PBM Oversight Act of 2023
This bill requires prescription drug plan (PDP) sponsors under the Medicare prescription drug benefit to report certain information about the involvement of affiliated committees in decisions about formularies.
Specifically, PDP sponsors that use formularies must report to the Centers for Medicare & Medicaid Services the names and descriptions of committees that are affiliated with the PDP sponsor, or a contracted pharmacy benefit manager, that are authorized to change initial recommendations of the pharmacy and therapeutic committee about formularies. PDP sponsors must also report any formulary changes that were made by an affiliated committee and provide justifications for these decisions.
The Government Accountability Office must report on the use of these types of committees with respect to formularies under the Medicare prescription drug benefit, including decision-making trends.
[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 2406 Introduced in Senate (IS)]
<DOC>
118th CONGRESS
1st Session
S. 2406
To amend title XVIII of the Social Security Act to improve oversight of
formulary development and management under Medicare part D.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
July 20, 2023
Mr. Carper (for himself and Mr. Grassley) introduced the following
bill; which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend title XVIII of the Social Security Act to improve oversight of
formulary development and management under Medicare part D.
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 ``PBM Oversight Act of 2023''.
SEC. 2. RESOLVING CONFLICTS OF INTEREST AND IMPROVING OVERSIGHT OF P&T
COMMITTEE OVERRIDES.
(a) In General.--Section 1860D-4(b)(3) of the Social Security Act
(42 U.S.C. 1395w-104(b)(3)) is amended--
(1) in subparagraph (A)(ii)(I), by inserting the following
before the semicolon: ``(and, for 2025 and each subsequent
year, any pharmacy benefit manager)''; and
(2) by adding at the end the following new subparagraph:
``(J) Reporting on additional committees with
formulary decision making authority.--
``(i) In general.--For 2026 and each
subsequent plan year, a PDP sponsor shall
submit to the Secretary the following
information, if applicable, with respect to
each prescription drug plan offered by the PDP
sponsor:
``(I) The name and a description of
the role and composition of any
committee, entity, or individual within
or affiliated with the PDP sponsor (or
a pharmacy benefit manager, acting
under contract with such sponsor) that
has the authority to make a coverage,
formulary placement, or utilization
management decision (as defined in
clause (ii)(I)), other than the
pharmacy and therapeutic committee
described in subparagraph (A).
``(II) A list of drugs for which a
committee, entity, or individual
described in subclause (I) made a
coverage, formulary placement, or
utilization management decision (as so
defined) and the corresponding initial
recommendation (as defined in clause
(ii)(II)) made by the pharmacy and
therapeutic committee.
``(III) A brief justification for
each decision described in subclause
(II).
``(ii) Definitions.--In this subparagraph:
``(I) Coverage, formulary
placement, or utilization management
decision.--The term `coverage,
formulary placement, or utilization
management decision' means a decision
by a committee, entity, or individual
described in clause (i)(I) that
modifies, adjusts, reverses, or
otherwise alters (such as by
substituting the formulary inclusion of
one covered part D drug for another or
by substituting a more general initial
recommendation for a more specific
decision) an initial recommendation by
the pharmacy and therapeutic committee.
``(II) Initial recommendation.--The
term `initial recommendation' means a
coverage, formulary placement, or
utilization management decision
recommended by the pharmacy and
therapeutic committee prior to the
review, adoption, or modification of
such a recommendation by a committee,
entity, or individual described in
clause (i)(I). For purposes of this
subparagraph, such initial
recommendation shall be considered to
be separate and distinct from the final
review and approval of the formulary
design and components by such pharmacy
and therapeutic committee, as required
under section 423.120 of title 42, Code
of Federal Regulations (or any
successor regulation).
``(iii) Non-application of paperwork
reduction act.--Chapter 35 of title 44, United
States Code, shall not apply to information
required for purposes of carrying out this
subparagraph.''.
(b) Implementation.--Notwithstanding any other provision of law,
the Secretary of Health and Human Services may implement the amendments
made by subsection (a) by program instruction or otherwise.
(c) GAO Study and Report.--
(1) Study.--The Comptroller General shall conduct a study
on the use of committees, entities, or individuals described in
clause (i)(I) of section 1860D-4(b)(3)(J) of the Social
Security Act, as added by subsection (a), in the development
and review of formularies under part D of title XVIII of the
Social Security Act. Such study shall include an analysis of
the following:
(A) The prevalence of such committees, entities, or
individuals.
(B) The number, type, and characteristics of drugs
for which a committee, entity, or individual described
in such clause (i)(I) made a coverage, formulary
placement, or utilization management decision (as
defined in clause (ii)(I) of such section 1860D-
4(b)(3)(J)).
(C) Trends in the justifications provided under
clause (i)(III) of such section 1860D-4(b)(3)(J).
(D) Trends in the application of utilization
management tools (such as prior authorization, step
therapy, and quantity limits) and formulary exclusions
under prescription drug plans and MA-PD plans and the
impact such tools and exclusions have on beneficiary
access to covered part D drugs.
(2) Report.--Not later than January 1, 2029, the
Comptroller General shall submit to Congress a report
containing the results of the study conducted under paragraph
(1), together with any recommendations for such legislation and
administrative action as the Comptroller General determines
appropriate.
(3) Definitions.--In this subsection:
(A) Comptroller general.--The term ``Comptroller
General'' means the Comptroller General of the United
States.
(B) Other terms.--The terms ``covered part D
drug'', ``MA-PD plan'', and ``prescription drug plan''
have the meaning given those terms in section 1860D-41
of the Social Security Act (42 U.S.C. 1395w-151).
<all>
Introduced in Senate
Read twice and referred to the Committee on Finance.
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