S2052-118

1. Short title This Act may be cited as the Protect Patient Access to Pharmacies Act.

2. Establishing safeguards to ensure fair market competition for pharmacies in Medicare part D Section 1860D–4(b)(1)(C) of the Social Security Act (42 U.S.C. 1395w–104(b)(1)(C)) is amended by adding at the end the following new clauses: Not later than September 30, 2024, the Secretary shall require that total payment (including dispensing fees) by a PDP sponsor offering a prescription drug plan or MA organization offering an MA–PD plan for each covered part D drug dispensed to an enrollee by a network pharmacy (including specialty pharmacies (as defined under section 1860D–2(d)(4)(E))), net of any and all price concessions, discounts, fees of any type, incentive payments, or any other form of remuneration, ensures that at a minimum, such payment covers such pharmacy’s costs to acquire and to dispense each covered part D drug so that such pharmacy may have the option to participate as a network provider, which shall include the ability to acquire and dispense covered part D drugs and provide pharmacy services necessary for dispensing such drugs. In carrying out this clause, the Secretary shall— utilize pharmacy acquisition cost data on each type of pharmacy for each covered part D drug (excluding drugs purchased under section 340B of the Public Health Service Act) and cost to dispense data from each type of pharmacy (including pharmacies not otherwise owned, controlled, or affiliated with any other pharmacy, plan, or pharmacy benefit manager); establish payment parameters for each covered part D drug that considers how the drug is dispensed and what pharmacy services are provided by each type of pharmacy to support drug management with the individual for whom the drug is dispensed; and establish an appeal process in which the pharmacy may appeal payment, in writing and with supporting documentation, to the Medicare Pharmaceutical and Technology Ombudsman within 60 days following notification of the payment or any adjustment of such payment of such a drug, if a network pharmacy believes that the amount a PDP offering a prescription drug plan or an MA organization offering an MA–PD plan has paid for such drug is below the pharmacy’s lowest actual acquisition and dispensing costs of such drug. With respect to the requirement under clause (v)(I) for the Secretary to utilize pharmacy acquisition cost data— the Secretary shall utilize pharmacy acquisition cost data described in section 1927(f), relating to a survey of retail prices; and for each covered part D drug not included in the survey described in section 1927(f), the Secretary shall amend the survey or establish a survey. (v)Enforcing any willing provider requirements to support patient choice of pharmacyNot later than September 30, 2024, the Secretary shall require that total payment (including dispensing fees) by a PDP sponsor offering a prescription drug plan or MA organization offering an MA–PD plan for each covered part D drug dispensed to an enrollee by a network pharmacy (including specialty pharmacies (as defined under section 1860D–2(d)(4)(E))), net of any and all price concessions, discounts, fees of any type, incentive payments, or any other form of remuneration, ensures that at a minimum, such payment covers such pharmacy’s costs to acquire and to dispense each covered part D drug so that such pharmacy may have the option to participate as a network provider, which shall include the ability to acquire and dispense covered part D drugs and provide pharmacy services necessary for dispensing such drugs. In carrying out this clause, the Secretary shall— (I)utilize pharmacy acquisition cost data on each type of pharmacy for each covered part D drug (excluding drugs purchased under section 340B of the Public Health Service Act) and cost to dispense data from each type of pharmacy (including pharmacies not otherwise owned, controlled, or affiliated with any other pharmacy, plan, or pharmacy benefit manager); (II)establish payment parameters for each covered part D drug that considers how the drug is dispensed and what pharmacy services are provided by each type of pharmacy to support drug management with the individual for whom the drug is dispensed; and (III)establish an appeal process in which the pharmacy may appeal payment, in writing and with supporting documentation, to the Medicare Pharmaceutical and Technology Ombudsman within 60 days following notification of the payment or any adjustment of such payment of such a drug, if a network pharmacy believes that the amount a PDP offering a prescription drug plan or an MA organization offering an MA–PD plan has paid for such drug is below the pharmacy’s lowest actual acquisition and dispensing costs of such drug. (vi)Utilization of pharmacy acquisition cost dataWith respect to the requirement under clause (v)(I) for the Secretary to utilize pharmacy acquisition cost data— (I)the Secretary shall utilize pharmacy acquisition cost data described in section 1927(f), relating to a survey of retail prices; and (II)for each covered part D drug not included in the survey described in section 1927(f), the Secretary shall amend the survey or establish a survey..

