Vertical integration accountability

(a) Required MA and PDP reporting (1) MA plans 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: (6) Required disclosure of certain information relating to health care provider ownership (A) In general For plan year 2028 and for every third plan year thereafter, each applicable MA organization offering an MA plan under this part during such plan year shall submit to the Secretary, at a time and in a manner specified by the Secretary— (i) the taxpayer identification number for each health care provider that was a specified health care provider with respect to such organization during such year; (ii) the total amount of incentive-based payments made with respect to such plan year to such specified health care providers that have in effect a financial risk arrangement with respect to such plan year; (iii) the total amount of recoupments collected with respect to such plan year from such specified health care providers that have in effect a financial risk arrangement with respect to such plan year; (iv) the total amount of incentive-based payments made with respect to such plan year to providers of services and suppliers not that are not specified health care providers and that have in effect a financial risk arrangement with respect to such plan year; and (v) the total amount of recoupments collected with respect to such plan year from such providers of services and suppliers that have in effect a financial risk arrangement with respect to such plan year. (B) Definitions For purposes of this paragraph: (i) Applicable MA organization The term applicable MA organization means, with respect to a plan year, an MA organization with at least 25,000 individuals enrolled across all Medicare Advantage plans offered by such organization during such plan year. (ii) Specified health care provider The term specified health care provider means, with respect to an applicable MA organization and a plan year, a provider of services or supplier that— (I) is owned by, controlled by, or related under a common ownership structure with such MA organization; (II) has in effect a contract solely with such organization (or with an entity owned by, controlled by, or related under a common ownership structure with such organization (or that has in effect any comparable arrangement with such organization)) for furnishing items and services; (III) is a partner under a partnership (as defined in section 7701(a)(2) of the Internal Revenue Code of 1986) with such organization (or with any an entity owned by, controlled by, or related under a common ownership structure with such organization); or (IV) through contract, ownership, or otherwise— (aa) directly or indirectly controls, is controlled by, or is under common ownership with such organization (or with an entity owned by, controlled by, or related under a common ownership structure with such organization); (bb) is part of a controlled group of corporations under section 1563 of the Internal Revenue Code of 1986 with such organization (or with any such entity); (cc) is a participant in a lawful combination under which such provider or supplier shares substantial financial risk in connection with such organization’s operations (or with the operations of any such entity); or (dd) part of an affiliated service group under section 414 of such Code with such organization (or with any such entity).. (2) Prescription drug plans Section 1860D–12(b) of the Social Security Act (42 U.S.C. 1395w–112(b)) is amended by adding at the end the following new paragraph: (9) Provision of information relating to pharmacy ownership (A) In general For plan year 2028 and for every third plan year thereafter, each PDP sponsor offering a prescription drug plan under this part during such plan year shall submit to the Secretary, at a time and in a manner specified by the Secretary, the taxpayer identification number and National Provider Identifier for each pharmacy that was a specified pharmacy with respect to such plan during such year. (B) Definition For purposes of this paragraph, the term specified pharmacy means, with respect to a prescription drug plan offered by a PDP sponsor and a plan year, a pharmacy that— (i) is owned by, controlled by, or related under a common ownership structure with such sponsor; (ii) has in effect a contract solely with such sponsor (or with an entity owned by, controlled by, or related under a common ownership structure with such sponsor (or that has in effect any comparable arrangement with such sponsor)) for dispensing covered part D drugs; (iii) is a partner under a partnership (as defined in section 7701(a)(2) of the Internal Revenue Code of 1986) with such sponsor (or with any an entity owned by, controlled by, or related under a common ownership structure with such sponsor); or (iv) through contract, ownership, or otherwise— (I) directly or indirectly controls, is controlled by, or is under common ownership with such sponsor (or with an entity owned by, controlled by, or related under a common ownership structure with such sponsor); (II) is part of a controlled group of corporations under section 1563 of the Internal Revenue Code of 1986 with such sponsor (or with any such entity); (III) is a participant in a lawful combination under which such provider or supplier shares substantial financial risk in connection with such sponsor’s operations (or with the operations of any such sponsor); or (IV) part of an affiliated service group