Except as otherwise expressly provided, whenever in this subtitle an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.

(a) Imposition of tax.—

(1) IN GENERAL.—Paragraph (2) of section 55(b) is amended to read as follows:

“(2) CORPORATIONS.—

“(A) APPLICABLE CORPORATIONS.—In the case of an applicable corporation, the tentative minimum tax for the taxable year shall be the excess of—

“(i) 15 percent of the adjusted financial statement income for the taxable year (as determined under section 56A), over

“(ii) the corporate AMT foreign tax credit for the taxable year.

“(B) OTHER CORPORATIONS.—In the case of any corporation which is not an applicable corporation, the tentative minimum tax for the taxable year shall be zero.”.

(2) APPLICABLE CORPORATION.—Section 59 is amended by adding at the end the following new subsection:

“(k) Applicable corporation.—For purposes of this part—

“(1) APPLICABLE CORPORATION DEFINED.—

“(A) IN GENERAL.—The term ‘applicable corporation’ means, with respect to any taxable year, any corporation (other than an S corporation, a regulated investment company, or a real estate investment trust) which meets the average annual adjusted financial statement income test of subparagraph (B) for one or more taxable years which—

“(i) are prior to such taxable year, and

“(ii) end after December 31, 2021.

“(B) AVERAGE ANNUAL ADJUSTED FINANCIAL STATEMENT INCOME TEST.—For purposes of this subsection—

“(i) a corporation meets the average annual adjusted financial statement income test for a taxable year if the average annual adjusted financial statement income of such corporation (determined without regard to section 56A(d)) for the 3-taxable-year period ending with such taxable year exceeds $1,000,000,000, and

“(ii) in the case of a corporation described in paragraph (2), such corporation meets the average annual adjusted financial statement income test for a taxable year if—

“(I) the corporation meets the requirements of clause (i) for such taxable year (determined after the application of paragraph (2)), and

“(II) the average annual adjusted financial statement income of such corporation (determined without regard to the application of paragraph (2) and without regard to section 56A(d)) for the 3-taxable-year-period ending with such taxable year is $100,000,000 or more.

“(C) EXCEPTION.—Notwithstanding subparagraph (A), the term ‘applicable corporation’ shall not include any corporation which otherwise meets the requirements of subparagraph (A) if—

“(i) such corporation—

“(I) has a change in ownership, or

“(II) has a specified number (to be determined by the Secretary and which shall, as appropriate, take into account the facts and circumstances of the taxpayer) of consecutive taxable years, including the most recent taxable year, in which the corporation does not meet the average annual adjusted financial statement income test of subparagraph (B), and

“(ii) the Secretary determines that it would not be appropriate to continue to treat such corporation as an applicable corporation.

The preceding sentence shall not apply to any corporation if, after the Secretary makes the determination described in clause (ii), such corporation meets the average annual adjusted financial statement income test of subparagraph (B) for any taxable year beginning after the first taxable year for which such determination applies.

“(D) SPECIAL RULES FOR DETERMINING APPLICABLE CORPORATION STATUS.—

“(i) IN GENERAL.—Solely for purposes of determining whether a corporation is an applicable corporation under this paragraph, all adjusted financial statement income of persons treated as a single employer with such corporation under subsection (a) or (b) of section 52 (determined with the modifications described in clause (ii)) shall be treated as adjusted financial statement income of such corporation, and adjusted financial statement income of such corporation shall be determined without regard to paragraphs (2)(D)(i) and (11) of section 56A(c).

“(ii) MODIFICATIONS.—For purposes of this subparagraph—

“(I) section 52(a) shall be applied by substituting ‘component members’ for ‘members’, and

“(II) for purposes of applying section 52(b), the term ‘trade or business’ shall include any activity treated as a trade or business under paragraph (5) or (6) of section 469(c) (determined without regard to the phrase ‘To the extent provided in regulations’ in such paragraph (6)).

“(iii) COMPONENT MEMBER.—For purposes of this subparagraph, the term ‘component member’ has the meaning given such term by section 1563(b), except that the determination shall be made without regard to section 1563(b)(2).

“(E) OTHER SPECIAL RULES.—

“(i) CORPORATIONS IN EXISTENCE FOR LESS THAN 3 YEARS.—If the corporation was in existence for less than 3-taxable years, subparagraph (B) shall be applied on the basis of the period during which such corporation was in existence.

“(ii) SHORT TAXABLE YEARS.—Adjusted financial statement income for any taxable year of less than 12 months shall be annualized by multiplying the adjusted financial statement income for the short period by 12 and dividing the result by the number of months in the short period.

“(iii) TREATMENT OF PREDECESSORS.—Any reference in this subparagraph to a corporation shall include a reference to any predecessor of such corporation.

“(2) SPECIAL RULE FOR FOREIGN-PARENTED MULTINATIONAL GROUPS.—

“(A) IN GENERAL.—If a corporation is a member of a foreign-parented multinational group for any taxable year, then, solely for purposes of determining whether such corporation meets the average annual adjusted financial statement income test under paragraph (1)(B)(ii)(I) for such taxable year, the adjusted financial statement income of such corporation for such taxable year shall include the adjusted financial statement income of all members of such group. Solely for purposes of this subparagraph, adjusted financial statement income shall be determined without regard to paragraphs (2)(D)(i), (3), (4), and (11) of section 56A(c).

“(B) FOREIGN-PARENTED MULTINATIONAL GROUP.—For purposes of subparagraph (A), the term ‘foreign-parented multinational group’ means, with respect to any taxable year, two or more entities if—

“(i) at least one entity is a domestic corporation and another entity is a foreign corporation,

“(ii) such entities are included in the same applicable financial statement with respect to such year, and

“(iii) either—

“(I) the common parent of such entities is a foreign corporation, or

“(II) if there is no common parent, the entities are treated as having a common parent which is a foreign corporation under subparagraph (D).

“(C) FOREIGN CORPORATIONS ENGAGED IN A TRADE OR BUSINESS WITHIN THE UNITED STATES.—For purposes of this paragraph, if a foreign corporation is engaged in a trade or business within the United States, such trade or business shall be treated as a separate domestic corporation that is wholly owned by the foreign corporation.

“(D) OTHER RULES.—The Secretary shall, applying the principles of this section, prescribe rules for the application of this paragraph, including rules for the determination of—

“(i) the entities (if any) which are to be to be treated under subparagraph (B)(iii)(II) as having a common parent which is a foreign corporation,

“(ii) the entities to be included in a foreign-parented multinational group, and

“(iii) the common parent of a foreign-parented multinational group.

“(3) REGULATIONS OR OTHER GUIDANCE.—The Secretary shall provide regulations or other guidance for the purposes of carrying out this subsection, including regulations or other guidance—

“(A) providing a simplified method for determining whether a corporation meets the requirements of paragraph (1), and

“'(B) addressing the application of this subsection to a corporation that experiences a change in ownership.”.

(3) REDUCTION FOR BASE EROSION AND ANTI-ABUSE TAX.—Section 55(a)(2) is amended by inserting “plus, in the case of an applicable corporation, the tax imposed by section 59A” before the period at the end.

(4) CONFORMING AMENDMENTS.—

(A) Section 55(a) is amended by striking “In the case of a taxpayer other than a corporation, there” and inserting “There”.

(B) (i) Section 55(b)(1) is amended—

(I) by striking so much as precedes subparagraph (A) and inserting the following:

“(1) NONCORPORATE TAXPAYERS.—In the case of a taxpayer other than a corporation—”, and

(II) by adding at the end the following new subparagraph:

“(D) ALTERNATIVE MINIMUM TAXABLE INCOME.—The term ‘alternative minimum taxable income’ means the taxable income of the taxpayer for the taxable year—

“(i) determined with the adjustments provided in section 56 and section 58, and

“(ii) increased by the amount of the items of tax preference described in section 57.

If a taxpayer is subject to the regular tax, such taxpayer shall be subject to the tax imposed by this section (and, if the regular tax is determined by reference to an amount other than taxable income, such amount shall be treated as the taxable income of such taxpayer for purposes of the preceding sentence).”.

(ii) Section 860E(a)(4) is amended by striking “55(b)(2)” and inserting “55(b)(1)(D)”.

(iii) Section 897(a)(2)(A)(i) is amended by striking “55(b)(2)” and inserting “55(b)(1)(D)”.

(C) Section 11(d) is amended by striking “the tax imposed by subsection (a)” and inserting “the taxes imposed by subsection (a) and section 55”.

(D) Section 12 is amended by adding at the end the following new paragraph:

“(5) For alternative minimum tax, see section 55.”.

(E) Section 882(a)(1) is amended by inserting “, 55,” after “section 11”.

(F) Section 6425(c)(1)(A) is amended to read as follows:

“(A) the sum of—

“(i) the tax imposed by section 11 or subchapter L of chapter 1, whichever is applicable, plus

“(ii) the tax imposed by section 55, plus

“(iii) the tax imposed by section 59A, over”.

(G) Section 6655(e)(2) is amended by inserting “, adjusted financial statement income (as defined in section 56A),” before “and modified taxable income” each place it appears in subparagraphs (A)(i) and (B)(i).

(H) Section 6655(g)(1)(A) is amended by redesignating clauses (ii) and (iii) as clauses (iii) and (iv), respectively, and by inserting after clause (i) the following new clause:

“(ii) the tax imposed by section 55,”.

(b) Adjusted financial statement income.—

(1) IN GENERAL.—Part VI of subchapter A of chapter 1 is amended by inserting after section 56 the following new section:

(2) CLERICAL AMENDMENT.—The table of sections for part VI of subchapter A of chapter 1 is amended by inserting after the item relating to section 56 the following new item:

“Sec. 56A. Adjusted financial statement income.”.

(c) Corporate AMT foreign tax credit.—Section 59, as amended by this section, is amended by adding at the end the following new subsection:

“(l) Corporate AMT foreign tax credit.—

“(1) IN GENERAL.—For purposes of this part, if an applicable corporation chooses to have the benefits of subpart A of part III of subchapter N for any taxable year, the corporate AMT foreign tax credit for the taxable year of the applicable corporation is an amount equal to sum of—

“(A) the lesser of—

“(i) the aggregate of the applicable corporation’s pro rata share (as determined under section 56A(c)(3)) of the amount of income, war profits, and excess profits taxes (within the meaning of section 901) imposed by any foreign country or possession of the United States which are—

“(I) taken into account on the applicable financial statement of each controlled foreign corporation with respect to which the applicable corporation is a United States shareholder, and

“(II) paid or accrued (for Federal income tax purposes) by each such controlled foreign corporation, or

“(ii) the product of the amount of the adjustment under section 56A(c)(3) and the percentage specified in section 55(b)(2)(A)(i), and

“(B) in the case of an applicable corporation that is a domestic corporation, the amount of income, war profits, and excess profits taxes (within the meaning of section 901) imposed by any foreign country or possession of the United States to the extent such taxes are—

“(i) taken into account on the applicable corporation’s applicable financial statement, and

“(ii) paid or accrued (for Federal income tax purposes) by the applicable corporation.

“(2) CARRYOVER OF EXCESS TAX PAID.—For any taxable year for which an applicable corporation chooses to have the benefits of subpart A of part III of subchapter N, the excess of the amount described in paragraph (1)(A)(i) over the amount described in paragraph (1)(A)(ii) shall increase the amount described in paragraph (1)(A)(i) in any of the first 5 succeeding taxable years to the extent not taken into account in a prior taxable year.

“(3) REGULATIONS OR OTHER GUIDANCE.—The Secretary shall provide for such regulations or other guidance as is necessary to carry out the purposes of this subsection.”.

(d) Treatment of general business credit.—Section 38(c)(6)(E) is amended to read as follows:

“(E) CORPORATIONS.—In the case of a corporation—

“(i) the first sentence of paragraph (1) shall be applied by substituting ‘25 percent of the taxpayer's net income tax as exceeds $25,000’ for ‘the greater of’ and all that follows,

“(ii) paragraph (2)(A) shall be applied without regard to clause (ii)(I) thereof, and

“(iii) paragraph (4)(A) shall be applied without regard to clause (ii)(I) thereof.”.

(e) Credit for prior year minimum tax liability.—

(1) IN GENERAL.—Section 53(e) is amended to read as follows:

“(e) Application to applicable corporations.—In the case of a corporation—

“(1) subsection (b)(1) shall be applied by substituting ‘the net minimum tax for all prior taxable years beginning after 2022’ for ‘the adjusted net minimum tax imposed for all prior taxable years beginning after 1986’, and

“(2) the amount determined under subsection (c)(1) shall be increased by the amount of tax imposed under section 59A for the taxable year.”.

(2) CONFORMING AMENDMENTS.—Section 53(d) is amended—

(A) in paragraph (2), by striking “, except that in the case” and all that follows through “treated as zero”, and

(B) by striking paragraph (3).

(f) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2022.

(a) In general.—Subtitle D is amended by inserting after chapter 36 the following new chapter:

“Sec. 4501. Repurchase of corporate stock.

(b) Tax not deductible.—Paragraph (6) of section 275(a) is amended by inserting “37,” before “41”.

(c) Clerical amendment.—The table of chapters for subtitle D is amended by inserting after the item relating to chapter 36 the following new item:

(d) Effective date.—The amendments made by this section shall apply to repurchases (within the meaning of section 4501(c) of the Internal Revenue Code of 1986, as added by this section) of stock after December 31, 2022.

