SenateS. 5586119th Congress
Ensuring Accurate Payments to Specialty Pharmacies Act
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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 5586 Introduced in Senate (IS)]
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119th CONGRESS
2d Session
S. 5586
To amend title XIX of the Social Security Act to require the Secretary
of Health and Human Services to conduct surveys of non-retail pharmacy
drug prices, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
September 29, 2026
Mr. Warner (for himself and Mr. Cassidy) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend title XIX of the Social Security Act to require the Secretary
of Health and Human Services to conduct surveys of non-retail pharmacy
drug prices, and for other purposes.
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 ``Ensuring Accurate Payments to
Specialty Pharmacies Act''.
SEC. 2. ENSURING ACCURATE PAYMENTS TO PHARMACIES UNDER MEDICAID.
(a) In General.--Section 1927(f) of the Social Security Act (42
U.S.C. 1396r-8(f)) is amended--
(1) by redesignating paragraphs (2) through (4) as
paragraphs (3), (4), and (6), respectively;
(2) by inserting after paragraph (1) the following new
paragraph:
``(2) Determining applicable non-retail pharmacy actual
acquisition costs.--
``(A) In general.--The Secretary shall conduct a
survey of applicable non-retail pharmacy drug prices to
determine national average drug acquisition cost
benchmarks. In conducting such survey, the Secretary
may contract services for--
``(i) the determination of survey prices,
separate from the survey prices described in
paragraph (1)(A)(i), of the applicable non-
retail national average drug acquisition cost
for covered outpatient drugs that represent a
nationwide average of consumer purchase prices
for such drugs, net of all discounts and
rebates (to the extent any information with
respect to such discounts and rebates is
available) based on a monthly survey of
applicable non-retail pharmacies; and
``(ii) at the discretion of the Secretary,
for each type of applicable non-retail pharmacy
(as identified pursuant to the type indicators
established by the Secretary under subsection
(k)(12)(B)(ii)), the determination of survey
prices, separate from the survey prices
described in paragraph (1)(A)(i) or clause (i)
of this subparagraph, of the national average
drug acquisition cost for such type of pharmacy
for covered outpatient drugs that represent a
nationwide average of consumer purchase prices
for such drugs, net of all discounts and
rebates (to the extent any information with
respect to such discounts and rebates is
available) based on a monthly survey of such
pharmacies.
``(B) Application of requirements.--Subparagraphs
(C), (D), and (E) of paragraph (1) shall apply to
surveys of non-retail pharmacy drug prices conducted
under this paragraph in the same manner as such
subparagraphs apply to surveys of retail pharmacy drug
prices conducted under subparagraph (1).
``(C) Additional requirement.--In addition to the
terms and conditions identified in paragraph (1)(D),
and such other terms and conditions as the Secretary
shall specify, a contract with a vendor under this
paragraph shall require that the vendor must
differentiate, in collecting and reporting survey data,
the relevant pharmacy type indicator for all cost
information collected, including whether a pharmacy is
owned by, operated by, or otherwise affiliated with a
pharmacy benefit manager and whether a pharmacy is an
applicable non-retail pharmacy, and, in the case of an
applicable non-retail pharmacy, which type of
applicable non-retail pharmacy (as identified pursuant
to the type indicators established by the Secretary
under subsection (k)(12)(B)(ii)) it is.
``(D) Survey reporting.--In order to meet the
requirement of section 1902(a)(54), a State shall
require that any applicable non-retail pharmacy in the
State that receives any payment, reimbursement,
administrative fee, discount, or rebate related to the
dispensing of covered outpatient drugs to individuals
receiving benefits under this title, regardless of
whether such payment, reimbursement, administrative
fee, discount, or rebate is received from the State or
a managed care entity or other specified entity (as
such terms are defined in section 1903(m)(9)(D))
directly or from a pharmacy benefit manager or another
entity that has a contract with the State or a managed
care entity or other specified entity (as so defined),
shall respond to surveys conducted under this
paragraph.
``(E) Survey information.--Information on national
drug acquisition prices obtained under this paragraph
shall be made publicly available and shall include at
least the following:
``(i) The monthly response rate to the
survey including a list of applicable non-
retail pharmacies not in compliance with
subparagraph (D).
``(ii) The sampling methodology and number
of applicable non-retail pharmacies sampled
monthly.
``(iii) Information on price concessions to
applicable non-retail pharmacies, including
discounts, rebates, and other price
concessions, to the extent that such
information may be publicly released and has
been collected by the Secretary as part of the
survey.