under section 414 of such Code with such sponsor (or with any such entity).. (b) Reports on vertical integration under Medicare (1) In general Not later than the first June 15 occurring on or after the date that is 2 years after the Secretary of Health and Human Services first makes available information submitted under sections 1857(e)(6) and 1860D–12(b)(9) of the Social Security Act (as added by paragraphs (1) and (2), respectively, of subsection (a)) to the Medicare Payment Advisory Commission, and again not later than 4 years after the first report is submitted under this paragraph, the Medicare Payment Advisory Commission shall submit to Congress a report on the state of vertical integration in the health care sector during the applicable year with respect to entities participating in the Medicare program under part C of title XVIII of the Social Security Act (42 U.S.C. 1395w–21 et seq.) or part D of such title (42 U.S.C. 1395w–101 et seq.), including health care providers, pharmacies, prescription drug plan sponsors, Medicare Advantage organizations, and pharmacy benefit managers. Such report shall include, to the extent practicable— (A) with respect to Medicare Advantage organizations, the evaluation described in paragraph (2); (B) with respect to prescription drug plans, pharmacy benefit managers, and pharmacies, the comparisons and summary described in paragraph (3); (C) an assessment of the Medicare Advantage organization and PDP sponsor integration information described in paragraph (4); and (D) an analysis of the impact of such integration on health care access, price, quality, and outcomes. (2) Medicare Advantage organizations For purposes of paragraph (1)(A), the evaluation described in this paragraph is, with respect to Medicare Advantage organizations and an applicable year, an evaluation, taking into account patient acuity and the types of areas serviced by such organization, of— (A) the average number of qualifying diagnoses made during such year with respect to enrollees of a Medicare Advantage plan offered by such organization who, during such year, received a health risk assessment from a specified health care provider, compared to the average number of such diagnoses made during such year with respect to enrollees of such plan who, during such year, did not receive such an assessment from such a provider; (B) the average risk score for enrollees of a Medicare Advantage plan who received such an assessment from a specified health care provider during such year compared to the average risk score for enrollees of such plan who did not receive such an assessment from such a provider during such year; (C) any relationship between risk scores for such enrollees receiving such an assessment from such a provider during such year and incentive-based payments made to such providers; (D) the average risk score for enrollees of such plan who received any item or service from a specified health care provider during such year compared to the average risk score for enrollees of such plan who did not receive any item or service from such a provider during such year; (E) any relationship between the risk scores of enrollees under such plan and whether the enrollees have received any item or service from a specified provider; and (F) any relationship between the risk scores of enrollees under such plan that have received any item or service from a specified provider and incentive-based payments made under the plan to specified providers. (3) Prescription drug plans For purposes of paragraph (1)(B), the comparisons and summary described in this paragraph are, with respect to prescription drug plans and an applicable year, the following: (A) For each covered part D drug for which benefits are available under such a plan, a comparison of information about payments submitted with respect to such plan under section 1860D–12(h)(1)(C)(i)(I) of the Social Security Act (42 U.S.C. 1395w–112(h)(1)(C)(i)(I)) with respect to specified pharmacies with the same such information about payments submitted by such plan with respect to in-network pharmacies that are not specified pharmacies. (B) Comparisons of the following: (i) The total amount paid by pharmacy benefit managers to specified pharmacies for covered part D drugs and the total amount so paid to pharmacies that are not specified pharmacies for such drugs. (ii) The total amount paid by such sponsors to specified pharmacy benefit managers as reimbursement for covered part D drugs and the total amount so paid to pharmacy benefit managers that are not specified pharmacy benefit managers as such reimbursement. (C) A summary of the total manufacturer-derived revenue retained by pharmacy benefit managers and any affiliates of such pharmacy benefit managers (as reported under section 1860D–12(h)(1)(C)(i)(I)(kk) of the Social Security Act (42 U.S.C. 1395w–112(h)(1)(C)(i)(I)(kk)). (4) Medicare Advantage organization and PDP sponsor integration information For purposes of paragraph (1)(C), the Medicare Advantage organization and PDP sponsor integration information described in this paragraph is information submitted under sections 1857(e)(6) and 1860D–12(b)(9) of the Social Security Act (as added by paragraphs (1) and (2), respectively, of subsection (a)) and section1860D–12(h) of such Act (42 U.S.C. 1395w–112(h)). (5) Definitions In this subsection: (A) Applicable year The term applicable year means— (i) with respect to the first report submitted under paragraph (1), plan