3. Ensuring fair assessment of pharmacy performance and quality Section 1860D–2(d) of the Social Security Act (42 U.S.C. 1395w–102(d)) is amended— in paragraph (1)(B), by striking For purposes and inserting Subject to paragraph (4), for purposes; and by adding at the end the following new paragraph: Not later than 6 months after the date of enactment of this Act, and annually thereafter, the Secretary shall complete an evaluation of the performance measures used by PDP sponsors offering prescription drug plans and MA organizations offering MA–PD plans to assess pharmacy price concessions or any other fees based on performance, as established in network pharmacy agreements. Each such evaluation shall (to the extent practicable) include at least 5 years of retrospective information to examine the following: How measures are being applied to pharmacies, including whether such measures are applied based on the type of pharmacy (including specialty pharmacy), drugs dispensed, and pharmacy services used to dispense and manage drugs. Whether, with respect to each such measure, such measure results in anything of value including any fees, pharmacy price concessions, discounts, or incentives, transferred to or received from a pharmacy by a PDP sponsor offering a prescription drug plan or MA organization offering an MA–PD plan after the point-of-sale of a drug, broken down by type of pharmacy and the drug dispensed. The extent to which each measure is applied across prescription drug plans offered by a PDP sponsor and MA–PD plans offered by an MA organization and if such application is uniform. How measures are applied and if they are uniformly applied to all in-network types of pharmacies or only certain pharmacies within a network. How and when pharmacies are provided notice of measures, as well as methods and actual data calculations used to evaluate performance, and evaluation outcomes by type of pharmacy. How pharmacy performance is evaluated using such measures and the extent to which the goals or targets are— achievable at scale; structured to improve patient outcomes; and reasonable in the context of industry data regarding baseline patient behavior, such as improved patient outcomes and measure performance. For plan years beginning on or after January 1, 2025, a PDP sponsor offering a prescription drug plan or an MA organization offering an MA–PD plan that makes incentive payments to a pharmacy, or receives price concessions or any other remuneration paid by a pharmacy, based on measures of the performance or quality of work of the pharmacy, shall, for the purposes of such incentive payments and price concessions or fees with respect to covered part D drugs dispensed by such pharmacy, only use measures— on the most recently updated list maintained by the Secretary under subparagraph (C), as listed under clause (ii) of such subparagraph; and that are relevant to the performance of such pharmacy based on the type of pharmacy, drugs dispensed, and pharmacy services used to dispense and manage drugs. Notwithstanding any other provision of law, the Secretary shall, taking into account evaluations under subparagraph (A), establish or adopt from one or more multi-stakeholder, neutral, consensus-based measure development organizations representing all types of pharmacies (including pharmacies not otherwise owned, controlled, or affiliated with any other pharmacy, plan, or pharmacy benefit manager) standardized pharmacy quality measures and performance criteria, such as cut points, or any type of payment to be used by a PDP sponsor offering a prescription drug plan and an MA organization offering an MA–PD plan for the purposes of determining incentive payments and price concessions or fees described in subparagraph (B). Such measures shall be evidence-based, feasible, appropriate, and achievable based on industry data, and focus on pharmacy performance and quality of care, as determined by the Secretary, that the pharmacy can impact based on covered part D drugs the pharmacy dispenses and manages. The Secretary shall maintain a single list of measures established or adopted under this subparagraph. Such measures shall be evaluated and such list updated on an ongoing basis through stakeholder consensus organizations representing all types of pharmacies as referenced in clause (i) to ensure the measures on such list are evidence-based, feasible, appropriate, and achievable. Such list shall be published on a public website not later than January 1, 2024, and updated thereafter as appropriate as determined by the Secretary. For plan years beginning on or after January 