I 
111TH CONGRESS 
1ST SESSION H. R. 4199 
To ensure patient choice in pharmacies by regulating pharmacy benefit man-
agers and to establish a program to improve access to prescription 
drugs for certain individuals. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 3, 2009 
Mr. BUTTERFIELD (for himself, Mr. JONES, Mr. KISSELL, Mr. MCINTYRE, 
Mr. COBLE, Mr. MILLER of North Carolina, Mr. ALEXANDER, and Mrs. 
MCMORRIS RODGERS) introduced the following bill; which was referred 
to the Committee on Energy and Commerce, and in addition to the Com-
mittee 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 ensure patient choice in pharmacies by regulating phar-
macy benefit managers and to establish a program to 
improve access to prescription drugs for certain individ-
uals. 
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 ‘‘Patient Health and 
Real Medication Access Cost Savings Act of 2009’’ or the 
‘‘PHARMACY Bill’’. 
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SEC. 2. PATIENT CHOICE. 
A consumer shall have the right to choose to purchase 
prescription drugs from any domestic pharmacy that 
meets all applicable Federal and State licence and permit 
requirements. 
SEC. 3. REGULATION OF PHARMACY BENEFIT MANAGERS. 
Not later than January 1, 2011, the Secretary of 
Health and Human Services shall issue regulations to en-
sure the following: 
(1) ACCESS TO AND CHOICE OF PHARMACY.— 
(A) INCENTIVES.—A pharmacy benefit 
manager (referred to in this section as a 
‘‘PBM’’) may not provide incentives (including 
variations in premiums, deductibles, co-pay-
ments, or co-insurance rates) to enrollees of 
pharmacy benefit plans administered by such 
PBM for the purpose of encouraging such en-
rollees to use certain pharmacies (including 
mail order pharmacies, speciality drug phar-
macies, or other entities) unless the PBM offers 
the same incentives for all pharmacies in the 
network for such plan. 
(B) MANDATES.—A PBM may not refer, 
coerce, or mandate that an enrollee of a phar-
macy benefit plan administered by such PBM 
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use a specific mail order pharmacy, specialty 
drug pharmacy, or other entity— 
(i) if the PBM has an ownership in-
terest in a such pharmacy or entity; or 
(ii) if the pharmacy or entity has an 
ownership interest in such PBM. 
(C) PHARMACY
NETWORKS.—A PBM or 
pharmacy benefit plan sponsor may not exclude 
a pharmacy from a pharmacy network if— 
(i) the pharmacy agrees to the terms 
of the network contract; 
(ii) the pharmacy meets all applicable 
Federal and State licence and permit re-
quirements; and 
(iii) the owners of the pharmacy have 
not been convicted of a Federal crime re-
lated to owning or managing a pharmacy. 
(2) ENCOURAGE GENERIC DRUGS.— 
(A) COST TO CONSUMERS.— 
(i) IN
GENERAL.—Subject to clause 
(iii), a PBM shall ensure that enrollees of 
pharmacy benefit plans administered by 
such a PBM pay a copayment of 20 per-
cent for brand name drugs, not to exceed 
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a maximum amount of $150 per prescrip-
tion. 
(ii) ANNUAL UPDATES TO AMOUNT.— 
The maximum amount under clause (i) 
shall be updated annually for inflation 
based on the consumer price index. 
(iii) EXCEPTION FOR STATE MEDICAID 
PROGRAMS.—Clause (i) shall not apply to 
a PBM with respect to enrollees of a State 
Medicaid program that limits or prohibits 
copayments for prescription drugs. 
(B) PAYMENTS TO PHARMACIES.— 
(i) IN GENERAL.—With respect to a 
pharmacy benefit plan that is at least par-
tially funded with Federal funds, the PBM 
administering such plan shall reimburse a 
pharmacy that is in the network for such 
a plan at least— 
(I) 107 percent of the Wholesale 
Acquisition Cost plus a minimum pro-
fessional dispensing fee of $4.25 for a 
prescription for a brand-name drug; 
(II) 190 percent of the Federal 
Upper Limit plus a minimum profes-
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sional dispensing fee of $8.50 for a 
prescription for a generic drug; and 
(III) a professional service fee for 
any additional pharmacy services pro-
vided by the pharmacy, in an amount 
set by the Secretary of Health and 
Human Services. 
(ii) ADJUSTMENT FOR INFLATION.— 
The professional dispensing fees under 
clause (i) shall be adjusted annually for in-
flation, based on the consumer price index. 
(3) PAYMENTS AND CHARGES BETWEEN PBMS 
AND PHARMACY BENEFIT PLAN SPONSORS.— 
(A) PAYMENTS.—A PBM shall be reim-
bursed by a pharmacy benefit plan sponsor for 
adjudicating and processing claims in behalf of 
such sponsor at a rate that is determined by 
such sponsor. 
(B) CHARGES
TO
PHARMACY
BENEFIT 
PLAN
SPONSORS
FOR
DRUGS
DISPENSED
TO 
PLAN ENROLLEES.—The amount that a PBM 
charges a pharmacy benefit plan sponsor for a 
drug that is dispensed to enrollee of a phar-
macy benefit plan administered by such PBM 
may not be greater than the amount that the 
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PBM paid the pharmacy for such drug (includ-
ing any associated professional dispensing fee). 
