Sec. 11101. Medicare part B rebate by manufacturers
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Section 1847A of the Social Security Act ( 42 U.S.C. 1395w–3a ) is amended by redesignating subsection
(i)as subsection
(j)and by inserting after subsection
(h)the following subsection: Not later than 6 months after the end of each calendar quarter beginning on or after January 1, 2023, the Secretary shall, for each part B rebatable drug, report to each manufacturer of such part B rebatable drug the following for such calendar quarter: Information on the total number of units of the billing and payment code described in subparagraph (A)(i) of paragraph
(3)with respect to such drug and calendar quarter. Information on the amount (if any) of the excess average sales price increase described in subparagraph (A)(ii) of such paragraph for such drug and calendar quarter. The rebate amount specified under such paragraph for such part B rebatable drug and calendar quarter. For each calendar quarter beginning on or after January 1, 2023, the manufacturer of a part B rebatable drug shall, for such drug, not later than 30 days after the date of receipt from the Secretary of the information described in subparagraph
(A)for such calendar quarter, provide to the Secretary a rebate that is equal to the amount specified in paragraph
(3)for such drug for such calendar quarter. The Secretary may, for each part B rebatable drug, delay the timeframe for reporting the information described in subparagraph
(A)for calendar quarters beginning in 2023 and 2024 until not later than September 30, 2025. In this subsection, the term part B rebatable drug means a single source drug or biological (as defined in subparagraph
(D)of subsection (c)(6)), including a biosimilar biological product (as defined in subparagraph
(H)of such subsection) but excluding a qualifying biosimilar biological product (as defined in subsection (b)(8)(B)(iii)), for which payment is made under this part, except such term shall not include such a drug or biological— if, as determined by the Secretary, the average total allowed charges for such drug or biological under this part for a year per individual that uses such a drug or biological are less than, subject to subparagraph (B), $100; or that is a vaccine described in subparagraph
(A)or
(B)of section 1861(s)(10). The dollar amount applied under subparagraph (A)(i)— for 2024, shall be the dollar amount specified under such subparagraph for 2023, increased by the percentage increase in the consumer price index for all urban consumers (United States city average) for the 12-month period ending with June of the previous year; and for a subsequent year, shall be the dollar amount specified in this clause (or clause (i)) for the previous year (without application of subparagraph (C)), increased by the percentage increase in the consumer price index for all urban consumers (United States city average) for the 12-month period ending with June of the previous year. Any dollar amount determined under subparagraph
(B)that is not a multiple of $10 shall be rounded to the nearest multiple of $10. For purposes of paragraph (1), the amount specified in this paragraph for a part B rebatable drug assigned to a billing and payment code for a calendar quarter is, subject to subparagraphs
(B)and
(G)and paragraph (4), the estimated amount equal to the product of— the total number of units determined under subparagraph
(B)for the billing and payment code of such drug; and the amount (if any) by which— the amount equal to— in the case of a part B rebatable drug described in paragraph (1)(B) of subsection (b), 106 percent of the amount determined under paragraph
(4)of such section for such drug during the calendar quarter; or in the case of a part B rebatable drug described in paragraph (1)(C) of such subsection, the payment amount under such paragraph for such drug during the calendar quarter; exceeds the inflation-adjusted payment amount determined under subparagraph
(C)for such part B rebatable drug during the calendar quarter. For purposes of subparagraph (A)(i), the total number of units for the billing and payment code with respect to a part B rebatable drug furnished during a calendar quarter described in subparagraph
(A)is equal to— the number of units for the billing and payment code of such drug furnished during such calendar quarter, minus the number of units for such billing and payment code of such drug furnished during such calendar quarter— with respect to which the manufacturer provides a discount under the program under section 340B of the Public Health Service Act or a rebate under section 1927; or that are packaged into the payment amount for an item or service and are not separately payable. The inflation-adjusted payment amount determined under this subparagraph for a part B rebatable drug for a calendar quarter is— the payment amount for the billing and payment code for such drug in the payment amount benchmark quarter (as defined in subparagraph (D)); increased by the percentage by which the rebate period CPI–U (as defined in subparagraph (F)) for the calendar quarter exceeds the benchmark period CPI–U (as defined in subparagraph (E)). The term payment amount benchmark quarter means the calendar quarter beginning July 1, 2021. The term benchmark period CPI–U means the consumer price index for all urban consumers (United States city average) for January 2021. The term rebate period CPI–U means, with respect to a calendar quarter described in subparagraph (C), the greater of the benchmark period CPI–U and the consumer price index for all urban consumers (United States city average) for the first month of the calendar quarter that is two calendar quarters prior to such described calendar quarter. The Secretary shall reduce or waive the amount under subparagraph
