REFUND Act of 2021
Bill: S.1287 | Sponsor: Sen. Durbin, Richard J. (D-IL)
Policy area: Health

Summary:
Recovering Excessive Funds for Unused and Needless Drugs Act of 2021 or the REFUND Act of 2021
This bill requires drug manufacturers to issue rebates to the Centers for Medicare & Medicaid Services (CMS) in relation to discarded amounts (i.e., amounts remaining after administration) of single-dose vial drugs that are covered under Medicare. Manufacturers that fail to comply are subject to civil penalties.
The CMS must determine rebate amounts based on payment claims from providers. (Currently, providers may receive payment under Medicare for discarded amounts of single-dose vial drugs through the use of a specific claims modifier.)

To amend title XVIII of the Social Security Act to require 
manufacturers of certain single-dose vial drugs payable under part B of 
the Medicare program to provide refunds with respect to amounts of such 
                drugs discarded, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Recovering Excessive Funds for 
Unused and Needless Drugs Act of 2021'' or the ``REFUND Act of 2021''.

SEC. 2. REQUIRING MANUFACTURERS OF CERTAIN SINGLE-DOSE CONTAINER OR 
              SINGLE-USE PACKAGE DRUGS PAYABLE UNDER PART B OF THE 
              MEDICARE PROGRAM TO PROVIDE REFUNDS WITH RESPECT TO 
              DISCARDED AMOUNTS OF SUCH DRUGS.