1, 2025, the Secretary shall establish a uniform process under which a PDP sponsor offering a prescription drug plan and an MA organization offering an MA–PD plan shall promptly disclose, upon receiving a claim for a covered part D drug from a pharmacy, to such pharmacy all pricing components related to such claim, including the Network Reimbursement ID used to price the claim, any service fees and other fees, pharmacy price concessions, discounts, incentives or anything else of value to or from the pharmacy. For purposes of this subparagraph and section 1860D–4(b)(1)(C), not later than December 31, 2024, the Secretary shall define the term specialty pharmacy in consultation with all relevant stakeholders. For purposes of this subparagraph: The term affiliated means, with respect to a pharmacy, a PDP sponsor offering a prescription drug plan, or an MA organization offering an MA–PD plan, that the pharmacy, PDP sponsor, or MA organization— is directly or indirectly through one or more intermediaries wholly or partially owned by, controlled by, or is under common ownership of such pharmacy, PDP sponsor, or MA organization; or has a financial interest in such pharmacy, PDP sponsor, or MA organization. The term type of pharmacy means any type of pharmacy licensed by a State, including a retail pharmacy, specialty pharmacy, and any other type of pharmacy specified by the Secretary. (4)Application of pharmacy performance measures (A)Evaluation of pharmacy performance measuresNot later than 6 months after the date of enactment of this Act, and annually thereafter, the Secretary shall complete an evaluation of the performance measures used by PDP sponsors offering prescription drug plans and MA organizations offering MA–PD plans to assess pharmacy price concessions or any other fees based on performance, as established in network pharmacy agreements. Each such evaluation shall (to the extent practicable) include at least 5 years of retrospective information to examine the following: (i)How measures are being applied to pharmacies, including whether such measures are applied based on the type of pharmacy (including specialty pharmacy), drugs dispensed, and pharmacy services used to dispense and manage drugs. (ii)Whether, with respect to each such measure, such measure results in anything of value including any fees, pharmacy price concessions, discounts, or incentives, transferred to or received from a pharmacy by a PDP sponsor offering a prescription drug plan or MA organization offering an MA–PD plan after the point-of-sale of a drug, broken down by type of pharmacy and the drug dispensed. (iii)The extent to which each measure is applied across prescription drug plans offered by a PDP sponsor and MA–PD plans offered by an MA organization and if such application is uniform. (iv)How measures are applied and if they are uniformly applied to all in-network types of pharmacies or only certain pharmacies within a network. (v)How and when pharmacies are provided notice of measures, as well as methods and actual data calculations used to evaluate performance, and evaluation outcomes by type of pharmacy. (vi)How pharmacy performance is evaluated using such measures and the extent to which the goals or targets are— (I)achievable at scale; (II)structured to improve patient outcomes; and (III)reasonable in the context of industry data regarding baseline patient behavior, such as improved patient outcomes and measure performance. (B)Application of standardized pharmacy performance measuresFor plan years beginning on or after January 1, 2025, a PDP sponsor offering a prescription drug plan or an MA organization offering an MA–PD plan that makes incentive payments to a pharmacy, or receives price concessions or any other remuneration paid by a pharmacy, based on measures of the performance or quality of work of the pharmacy, shall, for the purposes of such incentive payments and price concessions or fees with respect to covered part D drugs dispensed by such pharmacy, only use measures— (i)on the most recently updated list maintained by the Secretary under subparagraph (C), as listed under clause (ii) of such subparagraph; and (ii)that are relevant to the performance of such pharmacy based on the type of pharmacy, drugs dispensed, and pharmacy services used to dispense and manage drugs. (C)Standardized pharmacy performance measures (i)In generalNotwithstanding any other provision of law, the Secretary shall, taking into account evaluations under subparagraph (A), establish or adopt from one or more multi-stakeholder, neutral, consensus-based measure development organizations