
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specific, drug-specific, or manufacturer-specific in-
formation in any such annual report. 
(c) EFFECTIVE DATE.—The amendments made by 
this section take effect on the date that is 6 months after 
the date of enactment of this Act and apply to claims sub-
mitted on or after that date. 
SEC. 4. REPORTS TO CONGRESS. 
Section 340B of the Public Health Service Act (42 
U.S.C. 256b) is amended by adding at the end the fol-
lowing: 
‘‘(f) REPORTS TO CONGRESS.— 
‘‘(1) OIG REPORT.—Not later than 2 years 
after the date of the enactment of this subsection, 
the Office of the Inspector General shall submit to 
Congress a final report on the level of charity care 
provided by covered entities described in subpara-
graph (L) of subsection (a)(4) and separately by 
child sites of such covered entities. 
‘‘(2) GAO REPORTS.— 
‘‘(A) INITIAL REPORT.—Not later than 1 
year after the date of the enactment of this 
subsection, the Comptroller General of the 
United States shall submit to Congress a re-
port— 
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‘‘(i) analyzing the State and local gov-
ernment contracts intended to satisfy the 
requirement under subsection (a)(4)(L)(i) 
for a covered entity to qualify as an entity 
described in subparagraph (L) of sub-
section (a)(4); 
‘‘(ii) assessing the amount of care 
such contracts obligate such entity to pro-
vide to low-income individuals ineligible for 
Medicare under title XVIII of the Social 
Security Act and Medicaid under title XIX 
of such Act; and 
‘‘(iii) analyzing how these contracts 
define low-income individuals and whether 
the Secretary reviews such determinations. 
‘‘(B) SUBSEQUENT
REPORT.—Not later 
than 2 years after the date of the enactment of 
this subsection, the Comptroller General of the 
United States shall submit to Congress a final 
report on the difference between the aggregate 
gross reimbursement and aggregate acquisition 
costs received by each such covered entity (in-
cluding child sites of such entity) for drugs sub-
ject to an agreement under this section.’’. 
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SEC. 5. MEDICARE REQUIREMENT FOR HOSPITALS RE-
GARDING 340B DRUG INFORMATION. 
(a) IN GENERAL.—Section 1866(a)(1) of the Social 
Security Act (42 U.S.C. 1395cc(a)(1)) is amended— 
(1) in subparagraph (X), by striking ‘‘and’’ at 
the end; 
(2) in subparagraph (Y), by striking the period 
at the end and inserting ‘‘, and’’; and 
(3) by inserting after subparagraph (Y), the fol-
lowing new subparagraph: 
‘‘(Z) in the case of a hospital that is a covered 
entity under subsection (a)(4) of section 340B of the 
Public Health Service Act, to include in any cost re-
port submitted to the Secretary under this title in-
formation on— 
‘‘(i) the aggregate acquisition costs of the 
hospital for drugs, the purchase of which were 
attributed to the hospital, during the period 
covered by such cost report and for which the 
hospital received a discount under such section 
340B; and 
‘‘(ii) the aggregate revenues the hospital 
received from all payors for such drugs, 
disaggregated by insurance status (including 
the Medicare program, the Medicaid program, 
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the Children’s Health Insurance Program, pri-
vate health insurance, and uninsured).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to contracts entered into or re-
newed on or after the date of the enactment of this Act. 
Æ 
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