amounts paid by the enrollee, when the 
same drug is dispensed by other phar-
macies that are not wholly or partially 
owned by the issuer or entity and that are 
included in the pharmacy network of that 
plan or coverage; 
‘‘(iii) the interquartile range of the 
costs, per dosage unit or course of treat-
ment, and including amounts paid by the 
enrollee, when the same drug is dispensed 
by other pharmacies that are not wholly or 
partially owned by the issuer or entity and 
that are included in the pharmacy network 
of that plan or coverage; and 
‘‘(iv) the lowest cost per dosage unit 
or course of treatment, for such drug, in-
cluding amounts charged to the plan or 
issuer and enrollee, that is available from 
any pharmacy included in the network of 
the plan or coverage. 
‘‘(d) FULL REBATE PASS-THROUGH TO PLAN.— 
‘‘(1) IN GENERAL.—A pharmacy benefits man-
ager, a third-party administrator of a group health 
plan, a health insurance issuer offering group health 
insurance coverage, or an entity providing pharmacy 
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benefits management services under such health 
plan or health insurance coverage shall remit 100 
percent of rebates, fees, alternative discounts, and 
all other remuneration received from a pharma-
ceutical manufacturer, distributor or any other third 
party, that are related to utilization of drugs under 
such health plan or health insurance coverage, to the 
health plan issuer. 
‘‘(2) FORM AND MANNER OF REMITTANCE.— 
Such rebates, fees, alternative discounts, and other 
remuneration shall be— 
‘‘(A) remitted to the group health plan in 
a timely fashion after the period for which such 
rebates, fees, or other remuneration is cal-
culated, and in no case later than 120 days 
after the end of such period; 
‘‘(B) fully disclosed and enumerated to the 
group health plan sponsor, as described in 
(b)(1); 
‘‘(C) available for audit by the plan spon-
sor, or a third party designated by a plan spon-
sor no less than once per plan year; and 
‘‘(D) returned to the issuer or entity pro-
viding 
pharmaceutical 
benefit 
management 
services by the group health plan if audits by 
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such issuer or entity indicate that the amounts 
received are incorrect after such amounts have 
been paid to the group health plan. 
‘‘(3) AUDIT OF REBATE CONTRACTS.—A phar-
macy benefits manager, a third-party administrator 
of a group health plan, a health insurance issuer of-
fering a group health insurance coverage, or an enti-
ty providing pharmacy benefits management services 
under such health plan or health insurance coverage 
shall make rebate contracts with drug manufactur-
ers available for audit by such plan sponsor or des-
ignated third party, subject to confidentiality agree-
ments to prevent re-disclosure of such contracts. 
‘‘(e) ENFORCEMENT.— 
‘‘(1) IN GENERAL.—The Secretary, in consulta-
tion with the Secretary of Labor and the Secretary 
of the Treasury, shall enforce this section. 
‘‘(2) FAILURE TO PROVIDE TIMELY INFORMA-
TION.—A health insurance issuer or an entity pro-
viding pharmacy benefit management services that 
violates subsection (a), fails to provide information 
required under subsection (b), engages in spread 
pricing as defined in subsection (c), or fails to com-
ply with the requirements of subsection (d), or a 
drug manufacturer that fails to provide information 
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under subsection (b)(1)(A), in a timely manner shall 
be subject to a civil monetary penalty in the amount 
of $10,000 for each day during which such violation 
continues or such information is not disclosed or re-
ported. 
‘‘(3) FALSE INFORMATION.—A health insurance 
issuer, entity providing pharmacy benefit manage-
ment services, or drug manufacturer that knowingly 
provides false information under this section shall be 
subject to a civil money penalty in an amount not 
to exceed $100,000 for each item of false informa-
tion. Such civil money penalty shall be in addition to 
other penalties as may be prescribed by law. 
‘‘(4) PROCEDURE.—The provisions of section 
1128A of the Social Security Act, other than sub-
sections (a) and (b) and the first sentence of sub-
section (c)(1) of such section shall apply to civil 
monetary penalties under this subsection in the 
same manner as such provisions apply to a penalty 
or proceeding under section 1128A of the Social Se-
curity Act. 
‘‘(5) SAFE HARBOR.—The Secretary may waive 
penalties under paragraph (2), or extend the period 
of time for compliance with a requirement of this 
section, for an entity in violation of this section that 
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has made a good-faith effort to comply with this sec-
tion. 
‘‘(f) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to prohibit entities providing phar-
macy benefits management services from retaining bona 
fide service fees, provided that such fees are transparent 
to group health plans and health insurance issuers and 
are not linked directly to the price or formulary placement 
or position of a drug. 
‘‘(g) DEFINITIONS.—In this section— 
‘‘(1) the term ‘similarly situated pharmacy’ 
means, with respect to a particular pharmacy, an-
other pharmacy that is approximately the same size 
(as measured by the number of prescription drugs 
dispensed), and that serves patients in the same geo-
graphical area, whether through physical locations or 
mail order; 
‘‘(2) the term ‘wholesale acquisition cost’ has 
the 
meaning 
given 
such 
term 
in 
section 
1847A(c)(6)(B) of the Social Security Act; and 
‘‘(3) the term ‘bona fide service fees’ means 
fees paid by a manufacturer, customer, or client 
(other than a group health plan or health insurance 
issuer) of an entity providing pharmacy benefit man-
agement services, to an entity providing pharmacy 
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benefit management services, that represent fair 
market value for bona fide, itemized services actually 
performed on behalf of the manufacturer, customer, 
or client would otherwise perform or contract for in 
the absence of the service arrangement, without 
prior consent for any specific arrangements.’’. 
SEC. 3. THIRD-PARTY ADMINISTRATORS. 
Any obligation on a third-party administrator under 
this Act (including the amendment made by this Act) shall 
not affect any other direct or indirect requirement under 
any other provision of Federal law that applies to third- 
party administrators offering services to group health 
plans. 
Æ 
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