In general.—The following sums are appropriated, out of any money in the Treasury not otherwise appropriated, for the fiscal year ending September 30, 2022:

(1) INTERNAL REVENUE SERVICE.—

(A) IN GENERAL.—

(i) TAXPAYER SERVICES.—For necessary expenses of the Internal Revenue Service to provide taxpayer services, including pre-filing assistance and education, filing and account services, taxpayer advocacy services, and other services as authorized by 5 U.S.C. 3109, at such rates as may be determined by the Commissioner, $3,181,500,000, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(ii) ENFORCEMENT.—For necessary expenses for tax enforcement activities of the Internal Revenue Service to determine and collect owed taxes, to provide legal and litigation support, to conduct criminal investigations (including investigative technology), to provide digital asset monitoring and compliance activities, to enforce criminal statutes related to violations of internal revenue laws and other financial crimes, to purchase and hire passenger motor vehicles (31 U.S.C. 1343(b)), and to provide other services as authorized by 5 U.S.C. 3109, at such rates as may be determined by the Commissioner, $45,637,400,000, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(iii) OPERATIONS SUPPORT.—For necessary expenses of the Internal Revenue Service to support taxpayer services and enforcement programs, including rent payments; facilities services; printing; postage; physical security; headquarters and other IRS-wide administration activities; research and statistics of income; telecommunications; information technology development, enhancement, operations, maintenance, and security; the hire of passenger motor vehicles (31 U.S.C. 1343(b)); the operations of the Internal Revenue Service Oversight Board; and other services as authorized by 5 U.S.C. 3109, at such rates as may be determined by the Commissioner, $25,326,400,000, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(iv) BUSINESS SYSTEMS MODERNIZATION.—For necessary expenses of the Internal Revenue Service's business systems modernization program, including development of callback technology and other technology to provide a more personalized customer service but not including the operation and maintenance of legacy systems, $4,750,700,000, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(B) TASK FORCE TO DESIGN AN IRS-RUN FREE Direct eFile TAX RETURN SYSTEM.—For necessary expenses of the Internal Revenue Service to deliver to Congress, within nine months following the date of the enactment of this Act, a report on (I) the cost (including options for differential coverage based on taxpayer adjusted gross income and return complexity) of developing and running a free direct efile tax return system, including costs to build and administer each release, with a focus on multi-lingual and mobile-friendly features and safeguards for taxpayer data; (II) taxpayer opinions, expectations, and level of trust, based on surveys, for such a free direct efile system; and (III) the opinions of an independent third-party on the overall feasibility, approach, schedule, cost, organizational design, and Internal Revenue Service capacity to deliver such a direct efile tax return system, $15,000,000, to remain available until September 30, 2023: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(2) TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION.—For necessary expenses of the Treasury Inspector General for Tax Administration in carrying out the Inspector General Act of 1978, as amended, including purchase and hire of passenger motor vehicles (31 U.S.C. 1343(b)); and services authorized by 5 U.S.C. 3109, at such rates as may be determined by the Inspector General for Tax Administration, $403,000,000, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(3) OFFICE OF TAX POLICY.—For necessary expenses of the Office of Tax Policy of the Department of the Treasury to carry out functions related to promulgating regulations under the Internal Revenue Code of 1986, $104,533,803, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(4) UNITED STATES TAX COURT.—For necessary expenses of the United States Tax Court, including contract reporting and other services as authorized by 5 U.S.C. 3109; $153,000,000, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(5) TREASURY DEPARTMENTAL OFFICES.—For necessary expenses of the Departmental Offices of the Department of the Treasury to provide for oversight and implementation support for actions by the Internal Revenue Service to implement this Act and the amendments made by this Act, $50,000,000, to remain available until September 30, 2031: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes.

(a) Program To lower prices for certain high-Priced single source drugs.—Title XI of the Social Security Act is amended by adding after section 1184 (42 U.S.C. 1320e–3) the following new part:

(b) Application of maximum fair prices and conforming amendments.—

(1) UNDER MEDICARE.—

(A) APPLICATION TO PAYMENTS UNDER PART B.—Section 1847A(b)(1)(B) of the Social Security Act (42 U.S.C. 1395w–3a(b)(1)(B)) is amended by inserting “or in the case of such a drug or biological product that is a selected drug (as referred to in section 1192(c)), with respect to a price applicability period (as defined in section 1191(b)(2)), 106 percent of the maximum fair price (as defined in section 1191(c)(3)) applicable for such drug and a year during such period” after “paragraph (4)”.

(B) APPLICATION UNDER MA OF COST-SHARING FOR PART B DRUGS BASED OFF OF NEGOTIATED PRICE.—Section 1852(a)(1)(B)(iv) of the Social Security Act (42 U.S.C. 1395w–22(a)(1)(B)(iv)) is amended—

(i) by redesignating subclause (VII) as subclause (VIII); and

(ii) by inserting after subclause (VI) the following subclause:

“(VII) A drug or biological product that is a selected drug (as referred to in section 1192(c)).”.

(C) EXCEPTION TO PART D NON-INTERFERENCE.—Section 1860D–11(i) of the Social Security Act (42 U.S.C. 1395w–111(i)) is amended—

(i) in paragraph (1), by striking “and” at the end;

(ii) in paragraph (2), by striking “or institute a price structure for the reimbursement of covered part D drugs.” and inserting “, except as provided under section 1860D–4(b)(3)(l); and”; and

(iii) by adding at the end the following new paragraph:

“(3) may not institute a price structure for the reimbursement of covered part D drugs, except as provided under part E of title XI.”.

(D) APPLICATION AS NEGOTIATED PRICE UNDER PART D.—Section 1860D–2(d)(1) of the Social Security Act (42 U.S.C. 1395w–102(d)(1)) is amended—

(i) in subparagraph (B), by inserting “, subject to subparagraph (D),” after “negotiated prices”; and

(ii) by adding at the end the following new subparagraph:

“(D) APPLICATION OF MAXIMUM FAIR PRICE FOR SELECTED DRUGS.—In applying this section, in the case of a covered part D drug that is a selected drug (as referred to in section 1192(c)), with respect to a price applicability period (as defined in section 1191(b)(2)), the negotiated prices used for payment (as described in this subsection) shall be no greater than the maximum fair price (as defined in section 1191(c)(3)) for such drug and for each year during such period plus any dispensing fees for such drug.”.

(E) COVERAGE OF SELECTED DRUGS.—Section 1860D–4(b)(3) of the Social Security Act (42 U.S.C. 1395w–104(b)(3)) is amended by adding at the end the following new subparagraph:

“(I) REQUIRED INCLUSION OF SELECTED DRUGS.—

“(i) IN GENERAL.—For 2026 and each subsequent year, the PDP sponsor offering a prescription drug plan shall include each covered part D drug that is a selected drug under section 1192 for which a maximum fair price (as defined in section 1191(c)(3)) is in effect with respect to the year.

“(ii) CLARIFICATION.—Nothing in clause (i) shall be construed as prohibiting a PDP sponsor from removing such a selected drug from a formulary if such removal would be permitted under section 423.120(b)(5)(iv) of title 42, Code of Federal Regulations (or any successor regulation).”.

(F) INFORMATION FROM PRESCRIPTION DRUG PLANS AND MA–PD PLANS REQUIRED.—

(i) 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:

“(8) PROVISION OF INFORMATION RELATED TO MAXIMUM FAIR PRICES.—Each contract entered into with a PDP sponsor under this part with respect to a prescription drug plan offered by such sponsor shall require the sponsor to provide information to the Secretary as requested by the Secretary for purposes of carrying out section 1194.”.

(ii) MA–PD PLANS.—Section 1857(f)(3) of the Social Security Act (42 U.S.C. 1395w–27(f)(3)) is amended by adding at the end the following new subparagraph:

“(E) PROVISION OF INFORMATION RELATED TO MAXIMUM FAIR PRICES.—Section 1860D–12(b)(8).”.

(G) CONDITIONS FOR COVERAGE.—

(i) MEDICARE PART D.—Section 1860D–43(c) of the Social Security Act (42 U.S.C. 1395w–153(c)) is amended—

(I) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively;

(II) by striking “agreements.—Subsection” and inserting the following: “agreements.—

“(1) IN GENERAL.—Subject to paragraph (2), subsection”; and

(III) by adding at the end the following new paragraph:

“(2) EXCEPTION.—Paragraph (1)(A) shall not apply to a covered part D drug of a manufacturer for any period described in section 5000D(c)(1) of the Internal Revenue Code of 1986 with respect to the manufacturer.”.

(ii) MEDICAID AND MEDICARE PART B.—Section 1927(a)(3) of the Social Security Act (42 U.S.C. 1396r–8(a)(3)) is amended by adding at the end the following new sentence: “The preceding sentence shall not apply to a single source drug or innovator multiple source drug of a manufacturer for any period described in section 5000D(c)(1) of the Internal Revenue Code of 1986 with respect to the manufacturer.”.

(H) DISCLOSURE OF INFORMATION UNDER MEDICARE PART D.—

(i) CONTRACT REQUIREMENTS.—Section 1860D–12(b)(3)(D)(i) of the Social Security Act (42 U.S.C. 1395w–112(b)(3)(D)(i)) is amended by inserting “, or carrying out part E of title XI” after “appropriate)”.

(ii) SUBSIDIES.—Section 1860D–15(f)(2)(A)(i) of the Social Security Act (42 U.S.C. 1395w–115(f)(2)(A)(i)) is amended by inserting “or part E of title XI” after “this section”.

(2) DRUG PRICE NEGOTIATION PROGRAM PRICES INCLUDED IN BEST PRICE.—Section 1927(c)(1)(C) of the Social Security Act (42 U.S.C. 1396r–8(c)(1)(C)) is amended—

(A) in clause (i)(VI), by striking “any prices charged” and inserting “subject to clause (ii)(V), any prices charged”; and

(B) in clause (ii)—

(i) in subclause (III), by striking “; and” at the end;

(ii) in subclause (IV), by striking the period at the end and inserting “; and”; and

(iii) by adding at the end the following new subclause:

“(V) in the case of a rebate period and a covered outpatient drug that is a selected drug (as referred to in section 1192(c)) during such rebate period, shall be inclusive of the maximum fair price (as defined in section 1191(c)(3)) for such drug with respect to such period.”.

(3) MAXIMUM FAIR PRICES EXCLUDED FROM AVERAGE MANUFACTURER PRICE.—Section 1927(k)(1)(B)(i) of the Social Security Act (42 U.S.C. 1396r–8(k)(1)(B)(i)) is amended—

(A) in subclause (IV) by striking “; and” at the end;

(B) in subclause (V) by striking the period at the end and inserting “; and”; and

(C) by adding at the end the following new subclause:

“(VI) any reduction in price paid during the rebate period to the manufacturer for a drug by reason of application of part E of title XI.”.

(c) Implementation for 2026 through 2028.—The Secretary of Health and Human Services shall implement this section, including the amendments made by this section, for 2026, 2027, and 2028 by program instruction or other forms of program guidance.

(a) In general.—Part E of title XI of the Social Security Act, as added by section 11001, is amended—

(1) in section 1192—

(A) in subsection (a), in the flush matter following paragraph (4), by inserting “and subsection (b)(3)” after “the previous sentence”;

(B) in subsection (b)—

(i) in paragraph (1), by adding at the end the following new subparagraph:

“(C) In the case of a biological product for which the inclusion of the biological product as a selected drug on a list published under subsection (a) has been delayed under subsection (f)(2), remove such biological product from the rankings under subparagraph (A) before making the selections under subparagraph (B).”; and

(ii) by adding at the end the following new paragraph:

“(3) INCLUSION OF DELAYED BIOLOGICAL PRODUCTS.—Pursuant to subparagraphs (B)(ii)(I) and (C)(i) of subsection (f)(2), the Secretary shall select and include on the list published under subsection (a) the biological products described in such subparagraphs. Such biological products shall count towards the required number of drugs to be selected under subsection (a)(1).”; and

(C) by adding at the end the following new subsection:

“(f) Special rule To delay selection and negotiation of biologics for biosimilar market entry.—

“(1) APPLICATION.—

“(A) IN GENERAL.—Subject to subparagraph (B), in the case of a biological product that would (but for this subsection) be an extended-monopoly drug (as defined in section 1194(c)(4)) included as a selected drug on the list published under subsection (a) with respect to an initial price applicability year, the rules described in paragraph (2) shall apply if the Secretary determines that there is a high likelihood (as described in paragraph (3)) that a biosimilar biological product (for which such biological product will be the reference product) will be licensed and marketed under section 351(k) of the Public Health Service Act before the date that is 2 years after the selected drug publication date with respect to such initial price applicability year.

“(B) REQUEST REQUIRED.—

“(i) IN GENERAL.—The Secretary shall not provide for a delay under—

“(I) paragraph (2)(A) unless a request is made for such a delay by a manufacturer of a biosimilar biological product prior to the selected drug publication date for the list published under subsection (a) with respect to the initial price applicability year for which the biological product may have been included as a selected drug on such list but for subparagraph (2)(A); or

“(II) paragraph (2)(B)(iii) unless a request is made for such a delay by such a manufacturer prior to the selected drug publication date for the list published under subsection (a) with respect to the initial price applicability year that is 1 year after the initial price applicability year for which the biological product described in subsection (a) would have been included as a selected drug on such list but for paragraph (2)(A).

“(ii) INFORMATION AND DOCUMENTS.—

“(I) IN GENERAL.—A request made under clause (i) shall be submitted to the Secretary by such manufacturer at a time and in a form and manner specified by the Secretary, and contain—

“(aa) information and documents necessary for the Secretary to make determinations under this subsection, as specified by the Secretary and including, to the extent available, items described in subclause (III); and

“(bb) all agreements related to the biosimilar biological product filed with the Federal Trade Commission or the Assistant Attorney General pursuant to subsections (a) and (c) of section 1112 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.

“(II) ADDITIONAL INFORMATION AND DOCUMENTS.—After the Secretary has reviewed the request and materials submitted under subclause (I), the manufacturer shall submit any additional information and documents requested by the Secretary necessary to make determinations under this subsection.

“(III) ITEMS DESCRIBED.—The items described in this clause are the following:

“(aa) The manufacturing schedule for such biosimilar biological product submitted to the Food and Drug Administration during its review of the application under such section 351(k).

