Title: Drug Pricing Transparency and Accountability Act
Policy area: Health

Summary:
Drug Pricing Transparency and Accountability Act
This bill establishes a two-year moratorium on allowing new, non-rural hospitals and associated child sites to participate in the 340B drug pricing program; during the moratorium, the Department of Health and Human Services must issue regulations with specified program eligibility standards. The bill also requires additional reporting relating to program participation, eligibility, and costs.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5463 Introduced in House (IH)]

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117th CONGRESS
  1st Session
                                H. R. 5463

To increase reporting requirements and transparency requirements in the 
           340B Drug Pricing Program, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 30, 2021

Mr. Rosendale introduced the following bill; which was referred to the 
 Committee on Energy and Commerce, and in addition to the Committee 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 increase reporting requirements and transparency requirements in the 
           340B Drug Pricing Program, 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 ``Drug Pricing Transparency and 
Accountability Act''.

SEC. 2. MORATORIUM ON REGISTRATION OF NEW NON-RURAL SECTION 340B 
              HOSPITALS.

    Section 340B(a) of the Public Health Service Act (42 U.S.C. 
256b(a)) is amended--
            (1) in paragraph (4)(L), by striking ``A subsection (d) 
        hospital'' and inserting ``Subject to paragraph (11), a 
        subsection (d) hospital''; and
            (2) by adding at the end the following:
            ``(11) Moratorium on registration of certain hospitals.--
        During the 2-year period beginning on the date of the enactment 
        of this paragraph--
                    ``(A) an entity described in paragraph (4)(L) shall 
                not be considered a covered entity under this section 
                unless such entity was a covered entity on such date 
                (as evidenced by the entity having been identified as a 
                covered entity as of such date under the covered entity 
                identification system established under subsection 
                (d)(2)(B)(iv)); and
                    ``(B) no site shall be added to the covered entity 
                identification system established under subsection 
                (d)(2)(B)(iv) or be permitted to begin participating in 
                the drug discount program under this section, as a 
                `child site' or otherwise, on the basis of association 
                with a covered entity described in paragraph (4)(L) 
                unless such site was identified as a child site as of 
                December 31, 2020, under the system established under 
                subsection (d)(2)(B)(iv).
            ``(12) Regulations to be issued during the moratorium 
        period to implement statutory requirements clarifying hospital 
        eligibility criteria and hospital child site standards and 
        enhancing hospital transparency.--
                    ``(A) Issuance of regulations.--
                            ``(i) In general.--During the moratorium 
                        period under paragraph (11), the Secretary 
                        shall promulgate regulations through notice and 
                        comment rulemaking to implement the standards 
                        and requirements described in subparagraph (B).
                            ``(ii) Deadline.--Such final regulations 
                        shall be promulgated and take effect--
                                    ``(I) before the end date of the 
                                moratorium described in paragraph (11); 
                                or
                                    ``(II) in the event that any of 
                                such regulations have not taken effect 
                                by such end date, the moratorium under 
                                subparagraph (11) shall be extended 
                                until such regulations are final and 
                                effective.
                            ``(iii) Limitation.--The authority to 
                        promulgate regulations under this paragraph is 
                        limited to setting forth the details necessary 
                        and appropriate to carry out the requirements 
                        of subparagraph (B) efficiently, effectively, 
                        and in conformity with such subparagraph.
                    ``(B) Standards and requirements.--
                            ``(i) Hospital child site standards.--
                                    ``(I) In general.--Hospitals 
                                described in subparagraphs (L) and (M) 
                                of paragraph (4) may register off-
                                campus outpatient facilities associated 
                                with the hospital (also known as `child 
                                sites') to participate in the drug 
                                discount program under this section 
                                (beginning after the moratorium under 
                                paragraph (11) ends), if--
                                            ``(aa) the site is listed 
                                        on the hospital's most recently 
                                        filed Medicare cost report on a 
                                        line that is reimbursable under 
                                        the Medicare program (or, if 
                                        the hospital is a children's 
                                        hospital that does not file a 
                                        Medicare cost report, the 
                                        hospital submits to the 
                                        Secretary a signed statement 
                                        certifying that the facility 
                                        would be correctly included on 
                                        a reimbursable line of a 
                                        Medicare cost report if the 
                                        hospital filed a cost report);
                                            ``(bb) such cost report 
                                        demonstrates that the services 
                                        provided at the facility have 
                                        associated costs and charges 
                                        for hospital outpatient 
                                        department services under title 
                                        XVIII of the Social Security 
                                        Act (or, if the hospital is a 
                                        children's hospital that does 
                                        not file a Medicare cost 
                                        report, the hospital submits to 
                                        the Secretary a signed 
                                        statement certifying that the 
                                        services provided at the 
                                        facility include or consist 
                                        solely of outpatient services);
                                            ``(cc) the facility is 
                                        wholly owned by the covered 
                                        entity;
                                            ``(dd) the Secretary has 
                                        made a determination, under the 
                                        process described in section 
                                        413.65(b) of title 42, Code of 
                                        Federal Regulations (or any 
                                        successor regulations), that 
                                        the facility meets the Medicare 
                                        provider-based standards under 
