---
kind: "section"
citation: "42 U.S.C. § 300gg–121"
title: "42"
title_heading: "The Public Health and Welfare"
number: "300gg–121"
heading: "Oversight of entities that provide pharmacy benefit management services"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/42/300gg-121"
units:
  - "Chapter 6A — Public Health Service"
  - "Subchapter XXV — Requirements Relating to Health Insurance Coverage"
  - "Part D — Additional Coverage Provisions"
---

# §300gg–121. Oversight of entities that provide pharmacy benefit management services

- (a) **In general—** For plan years beginning on or after the date that is 30 months after February 3, 2026 (referred to in this subsection and [subsection (b)](#b) as the “effective date”), a [group health plan](/usc/42/300bb–8.md?p=1) or a [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4), or an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such a plan or issuer, shall not enter into a contract, including an extension or renewal of a contract, entered into on or after the effective date, with an applicable entity unless such applicable entity agrees to—
  - (1) not limit or delay the disclosure of information to the [group health plan](/usc/42/300bb–8.md?p=1) (including such a plan offered through a [health insurance issuer](/usc/42/300gg–91.md?p=b-2)) in such a manner that prevents an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) from making the reports described in [subsection (b)](#b); and
  - (2) provide the entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) relevant information necessary to make the reports described in [subsection (b)](#b).
- (b) **Reports—**
  - (1) **In general—** For plan years beginning on or after the effective date, in the case of any contract between a [group health plan](/usc/42/300bb–8.md?p=1) or a [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with such a plan and an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such plan or issuer, including an extension or renewal of such a contract, entered into on or after the effective date, the entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2), not less frequently than every 6 months (or, at the request of a [group health plan](/usc/42/300bb–8.md?p=1), not less frequently than quarterly, and under the same conditions, terms, and cost of the semiannual report under this subsection), shall submit to the [group health plan](/usc/42/300bb–8.md?p=1) a report in accordance with this section. Each such report shall be made available to such [group health plan](/usc/42/300bb–8.md?p=1) in plain language, in a machine-readable format, and as the [Secretary](/usc/42/201.md?p=c) may determine, other formats. Each such report shall include the information described in [paragraph (2)](#b-2).
  - (2) **Information described—** For purposes of [paragraph (1)](#b-1), the information described in this paragraph is, with respect to [drugs](/usc/42/11851.md?p=4) covered by a [group health plan](/usc/42/300bb–8.md?p=1) or [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered by a [health insurance issuer](/usc/42/300gg–91.md?p=b-2) in connection with a [group health plan](/usc/42/300bb–8.md?p=1) during each reporting period—
    - (A) in the case of a [group health plan](/usc/42/300bb–8.md?p=1) that is offered by a specified [large employer](/usc/42/300gg–91.md?p=e-2) or that is a specified large plan, and is not offered as [health insurance coverage](/usc/42/300gg–91.md?p=b-1), or in the case of [health insurance coverage](/usc/42/300gg–91.md?p=b-1) for which the election under [paragraph (3)](#b-3) is made for the applicable reporting period—
      - (i) a list of [drugs](/usc/42/11851.md?p=4) for which a claim was filed and, with respect to each such [drug](/usc/42/11851.md?p=4) on such list—
        - (I) the contracted compensation paid by the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) for each covered [drug](/usc/42/11851.md?p=4) (identified by the National Drug Code) to the entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) or other applicable entity on behalf of the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2);
        - (II) the contracted compensation paid to the pharmacy, by any entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) or other applicable entity on behalf of the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2), for each covered [drug](/usc/42/11851.md?p=4) (identified by the National Drug Code);
        - (III) for each such claim, the difference between the amount paid under [subclause (I)](#b-2-A-i-I) and the amount paid under [subclause (II)](#b-2-A-i-II);
        - (IV) the proprietary name, established name or proper name, and the National Drug Code;
        - (V) for each claim for the [drug](/usc/42/11851.md?p=4) (including original prescriptions and refills) and for each dosage unit of the [drug](/usc/42/11851.md?p=4) for which a claim was filed, the type of dispensing channel used to furnish the [drug](/usc/42/11851.md?p=4), including retail, mail order, or specialty pharmacy;
        - (VI) with respect to each [drug](/usc/42/11851.md?p=4) dispensed, for each type of dispensing channel (including retail, mail order, or specialty pharmacy)—
          - (aa) whether such [drug](/usc/42/11851.md?p=4) is a brand name [drug](/usc/42/11851.md?p=4) or a generic [drug](/usc/42/11851.md?p=4), and—