“(bb) Disclosures (in filings by the manufacturer of such biosimilar biological product with the Securities and Exchange Commission required under section 12(b), 12(g), 13(a), or 15(d) of the Securities Exchange Act of 1934 about capital investment, revenue expectations, and actions taken by the manufacturer that are typical of the normal course of business in the year (or the 2 years, as applicable) before marketing of a biosimilar biological product) that pertain to the marketing of such biosimilar biological product, or comparable documentation that is distributed to the shareholders of privately held companies.

“(C) AGGREGATION RULE.—

“(i) IN GENERAL.—All persons treated as a single employer under subsection (a) or (b) of section 52 of the Internal Revenue Code of 1986, or in a partnership, shall be treated as one manufacturer for purposes of paragraph (2)(D)(iv).

“(ii) PARTNERSHIP DEFINED.—In clause (i), the term ‘partnership’ means a syndicate, group, pool, joint venture, or other organization through or by means of which any business, financial operation, or venture is carried on by the manufacturer of the biological product and the manufacturer of the biosimilar biological product.

“(2) RULES DESCRIBED.—The rules described in this paragraph are the following:

“(A) DELAYED SELECTION AND NEGOTIATION FOR 1 YEAR.—If a determination of high likelihood is made under paragraph (3), the Secretary shall delay the inclusion of the biological product as a selected drug on the list published under subsection (a) until such list is published with respect to the initial price applicability year that is 1 year after the initial price applicability year for which the biological product would have been included as a selected drug on such list.

“(B) IF NOT LICENSED AND MARKETED DURING THE INITIAL DELAY.—

“(i) IN GENERAL.—If, during the time period between the selected drug publication date on which the biological product would have been included on the list as a selected drug pursuant to subsection (a) but for subparagraph (A) and the selected drug publication date with respect to the initial price applicability year that is 1 year after the initial price applicability year for which such biological product would have been included as a selected drug on such list, the Secretary determines that the biosimilar biological product for which the manufacturer submitted the request under paragraph (1)(B)(i)(II) (and for which the Secretary previously made a high likelihood determination under paragraph (3)) has not been licensed and marketed under section 351(k) of the Public Health Service Act, the Secretary shall, at the request of such manufacturer—

“(I) reevaluate whether there is a high likelihood (as described in paragraph (3)) that such biosimilar biological product will be licensed and marketed under such section 351(k) before the date that is 2 years after the selected drug publication date for which such biological product would have been included as a selected drug on such list published but for subparagraph (A); and

“(II) evaluate whether, on the basis of clear and convincing evidence, the manufacturer of such biosimilar biological product has made a significant amount of progress (as determined by the Secretary) towards both such licensure and the marketing of such biosimilar biological product (based on information from items described in subclauses (I)(bb) and (II) of paragraph (1)(B)(ii)) since the receipt by the Secretary of the request made by such manufacturer under paragraph (1)(B)(i)(I).

“(ii) SELECTION AND NEGOTIATION.—If the Secretary determines that there is not a high likelihood that such biosimilar biological product will be licensed and marketed as described in clause (i)(I) or there has not been a significant amount of progress as described in clause (i)(II)—

“(I) the Secretary shall include the biological product as a selected drug on the list published under subsection (a) with respect to the initial price applicability year that is 1 year after the initial price applicability year for which such biological product would have been included as a selected drug on such list but for subparagraph (A); and

“(II) the manufacturer of such biological product shall pay a rebate under paragraph (4) with respect to the year for which such manufacturer would have provided access to a maximum fair price for such biological product but for subparagraph (A).

“(iii) SECOND 1-YEAR DELAY.—If the Secretary determines that there is a high likelihood that such biosimilar biological product will be licensed and marketed (as described in clause (i)(I)) and a significant amount of progress has been made by the manufacturer of such biosimilar biological product towards such licensure and marketing (as described in clause (i)(II)), the Secretary shall delay the inclusion of the biological product as a selected drug on the list published under subsection (a) until the selected drug publication date of such list with respect to the initial price applicability year that is 2 years after the initial price applicability year for which such biological product would have been included as a selected drug on such list but for this subsection.

“(C) IF NOT LICENSED AND MARKETED DURING THE YEAR TWO DELAY.—If, during the time period between the selected drug publication date of the list for which the biological product would have been included as a selected drug but for subparagraph (B)(iii) and the selected drug publication date with respect to the initial price applicability year that is 2 years after the initial price applicability year for which such biological product would have been included as a selected drug on such list but for this subsection, the Secretary determines that such biosimilar biological product has not been licensed and marketed—

“(i) the Secretary shall include such biological product as a selected drug on such list with respect to the initial price applicability year that is 2 years after the initial price applicability year for which such biological product would have been included as a selected drug on such list; and

“(ii) the manufacturer of such biological product shall pay a rebate under paragraph (4) with respect to the years for which such manufacturer would have provided access to a maximum fair price for such biological product but for this subsection.

“(D) LIMITATIONS ON DELAYS.—

“(i) LIMITED TO 2 YEARS.—In no case shall the Secretary delay the inclusion of a biological product on the list published under subsection (a) for more than 2 years.

“(ii) EXCLUSION OF BIOLOGICAL PRODUCTS THAT TRANSITIONED TO A LONG-MONOPOLY DRUG DURING THE DELAY.—In the case of a biological product for which the inclusion on the list published pursuant to subsection (a) was delayed by 1 year under subparagraph (A) and for which there would have been a change in status to a long-monopoly drug (as defined in section 1194(c)(5)) if such biological product had been a selected drug, in no case may the Secretary provide for a second 1-year delay under subparagraph (B)(iii).

“(iii) EXCLUSION OF BIOLOGICAL PRODUCTS IF MORE THAN 1 YEAR SINCE LICENSURE.—In no case shall the Secretary delay the inclusion of a biological product on the list published under subsection (a) if more than 1 year has elapsed since the biosimilar biological product has been licensed under section 351(k) of the Public Health Service Act and marketing has not commenced for such biosimilar biological product.

“(iv) CERTAIN MANUFACTURERS OF BIOSIMILAR BIOLOGICAL PRODUCTS EXCLUDED.—In no case shall the Secretary delay the inclusion of a biological product as a selected drug on the list published under subsection (a) if Secretary determined that the manufacturer of the biosimilar biological product described in paragraph (1)(A)—

“(I) is the same as the manufacturer of the reference product described in such paragraph or is treated as being the same pursuant to paragraph (1)(C); or

“(II) has, based on information from items described in paragraph (1)(B)(ii)(I)(bb), entered into any agreement described in such paragraph with the manufacturer of the reference product described in paragraph (1)(A) that—

“(aa) requires or incentivizes the manufacturer of the biosimilar biological product to submit a request described in paragraph (1)(B); or

“(bb) restricts the quantity (either directly or indirectly) of the biosimilar biological product that may be sold in the United States over a specified period of time.

“(3) HIGH LIKELIHOOD.—For purposes of this subsection, there is a high likelihood described in paragraph (1) or paragraph (2), as applicable, if the Secretary finds that—

“(A) an application for licensure under section 351(k) of the Public Health Service Act for the biosimilar biological product has been accepted for review or approved by the Food and Drug Administration; and

“(B) information from items described in sub clauses (I)(bb) and (III) of paragraph (1)(B)(ii) submitted to the Secretary by the manufacturer requesting a delay under such paragraph provides clear and convincing evidence that such biosimilar biological product will, within the time period specified under paragraph (1)(A) or (2)(B)(i)(I), be marketed.

“(4) REBATE.—

“(A) IN GENERAL.—For purposes of subparagraphs (B)(ii)(II) and (C)(ii) of paragraph (2), in the case of a biological product for which the inclusion on the list under subsection (a) was delayed under this subsection and for which the Secretary has negotiated and entered into an agreement under section 1193 with respect to such biological product, the manufacturer shall be required to pay a rebate to the Secretary at such time and in such manner as determined by the Secretary.

“(B) AMOUNT.—Subject to subparagraph (C), the amount of the rebate under subparagraph (A) with respect to a biological product shall be equal to the estimated amount—

“(i) in the case of a biological product that is a covered part D drug (as defined in section 1860D–2(e)), that is the sum of the products of—

“(I) 75 percent of the amount by which—

“(aa) the average manufacturer price, as reported by the manufacturer of such covered part D drug under section 1927 (or, if not reported by such manufacturer under section 1927, as reported by such manufacturer to the Secretary pursuant to the agreement under section 1193(a)) for such biological product, with respect to each of the calendar quarters of the price applicability period that would have applied but for this subsection; exceeds

“(bb) in the initial price applicability year that would have applied but for a delay under—

“(AA) paragraph (2)(A), the maximum fair price negotiated under section 1194 for such biological product under such agreement; or

“(BB) paragraph (2)(B)(iii), such maximum fair price, increased as described in section 1195(b)(1)(A); and

“(II) the number of units dispensed under part D of title XVIII for such covered part D drug during each such calendar quarter of such price applicability period; and

“(ii) in the case of a biological product for which payment may be made under part B of title XVIII, that is the sum of the products of—

“(I) 80 percent of the amount by which—

“(aa) the payment amount for such biological product under section 1847A(b), with respect to each of the calendar quarters of the price applicability period that would have applied but for this subsection; exceeds

“(bb) in the initial price applicability year that would have applied but for a delay under—

“(AA) paragraph (2)(A), the maximum fair price negotiated under section 1194 for such biological product under such agreement; or

“(BB) paragraph (2)(B)(iii), such maximum fair price, increased as described in section 1195(b)(1)(A); and

“(II) the number of units (excluding units that are packaged into the payment amount for an item or service and are not separately payable under such part B) of the billing and payment code of such biological product administered or furnished under such part B during each such calendar quarter of such price applicability period.

“(C) SPECIAL RULE FOR DELAYED BIOLOGICAL PRODUCTS THAT ARE LONG-MONOPOLY DRUGS.—

“(i) IN GENERAL.—In the case of a biological product with respect to which a rebate is required to be paid under this paragraph, if such biological product qualifies as a long-monopoly drug (as defined in section 1194(c)(5)) at the time of its inclusion on the list published under subsection (a), in determining the amount of the rebate for such biological product under subparagraph (B), the amount described in clause (ii) shall be substituted for the maximum fair price described in clause (i)(I) or (ii)(I) of such subparagraph (B), as applicable.

“(ii) AMOUNT DESCRIBED.—The amount described in this clause is an amount equal to 65 percent of the average non-Federal average manufacturer price for the biological product for 2021 (or, in the case that there is not an average non-Federal average manufacturer price available for such biological product for 2021, for the first full year following the market entry for such biological product), increased by the percentage increase in the consumer price index for all urban consumers (all items; United States city average) from September 2021 (or December of such first full year following the market entry), as applicable, to September of the year prior to the selected drug publication date with respect to the initial price applicability year that would have applied but for this subsection.

“(D) REBATE DEPOSITS.—Amounts paid as rebates under this paragraph shall be deposited into—

“(i) in the case payment is made for such biological product under part B of title XVIII, the Federal Supplementary Medical Insurance Trust Fund established under section 1841; and

“(ii) in the case such biological product is a covered part D drug (as defined in section 1860D–2(e)), the Medicare Prescription Drug Account under section 1860D–16 in such Trust Fund.

“(5) DEFINITIONS OF BIOSIMILAR BIOLOGICAL PRODUCT.—In this subsection, the term ‘biosimilar biological product’ has the meaning given such term in section 1847A(c)(6).”;

(2) in section 1193(a)(4)—

(A) in the matter preceding subparagraph (A), by inserting “, and for section 1192(f),” after “section 1194(f))”;

(B) in subparagraph (A), by striking “and” at the end;

(C) by adding at the end the following new subparagraph:

“(C) information that the Secretary requires to carry out section 1192(f), including rebates under paragraph (4) of such section; and”;

(3) in section 1196(a)(7), by striking “section 1192(d)(2)(B)” and inserting “subsections (d)(2)(B) and (f)(1)(C) of section 1192”;

(4) in section 1197—

(A) by redesignating subsections (b), (c), and (d) as subsections (c), (d), and (e), respectively; and

(B) by inserting after subsection (a) the following new subsection:

“(b) Violations relating to providing rebates.—Any manufacturer that fails to comply with the rebate requirements under section 1192(f)(4) shall be subject to a civil monetary penalty equal to 10 times the amount of the rebate the manufacturer failed to pay under such section.”; and

(5) in section 1198(b)(2), by inserting “the application of section 1192(f),” after “section 1192(e)”.

(b) Conforming amendments for disclosure of certain information.—Section 1927(b)(3)(D)(i) of the Social Security Act (42 U.S.C. 1396r–8(b)(3)(D)(i)) is amended by striking “or to carry out section 1847B” and inserting “or to carry out section 1847B or section 1192(f), including rebates under paragraph (4) of such section”.

(c) Implementation for 2026 through 2028.—The Secretary of Health and Human Services shall implement this section, including the amendments made by this section, for 2026, 2027, and 2028 by program instruction or other forms of program guidance.

(a) In general.—Subtitle D of the Internal Revenue Code of 1986 is amended by adding at the end the following new chapter:

“Sec. 5000D. Designated drugs during noncompliance periods.

(b) No deduction for excise tax payments.—Section 275(a)(6) of the Internal Revenue Code of 1986 is amended by inserting “50A,” after “46,”.

(c) Clerical amendment.—The table of chapters for subtitle D of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:

(d) Effective date.—The amendments made by this section shall apply to sales after the date of the enactment of this Act.

In addition to amounts otherwise available, there is appropriated to the Centers for Medicare & Medicaid Services, out of any money in the Treasury not otherwise appropriated, $3,000,000,000 for fiscal year 2022, to remain available until expended, to carry out the provisions of, including the amendments made by, this part.

(a) In general.—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:

“(i) Rebate by manufacturers for single source drugs and biologicals with prices increasing faster than inflation.—

“(1) REQUIREMENTS.—

“(A) SECRETARIAL PROVISION OF INFORMATION.—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:

“(i) 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.

“(ii) 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.