(A)with respect to a part B rebatable drug and a calendar quarter— in the case of a part B rebatable drug that is described as currently in shortage on the shortage list in effect under section 506E of the Federal Food, Drug, and Cosmetic Act at any point during the calendar quarter; or in the case of a biosimilar biological product, when the Secretary determines there is a severe supply chain disruption during the calendar quarter, such as that caused by a natural disaster or other unique or unexpected event. In the case of a part B rebatable drug first approved or licensed by the Food and Drug Administration after December 1, 2020, clause
(i)of paragraph (3)(C) shall be applied as if the term payment amount benchmark quarter were defined under paragraph (3)(D) as the third full calendar quarter after the day on which the drug was first marketed and clause
(ii)of paragraph (3)(C) shall be applied as if the term benchmark period CPI–U were defined under paragraph (3)(E) as if the reference to January 2021 under such paragraph were a reference to the first month of the first full calendar quarter after the day on which the drug was first marketed . In the case of a part B rebatable drug first approved or licensed by the Food and Drug Administration after December 1, 2020, paragraph (1)(B) shall be applied as if the reference to January 1, 2023 under such paragraph were a reference to the later of the 6th full calendar quarter after the day on which the drug was first marketed or January 1, 2023 . In the case of a part B rebatable drug that is a selected drug (as defined in section 1192(c)) with respect to a price applicability period (as defined in section 1191(b)(2)), in the case such drug is no longer considered to be a selected drug under section 1192(c), for each applicable period (as defined under subsection (g)(7)) beginning after the price applicability period with respect to such drug, clause
(i)of paragraph (3)(C) shall be applied as if the term payment amount benchmark quarter were defined under paragraph (3)(D) as the calendar quarter beginning January 1 of the last year during such price applicability period with respect to such selected drug and clause
(ii)of paragraph (3)(C) shall be applied as if the term benchmark period CPI–U were defined under paragraph (3)(E) as if the reference to January 2021 under such paragraph were a reference to the July of the year preceding such last year . In the case of a part B rebatable drug furnished on or after April 1, 2023, if the payment amount described in paragraph (3)(A)(ii)(I) (or, in the case of a part B rebatable drug that is a selected drug (as defined in section 1192(c)), the payment amount described in subsection (b)(1)(B) for such drug) for a calendar quarter exceeds the inflation adjusted payment for such quarter— in computing the amount of any coinsurance applicable under this part to an individual to whom such drug is furnished, the computation of such coinsurance shall be equal to 20 percent of the inflation-adjusted payment amount determined under paragraph (3)(C) for such part B rebatable drug; and the amount of such coinsurance for such calendar quarter, as computed under subparagraph (A), shall be applied as a percent, as determined by the Secretary, to the payment amount that would otherwise apply under subparagraphs
(B)or
(C)of subsection (b)(1). Amounts paid as rebates under paragraph (1)(B) shall be deposited into the Federal Supplementary Medical Insurance Trust Fund established under section 1841. If a manufacturer of a part B rebatable drug has failed to comply with the requirements under paragraph (1)(B) for such drug for a calendar quarter, the manufacturer shall be subject to, in accordance with a process established by the Secretary pursuant to regulations, a civil money penalty in an amount equal to at least 125 percent of the amount specified in paragraph
(3)for such drug for such calendar quarter. The provisions of section 1128A (other than subsections
(a)(with respect to amounts of penalties or additional assessments) and (b)) shall apply to a civil money penalty under this paragraph in the same manner as such provisions apply to a penalty or proceeding under section 1128A(a). There shall be no administrative or judicial review of any of the following: The determination of units under this subsection. The determination of whether a drug is a part B rebatable drug under this subsection. The calculation of the rebate amount under this subsection. The computation of coinsurance under paragraph
