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 de-
termined as if the aggregate price per the terms 
of the agreement was paid in full in the first in-
stallment during the rebate period.’’. 
(2) RULEMAKING.—Not later than 180 days 
after the date of the enactment of this Act, the Sec-
retary of Health and Human Services shall imple-
ment the amendments made by this subsection 
through rulemaking. 
(c) 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: 
‘‘(12) VALUE-BASED
PURCHASING
ARRANGE-
MENT.—The term ‘value-based purchasing arrange-
ment’ has the meaning given such term in section 
447.502 of title 42, Code of Federal Regulations (or 
any successor regulation).’’. 
SEC. 3. CALCULATION OF AVERAGE SALES PRICE UNDER 
MEDICARE. 
Section 1847A(c)(3) of the Social Security Act (42 
U.S.C. 1395w–3a(c)(3)) is amended— 
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(1) by striking ‘‘In calculating’’ and inserting 
the following: 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), in calculating’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(B) 
CERTAIN
REMUNERATION
UNDER 
VALUE-BASED PURCHASING ARRANGEMENTS EX-
CLUDED.—In calculating the manufacturer’s av-
erage sales price under this subsection for a drug 
or biological that is sold under a value-based 
purchasing arrangement (as defined in section 
1927(k)(12)) and with respect to which the man-
ufacturer of such drug or biological has elected to 
include multiple best price points (as described 
in section 1927(c)(1)(C)(ii)(VI)) in reporting the 
best price of such drug under section 1927(b), 
such price shall not include any amount that is 
excluded from the calculation of the average 
manufacturer price of such drug or biological 
under section 1927(k)(1)(B)(i)(IX).’’. 
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SEC. 4. GUIDANCE ON VALUE-BASED PURCHASING AR-
RANGEMENTS FOR INPATIENT DRUGS UNDER 
MEDICAID. 
Not later than 180 days after the date of the enactment 
of this Act, the Secretary of Health and Human Services 
shall issue guidance to State Medicaid agencies on the op-
tion of entering into 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))) with manufacturers for 
drugs or biological products provided as part of, or as inci-
dent to and in the same setting as, inpatient hospital serv-
ices furnished under a State plan under title XIX of the 
Social Security Act (42 U.S.C. 1396 et seq.), or under a 
waiver of such plan, where such drugs or biological products 
are reimbursed directly and not paid for as part of pay-
ment for such inpatient hospital services, including guid-
ance on how multiple States may enter into agreements 
with one another and with manufacturers which permit the 
transfer of funds between the participating States so that 
individuals who reside in a State different from the State 
in which they receive a drug subject to a value-based pur-
chasing arrangement as an inpatient may be treated as if 
they received such drug in the State in which they reside. 
SEC. 5. EXCEPTION UNDER THE ANTIKICKBACK STATUTE. 
(a) IN GENERAL.—Section 1128B(b)(3) of the Social 
Security Act (42 U.S.C. 1320a–7b(b)(3)) is amended— 
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(1) in subparagraph (J), by moving the left mar-
gin of such subparagraph 2 ems to the left; 
(2) in subparagraph (K)— 
(A) by moving the left margin of such sub-
paragraph 2 ems to the left; and 
(B) by striking ‘‘and’’ at the end; 
(3) in subparagraph (L)(iii), by striking the pe-
riod and inserting ‘‘; and’’; and 
(4) by adding at the end the following new sub-
paragraph: 
‘‘(M) any remuneration provided by a man-
ufacturer or third party on behalf of a manufac-
turer to a State under a value-based purchasing 
arrangement (as defined in section 1927(k)(12)) 
under a State plan under title XIX (or waiver 
of such plan) in the case a patient fails to 
achieve outcomes or measures defined in such ar-
rangement following the administration of a cov-
ered outpatient drug (as defined in section 
1927(k)(2)).’’. 
(b) RULEMAKING.—Not later than 180 days after the 
date of the enactment of this Act, the Inspector General of 
the Department of Health and Human Services shall 
through rulemaking implement the amendments made by 
this section. 
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SEC. 6. 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 
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 ar-
rangement pricing structure that are available 
in the commercial market for such drugs; 
(C) the Medicaid drug rebate program 
under section 1927 of the Social Security Act (42 
U.S.C. 1396r–8), the 340B drug pricing pro-
gram under section 340B of the Public Health 
Service Act (42 U.S.C. 256b), and part B of title 
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Union Calendar No. 768 
118TH CONGRESS 
2D SESSION 
H. R. 2666 
[Report No. 118–743, Part I] 
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. 
DECEMBER 19, 2024 
Committee on Ways and Means discharged; committed to 
the Committee of the Whole House on the State of the 
Union and ordered to be printed 
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