“(iii) The rebate amount specified under such paragraph for such part B rebatable drug and calendar quarter.

“(B) MANUFACTURER REQUIREMENT.—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.

“(C) TRANSITION RULE FOR REPORTING.—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.

“(2) PART B REBATABLE DRUG DEFINED.—

“(A) IN GENERAL.—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—

“(i) 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

“(ii) that is a vaccine described in subparagraph (A) or (B) of section 1861(s)(10).

“(B) INCREASE.—The dollar amount applied under subparagraph (A)(i)—

“(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

“(ii) 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.

“(C) ROUNDING.—Any dollar amount determined under subparagraph (B) that is not a multiple of $10 shall be rounded to the nearest multiple of $10.

“(3) REBATE AMOUNT.—

“(A) IN GENERAL.—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—

“(i) the total number of units determined under subparagraph (B) for the billing and payment code of such drug; and

“(ii) the amount (if any) by which—

“(I) the amount equal to—

“(aa) 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

“(bb) 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

“(II) the inflation-adjusted payment amount determined under subparagraph (C) for such part B rebatable drug during the calendar quarter.

“(B) TOTAL NUMBER OF UNITS.—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—

“(i) the number of units for the billing and payment code of such drug furnished during such calendar quarter, minus

“(ii) the number of units for such billing and payment code of such drug furnished during such calendar quarter—

“(I) 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

“(II) that are packaged into the payment amount for an item or service and are not separately payable.

“(C) DETERMINATION OF INFLATION-ADJUSTED PAYMENT AMOUNT.—The inflation-adjusted payment amount determined under this subparagraph for a part B rebatable drug for a calendar quarter is—

“(i) 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

“(ii) 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)).

“(D) PAYMENT AMOUNT BENCHMARK QUARTER.—The term ‘payment amount benchmark quarter’ means the calendar quarter beginning July 1, 2021.

“(E) BENCHMARK PERIOD CPI–U.—The term ‘benchmark period CPI–U’ means the consumer price index for all urban consumers (United States city average) for January 2021.

“(F) REBATE PERIOD CPI–U.—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.

“(G) REDUCTION OR WAIVER FOR SHORTAGES AND SEVERE SUPPLY CHAIN DISRUPTIONS.—The Secretary shall reduce or waive the amount under subparagraph (A) with respect to a part B rebatable drug and a calendar quarter—

“(i) 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

“(ii) 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.

“(4) SPECIAL TREATMENT OF CERTAIN DRUGS AND EXEMPTION.—

“(A) SUBSEQUENTLY APPROVED DRUGS.—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’.

“(B) TIMELINE FOR PROVISION OF REBATES FOR SUBSEQUENTLY APPROVED DRUGS.—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’.

“(C) SELECTED DRUGS.—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’.

“(5) APPLICATION TO BENEFICIARY COINSURANCE.—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—

“(A) 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

“(B) 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).

“(6) REBATE DEPOSITS.—Amounts paid as rebates under paragraph (1)(B) shall be deposited into the Federal Supplementary Medical Insurance Trust Fund established under section 1841.

“(7) CIVIL MONEY PENALTY.—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).

“(8) LIMITATION ON ADMINISTRATIVE OR JUDICIAL REVIEW.—There shall be no administrative or judicial review of any of the following:

“(A) The determination of units under this subsection.

“(B) The determination of whether a drug is a part B rebatable drug under this subsection.

“(C) The calculation of the rebate amount under this subsection.

“(D) The computation of coinsurance under paragraph (5) of this subsection.

“(E) The computation of amounts paid under section 1833(a)(1)(EE).”.

(b) Amounts payable; cost-Sharing.—Section 1833 of the Social Security Act (42 U.S.C. 1395l) is amended—

(1) in subsection (a)(1)—

(A) in subparagraph (G), by inserting “, subject to subsection (i)(9),” after “the amounts paid”;

(B) in subparagraph (S), by striking “with respect to” and inserting “subject to subparagraph (EE), with respect to”;

(C) by striking “and (DD)” and inserting “(DD)”; and

(D) 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)”;

(2) in subsection (i), by adding at the end the following new paragraph:

“(9) 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

(3) in subsection (t)(8), by adding at the end the following new subparagraph:

“(F) PART B REBATABLE DRUGS.—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.”.

(c) Conforming amendments.—

(1) TO PART B ASP CALCULATION.—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”.

(2) EXCLUDING PART B DRUG INFLATION REBATE FROM BEST PRICE.—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”.

(3) COORDINATION WITH MEDICAID REBATE INFORMATION DISCLOSURE.—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”.

(4) EXCLUDING PART B DRUG INFLATION REBATES FROM AVERAGE MANUFACTURER PRICE.—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—

(A) in subclause (V), by striking “and” at the end;

(B) in subclause (VI), by striking the period at the end and inserting a semicolon; and

(C) by adding at the end the following new subclause:

“(VII) rebates paid by manufacturers under section 1847A(i); and”.

(d) Funding.—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.

(a) In general.—Part D of title XVIII of the Social Security Act is amended by inserting after section 1860D–14A (42 U.S.C. 1395w–114a) the following new section:

(b) Conforming amendments.—

(1) TO PART B ASP CALCULATION.—Section 1847A(c)(3) of the Social Security Act (42 U.S.C. 1395w–3a(c)(3)), as amended by section 11101(c)(1), is amended by striking “subsection (i) or section 1927” and inserting “subsection (i), section 1927, or section 1860D–14B”.

(2) EXCLUDING PART D DRUG INFLATION REBATE FROM BEST PRICE.—Section 1927(c)(1)(C)(ii)(I) of the Social Security Act (42 U.S.C. 1396r–8(c)(1)(C)(ii)(I)), as amended by section 11101(c)(2), is amended by striking “or section 1847A(i)” and inserting “, section 1847A(i), or section 1860D–14B”.

(3) COORDINATION WITH MEDICAID REBATE INFORMATION DISCLOSURE.—Section 1927(b)(3)(D)(i) of the Social Security Act (42 U.S.C. 1396r–8(b)(3)(D)(i)), as amended by sections 11002(b) and 11101(c)(3), is amended by striking “or section 1192(f), including rebates under paragraph (4) of such section” and inserting “, section 1192(f), including rebates under paragraph (4) of such section, or section 1860D–14B”.

(4) EXCLUDING PART D DRUG INFLATION REBATES FROM AVERAGE MANUFACTURER PRICE.—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) and section 11101(c)(4), is amended by adding at the end the following new subclause:

(A) in subclause (VI), by striking “and” at the end;

(B) in subclause (VII), by striking the period at the end and inserting a semicolon; and

(C) by adding at the end the following new subclause:

“(VIII) rebates paid by manufacturers under section 1860D–14B.”.

(c) Funding.—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.

(a) Benefit structure redesign.—Section 1860D–2(b) of the Social Security Act (42 U.S.C. 1395w–102(b)) is amended—

(1) in paragraph (2)—

(A) in subparagraph (A), in the matter preceding clause (i), by inserting “for a year preceding 2025 and for costs above the annual deductible specified in paragraph (1) and up to the annual out-of-pocket threshold specified in paragraph (4)(B) for 2025 and each subsequent year” after “paragraph (3)”;

(B) in subparagraph (C)—

(i) in clause (i), in the matter preceding subclause (I), by inserting “for a year preceding 2025, ” after “paragraph (4),”; and

(ii) in clause (ii)(III), by striking “and each subsequent year” and inserting “through 2024”; and

(C) in subparagraph (D)—

(i) in clause (i)—

(I) in the matter preceding subclause (I), by inserting “for a year preceding 2025, ” after “paragraph (4),”; and

(II) in subclause (I)(bb), by striking “a year after 2018” and inserting “each of years 2019 through 2024”; and

(ii) in clause (ii)(V), by striking “2019 and each subsequent year” and inserting “each of years 2019 through 2024”;

(2) in paragraph (3)(A)—

(A) in the matter preceding clause (i), by inserting “for a year preceding 2025,” after “and (4),”; and

(B) in clause (ii), by striking “for a subsequent year” and inserting “for each of years 2007 through 2024”; and

(3) in paragraph (4)—

(A) in subparagraph (A)—

(i) in clause (i)—

(I) by redesignating subclauses (I) and (II) as items (aa) and (bb), respectively, and moving the margin of each such redesignated item 2 ems to the right;

(II) in the matter preceding item (aa), as redesignated by subclause (I), by striking “is equal to the greater of—” and inserting “is equal to—

“(I) for a year preceding 2024, the greater of—”;

(III) by striking the period at the end of item (bb), as redesignated by subclause (I), and inserting “; and”; and

(IV) by adding at the end the following:

“(II) for 2024 and each succeeding year, $0.”; and

(ii) in clause (ii)—

(I) by striking “clause (i)(I)” and inserting “clause (i)(I)(aa)”; and

(II) by adding at the end the following new sentence: “The Secretary shall continue to calculate the dollar amounts specified in clause (i)(I)(aa), including with the adjustment under this clause, after 2023 for purposes of section 1860D–14(a)(1)(D)(iii).”;

(B) in subparagraph (B)—

(i) in clause (i)—

(I) in subclause (V), by striking “or” at the end;

(II) in subclause (VI)—

(aa) by striking “for a subsequent year” and inserting “for each of years 2021 through 2024”; and

(bb) by striking the period at the end and inserting a semicolon; and

(III) by adding at the end the following new subclauses:

“(VII) for 2025, is equal to $2,000; or

“(VIII) for a subsequent year, is equal to the amount specified in this subparagraph for the previous year, increased by the annual percentage increase described in paragraph (6) for the year involved.”; and

(ii) in clause (ii), by striking “clause (i)(II)” and inserting “clause (i)”;

(C) in subparagraph (C)—

(i) in clause (i), by striking “and for amounts” and inserting “and, for a year preceding 2025, for amounts”; and

(ii) in clause (iii)—

(I) by redesignating subclauses (I) through (IV) as items (aa) through (dd) and indenting appropriately;

(II) by striking “if such costs are borne or paid” and inserting “if such costs—

“(I) are borne or paid—”; and

(III) in item (dd), by striking the period at the end and inserting “; or”; and

(IV) by adding at the end the following new subclause:

“(II) for 2025 and subsequent years, are reimbursed through insurance, a group health plan, or certain other third party payment arrangements, but not including the coverage provided by a prescription drug plan or an MA–PD plan that is basic prescription drug coverage (as defined in subsection (a)(3)) or any payments by a manufacturer under the manufacturer discount program under section 1860D–14C.”; and

(D) in subparagraph (E), by striking “In applying” and inserting “For each of years 2011 through 2024, in applying”.

(b) Reinsurance payment amount.—Section 1860D–15(b) of the Social Security Act (42 U.S.C. 1395w–115(b)) is amended—

(1) in paragraph (1)—

(A) by striking “equal to 80 percent” and inserting “equal to—

“(A) for a year preceding 2025, 80 percent”;

(B) in subparagraph (A), as added by subparagraph (A), by striking the period at the end and inserting “; and”; and

(C) by adding at the end the following new subparagraph:

“(B) for 2025 and each subsequent year, the sum of—

“(i) with respect to applicable drugs (as defined in section 1860D–14C(g)(2)), an amount equal to 20 percent of such allowable reinsurance costs attributable to that portion of gross covered prescription drug costs as specified in paragraph (3) incurred in the coverage year after such individual has incurred costs that exceed the annual out-of-pocket threshold specified in section 1860D–2(b)(4)(B); and

“(ii) with respect to covered part D drugs that are not applicable drugs (as so defined), an amount equal to 40 percent of such allowable reinsurance costs attributable to that portion of gross covered prescription drug costs as specified in paragraph (3) incurred in the coverage year after such individual has incurred costs that exceed the annual out-of-pocket threshold specified in section 1860D–2(b)(4)(B).”;

(2) in paragraph (2)—

(A) by striking “COSTS.—For purposes” and inserting “Costs.—

“(A) IN GENERAL.—Subject to subparagraph (B), for purposes”; and

(B) by adding at the end the following new subparagraph:

“(B) INCLUSION OF MANUFACTURER DISCOUNTS ON APPLICABLE DRUGS.—For purposes of applying subparagraph (A), the term ‘allowable reinsurance costs’ shall include the portion of the negotiated price (as defined in section 1860D–14C(g)(6)) of an applicable drug (as defined in section 1860D–14C(g)(2)) that was paid by a manufacturer under the manufacturer discount program under section 1860D–14C.”; and

(3) in paragraph (3)—

(A) in the first sentence, by striking “For purposes” and inserting “Subject to paragraph (2)(B), for purposes”; and

(B) in the second sentence, by inserting “(or, with respect to 2025 and subsequent years, in the case of an applicable drug, as defined in section 1860D–14C(g)(2), by a manufacturer)” after “by the individual or under the plan”.

(c) Manufacturer discount program.—

(1) IN GENERAL.—Part D of title XVIII of the Social Security Act (42 U.S.C. 1395w–101 through 42 U.S.C. 1395w–153), as amended by section 11102, is amended by inserting after section 1860D–14B the following new sections:

(2) SUNSET OF MEDICARE COVERAGE GAP DISCOUNT PROGRAM.—Section 1860D–14A of the Social Security Act (42 U.S.C. 1395w–114a) is amended—

(A) in subsection (a), in the first sentence, by striking “The Secretary” and inserting “Subject to subsection (h), the Secretary”; and

(B) by adding at the end the following new subsection:

“(h) Sunset of program.—

“(1) IN GENERAL.—The program shall not apply with respect to applicable drugs dispensed on or after January 1, 2025, and, subject to paragraph (2), agreements under this section shall be terminated as of such date.

“(2) CONTINUED APPLICATION FOR APPLICABLE DRUGS DISPENSED PRIOR TO SUNSET.—The provisions of this section (including all responsibilities and duties) shall continue to apply on and after January 1, 2025, with respect to applicable drugs dispensed prior to such date.”.