    Section 1847A of the Social Security Act (42 U.S.C. 1395-3a), as 
amended by section 405 of division CC of the Consolidated 
Appropriations Act, 2021, is amended--
            (1) by redesignating subsection (h) as subsection (i); and
            (2) inserting after subsection (g) the following:
    ``(h) Refund for Certain Discarded Single-Dose Container or Single-
Use Package Drugs.--
            ``(1) Secretarial provision of information.--
                    ``(A) In general.--For each calendar quarter 
                beginning on or after January 1, 2022, the Secretary 
                shall, with respect to a refundable single-dose 
                container or single-use package drug (as defined in 
                paragraph (8)), report to each manufacturer (as defined 
                in subsection (c)(6)(A)) of such refundable single-dose 
                container or single-use package drug the following for 
                the calendar quarter:
                            ``(i) Subject to subparagraph (C), 
                        information on the total number of units of the 
                        billing and payment code of such drug, if any, 
                        that were discarded during such quarter, as 
                        determined using a mechanism such as the JW 
                        modifier used as of the date of enactment of 
                        this subsection (or any such successor modifier 
                        that includes such data as determined 
                        appropriate by the Secretary).
                            ``(ii) The refund amount that the 
                        manufacturer is liable for pursuant to 
                        paragraph (3).
                    ``(B) Determination of discarded amounts.--For 
                purposes of subparagraph (A)(i), with respect to a 
                refundable single-dose container or single-use package 
                drug furnished during a quarter, the amount of such 
                drug that was discarded shall be determined based on 
                the amount of such drug that was unused and discarded 
                for each drug on the date of service.
                    ``(C) Exclusion of units of packaged drugs.--The 
                total number of units of the billing and payment code 
                of a refundable single-dose container or single-use 
                package drug of a manufacturer furnished during a 
                calendar quarter for purposes of subparagraph (A)(i) 
                shall not include such units that are packaged into the 
                payment amount for an item or service and are not 
                separately payable.
            ``(2) Manufacturer requirement.--For each calendar quarter 
        beginning on or after January 1, 2022, the manufacturer of a 
        refundable single-dose container or single-use package drug 
        shall, for such drug, provide to the Secretary a refund that is 
        equal to the amount specified in paragraph (3) for such drug 
        for such quarter.
            ``(3) Refund amount.--
                    ``(A) In general.--The amount of the refund 
                specified in this paragraph is, with respect to a 
                refundable single-dose container or single-use package 
                drug of a manufacturer assigned to a billing and 
                payment code for a calendar quarter beginning on or 
                after January 1, 2022, an amount equal to 90 percent 
                (or, in the case of a refundable single-dose container 
                or single-use package drug described in subclause (I) 
                or (II) of subparagraph (B)(ii), the percent determined 
                for such drug under subparagraph (B)(i)) of the product 
                of--
                            ``(i) the total number of units of the 
                        billing and payment code for such drug that 
                        were discarded during such quarter (as 
                        determined under paragraph (1)); and
                            ``(ii)(I) in the case of a refundable 
                        single-dose container or single-use package 
                        drug that is a single source drug or 
                        biological, the amount determined for such drug 
                        under subsection (b)(4); or
                            ``(II) in the case of a refundable single-
                        dose container or single-use package drug that 
                        is a biosimilar biological product, the average 
                        sales price determined under subsection 
                        (b)(8)(A).
                    ``(B) Treatment of drugs that require filtration or 
                other unique circumstances.--
                            ``(i) In general.--The Secretary, through 
                        notice and comment rulemaking--
                                    ``(I) in the case of a refundable 
                                single-dose container or single-use 
                                package drug described in subclause (I) 
                                of clause (ii), shall adjust the 
                                percentage otherwise applicable for 
                                purposes of determining the refund 
                                amount with respect to such drug under 
                                subparagraph (A) as determined 
                                appropriate by the Secretary; and
                                    ``(II) in the case of a refundable 
                                single-dose container or single-use 
                                package drug described in subclause 
                                (II) of clause (ii), may adjust the 
                                percentage otherwise applicable for 
                                purposes of determining the refund 
                                amount with respect to such drug under 
                                subparagraph (A) as determined 
                                appropriate by the Secretary.
                            ``(ii) Drug described.--For purposes of 
                        clause (i), a refundable single-dose container 
                        or single-use package drug described in this 
                        clause is either of the following:
                                    ``(I) A refundable single-dose 
                                container or single-use package drug 
                                for which preparation instructions 
                                required and approved by the 
                                Commissioner of the Food and Drug 
                                Administration include filtration 
                                during the drug preparation process, 
                                prior to dilution and administration, 
                                and require that any unused portion of 
                                such drug after the filtration process 
                                be discarded after the completion of 
                                such filtration process.
                                    ``(II) Any other refundable single-
                                dose container or single-use package 
                                drug that has unique circumstances 
                                involving similar loss of product.
            ``(4) Frequency.--Amounts required to be refunded pursuant 
        to paragraph (2) shall be paid in regular intervals (as 
        determined appropriate by the Secretary).
            ``(5) Refund deposits.--Amounts paid as refunds pursuant to 
        paragraph (2) shall be deposited into the Federal Supplementary 
        Medical Insurance Trust Fund established under section 1841.
            ``(6) Enforcement.--
                    ``(A) Audits.--
                            ``(i) Manufacturer audits.--Each 
                        manufacturer of a refundable single-dose 
                        container or single-use package drug that is 
                        required to provide a refund under this 
                        subsection shall be subject to periodic audit 
                        with respect to such drug and such refunds by 
                        the Secretary.
                            ``(ii) Provider audits.--The Secretary 
                        shall conduct periodic audits of claims 
                        submitted under this part with respect to 
                        refundable single-dose container or single-use 
                        package drugs in accordance with the authority 
                        under section 1833(e) to ensure compliance with 
                        the requirements applicable under this 
                        subsection.
                    ``(B) Civil money penalty.--
                            ``(i) In general.--The Secretary shall 
                        impose a civil money penalty on a manufacturer 
                        of a refundable single-dose container or 
                        single-use package drug who has failed to 
                        comply with the requirement under paragraph (2) 
                        for such drug for a calendar quarter in an 
                        amount equal to the sum of--
                                    ``(I) the amount that the 
                                manufacturer would have paid under such 
                                paragraph with respect to such drug for 
                                such quarter; and
                                    ``(II) 25 percent of such amount.
                            ``(ii) Application.--The provisions of 
                        section 1128A (other than subsections (a) and 
                        (b)) shall apply to a civil money penalty under 
                        this subparagraph in the same manner as such 
                        provisions apply to a penalty or proceeding 
                        under section 1128A(a).
            ``(7) Implementation.--The Secretary shall implement this 
        subsection through notice and comment rulemaking.
            ``(8) Definition of refundable single-dose container or 
        single-use package drug.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), in this subsection, the term 
                `refundable single-dose container or single-use package 
                drug' means a single source drug or biological (as 
                defined in section 1847A(c)(6)(D)) or a biosimilar 
                biological product (as defined in section 
                1847A(c)(6)(H)) for which payment is established under 
                this part and that is furnished from a single-dose 
                container or single-use package.
                    ``(B) Exclusions.--The term `refundable single-dose 
                container or single-use package drug' does not include 
                a drug or biological that is either a 
                radiopharmaceutical or an imaging agent.
            ``(9) Report to congress.--
                    ``(A) In general.--Not later than 3 years after the 
                date of enactment of this subsection, the Office of the 
                Inspector General of the Department of Health and Human 
                Services, in consultation with the Centers for Medicare 
                & Medicaid Services and the Food and Drug 
                Administration, shall submit to the Committee on Energy 
                and Commerce and the Committee on Ways and Means of the 
                House of Representatives and the Committee on Finance 
                of the Senate, a report on any impact this subsection 
                is demonstrated to have on--
                            ``(i) the licensure, market entry, market 
                        retention, or marketing of biosimilar 
                        biological products; and
                            ``(ii) vial size changes, label 
                        adjustments, or technological developments.
                    ``(B) Updates.--At the direction of the Committees 
                referred to in subparagraph (A), the Office of the 
                Inspector General of the Department of Health and Human 
                Services, in consultation with the Centers for Medicare 
                & Medicaid Services and the Food and Drug 
                Administration, shall periodically update the report 
                under such subparagraph.''.
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