Prohibition on discriminatory practices and contracting

(a) In general Part A of title XXVII of the Public Health Service Act (42 U.S.C. 300gg et seq.) is amended by inserting after section 2729 (42 U.S.C. 300gg-19b) the following: 2730. Anti-discrimination and permissible 340b arrangements (a) In general A group health plan, a health insurance issuer offering group or individual health insurance coverage, or a pharmacy benefit manager may not discriminate against a covered entity (as defined in section 340B(a)(4)) or a contract pharmacy (as defined in section 340B(b)(5)), or a participant, beneficiary, or enrollee of such plan or coverage by imposing requirements, exclusions, reimbursement terms, or other conditions on such entity or pharmacy that differ from those applied to entities or pharmacies that are not covered entities or contract pharmacies on the basis that the entity or pharmacy is a covered entity or contract pharmacy or that the entity or pharmacy dispenses covered outpatient drugs (as defined in section 1927(k) of the Social Security Act), including by taking any action prohibited under subsection (b). (b) Specified prohibited actions A group health plan, a health insurance issuer offering group or individual health insurance coverage, or a pharmacy benefit manager may not discriminate against a covered entity, a contract pharmacy, or a participant or beneficiary in a group health plan or health insurance offered by a health insurance issuer offering group or individual health insurance by doing any of the following: (1) Reimbursing a covered entity or contract pharmacy for a quantity of a covered outpatient drug purchased under section 340B in an amount less than such plan, issuer, or pharmacy benefit manager, as applicable, would pay to any other similarly situated (as specified by the Secretary through notice and comment rulemaking) entity or pharmacy that is not a covered entity or a contract pharmacy for such quantity of such drug on the basis that the entity or pharmacy is a covered entity or contract pharmacy or that the entity or pharmacy dispenses covered outpatient drugs purchased under section 340B. (2) Imposing any terms or conditions on covered entities or contract pharmacies with respect to any of the following that differ from such terms or conditions applied to other similarly situated entities or pharmacies that are not covered entities or contract pharmacies on the basis that the entity or pharmacy is a covered entity or contract pharmacy or that the entity or pharmacy dispenses covered outpatient drugs purchased under this section— (A) fees, chargebacks, clawbacks, adjustments, or other assessments; (B) professional dispensing fees; (C) restrictions or requirements regarding participation in standard or preferred pharmacy networks; (D) requirements relating to the frequency or scope of audits or to inventory management systems using generally accepted accounting principles; or (E) any other restrictions, conditions, practices, or policies that, as specified by the Administrator of the Health Resources and Services Administration through notice and comment rulemaking, interfere with the ability of a covered entity to maximize the value of discounts provided under section 340B. (3) Interfering with an individual’s choice to receive a drug purchased under Section 340B from a covered entity or contract pharmacy, whether in person or via direct delivery, mail, or other form of shipment. (4) Requiring a covered entity or specified pharmacy to identify, either directly or through a third party, covered outpatient drug purchased under the 340B program. Other than through the 340B Data Clearinghouse established at section 1150D. (5) Refusing to contract with a covered entity or contract pharmacy for reasons other than those that apply equally to entities or pharmacies that are not covered entities or contract pharmacies, or on the basis that the covered entity is described in section 340B(a)(4). (6) Denying coverage of a covered outpatient drug purchased under the 340B program on the basis of its status as a 340B eligible drug if the group health plan or health insurance issuer otherwise covers the identical drug not purchased under 340B. (c) Prohibition A group health plan, a health insurance issuer offering group or individual health insurance coverage, or a pharmacy benefit manager may not enter into a contract or other agreement, or any other arrangement regardless of whether such arrangement is memorialized in writing, with a covered entity (as defined in section 340B(a)(4)) in which the covered entity provides a share of any discount or savings for a covered outpatient drug under section 340B to the group health plan, health insurance issuer, or pharmacy benefit manager, and may not condition network participation, preferred formulary placement, claim routing, or any other benefit on the covered entity’s agreement to share any such discount or savings. (d) Enforcement mechanism The Secretary shall impose a civil monetary penalty on any pharmacy benefit manager that violates the requirements of this section. Such penalty shall not exceed $5,000 per violation per day. The Secretary shall issue proposed regulations to implement this subsection not later than 60 days after the date of the enactment of this subsection and shall finalize such regulations not later than 180 days after such date of enactment.. (b) SSA Section 1860D(12) of the Social Security Act (42 U.S.C. 1395w–112) is amended by adding at the end the following new subsection: (i) Nondiscrimination PDP sponsors may not include any provision in a prescription drug plan that requires covered entities under Section 340B of the Public Health Service Act to make use of contract pharmacy sites that do not meet the requirements set forth in Section 340B for the use of contract pharmacies or are otherwise inconsistent with patient need and access.. (c) 340B Section 340B of the Public Health Service Act (42 U.S.C. 256b), as amended, is amended by adding at the end the following new subsection: (i) Permitted third party administrator arrangements (1) A covered entity under this section may only contract with a third-party administrator for the purposes of administering the dispensing of covered drugs under this section if compensation for the third-party administrator is in the form of bona fide services fees. (2) Bona fide service fees as described in paragraph (1) may not be determined as a percentage of revenue to the covered entity for covered drugs under this section or by any other metric tied to revenue for covered drugs to the covered entity or volume of covered drugs dispensed by the covered entity. (3) HRSA may, pursuant to standards established through notice and comment rulemaking, levy Civil Monetary Penalties upon covered entities for knowing and intentional non-compliance with requirements under paragraphs (1) and (2).. (d) Conforming amendments (1) Employee retirement income security act (erisa) Section 715(a)(1) of ERISA (29 U.S.C. 1185d(a)(1)) is amended by inserting and subsequent legislation after as amended by the Patient Protection and Affordable Care Act. (2) Internal revenue code Section 9815(a)(1) of the Internal Revenue Code of 1986 (26 U.S.C. 9815(a)(1)) is amended by inserting and subsequent legislation after as amended by the Patient Protection and Affordable Care Act.