            - (AA) in the case of a brand name [drug](/usc/42/11851.md?p=4), the wholesale acquisition cost, listed as cost per days supply and cost per dosage unit, on the date such [drug](/usc/42/11851.md?p=4) was dispensed; and
            - (BB) in the case of a generic [drug](/usc/42/11851.md?p=4), the average wholesale price, listed as cost per days supply and cost per dosage unit, on the date such [drug](/usc/42/11851.md?p=4) was dispensed; and
          - (bb) the total number of—
            - (AA) prescription claims (including original prescriptions and refills);
            - (BB) [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) for whom a claim for such [drug](/usc/42/11851.md?p=4) was filed through the applicable dispensing channel;
            - (CC) dosage units and dosage units per fill of such [drug](/usc/42/11851.md?p=4); and
            - (DD) days supply of such [drug](/usc/42/11851.md?p=4) per fill;
        - (VII) the net price per course of [treatment](/usc/42/11851.md?p=11) or single fill, such as a 30-day supply or 90-day supply to the plan or coverage after rebates, fees, alternative discounts, or other remuneration received from applicable entities;
        - (VIII) the total amount of out-of-pocket spending by [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) on such [drug](/usc/42/11851.md?p=4), including spending through copayments, coinsurance, and deductibles, but not including any amounts spent by [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) on [drugs](/usc/42/11851.md?p=4) not covered under the plan or coverage, or for which no claim is submitted under the plan or coverage;
        - (IX) the total net spending on the [drug](/usc/42/11851.md?p=4);
        - (X) the total amount received, or expected to be received, by the plan or issuer from any applicable entity in rebates, fees, alternative discounts, or other remuneration;
        - (XI) the total amount received, or expected to be received, by the entity providing pharmacy benefit management [services](/usc/42/201.md?p=a), from applicable entities, in rebates, fees, alternative discounts, or other remuneration from such entities—
          - (aa) for claims incurred during the reporting period; and
          - (bb) that is related to utilization of such [drug](/usc/42/11851.md?p=4) or spending on such [drug](/usc/42/11851.md?p=4); and
        - (XII) to the extent feasible, information on the total amount of remuneration for such [drug](/usc/42/11851.md?p=4), including copayment assistance dollars paid, copayment cards applied, or other discounts provided by each [drug](/usc/42/11851.md?p=4) [manufacturer](/usc/42/300aa–33.md?p=3) (or entity administering copayment assistance on behalf of such [drug](/usc/42/11851.md?p=4) [manufacturer](/usc/42/300aa–33.md?p=3)), to the [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) enrolled in such plan or coverage;
      - (ii) a list of each therapeutic class (as defined by the [Secretary](/usc/42/201.md?p=c)) for which a claim was filed under the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance coverage](/usc/42/300gg–91.md?p=b-1) during the reporting period, and, with respect to each such therapeutic class—
        - (I) the total gross spending on [drugs](/usc/42/11851.md?p=4) in such class before rebates, price concessions, alternative discounts, or other remuneration from applicable entities;
        - (II) the net spending in such class after such rebates, price concessions, alternative discounts, or other remuneration from applicable entities;
        - (III) the total amount received, or expected to be received, by the entity providing pharmacy benefit management [services](/usc/42/201.md?p=a), from applicable entities, in rebates, fees, alternative discounts, or other remuneration from such entities—
          - (aa) for claims incurred during the reporting period; and
          - (bb) that is related to utilization of [drugs](/usc/42/11851.md?p=4) or [drug](/usc/42/11851.md?p=4) spending;
        - (IV) the average net spending per 30-day supply and per 90-day supply by the plan or by the issuer with respect to such coverage and its [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2), among all [drugs](/usc/42/11851.md?p=4) within the therapeutic class for which a claim was filed during the reporting period;
        - (V) the number of [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) who filled a prescription for a [drug](/usc/42/11851.md?p=4) in such class, including the National Drug Code for each such [drug](/usc/42/11851.md?p=4);
        - (VI) if applicable, a description of the formulary tiers and utilization mechanisms (such as prior authorization or step therapy) employed for [drugs](/usc/42/11851.md?p=4) in that class; and
        - (VII) the total out-of-pocket spending under the plan or coverage by [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2), including spending through copayments, coinsurance, and deductibles, but not including any amounts spent by [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) on [drugs](/usc/42/11851.md?p=4) not covered under the plan or coverage or for which no claim is submitted under the plan or coverage;