(3) SELECTED DRUG SUBSIDY PAYMENTS FROM MEDICARE PRESCRIPTION DRUG ACCOUNT.—Section 1860D–16(b)(1) of the Social Security Act (42 U.S.C. 1395w–116(b)(1)) is amended—

(A) in subparagraph (C), by striking “and” at the end;

(B) in subparagraph (D), by striking the period at the end and inserting “; and”; and

(C) by adding at the end the following new subparagraph:

“(E) payments under section 1860D–14D (relating to selected drug subsidy payments).”.

(d) Medicare part D premium stabilization.—

(1) 2024 THROUGH 2029.—Section 1860D–13 of the Social Security Act (42 U.S.C. 1395w–113) is amended—

(A) in subsection (a)—

(i) in paragraph (1)(A), by inserting “or (8) (as applicable)” after “paragraph (2)”;

(ii) in paragraph (2), in the matter preceding subparagraph (A), by striking “The base” and inserting “Subject to paragraph (8), the base”;

(iii) in paragraph (7)—

(I) in subparagraph (B)(ii), by inserting “or (8) (as applicable)” after “paragraph (2)”; and

(II) in subparagraph (E)(i), by inserting “or (8) (as applicable)” after “paragraph (2)”; and

(iv) by adding at the end the following new paragraph:

“(8) PREMIUM STABILIZATION.—

“(A) IN GENERAL.—The base beneficiary premium under this paragraph for a prescription drug plan for a month in 2024 through 2029 shall be computed as follows:

“(i) 2024.—The base beneficiary premium for a month in 2024 shall be equal to the lesser of—

“(I) the base beneficiary premium computed under paragraph (2) for a month in 2023 increased by 6 percent; or

“(II) the base beneficiary premium computed under paragraph (2) for a month in 2024 that would have applied if this paragraph had not been enacted.

“(ii) 2025.—The base beneficiary premium for a month in 2025 shall be equal to the lesser of—

“(I) the base beneficiary premium computed under clause (i) for a month in 2024 increased by 6 percent; or

“(II) the base beneficiary premium computed under paragraph (2) for a month in 2025 that would have applied if this paragraph had not been enacted.

“(iii) 2026.—The base beneficiary premium for a month in 2026 shall be equal to the lesser of—

“(I) the base beneficiary premium computed under clause (ii) for a month in 2025 increased by 6 percent; or

“(II) the base beneficiary premium computed under paragraph (2) for a month in 2026 that would have applied if this paragraph had not been enacted.

“(iv) 2027.—The base beneficiary premium for a month in 2027 shall be equal to the lesser of—

“(I) the base beneficiary premium computed under clause (iii) for a month in 2026 increased by 6 percent; or

“(II) the base beneficiary premium computed under paragraph (2) for a month in 2027 that would have applied if this paragraph had not been enacted.

“(v) 2028.—The base beneficiary premium for a month in 2028 shall be equal to the lesser of—

“(I) the base beneficiary premium computed under clause (iv) for a month in 2027 increased by 6 percent; or

“(II) the base beneficiary premium computed under paragraph (2) for a month in 2028 that would have applied if this paragraph had not been enacted.

“(vi) 2029.—The base beneficiary premium for a month in 2029 shall be equal to the lesser of—

“(I) the base beneficiary premium computed under clause (v) for a month in 2028 increased by 6 percent; or

“(II) the base beneficiary premium computed under paragraph (2) for a month in 2029 that would have applied if this paragraph had not been enacted.

“(B) CLARIFICATION REGARDING 2030 AND SUBSEQUENT YEARS.—The base beneficiary premium for a month in 2030 or a subsequent year shall be computed under paragraph (2) without regard to this paragraph.”; and

(B) in subsection (b)(3)(A)(ii), by striking “subsection (a)(2)” and inserting “paragraph (2) or (8) of subsection (a) (as applicable)”.

(2) ADJUSTMENT TO BENEFICIARY PREMIUM PERCENTAGE FOR 2030 AND SUBSEQUENT YEARS.—Section 1860D–13(a) of the Social Security Act (42 U.S.C. 1395w–113(a)), as amended by paragraph (1), is amended—

(A) in paragraph (3)(A), by inserting “(or, for 2030 and each subsequent year, the percent specified under paragraph (9))” after “25.5 percent”; and

(B) by adding at the end the following new paragraph:

“(9) PERCENT SPECIFIED.—

“(A) IN GENERAL.—Subject to subparagraph (B), for purposes of paragraph (3)(A), the percent specified under this paragraph for 2030 and each subsequent year is the percent that the Secretary determines is necessary to ensure that the base beneficiary premium computed under paragraph (2) for a month in 2030 is equal to the lesser of—

“(i) the base beneficiary premium computed under paragraph (8)(A)(vi) for a month in 2029 increased by 6 percent; or

“(ii) the base beneficiary premium computed under paragraph (2) for a month in 2030 that would have applied if this paragraph had not been enacted.

“(B) FLOOR.—The percent specified under subparagraph (A) may not be less than 20 percent.”.

(3) CONFORMING AMENDMENTS.—

(A) Section 1854(b)(2)(B) of the Social Security Act 42 U.S.C. 1395w–24(b)(2)(B)) is amended by striking “section 1860D–13(a)(2)” and inserting “paragraph (2) or (8) (as applicable) of section 1860D–13(a)”.

(B) Section 1860D–11(g)(6) of the Social Security Act (42 U.S.C. 1395w–111(g)(6)) is amended by inserting “(or, for 2030 and each subsequent year, the percent specified under section 1860D–13(a)(9))” after “25.5 percent”.

(C) Section 1860D–13(a)(7)(B)(i) of the Social Security Act (42 U.S.C. 1395w–113(a)(7)(B)(i)) is amended—

(i) in subclause (I), by inserting “(or, for 2030 and each subsequent year, the percent specified under paragraph (9))” after “25.5 percent”; and

(ii) in subclause (II), by inserting “(or, for 2030 and each subsequent year, the percent specified under paragraph (9))” after “25.5 percent”.

(D) Section 1860D–15(a) of the Social Security Act (42 U.S.C. 1395w–115(a)) is amended—

(i) in the matter preceding paragraph (1), by inserting “(or, for each of 2024 through 2029, the percent applicable as a result of the application of section 1860D–13(a)(8), or, for 2030 and each subsequent year, 100 percent minus the percent specified under section 1860D–13(a)(9))” after “74.5 percent”; and

(ii) in paragraph (1)(B), by striking “paragraph (2) of section 1860D–13(a)” and inserting “paragraph (2) or (8) of section 1860D–13(a) (as applicable)”.

(e) Conforming amendments.—

(1) Section 1860D–2 of the Social Security Act (42 U.S.C. 1395w–102) is amended—

(A) in subsection (a)(2)(A)(i)(I), by striking “, or an increase in the initial” and inserting “or, for a year preceding 2025, an increase in the initial”;

(B) in subsection (c)(1)(C)—

(i) in the subparagraph heading, by striking “at initial coverage limit”; and

(ii) by inserting “for a year preceding 2025 or the annual out-of-pocket threshold specified in subsection (b)(4)(B) for the year for 2025 and each subsequent year” after “subsection (b)(3) for the year” each place it appears; and

(C) in subsection (d)(1)(A), by striking “or an initial” and inserting “or, for a year preceding 2025, an initial”.

(2) Section 1860D–4(a)(4)(B)(i) of the Social Security Act (42 U.S.C. 1395w–104(a)(4)(B)(i)) is amended by striking “the initial” and inserting “for a year preceding 2025, the initial”.

(3) Section 1860D–14(a) of the Social Security Act (42 U.S.C. 1395w–114(a)) is amended—

(A) in paragraph (1)—

(i) in subparagraph (C), by striking “The continuation” and inserting “For a year preceding 2025, the continuation”;

(ii) in subparagraph (D)(iii), by striking “1860D–2(b)(4)(A)(i)(I)” and inserting “1860D–2(b)(4)(A)(i)(I)(aa)”; and

(iii) in subparagraph (E), by striking “The elimination” and inserting “For a year preceding 2024, the elimination”; and

(B) in paragraph (2)(E), by striking “1860D–2(b)(4)(A)(i)(I)” and inserting “1860D–2(b)(4)(A)(i)(I)(aa)”.

(4) Section 1860D–21(d)(7) of the Social Security Act (42 U.S.C. 1395w–131(d)(7)) is amended by striking “section 1860D–2(b)(4)(B)(i)” and inserting “section 1860D–2(b)(4)(C)(i)”.

(5) Section 1860D–22(a)(2)(A) of the Social Security Act (42 U.S.C. 1395w–132(a)(2)(A)) is amended—

(A) by striking “the value of any discount” and inserting the following: “the value of—

“(i) for years prior to 2025, any discount”;

(B) in clause (i), as inserted by subparagraph (A) of this paragraph, by striking the period at the end and inserting “; and”; and

(C) by adding at the end the following new clause:

“(ii) for 2025 and each subsequent year, any discount provided pursuant to section 1860D–14C.”.

(6) Section 1860D–41(a)(6) of the Social Security Act (42 U.S.C. 1395w–151(a)(6)) is amended—

(A) by inserting “for a year before 2025” after “1860D–2(b)(3)”; and

(B) by inserting “for such year” before the period.

(7) Section 1860D–43 of the Social Security Act (42 U.S.C. 1395w–153) is amended—

(A) in subsection (a)—

(i) by striking paragraph (1) and inserting the following:

“(1) participate in—

“(A) for 2011 through 2024, the Medicare coverage gap discount program under section 1860D–14A; and

“(B) for 2025 and each subsequent year, the manufacturer discount program under section 1860D–14C;”;

(ii) by striking paragraph (2) and inserting the following:

“(2) have entered into and have in effect—

“(A) for 2011 through 2024, an agreement described in subsection (b) of section 1860D–14A with the Secretary; and

“(B) for 2025 and each subsequent year, an agreement described in subsection (b) of section 1860D–14C with the Secretary; and”; and

(iii) in paragraph (3), by striking “such section” and inserting “section 1860D–14A”; and

(B) by striking subsection (b) and inserting the following:

“(b) Effective date.—Paragraphs (1)(A), (2)(A), and (3) of subsection (a) shall apply to covered part D drugs dispensed under this part on or after January 1, 2011, and before January 1, 2025, and paragraphs (1)(B) and (2)(B) of such subsection shall apply to covered part D drugs dispensed under this part on or after January 1, 2025.”.

(8) Section 1927 of the Social Security Act (42 U.S.C. 1396r–8) is amended—

(A) in subsection (c)(1)(C)(i)(VI), by inserting before the period at the end the following: “or under the manufacturer discount program under section 1860D–14C”; and

(B) in subsection (k)(1)(B)(i)(V), by inserting before the period at the end the following: “or under section 1860D–14C”.

(f) Implementation for 2024 through 2026.—The Secretary shall implement this section, including the amendments made by this section, for 2024, 2025, and 2026 by program instruction or other forms of program guidance.

(g) Funding.—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, $341,000,000 for fiscal year 2022, including $20,000,000 and $65,000,000 to carry out the provisions of, including the amendments made by, this section in fiscal years 2022 and 2023, respectively, and $32,000,000 to carry out the provisions of, including the amendments made by, this section in each of fiscal years 2024 through 2031, to remain available until expended.

(a) In general.—Section 1860D–2(b) of the Social Security Act (42 U.S.C. 1395w–102(b)) is amended—

(1) in paragraph (2)—

(A) in subparagraph (A), by striking “and (D)” and inserting “, (D), and (E)”; and

(B) by adding at the end the following new subparagraph:

“(E) MAXIMUM MONTHLY CAP ON COST-SHARING PAYMENTS.—

“(i) IN GENERAL.—For plan years beginning on or after January 1, 2025, each PDP sponsor offering a prescription drug plan and each MA organization offering an MA–PD plan shall provide to any enrollee of such plan, including an enrollee who is a subsidy eligible individual (as defined in paragraph (3) of section 1860D–14(a)), the option to elect with respect to a plan year to pay cost-sharing under the plan in monthly amounts that are capped in accordance with this subparagraph.

“(ii) DETERMINATION OF MAXIMUM MONTHLY CAP.—For each month in the plan year for which an enrollee in a prescription drug plan or an MA–PD plan has made an election pursuant to clause (i), the PDP sponsor or MA organization shall determine a maximum monthly cap (as defined in clause (iv)) for such enrollee.

“(iii) BENEFICIARY MONTHLY PAYMENTS.—With respect to an enrollee who has made an election pursuant to clause (i), for each month described in clause (ii), the PDP sponsor or MA organization shall bill such enrollee an amount (not to exceed the maximum monthly cap) for the out-of-pocket costs of such enrollee in such month.

“(iv) MAXIMUM MONTHLY CAP DEFINED.—In this subparagraph, the term ‘maximum monthly cap’ means, with respect to an enrollee—

“(I) for the first month for which the enrollee has made an election pursuant to clause (i), an amount determined by calculating—

“(aa) the annual out-of-pocket threshold specified in paragraph (4)(B) minus the incurred costs of the enrollee as described in paragraph (4)(C); divided by

“(bb) the number of months remaining in the plan year; and

“(II) for a subsequent month, an amount determined by calculating—

“(aa) the sum of any remaining out-of-pocket costs owed by the enrollee from a previous month that have not yet been billed to the enrollee and any additional out-of-pocket costs incurred by the enrollee; divided by

“(bb) the number of months remaining in the plan year.

“(v) ADDITIONAL REQUIREMENTS.—The following requirements shall apply with respect to the option to make an election pursuant to clause (i) under this subparagraph:

“(I) SECRETARIAL RESPONSIBILITIES.—The Secretary shall provide information to part D eligible individuals on the option to make such election through educational materials, including through the notices provided under section 1804(a).

“(II) TIMING OF ELECTION.—An enrollee in a prescription drug plan or an MA–PD plan may make such an election—

“(aa) prior to the beginning of the plan year; or

“(bb) in any month during the plan year.