                                        section 413.65 of title 42, 
                                        Code of Federal Regulations (or 
                                        any successor regulations);
                                            ``(ee) the facility 
                                        provides a full range of 
                                        outpatient services, in 
                                        addition to drugs; and
                                            ``(ff) the facility adheres 
                                        to the charity care policy and 
                                        any sliding fee scale policy of 
                                        the parent hospital.
                                    ``(II) De-registration.--If at any 
                                time following registration one or more 
                                of the standards listed above are no 
                                longer satisfied, a registered hospital 
                                shall immediately notify the Secretary, 
                                de-register the facility, and keep the 
                                facility from making any purchases 
                                under the drug discount program under 
                                this section or representing to third 
                                parties that it may purchase under such 
                                program.
                            ``(ii) Hospital eligibility standards for 
                        hospitals not owned or operated by a unit of 
                        state or local government.--For purposes of 
                        subparagraph (L)(i) of paragraph (4):
                                    ``(I) A private hospital has been 
                                formally granted governmental powers by 
                                a unit of State or local government if 
                                the Secretary receives a certification 
                                from a State or local governmental 
                                entity that such governmental entity 
                                has formally delegated, through State 
                                or local statute or regulation or, if 
                                permitted by applicable State or local 
                                law, through a contract with a State or 
                                local government, to the hospital such 
                                a power, described in detail in the 
                                certification.
                                    ``(II) A private hospital has a 
                                contract with a State or local 
                                government to provide health care 
                                services to low-income individuals who 
                                are not entitled to benefits under 
                                Medicare or Medicaid if--
                                            ``(aa) the hospital submits 
                                        a copy of the contract to the 
                                        Secretary for review;
                                            ``(bb) the Secretary 
                                        determines that the contract 
                                        creates an enforceable 
                                        obligation for the hospital to 
                                        provide direct medical care to 
                                        low-income individuals 
                                        ineligible for Medicare and 
                                        Medicaid in an amount that 
                                        represents at least 15 percent 
                                        of the hospital's total costs 
                                        for all items and services 
                                        furnished at such hospital; and
                                            ``(cc) the contract is 
                                        available to the public as part 
                                        of the information describing 
                                        the hospital in the covered 
                                        entity identification system 
                                        established under subsection 
                                        (d)(2)(B)(iv).
                                    ``(III) If at any time a hospital 
                                not owned or operated by a unit of 
                                State or local government no longer 
                                meets one or more requirements under 
                                subclause (I) or (II), the hospital 
                                shall immediately notify the Secretary, 
                                dis-enroll from the drug discount 
                                program under this section, and stop 
                                making purchases under such program and 
                                representing to third parties that it 
                                may purchase under such program.
                            ``(iii) Hospital transparency 
                        requirements.--
                                    ``(I) Hospital requirements to 
                                identify section 340b drugs.--In the 
                                case of covered entity hospitals 
                                described in subparagraph (L) of 
                                paragraph (4):
                                            ``(aa) Claims for covered 
                                        outpatient drugs purchased 
                                        under the drug discount program 
                                        under this section shall be 
                                        submitted to public and private 
                                        payors using the 340B modifier 
                                        established by the Secretary 
                                        under the prospective payment 
                                        system for hospital outpatient 
                                        department services, in 
                                        conformance with paragraph (22) 
                                        of section 1833(t) of the 
                                        Social Security Act, subsection 
                                        (h) of 1847A, subparagraph (F) 
                                        of section 1927(a)(5), and 
                                        paragraph (5) of section 
                                        1857(g), that is `JG'.
                                            ``(bb) Such hospitals shall 
                                        report to the Secretary on an 
                                        annual basis, in a form and 
                                        manner specified by the 
                                        Secretary--

                                                    ``(AA) the 
                                                hospital's aggregate 
                                                annual revenue from 
                                                drugs purchased under 
                                                the program under this 
                                                section, minus its 
                                                aggregate annual 
                                                acquisition costs for 
                                                such drugs, broken out 
                                                by hospital and by each 
                                                child site;

                                                    ``(BB) any 
                                                dispensing fees paid by 
                                                the hospital or child 
                                                site to contract 
                                                pharmacies for such 
                                                drugs;

