I 
118TH CONGRESS 
1ST SESSION H. R. 4508 
To amend the Employee Retirement Income Security Act of 1974 to clarify 
and strengthen the application of certain employer-sponsored health plan 
disclosure requirements. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 10, 2023 
Mr. COURTNEY (for himself and Mrs. HOUCHIN) introduced the following bill; 
which was referred to the Committee on Education and the Workforce 
A BILL 
To amend the Employee Retirement Income Security Act 
of 1974 to clarify and strengthen the application of 
certain employer-sponsored health plan disclosure re-
quirements. 
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 ‘‘Hidden Fee Disclosure 
Act’’. 
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SEC. 2. CLARIFICATION OF THE APPLICATION OF FEE DIS-
CLOSURE 
REQUIREMENTS 
TO 
COVERED 
SERVICE PROVIDERS. 
(a) 
SERVICES.—Clause 
(ii)(I)(bb) 
of 
section 
408(b)(2)(B) of the Employee Retirement Income Secu-
rity Act of 1974 (29 U.S.C. 1108(b)(2)(B)) is amended— 
(1) in subitem (AA) by striking ‘‘Brokerage 
services,’’ and inserting ‘‘Services (including broker-
age services),’’; and 
(2) in subitem (BB)— 
(A) by striking ‘‘Consulting,’’ and inserting 
‘‘Other services,’’; and 
(B) by inserting ‘‘any of the following:’’ be-
fore ‘‘plan design’’. 
(b) DISCLOSURES.—Clause (iii)(III) of section 
408(b)(2)(B) of the Employee Retirement Income Secu-
rity Act of 1974 (29 U.S.C. 1108(b)(2)(B)) is amended 
by striking ‘‘, either in the aggregate or by service,’’ and 
inserting ‘‘by service’’. 
SEC. 3. STRENGTHENING DISCLOSURE REQUIREMENTS 
WITH RESPECT TO PHARMACY BENEFIT MAN-
AGERS AND THIRD PARTY ADMINISTRATORS 
FOR GROUP HEALTH PLANS. 
(a) CERTAIN ARRANGEMENTS FOR PBM SERVICES 
CONSIDERED AS INDIRECT.— 
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(1) 
IN
GENERAL.—Clause 
(i) 
of 
section 
408(b)(2)(B) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1108(b)(2)(B)) is 
amended— 
(A) by striking ‘‘requirements of this 
clause’’ and inserting ‘‘requirements of this 
subparagraph’’; and 
(B) by adding at the end the following: 
‘‘For purposes of applying section 406(a)(1)(C) 
with respect to a transaction described under 
this subparagraph, a contract or arrangement 
for services between a covered plan and a health 
insurance issuer providing health insurance cov-
erage in connection with the covered plan in 
which the health insurance issuer contracts, in 
connection with such plan, with a service pro-
vider for pharmacy benefit management services 
shall be considered to constitute an indirect fur-
nishing of goods, services, or facilities between 
the plan and the service provider acting as the 
party in interest.’’. 
(2) HEALTH INSURANCE ISSUER AND HEALTH 
INSURANCE COVERAGE DEFINED.—Clause (ii)(I)(aa) 
of section 408(b)(2)(B) of the Employee Retirement 
Income 
Security 
Act 
of 
1974 
((29 
U.S.C. 
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1108(b)(2)(B)) is amended by inserting before the 
period at the end ‘‘and the terms ‘health insurance 
coverage’ and ‘health insurance issuer’ have the 
meanings given such terms in section 733(b)’’. 