“(III) PDP SPONSOR AND MA ORGANIZATION RESPONSIBILITIES.—Each PDP sponsor offering a prescription drug plan or MA organization offering an MA–PD plan—

“(aa) may not limit the option for an enrollee to make such an election to certain covered part D drugs;

“(bb) shall, prior to the plan year, notify prospective enrollees of the option to make such an election in promotional materials;

“(cc) shall include information on such option in enrollee educational materials;

“(dd) shall have in place a mechanism to notify a pharmacy during the plan year when an enrollee incurs out-of-pocket costs with respect to covered part D drugs that make it likely the enrollee may benefit from making such an election;

“(ee) shall provide that a pharmacy, after receiving a notification described in item (dd) with respect to an enrollee, informs the enrollee of such notification;

“(ff) shall ensure that such an election by an enrollee has no effect on the amount paid to pharmacies (or the timing of such payments) with respect to covered part D drugs dispensed to the enrollee; and

“(gg) shall have in place a financial reconciliation process to correct inaccuracies in payments made by an enrollee under this subparagraph with respect to covered part D drugs during the plan year.

“(IV) FAILURE TO PAY AMOUNT BILLED.—If an enrollee fails to pay the amount billed for a month as required under this subparagraph—

“(aa) the election of the enrollee pursuant to clause (i) shall be terminated and the enrollee shall pay the cost-sharing otherwise applicable for any covered part D drugs subsequently dispensed to the enrollee up to the annual out-of-pocket threshold specified in paragraph (4)(B); and

“(bb) the PDP sponsor or MA organization may preclude the enrollee from making an election pursuant to clause (i) in a subsequent plan year.

“(V) CLARIFICATION REGARDING PAST DUE AMOUNTS.—Nothing in this subparagraph shall be construed as prohibiting a PDP sponsor or an MA organization from billing an enrollee for an amount owed under this subparagraph.

“(VI) TREATMENT OF UNSETTLED BALANCES.—Any unsettled balances with respect to amounts owed under this subparagraph shall be treated as plan losses and the Secretary shall not be liable for any such balances outside of those assumed as losses estimated in plan bids.”; and

(2) in paragraph (4)—

(A) in subparagraph (C), by striking “subparagraph (E)” and inserting “subparagraph (E) or subparagraph (F)”; and

(B) by adding at the end the following new subparagraph:

“(F) INCLUSION OF COSTS PAID UNDER MAXIMUM MONTHLY CAP OPTION.—In applying subparagraph (A), with respect to an enrollee who has made an election pursuant to clause (i) of paragraph (2)(E), costs shall be treated as incurred if such costs are paid by a PDP sponsor or an MA organization under the option provided under such paragraph.”.

(b) Application to alternative prescription drug coverage.—Section 1860D–2(c) of the Social Security Act (42 U.S.C. 1395w–102(c)) is amended by adding at the end the following new paragraph:

“(4) SAME MAXIMUM MONTHLY CAP ON COST-SHARING.—The maximum monthly cap on cost-sharing payments shall apply to coverage with respect to an enrollee who has made an election pursuant to clause (i) of subsection (b)(2)(E) under the option provided under such subsection.”.

(c) Implementation for 2025.—The Secretary shall implement this section, including the amendments made by this section, for 2025 by program instruction or other forms of program guidance.

(d) Funding.—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, $10,000,000 for fiscal year 2023, to remain available until expended, to carry out the provisions of, including the amendments made by, this section.

The Secretary of Health and Human Services shall not, prior to January 1, 2032, implement, administer, or enforce the provisions of the final rule published by the Office of the Inspector General of the Department of Health and Human Services on November 30, 2020, and titled “Fraud and Abuse; Removal of Safe Harbor Protection for Rebates Involving Prescription Pharmaceuticals and Creation of New Safe Harbor Protection for Certain Point-of-Sale Reductions in Price on Prescription Pharmaceuticals and Certain Pharmacy Benefit Manager Service Fees ” (85 Fed. Reg. 76666).

(a) Ensuring treatment of cost-sharing and deductible is consistent with treatment of vaccines under medicare part b.—Section 1860D–2 of the Social Security Act (42 U.S.C. 1395w–102), as amended by sections 11201 and 11202, is amended—

(1) in subsection (b)—

(A) in paragraph (1)(A), by striking “The coverage” and inserting “Subject to paragraph (8), the coverage”;

(B) in paragraph (2)—

(i) in subparagraph (A), by inserting “and paragraph (8)” after “and (E)”;

(ii) in subparagraph (C)(i), in the matter preceding subclause (I), by striking “paragraph (4)” and inserting “paragraphs (4) and (8)”; and

(iii) in subparagraph (D)(i), in the matter preceding subclause (I), by striking “paragraph (4)” and inserting “paragraphs (4) and (8)”;

(C) in paragraph (3)(A), in the matter preceding clause (i), by striking “and (4)” and inserting “(4), and (8)”;

(D) in paragraph (4)(A)(i), by striking “The coverage” and inserting “Subject to paragraph (8), the coverage”; and

(E) by adding at the end the following new paragraph:

“(8) TREATMENT OF COST-SHARING FOR ADULT VACCINES RECOMMENDED BY THE ADVISORY COMMITTEE ON IMMUNIZATION PRACTICES CONSISTENT WITH TREATMENT OF VACCINES UNDER PART B.—

“(A) IN GENERAL.—For plan years beginning on or after January 1, 2023, with respect to an adult vaccine recommended by the Advisory Committee on Immunization Practices (as defined in subparagraph (B))—

“(i) the deductible under paragraph (1) shall not apply; and

“(ii) there shall be no coinsurance or other cost-sharing under this part with respect to such vaccine.

“(B) ADULT VACCINES RECOMMENDED BY THE ADVISORY COMMITTEE ON IMMUNIZATION PRACTICES.—For purposes of this paragraph, the term ‘adult vaccine recommended by the Advisory Committee on Immunization Practices’ means a covered part D drug that is a vaccine licensed under section 351 of the Public Health Service Act for use by adult populations and administered in accordance with recommendations of the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention.”; and

(2) in subsection (c), by adding at the end the following new paragraph:

“(5) TREATMENT OF COST-SHARING FOR ADULT VACCINES RECOMMENDED BY THE ADVISORY COMMITTEE ON IMMUNIZATION PRACTICES.—The coverage is in accordance with subsection (b)(8).”.

(b) Conforming amendments to cost-sharing for low-income individuals.—Section 1860D–14(a) of the Social Security Act (42 U.S.C. 1395w–114(a)), as amended by section 11201, is amended—

(1) in paragraph (1)(D), in each of clauses (ii) and (iii), by striking “In the case” and inserting “Subject to paragraph (6), in the case”;

(2) in paragraph (2)—

(A) in subparagraph (B), by striking “A reduction” and inserting “Subject to section 1860D–2(b)(8), a reduction”;

(B) in subparagraph (D), by striking “The substitution” and inserting “Subject to paragraph (6), the substitution”; and

(C) in subparagraph (E), by striking “subsection (c)” and inserting “paragraph (6) of this subsection and subsection (c)”; and

(3) by adding at the end the following new paragraph:

“(6) NO APPLICATION OF COST-SHARING OR DEDUCTIBLE FOR ADULT VACCINES RECOMMENDED BY THE ADVISORY COMMITTEE ON IMMUNIZATION PRACTICES.—For plan years beginning on or after January 1, 2023, with respect to an adult vaccine recommended by the Advisory Committee on Immunization Practices (as defined in section 1860D–2(b)(8)(B))—

“(A) the deductible under section 1860D–2(b)(1) shall not apply; and

“(B) there shall be no cost-sharing under this section with respect to such vaccine.”.

(c) Temporary retrospective subsidy.—

(1) IN GENERAL.—Section 1860D–15 of the Social Security Act (42 U.S.C. 1395w–115) is amended by adding at the end the following new subsection:

“(h) Temporary retrospective subsidy for reduction in cost-sharing and deductible for adult vaccines recommended by the advisory committee on immunization practices during 2023.—

“(1) IN GENERAL.—In addition to amounts otherwise payable under this section to a PDP sponsor of a prescription drug plan or an MA organization offering an MA–PD plan, for plan year 2023, the Secretary shall provide the PDP sponsor or MA organization offering the plan subsidies in an amount equal to the aggregate reduction in cost-sharing and deductible by reason of the application of section 1860D–2(b)(8) for individuals under the plan during the year.

“(2) TIMING.—The Secretary shall provide a subsidy under paragraph (1), as applicable, not later than 18 months following the end of the applicable plan year.”.

(2) TREATMENT AS INCURRED COSTS.—Section 1860D–2(b)(4)(C)(iii)(I) of the Social Security Act (42 U.S.C. 1395w–102(b)(4)(C)(iii)(I)), as amended by section 11201(a)(3)(C), is amended—

(A) in item (cc), by striking “or” at the end; and

(B) by adding at the end the following new item:

“(dd) under section 1860D–15(h); or”.

(d) Rule of construction.—Nothing in this section shall be construed as limiting coverage under part D of title XVIII of the Social Security Act for vaccines that are not recommended by the Advisory Committee on Immunization Practices.

(e) Implementation for 2023 through 2025.—The Secretary shall implement this section, including the amendments made by this section, for 2023, 2024, and 2025, by program instruction or other forms of program guidance.

Section 1847A(c)(4) of the Social Security Act (42 U.S.C. 1395w–3a(c)(4)) is amended—

Section 1847A(b)(8) of the Social Security Act (42 U.S.C. 1395w–3a(b)(8)) is amended—

Section 1860D–14(a) of the Social Security Act (42 U.S.C. 1395w–114(a)), as amended by sections 11201 and 11401, is amended—

(a) Medicaid.—

(1) REQUIRING COVERAGE OF ADULT VACCINATIONS.—

(A) IN GENERAL.—Section 1902(a)(10)(A) of the Social Security Act (42 U.S.C. 1396a(a)(10)(A)) is amended in the matter preceding clause (i) by inserting “(13)(B),” after “(5),”.

(B) MEDICALLY NEEDY.—Section 1902(a)(10)(C)(iv) of such Act (42 U.S.C. 1396a(a)(10)(C)(iv)) is amended by inserting “, (13)(B),” after “(5)”.

(2) NO COST SHARING FOR VACCINATIONS.—

(A) GENERAL COST-SHARING LIMITATIONS.—Section 1916 of the Social Security Act (42 U.S.C. 1396o) is amended—

(i) in subsection (a)(2)—

(I) in subparagraph (G), by inserting a comma after “State plan”;

(II) in subparagraph (H), by striking “; or” and inserting a comma;

(III) in subparagraph (I), by striking “; and” and inserting “, or”; and

(IV) by adding at the end the following new subparagraph:

“(J) vaccines described in section 1905(a)(13)(B) and the administration of such vaccines; and”; and

(ii) in subsection (b)(2)—

(I) in subparagraph (G), by inserting a comma after “State plan”;

(II) in subparagraph (H), by striking “; or” and inserting a comma;

(III) in subparagraph (I), by striking “; and” and inserting “, or”; and

(IV) by adding at the end the following new subparagraph:

“(J) vaccines described in section 1905(a)(13)(B) and the administration of such vaccines; and”.

(B) APPLICATION TO ALTERNATIVE COST SHARING.—Section 1916A(b)(3)(B) of the Social Security Act (42 U.S.C. 1396o–1(b)(3)(B)) is amended by adding at the end the following new clause:

“(xiv) Vaccines described in section 1905(a)(13)(B) and the administration of such vaccines.”.

(3) INCREASED FMAP FOR ADULT VACCINES AND THEIR ADMINISTRATION.—Section 1905(b) of the Social Security Act (42 U.S.C. 1396d(b)) is amended—

(A) by striking “and (5)” and inserting “(5)”;

(B) by striking “services and vaccines described in subparagraphs (A) and (B) of subsection (a)(13), and prohibits cost-sharing for such services and vaccines” and inserting “services described in subsection (a)(13)(A), and prohibits cost-sharing for such services”;

(C) by striking “medical assistance for such services and vaccines” and inserting “medical assistance for such services”; and

(D) by inserting “, and (6) during the first 8 fiscal quarters beginning on or after the effective date of this clause, in the case of a State which, as of the date of enactment of the Act titled ‘An Act to provide for reconciliation pursuant to title II of S. Con. Res. 14’, provides medical assistance for vaccines described in subsection (a)(13)(B) and their administration and prohibits cost-sharing for such vaccines, the Federal medical assistance percentage, as determined under this subsection and subsection (y), shall be increased by 1 percentage point with respect to medical assistance for such vaccines and their administration” before the first period.

(b) CHIP.—

(1) REQUIRING COVERAGE OF ADULT VACCINATIONS.—Section 2103(c) of the Social Security Act (42 U.S.C. 1397cc(c)) is amended by adding at the end the following paragraph:

“(12) REQUIRED COVERAGE OF APPROVED, RECOMMENDED ADULT VACCINES AND THEIR ADMINISTRATION.—Regardless of the type of coverage elected by a State under subsection (a), if the State child health plan or a waiver of such plan provides child health assistance or pregnancy-related assistance (as defined in section 2112) to an individual who is 19 years of age or older, such assistance shall include coverage of vaccines described in section 1905(a)(13)(B) and their administration.”.

(2) NO COST-SHARING FOR VACCINATIONS.—Section 2103(e)(2) of such Act (42 U.S.C. 1397cc(e)(2)) is amended by inserting “vaccines described in subsection (c)(12) (and the administration of such vaccines),” after “in vitro diagnostic products described in subsection (c)(10) (and administration of such products),”.

(c) Effective date.—The amendments made by this section take effect on the 1st day of the 1st fiscal quarter that begins on or after the date that is 1 year after the date of enactment of this Act and shall apply to expenditures made under a State plan or waiver of such plan under title XIX of the Social Security Act (42 U.S.C. 1396 through 1396w–6) or under a State child health plan or waiver of such plan under title XXI of such Act (42 U.S.C. 1397aa through 1397mm) on or after such effective date.