                                                    ``(CC) the patient 
                                                mix, broken down by 
                                                expected payment source 
                                                (including at least the 
                                                Medicare program under 
                                                title XVIII of the 
                                                Social Security Act, a 
                                                State plan under the 
                                                Medicaid program under 
                                                title XIX of such Act, 
                                                private insurance, and 
                                                uninsured individuals), 
                                                for each such hospital, 
                                                and each child site of 
                                                the hospital listed in 
                                                the covered entity 
                                                information system 
                                                established under 
                                                subsection 
                                                (d)(2)(B)(iv), and the 
                                                costs incurred at each 
                                                such hospital and site 
                                                for charity care (as 
                                                described in line 23 of 
                                                Worksheet S-10--
                                                Hospital Uncompensated 
                                                and Indigent Care Data 
                                                to the Medicare cost 
                                                report or as reported 
                                                in any successor form);

                                                    ``(DD) the percent 
                                                of total revenues (net 
                                                of any discounts) at 
                                                each site derived from 
                                                infusion or injection 
                                                of physician-
                                                administered drugs, 
                                                including any 
                                                associated items or 
                                                services furnished 
                                                incident-to the 
                                                administration of such 
                                                drugs; and

                                                    ``(EE) with respect 
                                                to such hospital and 
                                                each child site of the 
                                                hospital, the names of 
                                                all third-party vendors 
                                                or other similar 
                                                entities (including 
                                                split fee vendors and 
                                                contract pharmacies) 
                                                that the covered entity 
                                                contracts with to 
                                                provide services 
                                                associated with the 
                                                program under this 
                                                section (broken down by 
                                                covered entity and by 
                                                each child site).

                                    ``(II) Public availability.--The 
                                Secretary shall make the information 
                                reported to the Secretary under 
                                subclause (I)(bb) available to the 
                                public (with redactions of any 
                                information the Secretary determines to 
                                be proprietary or confidential) in an 
                                annual compilation of the reported 
                                information available on the internet 
                                website of the Department of Health and 
                                Human Services, and as part of the 
                                information describing the hospital and 
                                the relevant child site in the covered 
                                entity identification system 
                                established under subsection 
                                (d)(2)(B)(iv).''.

SEC. 3. 340B CLAIMS MODIFIER.

    (a) Medicaid.--Section 1927(a)(5) of the Social Security Act (42 
U.S.C. 1396r-8(a)(5)) is amended by adding at the end the following:
                    ``(F) 340B claims modifier.--
                            ``(i) In general.--All claims submitted to 
                        a Medicaid fee-for-service program or a 
                        medicaid managed care organization (as defined 
                        in section 1903(m)(1)(A)) for reimbursement of 
                        a unit of a covered outpatient drug subject to 
                        an agreement under section 340B of the Public 
                        Health Service Act shall include the 340B 
                        modifier established by the Secretary under the 
                        prospective payment system for hospital 
                        outpatient department services under section 
                        1833(t) that is `JG' or the Submission 
                        Clarification Code of `20' developed by the 
                        National Council for Prescription Drug Programs 
                        (NCPDP).
                            ``(ii) Data sharing.--Each single State 
                        agency shall make available to a manufacturer 
                        of a covered outpatient drug any fee-for-
                        service or managed care claim for reimbursement 
                        for a unit of such drug for the purpose of 
                        verifying the propriety of any claim for a 
                        rebate payment under an agreement under 
                        subsection (b) with respect to such drug. At 
                        the manufacturer's request, in lieu of making 
                        such a claim available to the manufacturer, the 
                        single State agency may instead provide a list 
                        of claims (and relevant data concerning each 
                        claim) for covered outpatient drugs that were 
                        purchased under an agreement under section 340B 
                        of the Public Health Service Act or other 
                        summary data specified by the manufacturer.
                            ``(iii) Report.--Each single State agency 
                        shall publish an annual report on utilization 
                        of covered outpatient drugs subject to an 
                        agreement under section 340B of the Public 
                        Health Service Act by the Medicaid fee-for-
                        service program or a medicaid managed care 
                        organization (as defined in section 
                        1903(m)(1)(A)) during the preceding calendar 
                        year. The State agency shall not include 
                        confidential patient-specific, drug-specific, 
                        or manufacturer-specific information in any 
                        such annual report.''.
    (b) Medicare.--
            (1) Medicare part b.--
                    (A) Hospital outpatient department services.--
                Section 1833(t) of the Social Security Act (42 U.S.C. 
                1395l) is amended by adding at the end the following 
                paragraph:
            ``(22) 340B claims modifier.--All claims submitted under 
        the system under this subsection for reimbursement of a unit of 
        a covered outpatient drug subject to an agreement under section 
        340B of the Public Health Service Act shall include the 340B 
        modifier established by the Secretary under such system that is 
        `JG' (or `TB' in the case of a claim for reimbursement under 
        such system submitted by a hospital described in subparagraph 
        (M) or (N) of section 340B(a)(4) of the Public Health Service 
        Act or a rural sole community hospital described in 
        subparagraph (O) of such section).''.
                    (B) Other part b claims.--Section 1847A of the 
                Social Security Act (42 U.S.C. 1395w-3a) is amended by 
                adding the following new subsection:
    ``(h) 340B Claims Modifier.--All claims submitted under this part 
(other than under the prospective payment system for hospital 
outpatient department services under section 1833(t)) for reimbursement 
of a unit of a covered outpatient drug subject to an agreement under 
section 340B of the Public Health Service Act shall include the 340B 
modifier established by the Secretary under such payment system that is 
`JG'.''.
            (2) Medicare advantage and medicare part d.--Section 
        1857(e) of the Social Security Act (42 U.S.C. 1395w-27(e)) is 
        amended by adding at the end the following new paragraph:
            ``(5) 340B claims modifier.--All claims submitted to a 
        Medicare Advantage organization or a PDP sponsor under this 
        part and part D, respectively, for reimbursement of a unit of a 
        covered outpatient drug subject to an agreement under section 
        340B of the Public Health Service Act shall include the 340B 
        modifier established by the Secretary under the prospective 
        payment system for hospital outpatient department services 
        under section 1833(t) that is `JG' or the Submission 
        Clarification Code of `20' developed by the National Council 
        for Prescription Drug Programs (NCPDP).''.
            (3) Report on utilization under medicare part b.--The 
        Secretary of Health and Human Services shall publish an annual 
        report on utilization under part B of title XVIII of the Social 
        Security Act (42 U.S.C. 1395j et seq.) of covered outpatient 
        drugs purchased subject to an agreement under section 340B of 
        the Public Health Service Act (42 U.S.C. 256b) during the 
        preceding calendar year. The Secretary shall not include 
        confidential patient-specific, drug-specific, or manufacturer-
        specific information in any such annual report.
    (c) Effective Date.--The amendments made by this section take 
effect on the date that is 6 months after the date of enactment of this 
Act and apply to claims submitted on or after that date.