(b) SPECIFIC DISCLOSURE REQUIREMENTS WITH 
RESPECT TO PHARMACY BENEFIT MANAGEMENT SERV-
ICES.— 
(1) IN
GENERAL.—Clause (iii) of section 
408(b)(2)(B) of such Act (29 U.S.C. 1108(b)(2)(B)) 
is amended by adding at the end the following: 
‘‘(VII) With respect to a contract or ar-
rangement with the covered plan in connection 
with the provision of pharmacy benefit manage-
ment services, as part of the description re-
quired under subclauses (III) and (IV)— 
‘‘(aa) all compensation described in 
clause (ii)(I)(dd)(AA), including fees, re-
bates, alternative discounts, co-payment 
offsets, and other remuneration expected 
to be received by the covered service pro-
vider, an affiliate, or a subcontractor from 
a 
pharmaceutical 
manufacturer, 
dis-
tributor, rebate aggregator, group pur-
chasing organization, or any other third 
party; and 
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‘‘(bb) the amount and form of any re-
bates, discounts, or price concessions, in-
cluding the amount expected to be passed 
through to the plan sponsor or the partici-
pants and beneficiaries under the covered 
plan; 
‘‘(cc) all compensation expected to be 
received by the covered service provider as 
a result of paying a lower amount for the 
drug than the amount charged as a copay-
ment, coinsurance amount, or deductible; 
‘‘(dd) all compensation expected to be 
received by the covered service provider as 
a result of paying pharmacies less than 
what is charged the health plan, plan spon-
sor, or participants and beneficiaries under 
the covered plan; 
‘‘(ee) all compensation expected to be 
received by the covered service provider 
from drug manufacturers and any other 
third party in exchange for— 
‘‘(AA) administering, invoicing, 
allocating, or collecting rebates related 
to the covered plan; 
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‘‘(BB) providing business serv-
ices and activities, including providing 
access to drug utilization data; 
‘‘(CC) keeping a percentage of 
the list price of a drug; or 
‘‘(DD) any other reason related 
to the role of a covered service pro-
vider as a conduit between the drug 
manufacturers or any other third 
party and the covered plan.’’. 
(2) ANNUAL DISCLOSURE.— 
(A) Clause (v) of section 408(b)(2)(B) of 
such Act (29 U.S.C. 1108(b)(2)(B)) is amended 
by adding at the end the following: 
‘‘(III) A covered service provider, with re-
spect to a contract or arrangement with the 
covered plan in connection with providing phar-
macy benefit management services, shall dis-
close, on an annual basis not later than 60 days 
after the beginning of the current plan year, to 
a responsible plan fiduciary, in writing, the fol-
lowing with respect to the twelve months pre-
ceding the current plan year: 
‘‘(aa) All direct compensation de-
scribed in subclause (III) of clause (iii) 
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and indirect compensation described in 
subclause (IV) of clause (iii) received by 
the covered service provider (including 
such compensation described in subclause 
(VII) of clause (iii)). 
‘‘(bb) For each drug covered under 
the covered plan, the amount by which the 
price for the drug paid by the plan exceeds 
the amount paid to pharmacies by the cov-
ered service provider. 
‘‘(cc) The total gross spending by the 
covered plan on drugs (excluding rebates, 
discounts, or other price concessions). 
‘‘(dd) The total net spending by the 
covered plan on drugs. 
‘‘(ee) The total gross spending at all 
pharmacies wholly or partially owned by 
the covered service provider, including 
mail-order, specialty and retail pharmacies, 
with a breakdown by individual pharmacy 
location. 
‘‘(ff) 
The 
aggregate 
amount 
of 
clawback from pharmacies, including mail- 
order, specialty, and retail pharmacies. 
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‘‘(AA) categorical explanations 
(grouped by the reason for clawback, 
such as contractual true-up provi-
sions, overpayments, or non-covered 
medication dispensed, and including 
information on the amount in each 
category that was passed through to 
the covered plan and to participants 
and beneficiaries of the covered plan); 
or 
‘‘(BB) individual explanations for 
such clawbacks. 
‘‘(gg) Total aggregate amounts of fees 
collected by the covered service provider in 
connection with the provision of pharmacy 
benefit management services to the covered 
plan. 
‘‘(hh) Any other information specified 
by the Secretary through regulations or 
guidance that may be necessary for a re-
sponsible plan fiduciary to consider the 
merits of the contract or arrangement with 
the covered service provider and any con-
flicts of interest that may exist.’’. 
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(3) PHARMACY BENEFIT MANAGEMENT SERV-
ICES
DEFINED.—Clause 
(ii)(I) 
of 
section 
408(b)(2)(B) of such Act (29 U.S.C. 1108(b)(2)(B)) 
is amended by adding at the end the following: 
‘‘(gg) The term ‘pharmacy benefit 
management services’ includes any services 
provided by a covered service provider to a 
covered plan with respect to the adminis-
tration of prescription drug benefits under 
the covered plan, including— 
‘‘(AA) the processing and pay-
ment of claims; 
‘‘(BB) design of pharmacy net-
works; 
‘‘(CC) negotiation, aggregation, 
and distribution of rebates, discounts, 
and other price concessions; 
‘‘(DD) formulary design and 
maintenance; 
‘‘(EE) operation of pharmacies 
(whether retail, mail order, specialty 
drug, or otherwise); recordkeeping; 
‘‘(FF) utilization review; 
‘‘(GG) adjudication of claims; 
and 
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