(a) In general.—Section 1860D–2 of the Social Security Act (42 U.S.C. 1395w–102), as amended by sections 11201, 11202, and 11401, is amended—

(1) in subsection (b)—

(A) in paragraph (1)(A), by striking “paragraph (8)” and inserting “paragraphs (8) and (9)”;

(B) in paragraph (2)—

(i) in subparagraph (A), by striking “paragraph (8)” and inserting “paragraphs (8) and (9)”;

(ii) in subparagraph (C)(i), in the matter preceding subclause (I), by striking “and (8)” and inserting “, (8), and (9)”; and

(iii) in subparagraph (D)(i), in the matter preceding subclause (I), by striking “and (8)” and inserting “, (8), and (9)”;

(C) in paragraph (3)(A), in the matter preceding clause (i), by striking “and (8)” and inserting “(8), and (9)”;

(D) in paragraph (4)(A)(i), by striking “paragraph (8)” and inserting “paragraphs (8) and (9)”; and

(E) by adding at the end the following new paragraph:

“(9) TREATMENT OF COST-SHARING FOR COVERED INSULIN PRODUCTS.—

“(A) NO APPLICATION OF DEDUCTIBLE.—For plan year 2023 and subsequent plan years, the deductible under paragraph (1) shall not apply with respect to any covered insulin product.

“(B) APPLICATION OF COST-SHARING.—

“(i) PLAN YEARS 2023 AND 2024.—For plan years 2023 and 2024, the coverage provides benefits for any covered insulin product, regardless of whether an individual has reached the initial coverage limit under paragraph (3) or the out-of-pocket threshold under paragraph (4), with cost-sharing for a month’s supply that does not exceed the applicable copayment amount.

“(ii) PLAN YEAR 2025 AND SUBSEQUENT PLAN YEARS.—For a plan year beginning on or after January 1, 2025, the coverage provides benefits for any covered insulin product, prior to an individual reaching the out-of-pocket threshold under paragraph (4), with cost-sharing for a month’s supply that does not exceed the applicable copayment amount.

“(C) COVERED INSULIN PRODUCT.—In this paragraph, the term ‘covered insulin product’ means an insulin product that is a covered part D drug covered under the prescription drug plan or MA–PD plan that is approved under section 505 of the Federal Food, Drug, and Cosmetic Act or licensed under section 351 of the Public Health Service Act and marketed pursuant to such approval or licensure, including any covered insulin product that has been deemed to be licensed under section 351 of the Public Health Service Act pursuant to section 7002(e)(4) of the Biologics Price Competition and Innovation Act of 2009 and marketed pursuant to such section.

“(D) APPLICABLE COPAYMENT AMOUNT.—In this paragraph, the term ‘applicable copayment amount’ means, with respect to a covered insulin product under a prescription drug plan or an MA–PD plan dispensed—

“(i) during plan years 2023, 2024, and 2025, $35; and

“(ii) during plan year 2026 and each subsequent plan year, the lesser of—

“(I) $35;

“(II) an amount equal to 25 percent of the maximum fair price established for the covered insulin product in accordance with part E of title XI; or

“(III) an amount equal to 25 percent of the negotiated price of the covered insulin product under the prescription drug plan or MA–PD plan.

“(E) SPECIAL RULE FOR FIRST 3 MONTHS OF 2023.—With respect to a month’s supply of a covered insulin product dispensed during the period beginning on January 1, 2023, and ending on March 31, 2023, a PDP sponsor offering a prescription drug plan or an MA organization offering an MA–PD plan shall reimburse an enrollee within 30 days for any cost-sharing paid by such enrollee that exceeds the cost-sharing applied by the prescription drug plan or MA–PD plan under subparagraph (B)(i) at the point-of-sale for such month’s supply.”; and

(2) in subsection (c), by adding at the end the following new paragraph:

“(6) TREATMENT OF COST-SHARING FOR COVERED INSULIN PRODUCTS.—The coverage is provided in accordance with subsection (b)(9).”.

(b) Conforming amendments to cost-sharing for low-income individuals.—Section 1860D–14(a) of the Social Security Act (42 U.S.C. 1395w–114(a)), as amended by sections 11201, 11401, and 11404, is amended—

(1) in paragraph (1)—

(A) in subparagraph (D)(iii), by adding at the end the following new sentence: “For plan year 2023 and subsequent plan years, the copayment amount applicable under the preceding sentence to a month’s supply of a covered insulin product (as defined in section 1860D–2(b)(9)(C)) dispensed to the individual may not exceed the applicable copayment amount for the product under the prescription drug plan or MA–PD plan in which the individual is enrolled.”; and

(B) in subparagraph (E), by inserting the following before the period at the end: “or under section 1860D–2(b)(9) in the case of a covered insulin product (as defined in subparagraph (C) of such section)”; and

(2) in paragraph (2)—

(A) in subparagraph (B), by striking “section 1860D–2(b)(8)” and inserting “paragraphs (8) and (9) of section 1860D–2(b)”;

(B) in subparagraph (D), by adding at the end the following new sentence: “For plan year 2023, the amount of the coinsurance applicable under the preceding sentence to a month’s supply of a covered insulin product (as defined in section 1860D–2(b)(9)(C)) dispensed to the individual may not exceed the applicable copayment amount for the product under the prescription drug plan or MA–PD plan in which the individual is enrolled.”; and

(C) in subparagraph (E), by adding at the end the following new sentence: “For plan year 2023, the amount of the copayment or coinsurance applicable under the preceding sentence to a month’s supply of a covered insulin product (as defined in section 1860D–2(b)(9)(C)) dispensed to the individual may not exceed the applicable copayment amount for the product under the prescription drug plan or MA–PD plan in which the individual is enrolled.”.

(c) Temporary retrospective subsidy.—Section 1860D–15(h) of the Social Security Act (42 U.S.C. 1395w–115(h)), as added by section 11401(c), is amended—

(1) in the subsection heading, by inserting “and insulin” after “practices”; and

(2) in paragraph (1), by striking “section 1860D–2(b)(8)” and inserting “paragraph (8) or (9) of section 1860D–2(b)”.

(d) Implementation for 2023 through 2025.—The Secretary shall implement this section for plan years 2023, 2024, and 2025 by program instruction or other forms of program guidance.

(e) Funding.—In addition to amounts otherwise available, there is appropriated to the Centers for Medicare & Medicaid Services, out of any money in the Treasury not otherwise appropriated, $1,500,000 for fiscal year 2022, to remain available until expended, to carry out the provisions of, including the amendments made by, this section.

(a) Waiver of deductible.—The first sentence of section 1833(b) of the Social Security Act (42 U.S.C. 1395l(b)) is amended—

(1) by striking “and (12)” and inserting “(12)”; and

(2) by inserting before the period the following: “, and (13) such deductible shall not apply with respect to insulin furnished on or after July 1, 2023, through an item of durable medical equipment covered under section 1861(n).”.

(b) Coinsurance.—

(1) IN GENERAL.—Section 1833(a)(1)(S) of the Social Security Act (42 U.S.C. 1395l(a)(1)(S)) is amended—

(A) by inserting “(i) except as provided in clause (ii),” after “(S)”; and

(B) by inserting after “or 1847B),” the following: “and (ii) with respect to insulin furnished on or after July 1, 2023, through an item of durable medical equipment covered under section 1861(n), the amounts paid shall be, subject to the fourth sentence of this subsection, 80 percent of the payment amount established under section 1847A (or section 1847B, if applicable) for such insulin,”.

(2) ADJUSTMENT TO SUPPLIER PAYMENTS; LIMITATION ON MONTHLY COINSURANCE.—Section 1833(a) of the Social Security Act (42 U.S.C. 1395l(a)) is amended, in the flush matter at the end, by adding at the end the following new sentence: “The Secretary shall make such adjustments as may be necessary to the amounts paid as specified under paragraph (1)(S)(ii) for insulin furnished on or after July 1, 2023, through an item of durable medical equipment covered under section 1861(n), such that the amount of coinsurance payable by an individual enrolled under this part for a month’s supply of such insulin does not exceed $35.”.

(c) Implementation.—The Secretary of Health and Human Services shall implement this section for 2023 by program instruction or other forms of program guidance.

(a) In general.—Paragraph (2) of section 223(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

“(G) SAFE HARBOR FOR ABSENCE OF DEDUCTIBLE FOR CERTAIN INSULIN PRODUCTS.—

“(i) IN GENERAL.—A plan shall not fail to be treated as a high deductible health plan by reason of failing to have a deductible for selected insulin products.

“(ii) SELECTED INSULIN PRODUCTS.—For purposes of this subparagraph—

“(I) IN GENERAL.—The term ‘selected insulin products’ means any dosage form (such as vial, pump, or inhaler dosage forms) of any different type (such as rapid-acting, short-acting, intermediate-acting, long-acting, ultra long-acting, and premixed) of insulin.

“(II) INSULIN.—The term ‘insulin’ means insulin that is licensed under subsection (a) or (k) of section 351 of the Public Health Service Act (42 U.S.C. 262) and continues to be marketed under such section, including any insulin product that has been deemed to be licensed under section 351(a) of such Act pursuant to section 7002(e)(4) of the Biologics Price Competition and Innovation Act of 2009 (Public Law 111–148) and continues to be marketed pursuant to such licensure.”.

(b) Effective date.—The amendment made by this section shall apply to plan years beginning after December 31, 2022.

(a) In general.—Clause (iii) of section 36B(b)(3)(A) of the Internal Revenue Code of 1986 is amended—

(1) by striking “in 2021 or 2022” and inserting “after December 31, 2020, and before January 1, 2026”, and

(2) by striking “2021 and 2022” in the heading and inserting “2021 through 2025”.

(b) Extension through 2025 of rule to allow credit to taxpayers whose household income exceeds 400 percent of the poverty line.—Section 36B(c)(1)(E) of the Internal Revenue Code of 1986 is amended—

(1) by striking “in 2021 or 2022” and inserting “after December 31, 2020, and before January 1, 2026”, and

(2) by striking “2021 and 2022” in the heading and inserting “2021 through 2025”.

(c) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2022.

Except as otherwise expressly provided, whenever in this subtitle an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.

(a) In general.—The following provisions of section 45(d) are each amended by striking “January 1, 2022” each place it appears and inserting “January 1, 2025”:

(1) Paragraph (2)(A).

(2) Paragraph (3)(A).

(3) Paragraph (6).

(4) Paragraph (7).

(5) Paragraph (9).

(6) Paragraph (11)(B).

(b) Base credit amount.—Section 45 is amended—

(1) in subsection (a)(1), by striking “1.5 cents” and inserting “0.3 cents”, and

(2) in subsection (b)(2), by striking “1.5 cent” and inserting “0.3 cent”.

(c) Application of extension to geothermal and solar.—Section 45(d)(4) is amended by striking “and which” and all that follows through “January 1, 2022” and inserting “and the construction of which begins before January 1, 2025”.

(d) Extension of election to treat qualified facilities as energy property.—Section 48(a)(5)(C)(ii) is amended by striking “January 1, 2022” and inserting “January 1, 2025”.

(e) Application of extension to wind facilities.—

(1) IN GENERAL.—Section 45(d)(1) is amended by striking “January 1, 2022” and inserting “January 1, 2025”.

(2) APPLICATION OF PHASEOUT PERCENTAGE.—

(A) RENEWABLE ELECTRICITY PRODUCTION CREDIT.—Section 45(b)(5) is amended by inserting “which is placed in service before January 1, 2022” after “using wind to produce electricity”.

(B) ENERGY CREDIT.—Section 48(a)(5)(E) is amended by inserting “placed in service before January 1, 2022, and” before “treated as energy property”.

(3) QUALIFIED OFFSHORE WIND FACILITIES UNDER ENERGY CREDIT.—Section 48(a)(5)(F)(i) is amended by striking “offshore wind facility” and all that follows and inserting the following: “offshore wind facility, subparagraph (E) shall not apply.”.

(f) Wage and apprenticeship requirements.—Section 45(b) is amended by adding at the end the following new paragraphs:

“(6) INCREASED CREDIT AMOUNT FOR QUALIFIED FACILITIES.—

“(A) IN GENERAL.—In the case of any qualified facility which satisfies the requirements of subparagraph (B), the amount of the credit determined under subsection (a) (determined after the application of paragraphs (1) through (5) and without regard to this paragraph) shall be equal to such amount multiplied by 5.

“(B) QUALIFIED FACILITY REQUIREMENTS.—A qualified facility meets the requirements of this subparagraph if it is one of the following:

“(i) A facility with a maximum net output of less than 1 megawatt (as measured in alternating current).

“(ii) A facility the construction of which begins prior to the date that is 60 days after the Secretary publishes guidance with respect to the requirements of paragraphs (7)(A) and (8).

“(iii) A facility which satisfies the requirements of paragraphs (7)(A) and (8).

“(7) PREVAILING WAGE REQUIREMENTS.—

“(A) IN GENERAL.—The requirements described in this subparagraph with respect to any qualified facility are that the taxpayer shall ensure that any laborers and mechanics employed by the taxpayer or any contractor or subcontractor in—

“(i) the construction of such facility, and

“(ii) with respect to any taxable year, for any portion of such taxable year which is within the period described in subsection (a)(2)(A)(ii), the alteration or repair of such facility,

shall be paid wages at rates not less than the prevailing rates for construction, alteration, or repair of a similar character in the locality in which such facility is located as most recently determined by the Secretary of Labor, in accordance with subchapter IV of chapter 31 of title 40, United States Code. For purposes of determining an increased credit amount under paragraph (6)(A) for a taxable year, the requirement under clause (ii) is applied to such taxable year in which the alteration or repair of the qualified facility occurs.”

