Codifying value-based purchasing arrangements under Medicaid and reforms related to price reporting under such arrangements

(a) Codifying multiple best price points (1) In general Section 1927(c)(1)(C)(ii) of the Social Security Act (42 U.S.C. 1396r–8(c)(1)(C)(ii)) is amended— (A) in subclause (III), by adding a semicolon at the end; (B) in subclause (IV), by striking and at the end; (C) in subclause (V), by striking the period and inserting; and; and (D) by adding at the end the following new subclause: (VI) may include multiple best price points for a single dosage form and strength of a drug of a manufacturer subject to a value-based purchasing arrangement (as defined in subsection (k)(12)), but only if such manufacturer offers such arrangement to all States.. (2) Rule of construction Nothing in the amendments made by this subsection may be construed to prohibit a manufacturer from treating a value-based purchasing arrangement as a bundled sale. (b) Definition of average manufacturer price (1) In general Section 1927(k)(1) of the Social Security Act (42 U.S.C. 1396r–8(k)(1)) is amended— (A) in subparagraph (B)(i)— (i) in subclause (IV), by adding a semicolon at the end; (ii) in subclause (VII), by striking at the end and; (iii) in subclause (VIII), by striking the period at the end and inserting; and; and (iv) by adding at the end the following new subclause: (IX) with respect to a covered outpatient drug that is sold under a value-based purchasing arrangement (as defined in paragraph (12)) during the rebate period, including such a drug that is an inhalation, infusion, instilled, implanted, or injectable drug that is not generally dispensed through a retail community pharmacy— (aa) a refund, rebate, reimbursement, or free goods from the manufacturer or third party on behalf of the manufacturer; or (bb) the withholding or reduction of a payment to the manufacturer or third party on behalf of the manufacturer; that is triggered by a patient who fails to achieve outcomes or measures defined under the terms of such value-based purchasing arrangement during the period for which such arrangement is effective.; and (B) by adding at the end the following new subparagraph: (D) Special rule for certain value-based purchasing arrangements For purposes of subparagraph (A), in determining the average price paid to a manufacturer for a covered outpatient drug that is sold under a value-based purchasing arrangement (as defined in paragraph (12)) that provides that payment for such drug is made in installments over the course of such arrangement, such price shall be determined as if the aggregate price per the terms of the arrangement were paid in full in the first installment during the rebate period.. (2) Rulemaking Not later than 180 days after the date of the enactment of this Act, the Secretary of Health and Human Services shall implement the amendments made by this subsection through rulemaking. (c) Definition of value-Based purchasing arrangement Section 1927(k) of the Social Security Act (42 U.S.C. 1396r–8(k)) is amended by adding at the end the following paragraph: (12) Value-Based Purchasing Arrangement The term value-based purchasing arrangement has the meaning given such term in section 447.502 of title 42, Code of Federal Regulations (or any successor regulation)..