representing all types of pharmacies (including pharmacies not otherwise owned, controlled, or affiliated with any other pharmacy, plan, or pharmacy benefit manager) standardized pharmacy quality measures and performance criteria, such as cut points, or any type of payment to be used by a PDP sponsor offering a prescription drug plan and an MA organization offering an MA–PD plan for the purposes of determining incentive payments and price concessions or fees described in subparagraph (B). Such measures shall be evidence-based, feasible, appropriate, and achievable based on industry data, and focus on pharmacy performance and quality of care, as determined by the Secretary, that the pharmacy can impact based on covered part D drugs the pharmacy dispenses and manages. (ii)Maintenance of listThe Secretary shall maintain a single list of measures established or adopted under this subparagraph. Such measures shall be evaluated and such list updated on an ongoing basis through stakeholder consensus organizations representing all types of pharmacies as referenced in clause (i) to ensure the measures on such list are evidence-based, feasible, appropriate, and achievable. Such list shall be published on a public website not later than January 1, 2024, and updated thereafter as appropriate as determined by the Secretary. (D)Transparency to pharmacyFor plan years beginning on or after January 1, 2025, the Secretary shall establish a uniform process under which a PDP sponsor offering a prescription drug plan and an MA organization offering an MA–PD plan shall promptly disclose, upon receiving a claim for a covered part D drug from a pharmacy, to such pharmacy all pricing components related to such claim, including the Network Reimbursement ID used to price the claim, any service fees and other fees, pharmacy price concessions, discounts, incentives or anything else of value to or from the pharmacy. (E)Specialty pharmacyFor purposes of this subparagraph and section 1860D–4(b)(1)(C), not later than December 31, 2024, the Secretary shall define the term specialty pharmacy in consultation with all relevant stakeholders. (F)DefinitionsFor purposes of this subparagraph: (i)AffiliatedThe term affiliated means, with respect to a pharmacy, a PDP sponsor offering a prescription drug plan, or an MA organization offering an MA–PD plan, that the pharmacy, PDP sponsor, or MA organization— (I) is directly or indirectly through one or more intermediaries wholly or partially owned by, controlled by, or is under common ownership of such pharmacy, PDP sponsor, or MA organization; or (II)has a financial interest in such pharmacy, PDP sponsor, or MA organization. (ii)Type of pharmacyThe term type of pharmacy means any type of pharmacy licensed by a State, including a retail pharmacy, specialty pharmacy, and any other type of pharmacy specified by the Secretary..

4. Encouraging use of pharmacy performance measures through quality ratings Section 1853(o)(4)(A) of the Social Security Act (42 U.S.C. 1395w–23(o)(4)(A)) is amended— by striking determination.—The quality and inserting determination.— Subject to clause (ii), the quality by adding at the end the following new clause: In the case of a plan described in subclause (II), with respect to the determination of quality ratings on or after January 1, 2024, the Secretary shall provide for an increase in the quality rating otherwise determined under clause (i) in a manner determined appropriate by the Secretary. For purposes of subclause (I), a plan described in this subclause is a prescription drug plan offered by a PDP sponsor or an MA–PD plan offered by an MA organization that makes incentive payments to a pharmacy, or receives price concessions or any other remuneration paid by a pharmacy, based on measures of the performance or quality of work of the pharmacy. (i)In generalSubject to clause (ii), the quality; and (ii)Encouraging use of pharmacy performance measures (I)In generalIn the case of a plan described in subclause (II), with respect to the determination of quality ratings on or after January 1, 2024, the Secretary shall provide for an increase in the quality rating otherwise determined under clause (i) in a manner determined appropriate by the Secretary. (II)Plan describedFor purposes of subclause (I), a plan described in this subclause is a prescription drug plan offered by a PDP sponsor or an MA–PD plan offered by an MA organization that makes incentive payments to a pharmacy, or receives price concessions or any other remuneration paid by a pharmacy, based on measures of the performance or quality of work of the pharmacy..