SEC. 4. REPORTS TO CONGRESS.

    Section 340B of the Public Health Service Act (42 U.S.C. 256b) is 
amended by adding at the end the following:
    ``(f) Reports to Congress.--
            ``(1) OIG report.--Not later than 2 years after the date of 
        the enactment of this subsection, the Office of the Inspector 
        General shall submit to Congress a final report on the level of 
        charity care provided by covered entities described in 
        subparagraph (L) of subsection (a)(4) and separately by child 
        sites of such covered entities.
            ``(2) GAO reports.--
                    ``(A) Initial report.--Not later than 1 year after 
                the date of the enactment of this subsection, the 
                Comptroller General of the United States shall submit 
                to Congress a report--
                            ``(i) analyzing the State and local 
                        government contracts intended to satisfy the 
                        requirement under subsection (a)(4)(L)(i) for a 
                        covered entity to qualify as an entity 
                        described in subparagraph (L) of subsection 
                        (a)(4);
                            ``(ii) assessing the amount of care such 
                        contracts obligate such entity to provide to 
                        low-income individuals ineligible for Medicare 
                        under title XVIII of the Social Security Act 
                        and Medicaid under title XIX of such Act; and
                            ``(iii) analyzing how these contracts 
                        define low-income individuals and whether the 
                        Secretary reviews such determinations.
                    ``(B) Subsequent report.--Not later than 2 years 
                after the date of the enactment of this subsection, the 
                Comptroller General of the United States shall submit 
                to Congress a final report on the difference between 
                the aggregate gross reimbursement and aggregate 
                acquisition costs received by each such covered entity 
                (including child sites of such entity) for drugs 
                subject to an agreement under this section.''.

SEC. 5. MEDICARE REQUIREMENT FOR HOSPITALS REGARDING 340B DRUG 
              INFORMATION.

    (a) In General.--Section 1866(a)(1) of the Social Security Act (42 
U.S.C. 1395cc(a)(1)) is amended--
            (1) in subparagraph (X), by striking ``and'' at the end;
            (2) in subparagraph (Y), by striking the period at the end 
        and inserting ``, and''; and
            (3) by inserting after subparagraph (Y), the following new 
        subparagraph:
            ``(Z) in the case of a hospital that is a covered entity 
        under subsection (a)(4) of section 340B of the Public Health 
        Service Act, to include in any cost report submitted to the 
        Secretary under this title information on--
                    ``(i) the aggregate acquisition costs of the 
                hospital for drugs, the purchase of which were 
                attributed to the hospital, during the period covered 
                by such cost report and for which the hospital received 
                a discount under such section 340B; and
                    ``(ii) the aggregate revenues the hospital received 
                from all payors for such drugs, disaggregated by 
                insurance status (including the Medicare program, the 
                Medicaid program, the Children's Health Insurance 
                Program, private health insurance, and uninsured).''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to contracts entered into or renewed on or after the date of the 
enactment of this Act.
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