year 2028; and (ii) with respect to the second report submitted under paragraph (1), plan year 2031. (B) Covered part D drug The term covered part D drug has the meaning given such term in section 1860D–2(e) of the Social Security Act (42 U.S.C. 1395w–102(e)). (C) Qualifying diagnosis The term qualifying diagnosis means, with respect to an enrollee of a Medicare Advantage plan, a diagnosis that is taken into account in calculating a risk score for such enrollee under the risk adjustment methodology established by the Secretary pursuant to section 1853(a)(3) of the Social Security Act (42 U.S.C. 1305w–23(a)(3)). (D) Risk score The term risk score means, with respect to an enrollee of a Medicare Advantage plan, the score calculated for such individual using the methodology described in subparagraph (E). (E) Specified health care provider The term specified health care provider means, with respect to a Medicare Advantage plan offered by a Medicare Advantage organization, a health care provider that— (i) is owned by, controlled by, or related under a common ownership structure with such organization; (ii) has in effect a contract solely with such organization (or with an entity owned by, controlled by, or related under a common ownership structure with such organization (or that has in effect any comparable arrangement with such organization)) for furnishing items and services; (iii) is a partner under a partnership (as defined in section 7701(a)(2) of the Internal Revenue Code of 1986) with such organization (or with any an entity owned by, controlled by, or related under a common ownership structure with such organization); or (iv) through contract, ownership, or otherwise— (I) directly or indirectly controls, is controlled by, or is under common ownership with such organization (or with an entity owned by, controlled by, or related under a common ownership structure with such organization); (II) is part of a controlled group of corporations under section 1563 of the Internal Revenue Code of 1986 with such organization (or with any such entity); (III) is a participant in a lawful combination under which such provider or supplier shares substantial financial risk in connection with such organization’s operations (or with the operations of any such entity); or (IV) part of an affiliated service group under section 414 of such Code with such organization (or with any such entity). (F) Specified pharmacy The term specified pharmacy means, with respect to a prescription drug plan offered by a prescription drug plan sponsor, a pharmacy that— (i) is owned by, controlled by, or related under a common ownership structure with such sponsor; (ii) has in effect a contract solely with such sponsor (or with an entity owned by, controlled by, or related under a common ownership structure with such sponsor (or that has in effect any comparable arrangement with such sponsor)) for dispensing covered part D drugs; (iii) is a partner under a partnership (as defined in section 7701(a)(2) of the Internal Revenue Code of 1986) with such sponsor (or with any an entity owned by, controlled by, or related under a common ownership structure with such sponsor); or (iv) through contract, ownership, or otherwise— (I) directly or indirectly controls, is controlled by, or is under common ownership with such sponsor (or with an entity owned by, controlled by, or related under a common ownership structure with such sponsor); (II) is part of a controlled group of corporations under section 1563 of the Internal Revenue Code of 1986 with such sponsor (or with any such entity); (III) is a participant in a lawful combination under which such provider or supplier shares substantial financial risk in connection with such sponsor’s operations (or with the operations of any such entity); or (IV) part of an affiliated service group under section 414 of such Code with such sponsor (or with any such entity). (G) Specified pharmacy benefit manager The term specified pharmacy benefit manager means, with respect to a prescription drug plan offered by a prescription drug plan sponsor, a pharmacy benefit manager that— (i) is owned by, controlled by, or related under a common ownership structure with such sponsor; (ii) has in effect a contract solely with such sponsor (or with an entity owned by, controlled by, or related under a common ownership structure with such sponsor (or that has in effect any comparable arrangement with such sponsor)) for furnishing pharmacy benefit management services; (iii) is a partner under a partnership (as defined in section 7701(a)(2) of the Internal Revenue Code of 1986) with such sponsor (or with any an entity owned by, controlled by, or related under a common ownership structure with such sponsor); or (iv) through contract, ownership, or otherwise— (I) directly or indirectly controls, is controlled by, or is under common ownership with such sponsor (or with an entity owned by, controlled by, or related under a common ownership structure with such sponsor); (II) is part of a controlled group of corporations under section 1563 of the Internal Revenue Code of 1986 with such sponsor (or with any such entity); (III) is a participant in a lawful combination under which such provider or supplier shares substantial financial risk in connection with such sponsor’s operations (or with the operations of any such entity); or (IV) part of an affiliated service group under section 414 of such Code with such sponsor (or with any such entity).