``(F) Penalties.--The Secretary, in consultation
with the Office of the Inspector General of the
Department of Health and Human Services, shall enforce
the provisions of this paragraph with respect to an
applicable non-retail pharmacy through the
establishment of appropriate civil monetary penalties,
which may be assessed with respect to each violation or
survey non-response, and with respect to each non-
compliant applicable non-retail pharmacy (including a
pharmacy that is part of a chain), until compliance
with this paragraph has been completed. The provisions
of section 1128A (other than subsections (a) and (b))
shall apply to a civil money penalty under the
preceding sentence in the same manner as such
provisions apply to a civil money penalty or proceeding
under section 1128A(a).
``(G) Limitation on use of applicable non-retail
pharmacy pricing information.--No State shall use
pricing information reported by applicable non-retail
pharmacies under subparagraph (A) to develop or inform
reimbursement rates for retail community pharmacies.'';
(3) in paragraph (3), as so redesignated--
(A) in subparagraph (A), by inserting ``, including
payment rates under managed care entities or other
specified entities (as such terms are defined in
section 1903(m)(9)(D)),'' after ``under this title'';
and
(B) in subparagraph (B), by inserting ``and the
basis for such dispensing fees'' before the semicolon;
(4) by inserting after paragraph (4), as so redesignated,
the following new paragraph:
``(5) Oversight.--
``(A) In general.--The Inspector General of the
Department of Health and Human Services shall conduct
periodic studies of the survey data reported under this
subsection, as appropriate, including with respect to
substantial variations in acquisition costs or other
applicable costs, as well as with respect to how
internal transfer prices and related party transactions
may influence the costs reported by pharmacies
affiliated with pharmacy benefit managers, wholesalers,
distributors, and other entities that acquire covered
outpatient drugs relative to costs reported by
pharmacies not affiliated with such entities. The
Inspector General shall provide periodic updates to
Congress on the results of such studies, as
appropriate, in a manner that does not disclose trade
secrets or other proprietary information.
``(B) Appropriation.--There is appropriated to the
Inspector General of the Department of Health and Human
Services, out of any money in the Treasury not
otherwise appropriated, $5,000,000 for fiscal year
2027, to remain available until expended, to carry out
this paragraph.''; and
(5) in paragraph (6), as so redesignated, by inserting ``,
and $9,000,000 for fiscal year 2027 and each fiscal year
thereafter,'' after ``2010''.
(b) Definitions.--Section 1927(k) of the Social Security Act (42
U.S.C. 1396r-8(k)) is amended by adding the following--
``(12) Applicable non-retail pharmacy.--
``(A) In general.--The term `applicable non-retail
pharmacy' means a pharmacy that is licensed as a
pharmacy by the State and that is not a retail
community pharmacy, including a pharmacy that dispenses
prescription medications to patients primarily through
mail and specialty pharmacies. Such term does not
include nursing home pharmacies, long-term care
facility pharmacies, hospital pharmacies, clinics,
charitable or not-for-profit pharmacies, government
pharmacies, or low dispensing pharmacies (as defined by
the Secretary).
``(B) Identification of applicable non-retail
pharmacies.--
``(i) In general.--For purposes of
subsection (f), the Secretary shall, not later
than January 1, 2028, in consultation with
stakeholders as appropriate, publish guidance
specifying pharmacies that meet the definition
of applicable non-retail pharmacies and that
will be subject to the survey requirements
under subsection (f)(2).
``(ii) Inclusion of pharmacy type
indicators.--The guidance published under
clause (i) shall include pharmacy type
indicators to distinguish between different
types of applicable non-retail pharmacies, such
as pharmacies that dispense prescriptions
primarily through the mail and pharmacies that
dispense prescriptions that require special
handling or distribution. An applicable non-
retail pharmacy may be identified through
multiple pharmacy type indicators.
``(13) Pharmacy benefit manager.--The term `pharmacy
benefit manager' means any person or entity that, either
directly or through an intermediary, acts as a price negotiator
or group purchaser on behalf of a State, managed care entity
(as defined in section 1903(m)(9)(D)), or other specified
entity (as so defined), or manages the prescription drug
benefits provided by a State, managed care entity, or other
specified entity, including the processing and payment of
claims for prescription drugs, the performance of drug
utilization review, the processing of drug prior authorization
requests, the managing of appeals or grievances related to the
prescription drug benefits, contracting with pharmacies,
controlling the cost of covered outpatient drugs, or the
provision of services related thereto. Such term includes any
person or entity acts as a price negotiator (with regard to
payment amounts to pharmacies and providers for a covered
outpatient drug or the net cost of the drug) or group purchaser
on behalf of a State, managed care entity, or other specified
entity or that carries out 1 or more of the other activities
described in the preceding sentence, irrespective of whether
such person or entity calls itself a pharmacy benefit
manager.''.
(c) Effective Date.--The amendments made by this section take
effect on the first day of the first quarter that begins on or after
the date that is 18 months after the date of enactment of this Act.
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