“(B) CORRECTION AND PENALTY RELATED TO FAILURE TO SATISFY WAGE REQUIREMENTS.—

“(i) IN GENERAL.—In the case of any taxpayer which fails to satisfy the requirement under subparagraph (A) with respect to the construction of any qualified facility or with respect to the alteration or repair of a facility in any year during the period described in subparagraph (A)(ii), such taxpayer shall be deemed to have satisfied such requirement under such subparagraph with respect to such facility for any year if, with respect to any laborer or mechanic who was paid wages at a rate below the rate described in such subparagraph for any period during such year, such taxpayer—

“(I) makes payment to such laborer or mechanic in an amount equal to the sum of—

“(aa) an amount equal to the difference between—

“(AA) the amount of wages paid to such laborer or mechanic during such period, and

“(BB) the amount of wages required to be paid to such laborer or mechanic pursuant to such subparagraph during such period, plus

“(bb) interest on the amount determined under item (aa) at the underpayment rate established under section 6621 (determined by substituting ‘6 percentage points’ for ‘3 percentage points’ in subsection (a)(2) of such section) for the period described in such item, and

“(II) makes payment to the Secretary of a penalty in an amount equal to the product of—

“(aa) $5,000, multiplied by

“(bb) the total number of laborers and mechanics who were paid wages at a rate below the rate described in subparagraph (A) for any period during such year.

“(ii) DEFICIENCY PROCEDURES NOT TO APPLY.—Subchapter B of chapter 63 (relating to deficiency procedures for income, estate, gift, and certain excise taxes) shall not apply with respect to the assessment or collection of any penalty imposed by this paragraph.

“(iii) INTENTIONAL DISREGARD.—If the Secretary determines that any failure described in clause (i) is due to intentional disregard of the requirements under subparagraph (A), such clause shall be applied—

“(I) in subclause (I), by substituting ‘three times the sum’ for ‘the sum’, and

“(II) in subclause (II), by substituting ‘$10,000’ for ‘5,000’ in item (aa) thereof.

“(iv) LIMITATION ON PERIOD FOR PAYMENT.—Pursuant to rules issued by the Secretary, in the case of a final determination by the Secretary with respect to any failure by the taxpayer to satisfy the requirement under subparagraph (A), subparagraph (B)(i) shall not apply unless the payments described in subclauses (I) and (II) of such subparagraph are made by the taxpayer on or before the date which is 180 days after the date of such determination.

“(8) APPRENTICESHIP REQUIREMENTS.—The requirements described in this paragraph with respect to the construction of any qualified facility are as follows:

“(A) LABOR HOURS.—

“(i) PERCENTAGE OF TOTAL LABOR HOURS.—Taxpayers shall ensure that, with respect to the construction of any qualified facility, not less than the applicable percentage of the total labor hours of the construction, alteration, or repair work (including such work performed by any contractor or subcontractor) with respect to such facility shall, subject to subparagraph (B), be performed by qualified apprentices.

“(ii) APPLICABLE PERCENTAGE.—For purposes of clause (i), the applicable percentage shall be—

“(I) in the case of a qualified facility the construction of which begins before January 1, 2023, 10 percent,

“(II) in the case of a qualified facility the construction of which begins after December 31, 2022, and before January 1, 2024, 12.5 percent, and

“(III) in the case of a qualified facility the construction of which begins after December 31, 2023, 15 percent.

“(B) APPRENTICE TO JOURNEYWORKER RATIO.—The requirement under subparagraph (A)(i) shall be subject to any applicable requirements for apprentice-to-journeyworker ratios of the Department of Labor or the applicable State apprenticeship agency.

“(C) PARTICIPATION.—Each taxpayer, contractor, or subcontractor who employs 4 or more individuals to perform construction, alteration, or repair work with respect to the construction of a qualified facility shall employ 1 or more qualified apprentices to perform such work.

“(D) EXCEPTION.—

“(i) IN GENERAL.—A taxpayer shall not be treated as failing to satisfy the requirements of this paragraph if such taxpayer—

“(I) satisfies the requirements described in clause (ii), or

“(II) subject to clause (iii), in the case of any failure by the taxpayer to satisfy the requirement under subparagraphs (A) and (C) with respect to the construction, alteration, or repair work on any qualified facility to which subclause (I) does not apply, makes payment to the Secretary of a penalty in an amount equal to the product of—

“(aa) $50, multiplied by

“(bb) the total labor hours for which the requirement described in such subparagraph was not satisfied with respect to the construction, alteration, or repair work on such qualified facility.

“(ii) GOOD FAITH EFFORT.—For purposes of clause (i), a taxpayer shall be deemed to have satisfied the requirements under this paragraph with respect to a qualified facility if such taxpayer has requested qualified apprentices from a registered apprenticeship program, as defined in section 3131(e)(3)(B), and—

“(I) such request has been denied, provided that such denial is not the result of a refusal by the taxpayer or any contractors or subcontractors engaged in the performance of construction, alteration, or repair work with respect to such qualified facility to comply with the established standards and requirements of the registered apprenticeship program, or

“(II) the registered apprenticeship program fails to respond to such request within 5 business days after the date on which such registered apprenticeship program received such request.

“(iii) INTENTIONAL DISREGARD.—If the Secretary determines that any failure described in subclause (i)(II) is due to intentional disregard of the requirements under subparagraphs (A) and (C), subclause (i)(II) shall be applied by substituting ‘$500’ for ‘$50’ in item (aa) thereof.

“(E) DEFINITIONS.—For purposes of this paragraph—

“(i) LABOR HOURS.—The term ‘labor hours’—

“(I) means the total number of hours devoted to the performance of construction, alteration, or repair work by any individual employed by the taxpayer or by any contractor or subcontractor, and

“(II) excludes any hours worked by—

“(aa) foremen,

“(bb) superintendents,

“(cc) owners, or

“(dd) persons employed in a bona fide executive, administrative, or professional capacity (within the meaning of those terms in part 541 of title 29, Code of Federal Regulations).

“(ii) QUALIFIED APPRENTICE.—The term ‘qualified apprentice’ means an individual who is employed by the taxpayer or by any contractor or subcontractor and who is participating in a registered apprenticeship program, as defined in section 3131(e)(3)(B).

“(9) REGULATIONS AND GUIDANCE.—The Secretary shall issue such regulations or other guidance as the Secretary determines necessary to carry out the purposes of this subsection, including regulations or other guidance which provides for requirements for recordkeeping or information reporting for purposes of administering the requirements of this subsection.”.

(g) Domestic content, phaseout, and energy communities.—Section 45(b), as amended by subsection (f), is amended—

(1) by redesignating paragraph (9) as paragraph (12), and

(2) by inserting after paragraph (8) the following:

“(9) DOMESTIC CONTENT BONUS CREDIT AMOUNT.—

“(A) IN GENERAL.—In the case of any qualified facility which satisfies the requirement under subparagraph (B)(i), the amount of the credit determined under subsection (a) (determined after the application of paragraphs (1) through (8)) shall be increased by an amount equal to 10 percent of the amount so determined.

“(B) REQUIREMENT.—

“(i) IN GENERAL.—The requirement described in this clause is satisfied with respect to any qualified facility if the taxpayer certifies to the Secretary (at such time, and in such form and manner, as the Secretary may prescribe) that any steel, iron, or manufactured product which is a component of such facility (upon completion of construction) was produced in the United States (as determined under section 661 of title 49, Code of Federal Regulations).

“(ii) STEEL AND IRON.—In the case of steel or iron, clause (i) shall be applied in a manner consistent with section 661.5 of title 49, Code of Federal Regulations.

“(iii) MANUFACTURED PRODUCT.—For purposes of clause (i), the manufactured products which are components of a qualified facility upon completion of construction shall be deemed to have been produced in the United States if not less than the adjusted percentage (as determined under subparagraph (C)) of the total costs of all such manufactured products of such facility are attributable to manufactured products (including components) which are mined, produced, or manufactured in the United States.

“(C) ADJUSTED PERCENTAGE.—

“(i) IN GENERAL.—Subject to subclause (ii), for purposes of subparagraph (B)(iii), the adjusted percentage shall be 40 percent.

“(ii) OFFSHORE WIND FACILITY.—For purposes of subparagraph (B)(iii), in the case of a qualified facility which is an offshore wind facility, the adjusted percentage shall be 20 percent.

“(10) PHASEOUT FOR ELECTIVE PAYMENT.—

“(A) IN GENERAL.—In the case of a taxpayer making an election under section 6417 with respect to a credit under this section, the amount of such credit shall be replaced with—

“(i) the value of such credit (determined without regard to this paragraph), multiplied by

“(ii) the applicable percentage.

“(B) 100 PERCENT APPLICABLE PERCENTAGE FOR CERTAIN QUALIFIED FACILITIES.—In the case of any qualified facility—

“(i) which satisfies the requirements under paragraph (9)(B), or

“(ii) with a maximum net output of less than 1 megawatt (as measured in alternating current),

the applicable percentage shall be 100 percent.

“(C) PHASED DOMESTIC CONTENT REQUIREMENT.—Subject to subparagraph (D), in the case of any qualified facility which is not described in subparagraph (B), the applicable percentage shall be—

“(i) if construction of such facility began before January 1, 2024, 100 percent, and

“(ii) if construction of such facility began in calendar year 2024, 90 percent.

“(D) EXCEPTION.—

“(i) IN GENERAL.—For purposes of this paragraph, the Secretary shall provide exceptions to the requirements under this paragraph if—

“(I) the inclusion of steel, iron, or manufactured products which are produced in the United States increases the overall costs of construction of qualified facilities by more than 25 percent, or

“(II) relevant steel, iron, or manufactured products are not produced in the United States in sufficient and reasonably available quantities or of a satisfactory quality.

“(ii) APPLICABLE PERCENTAGE.—In any case in which the Secretary provides an exception pursuant to clause (i), the applicable percentage shall be 100 percent.

“(11) SPECIAL RULE FOR QUALIFIED FACILITY LOCATED IN ENERGY COMMUNITY.—

“(A) IN GENERAL.—In the case of a qualified facility which is located in an energy community, the credit determined under subsection (a) (determined after the application of paragraphs (1) through (10), without the application of paragraph (9)) shall be increased by an amount equal to 10 percent of the amount so determined.

“(B) ENERGY COMMUNITY.—For purposes of this paragraph, the term ‘energy community’ means—

“(i) a brownfield site (as defined in subparagraphs (A), (B), and (D)(ii)(III) of section 101(39) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. 9601(39))),

“(ii) a metropolitan statistical area or non-metropolitan statistical area which—

“(I) has (or, at any time during the period beginning after December 31, 2009, had) 0.17 percent or greater direct employment or 25 percent or greater local tax revenues related to the extraction, processing, transport, or storage of coal, oil, or natural gas (as determined by the Secretary), and

“(II) has an unemployment rate at or above the national average unemployment rate for the previous year (as determined by the Secretary), or

“(iii) a census tract—

“(I) in which—

“(aa) after December 31, 1999, a coal mine has closed, or

“(bb) after December 31, 2009, a coal-fired electric generating unit has been retired, or

“(II) which is directly adjoining to any census tract described in subclause (I).”.

(h) Credit reduced for tax-exempt bonds.—Section 45(b)(3) is amended to read as follows:

“(3) CREDIT REDUCED FOR TAX-EXEMPT BONDS.—The amount of the credit determined under subsection (a) with respect to any facility for any taxable year (determined after the application of paragraphs (1) and (2)) shall be reduced by the amount which is the product of the amount so determined for such year and the lesser of 15 percent or a fraction—

“(A) the numerator of which is the sum, for the taxable year and all prior taxable years, of proceeds of an issue of any obligations the interest on which is exempt from tax under section 103 and which is used to provide financing for the qualified facility, and

“(B) the denominator of which is the aggregate amount of additions to the capital account for the qualified facility for the taxable year and all prior taxable years.

The amounts under the preceding sentence for any taxable year shall be determined as of the close of the taxable year.”.

(i) Rounding adjustment.—

(1) IN GENERAL.—Section 45(b)(2) is amended by striking the second sentence and inserting the following: “If the 0.3 cent amount as increased under the preceding sentence is not a multiple of 0.05 cent, such amount shall be rounded to the nearest multiple of 0.05 cent. In any other case, if an amount as increased under this paragraph is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent.”.

(2) CONFORMING AMENDMENT.—Section 45(b)(4)(A) is amended by striking “last sentence” and inserting “last two sentences”.

(j) Hydropower.—

(1) ELIMINATION OF CREDIT RATE REDUCTION FOR QUALIFIED HYDROELECTRIC PRODUCTION AND MARINE AND HYDROKINETIC RENEWABLE ENERGY.—Section 45(b)(4)(A), as amended by the preceding provisions of this section, is amended by striking “(7), (9), or (11)” and inserting “or (7)”.

(2) MARINE AND HYDROKINETIC RENEWABLE ENERGY.—Section 45 is amended—

(A) in subsection (c)(10)(A)—

(i) in clause (iii), by striking “or”,

(ii) in clause (iv), by striking the period at the end and inserting “, or” and

(iii) by adding at the end the following:

“(v) pressurized water used in a pipeline (or similar man-made water conveyance) which is operated—

“(I) for the distribution of water for agricultural, municipal, or industrial consumption, and

“(II) not primarily for the generation of electricity.”, and

(B) in subsection (d)(11)(A), by striking “150” and inserting “25”.

(k) Effective dates.—

(1) IN GENERAL.—Except as provided in paragraphs (2) and (3), the amendments made by this section shall apply to facilities placed in service after December 31, 2021.

(2) CREDIT REDUCED FOR TAX-EXEMPT BONDS.—The amendment made by subsection (h) shall apply to facilities the construction of which begins after the date of enactment of this Act.

(3) DOMESTIC CONTENT, PHASEOUT, ENERGY COMMUNITIES, AND HYDROPOWER.—The amendments made by subsections (g) and (j) shall apply to facilities placed in service after December 31, 2022.

(a) Extension of credit.—The following provisions of section 48 are each amended by striking “January 1, 2024” each place it appears and inserting “January 1, 2025”: