I 
117TH CONGRESS 
2D SESSION 
H. R. 7389 
To amend title XIX of the Social Security Act to codify value-based pur-
chasing arrangements under the Medicaid program and reforms related 
to price reporting under such arrangements, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 4, 2022 
Mr. SCHRADER (for himself, Mr. GUTHRIE, and Mr. MULLIN) introduced the 
following bill; which was referred to the Committee on Energy and Commerce 
A BILL 
To amend title XIX of the Social Security Act to codify 
value-based purchasing arrangements under the Medicaid 
program and reforms related to price reporting under 
such arrangements, 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 ‘‘Medicaid VBPs for 
Patients Act’’ or the ‘‘MVP Act’’. 
SEC. 2. FINDINGS. 
The Congress finds the following: 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
(1) Value-based payment (VBP) arrangements 
are a critical component of a modernized reimburse-
ment system. By codifying elements of the recently 
finalized ‘‘multiple best price’’ policies of the Centers 
for Medicare & Medicaid Services, Congress is en-
shrining a sustainable and flexible payment ap-
proach for innovative treatments and cures. 
(2) Many of these treatments, including gene 
therapies, are different from traditional pharma-
ceutical and biologic products in that they can offer 
long-lasting—sometimes lifelong—benefits for pa-
tients and long-term value for the health care system 
alike. 
(3) There are hundreds of innovative, curative, 
and life-changing treatments currently in develop-
ment in the United States. However, the current re-
imbursement structure was not designed with these 
therapies in mind, and allowing for innovative pay-
ment arrangements will spur greater development 
and access to future cures and treatments. 
(4) Medicaid is currently losing out on innova-
tive ways to ensure patients have access to these 
treatments, while private payors continue to see the 
value provided through flexible payment arrange-
ments. 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
(5) VBP arrangements include the ability to 
pay based on evidence-based outcomes and, over 
time, spreading the risk across all entities involved 
in the contract and ensuring that these often costly 
treatments are accessible. 
(6) Evidence-based outcomes can demonstrate 
decreased cost to the health system and to patients, 
including reduced hospitalizations and lower utiliza-
tion of other health care expenditures, including lab 
work, other medications, and office visits. 
(7) By allowing VBPs in Medicaid, the health 
care system will continue to move towards quality 
over quantity, holding manufacturers and providers 
accountable for the best treatment for every patient. 
SEC. 3. CODIFYING VALUE-BASED PURCHASING ARRANGE-
MENTS UNDER MEDICAID AND REFORMS RE-
LATED TO PRICE REPORTING UNDER SUCH 
ARRANGEMENTS. 
(a) CODIFYING THE VBP RULE.—The revision to 
section 447.505(a) of title 42, Code of Federal Regula-
tions related to the inclusion of varying best price points 
available under a value-based purchasing arrangement (as 
defined in section 1927(k)(12) of the Social Security Act 
(42 U.S.C. 1396r–8(k)(12), as added by subsection (d) 
of this section) for a single dosage form and strength of 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
a covered outpatient drug if a manufacturer offers such 
pricing structure to all States, as published by the Sec-
retary of Health and Human Services on December 31, 
2020 (85 Federal Register 87000), shall have the force 
and effect of law. 
(b) QUARTERLY REPORTING OBLIGATION.— 
(1) IN GENERAL.—Section 1927(b)(3)(A) of the 
Social Security Act (42 U.S.C. 1396r–8(b)(3)(A)) is 
amended— 
(A) in clause (iv), by striking at the end 
‘‘and’’; 
(B) in clause (v), by striking at the end 
the period and inserting ‘‘; and’’; 
(C) by inserting after clause (v) the fol-
lowing new clause: 
‘‘(vi) for calendar quarters beginning 
on or after July 1, 2022, in conjunction 
with reporting required under clause (i), in 
the case of a covered outpatient drug that 
is sold under a value-based purchasing ar-
rangement 
(as 
defined 
in 
subsection 
(k)(12)) made available by the manufac-
turer to a State plan— 
‘‘(I) the pricing structure for 
such drug based on pre-defined out-
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
comes or measures specified in such 
value-based purchasing arrangement; 
and 
‘‘(II) the best price for such cov-
ered outpatient drug outside of a 
value-based purchasing arrangement, 
which in the event such drug is sold 
exclusively through such an arrange-
ment, means the lowest price available 
net of any discounts or offsets that 
are unrelated to a refund, rebate, re-
imbursement, free item, withholding, 
or repayment made under a value- 
based purchasing arrangement for 
such drug.’’; and 
(D) by adding at the end of the flush left 
matter at the end the following new sentence: 
‘‘Information reported with respect to a rebate 
period under clause (i)(I) relating to average 
manufacturer price and clause (i)(II) relating to 
best price shall be updated for such rebate pe-
riod if, subsequent to the date such information 
was reported, cumulative discounts, rebates, or 
other arrangements adjust such average price 
actually realized or best price available to the 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
extent that such cumulative discounts, rebates, 
or other arrangements are not excluded under 
this section from the determination of average 
manufacturer price or best price.’’ 
(2) RULES OF CONSTRUCTION.—Nothing in the 
amendments made by paragraph (1) shall be con-
strued as— 
(A) requiring— 
(i) a State to enter into a value-based 
purchasing arrangement with a manufac-
turer for a covered outpatient drug; or 
(ii) a manufacturer to enter into a 
value-based purchasing arrangement with 
a State for a covered outpatient drug; 
(B) prohibiting a manufacturer from treat-
ing a value-based purchasing arrangement as a 
bundled sale; or 
(C) precluding the execution of a supple-
mental rebate agreement, as provided in section 
1927(a)(1) of the Social Security Act (42 
U.S.C. 1396r–8(a)(1)), for a covered outpatient 
drug sold under a value-based purchasing ar-
rangement. 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
(c) DEFINITION
OF
AVERAGE
MANUFACTURER 
PRICE.—Section 1927(k)(1) of the Social Security Act (42 
U.S.C. 1396r–8(k)(1)) is amended— 
(1) in subparagraph (B)(i)— 
(A) in subclause (IV), by striking at the 
end ‘‘and’’; 
(B) in subclause (V), by striking the period 
at the end and inserting ‘‘; and’’; and 
(C) by adding at the end the following new 
subclause: 
‘‘(VI) in accordance with sub-
section (b)(3)(A)(vi), with respect to 
such covered outpatient drug that is 
sold under a value-based purchasing 
arrangement (as defined in paragraph 
(12)) during the rebate period— 
‘‘(aa) a refund, rebate, reim-
bursement, or free goods from 
the manufacturer or third party 
on behalf of the manufacturer; or 
‘‘(bb) the withholding or re-
duction of a payment to the man-
ufacturer or third party on behalf 
of the manufacturer; 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
that is triggered by a patient who 
fails to achieve outcomes or measures 
defined under the terms of such value- 
based purchasing arrangement during 
the period for which such agreement 
is effective.’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(D) SPECIAL RULE FOR CERTAIN VALUE- 
BASED
PURCHASING
ARRANGEMENTS.—For 
purposes of subparagraph (A), in determining 
the average price paid to the manufacturer for 
a covered outpatient drug that is sold under a 
value-based purchasing arrangement (as defined 
in paragraph (12)) that provides that payment 
for such drug is made in installments over the 
course of such agreement, such price shall be 
determined as if the aggregate price per the 
terms of the agreement was paid in full in the 
first installment during the rebate period.’’. 
(d) DEFINITION OF VALUE-BASED PURCHASING AR-
RANGEMENT.—Section 1927(k) of the Social Security Act 
(42 U.S.C. 1396r–8(k)) shall be amended by adding at 
the end the following paragraph: 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
‘‘(12) VALUE-BASED
PURCHASING
ARRANGE-
MENT.—The term ‘value-based purchasing arrange-
ment’ means an arrangement or agreement intended 
to align pricing or payments to an observed or ex-
pected therapeutic or clinical value in a select popu-
lation and includes— 
‘‘(A) evidence-based measures, which sub-
stantially link the cost of a covered outpatient 
drug to existing evidence of effectiveness and 
potential value for specific uses of that product; 
or 
‘‘(B) outcomes-based measures, which sub-
stantially link payment for the covered out-
patient drug to that of the drug’s actual per-
formance in patient or a population, or a reduc-
tion in other medical expenses.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply beginning on July 1, 2022. 
SEC. 4. REMUNERATION IN FEDERAL HEALTH CARE PRO-
GRAMS. 
(a) IN GENERAL.—Section 1128B(b)(3) of the Social 
Security Act (42 U.S.C. 1320a–7b(b)(3)) is amended— 
(1) in subclause (J)— 
(A) by moving the left margin of such sub-
paragraph 2 ems to the left; and 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
(B) by striking ‘‘and’’ after the semicolon 
at the end; 
(2) in subclause (K)— 
(A) by moving the left margin of such sub-
paragraph 2 ems to the left; and 
(B) by striking the period at the end and 
inserting ‘‘; and’’; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(L) any remuneration provided by a man-
ufacturer or third party on behalf of a manu-
facturer to a plan under a value-based pur-
chasing arrangement (as defined in section 
1927(k)(12)) in the case a patient fails to 
achieve outcomes or measures defined in such 
arrangement following the administration of a 
covered outpatient drug (as defined in section 
1927(k)(2)).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply beginning on July 1, 2022. 
SEC. 5. GAO STUDY AND REPORT ON USE OF VALUE-BASED 
PURCHASING ARRANGEMENTS. 
(a) STUDY.—The Comptroller General of the United 
States shall conduct a study on the extent to which value- 
based purchasing arrangements (as defined in section 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
1927(k)(12) of the Social Security Act (42 U.S.C. 1396r– 
8(k)(12)) facilitate patient access to covered outpatient 
drugs, improve patient outcomes, lower overall health sys-
tem costs, and lower costs for patients in Federal health 
care programs. In conducting such study, the Comptroller 
General shall— 
(1) study the impact of this Act on— 
(A) access to transformative therapies, in-
cluding rare disease gene therapies, generally; 
(B) mitigating socioeconomic disparities in 
accessing covered outpatient drugs sold under 
value-based purchasing arrangements through 
its requirement that State Medicaid programs 
have access to the same value-based purchasing 
arrangement pricing structure that are available 
in the commercial market for such drugs; and 
(C) the Medicaid drug rebate program 
under section 1927 of the Social Security Act 
(42 U.S.C. 1396r–8), the 340B drug pricing 
program under section 340B of the Public 
Health Service Act (42 U.S.C. 256b), and part 
B of title XVIII of the Social Security Act (42 
U.S.C. 1395j et seq.), including compliance 
with such programs; and 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS
(2) using data submitted pursuant to clause 
(vi) of section 1927(b)(3)(A) of the Social Security 
Act (42 U.S.C. 1396r–8(b)(3)(A)), as added by sec-
tion 3 of this Act, analyze all the types of value- 
based purchasing arrangement pricing structures, 
which structures are working well (as measured by 
price and ease of implementing), and which need im-
provement. 
(b) REPORT.—Not later than June 30, 2027, the 
Comptroller General of the United States shall submit to 
Congress a report containing the results of the study con-
ducted under subsection (a). 
Æ 
VerDate Sep 11 2014 
21:03 Apr 06, 2022
Jkt 029200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6301
E:\BILLS\H7389.IH
H7389
pamtmann on DSKBC07HB2PROD with BILLS