(4) TREATMENT OF DRUG MANUFACTURER RE-
BATES.— 
(A) NO REBATES TO PBMS.—A manufac-
turer of prescription drugs— 
(i) shall pay all rebates, as defined in 
section 5(6), directly to the pharmacy ben-
efit plan sponsor; and 
(ii) shall not pay such rebates to a 
PBM. 
(B) NEGOTIATION
ALLOWED.—A PBM 
may negotiate rebate amounts with a manufac-
turer of prescription drugs on behalf of a phar-
macy benefit plan sponsor. 
(5) PROVISION OF COST INFORMATION TO PHY-
SICIANS.—In the case that the premium, deductible, 
co-payments, co-insurance, or other insurance-re-
lated charge under a pharmacy benefit plan is un-
derwritten, in whole or in part, by a Federal, State, 
or local government, the pharmacy benefit plan 
sponsor shall provide a list of the wholesale acquisi-
tion costs of the top 500 most frequently prescribed 
drugs to physicians who are licenced to prescribe 
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drugs and who provide treatment to enrollees in 
such a plan. 
(6) TREATMENT OF PHARMACISTS AS PROFES-
SIONAL
HEALTH
CARE
PROVIDERS.—Section 
1861(s)(2) of the Social Security Act (42 U.S.C. 
1395x(s)(2)) is amended— 
(A) by striking ‘‘and’’ at the end of sub-
paragraph (DD); 
(B) by adding ‘‘and’’ at the end of sub-
paragraph (EE); and 
(C) by inserting after subparagraph (EE), 
the following new subparagraph: 
‘‘(FF) pharmacist services;’’. 
SEC. 4. PHARMACEUTICAL ACCESS PROGRAM. 
(a) ESTABLISHMENT.—Not later than January 1, 
2011, the Secretary of Health and Human Services shall 
establish a pharmaceutical access program to provide af-
fordable access to prescription drugs to individuals who 
receive drug benefits under Federal programs (except for 
the Medicaid program under title XIX of the Social Secu-
rity Act). 
(b) ELIGIBILITY.—Any individual in a State shall be 
eligible to enroll in the program under subsection (a). 
(c) FEES.— 
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(1) IN GENERAL.—A pharmacy that dispenses 
prescription drugs in the United States shall remit 
to the Secretary of Health and Human Services— 
(A) $0.50 for each prescription dispensed 
by such pharmacy for a brand name drug; and 
(B) $1.00 for each prescription dispensed 
by such pharmacy for a generic drug. 
(2) TREATMENT
FOR
INFLATION.—The fees 
under paragraph (1) shall be adjusted annually for 
inflation, based on the consumer price index. 
(3) TREATMENT
OF
MEDICAID
PROGRAMS.— 
The rule under paragraph (1) shall not apply to 
drugs dispensed under a State Medicaid program 
under title XIX of the Social Security Act. 
(4) INCREASE
IN
PROFESSIONAL
DISPENSING 
FEE
FOR
PRIVATE
PLANS.—The professional dis-
pensing fee paid to pharmacies by a pharmacy ben-
efit plan that is not funded by any Federal funds 
shall be increased by such plan sponsor— 
(A) by $0.50 for each brand name pre-
scription; and 
(B) by $1.00 for each generic prescription. 
(d) USE OF FUNDS.—Funds generated under sub-
section (c) shall be used solely to provide affordable access 
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to prescription drugs to low-income individuals who have 
enrolled in the program under subsection (a). 
SEC. 5. DEFINITIONS. 
For purposes of this Act: 
(1) BRAND NAME DRUGS.—The term ‘‘brand 
name drug’’ means a prescription drug that is under 
patent by the drug’s original manufacturer and is 
protected from competition by other manufacturers 
of prescription drugs. 
(2) GENERIC DRUG.—The term ‘‘generic drug’’ 
means a prescription drug that has lost patient pro-
tection provided to a single manufacturer or multiple 
manufacturers and is widely available from multiple 
manufacturers. 
(3) PHARMACY
BENEFIT
PLAN.—The term 
‘‘pharmacy benefit plan’’ means an insurance plan 
or insurance coverage that provides benefits for pre-
scription drugs, including a group health plan (as 
such term is defined in section 733(a) of the Patient 
Health and Real Medication Access Cost Savings 
Act of 2009 (29 U.S.C. 1191b(a))) that provides 
prescription drug benefits. 
(4) PROFESSIONAL
DISPENSING
FEE.—The 
term ‘‘professional dispensing fee’’ means the fee 
paid for the dispensing of a drug by the pharmacist 
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and excludes any reimbursement for the cost of the 
drug. 
(5) PROFESSIONAL
SERVICE
FEE.—The term 
‘‘professional service fee’’ means a fee paid to a 
pharmacy for professional services preformed by a 
pharmacist, excluding dispensing drugs and any re-
imbursement for the cost of the drug. Such term 
may include medication reviews, injections, and cho-
lesterol checks. 
(6) REBATE.—The term ‘‘rebate’’ means any 
item of value, including monetary value, that is dis-
tributed by the manufacturer conditional upon the 
receipt of a payment for drugs produced by such 
manufacturer. 
Æ 
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