(5)of this subsection. The computation of amounts paid under section 1833(a)(1)(EE). . Section 1833 of the Social Security Act ( 42 U.S.C. 1395l ) is amended— in subsection (a)(1)— in subparagraph (G), by inserting , subject to subsection (i)(9), after the amounts paid ; in subparagraph (S), by striking with respect to and inserting subject to subparagraph (EE), with respect to ; by striking and
(DD)and inserting
(DD); and by inserting before the semicolon at the end the following: , and
(EE)with respect to a part B rebatable drug (as defined in paragraph
(2)of section 1847A(i)) furnished on or after April 1, 2023, for which the payment amount for a calendar quarter under paragraph (3)(A)(ii)(I) of such section (or, in the case of a part B rebatable drug that is a selected drug (as defined in section 1192(c) for which, the payment amount described in section 1847A(b)(1)(B)) for such drug for such quarter exceeds the inflation-adjusted payment under paragraph (3)(A)(ii)(II) of such section for such quarter, the amounts paid shall be equal to the percent of the payment amount under paragraph (3)(A)(ii)(I) of such section or section 1847A(b)(1)(B), as applicable, that equals the difference between
(i)100 percent, and
(ii)the percent applied under section 1847A(i)(5)(B) ; in subsection (i), by adding at the end the following new paragraph: In the case of a part B rebatable drug (as defined in paragraph
(2)of section 1847A(i)) for which payment under this subsection is not packaged into a payment for a service furnished on or after April 1, 2023, under the revised payment system under this subsection, in lieu of calculation of coinsurance and the amount of payment otherwise applicable under this subsection, the provisions of section 1847A(i)(5) and paragraph (1)(EE) of subsection (a), shall, as determined appropriate by the Secretary, apply under this subsection in the same manner as such provisions of section 1847A(i)(5) and subsection
(a)apply under such section and subsection. ; and in subsection (t)(8), by adding at the end the following new subparagraph: In the case of a part B rebatable drug (as defined in paragraph
(2)of section 1847A(i), except if such drug does not have a copayment amount as a result of application of subparagraph (E)) for which payment under this part is not packaged into a payment for a covered OPD service (or group of services) furnished on or after April 1, 2023, and the payment for such drug under this subsection is the same as the amount for a calendar quarter under paragraph (3)(A)(ii)(I) of section 1847A(i), under the system under this subsection, in lieu of calculation of the copayment amount and the amount of payment otherwise applicable under this subsection (other than the application of the limitation described in subparagraph (C)), the provisions of section 1847A(i)(5) and paragraph (1)(EE) of subsection (a), shall, as determined appropriate by the Secretary, apply under this subsection in the same manner as such provisions of section 1847A(i)(5) and subsection
(a)apply under such section and subsection. . Section 1847A(c)(3) of the Social Security Act (42 U.S.C. 1395w–3a(c)(3)) is amended by inserting subsection
(i)or before section 1927 . Section 1927(c)(1)(C)(ii)(I) of the Social Security Act ( 42 U.S.C. 1396r–8(c)(1)(C)(ii)(I) ) is amended by inserting or section 1847A(i) after this section . Section 1927(b)(3)(D)(i) of the Social Security Act ( 42 U.S.C. 1396r–8(b)(3)(D)(i) ) is amended by inserting and the rebate after the payment amount . Section 1927(k)(1)(B)(i) of the Social Security Act ( 42 U.S.C. 1396r–8(k)(1)(B)(i) ), as amended by section 11001(b)(3), is amended— in subclause (V), by striking and at the end; in subclause (VI), by striking the period at the end and inserting a semicolon; and by adding at the end the following new subclause: rebates paid by manufacturers under section 1847A(i); and . In addition to amounts otherwise available, there are appropriated to the Centers for Medicare & Medicaid Services, out of any money in the Treasury not otherwise appropriated, $80,000,000 for fiscal year 2022, including $12,500,000 to carry out the provisions of, including the amendments made by, this section in fiscal year 2022, and $7,500,000 to carry out the provisions of, including the amendments made by, this section in each of fiscal years 2023 through 2031, to remain available until expended.
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U.S. Code
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- 42 USC 1395w–3a
- 42 USC 1395w–3a(c)(3)
- 42 USC 1396r–8(c)(1)(C)(ii)(I)
- 42 USC 1396r–8(b)(3)(D)(i)
- 42 USC 1396r–8(k)(1)(B)(i)
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cites case law
Sec. 11101
Medicare part B rebate by manufacturers
Cite42 USC 1395w–3a
Cite42 USC 1395w–3a(c)(3)
Cite42 USC 1396r–8(c)(1)(C)(ii)(I)
Cite42 USC 1396r–8(b)(3)(D)(i)
Cite42 USC 1396r–8(k)(1)(B)(i)
Cites 6Cited by 0 across 0 sources