      - (iii) with respect to any [drug](/usc/42/11851.md?p=4) for which gross spending under the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance coverage](/usc/42/300gg–91.md?p=b-1) exceeded $10,000 during the reporting period or, in the case that gross spending under the [group health plan](/usc/42/300bb–8.md?p=1) or coverage exceeded $10,000 during the reporting period with respect to fewer than 50 [drugs](/usc/42/11851.md?p=4), with respect to the 50 prescription [drugs](/usc/42/11851.md?p=4) with the highest spending during the reporting period—
        - (I) a list of all other [drugs](/usc/42/11851.md?p=4) in the same therapeutic class as such [drug](/usc/42/11851.md?p=4);
        - (II) if applicable, the rationale for the formulary [placement](/usc/42/300gg–91.md?p=d-12) of such [drug](/usc/42/11851.md?p=4) in that therapeutic category or class, selected from a list of standard rationales established by the [Secretary](/usc/42/201.md?p=c), in consultation with stakeholders; and
        - (III) any change in formulary [placement](/usc/42/300gg–91.md?p=d-12) compared to the prior plan year; and
      - (iv) in the case that such plan or issuer (or an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such plan or issuer) has an affiliated pharmacy or pharmacy under common ownership, including mandatory mail and specialty home delivery [programs](/usc/42/274l–1.md?p=4), retail and mail auto-refill [programs](/usc/42/274l–1.md?p=4), and cost sharing assistance incentives funded by an entity providing pharmacy benefit [services](/usc/42/201.md?p=a)—
        - (I) an explanation of any benefit design parameters that encourage or require [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) in the plan or coverage to fill prescriptions at mail order, specialty, or retail pharmacies;
        - (II) the percentage of total prescriptions dispensed by such pharmacies to [participants](/usc/42/300gg–91.md?p=d-11) or [beneficiaries](/usc/42/300gg–91.md?p=d-2) in such plan or coverage; and
        - (III) a list of all [drugs](/usc/42/11851.md?p=4) dispensed by such pharmacies to [participants](/usc/42/300gg–91.md?p=d-11) or [beneficiaries](/usc/42/300gg–91.md?p=d-2) enrolled in such plan or coverage, and, with respect to each [drug](/usc/42/11851.md?p=4) dispensed—
          - (aa) the amount charged, per dosage unit, per 30-day supply, or per 90-day supply (as applicable) to the plan or issuer, and to [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2);
          - (bb) the median amount charged to such plan or issuer, and the interquartile range of the costs, per dosage unit, per 30-day supply, and per 90-day supply, including amounts paid by the [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2), when the same [drug](/usc/42/11851.md?p=4) is dispensed by other pharmacies that are not affiliated with or under common ownership with the entity and that are included in the pharmacy network of such plan or coverage;
          - (cc) the lowest cost per dosage unit, per 30-day supply and per 90-day supply, for each such [drug](/usc/42/11851.md?p=4), including amounts charged to the plan or coverage and to [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2), that is available from any pharmacy included in the network of such plan or coverage; and
          - (dd) the net acquisition cost per dosage unit, per 30-day supply, and per 90-day supply, if such [drug](/usc/42/11851.md?p=4) is subject to a maximum price discount; and
    - (B) with respect to any [group health plan](/usc/42/300bb–8.md?p=1), including [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with such a plan, regardless of whether the plan or coverage is offered by a specified [large employer](/usc/42/300gg–91.md?p=e-2) or whether it is a specified large plan—
      - (i) a summary document for the [group health plan](/usc/42/300bb–8.md?p=1) that includes such information described in clauses [(i)](#b-2-A-i) through [(iv)](#b-2-A-iv) of subparagraph (A), as specified by the [Secretary](/usc/42/201.md?p=c) through guidance, [program](/usc/42/274l–1.md?p=4) instruction, or otherwise (with no requirement of notice and comment rulemaking), that the [Secretary](/usc/42/201.md?p=c) determines useful to [group health plans](/usc/42/300bb–8.md?p=1) for purposes of selecting pharmacy benefit management [services](/usc/42/201.md?p=a), such as an estimated net price to [group health plan](/usc/42/300bb–8.md?p=1) and [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2), a cost per claim, the fee structure or reimbursement model, and estimated cost per [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2);
      - (ii) a summary document for plans and issuers to provide to [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2), which shall be made available to [participants](/usc/42/300gg–91.md?p=d-11) or [beneficiaries](/usc/42/300gg–91.md?p=d-2) upon request to their [group health plan](/usc/42/300bb–8.md?p=1) (including in the case of [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with such a plan), that—
        - (I) contains such information described in clauses [(iii)](#b-2-B-iii), [(iv)](#b-2-B-iv), [(v)](#b-2-B-v), and [(vi)](#b-2-B-vi), as applicable, as specified by the [Secretary](/usc/42/201.md?p=c) through guidance, [program](/usc/42/274l–1.md?p=4) instruction, or otherwise (with no requirement of notice and comment rulemaking) that the [Secretary](/usc/42/201.md?p=c) determines useful to [participants](/usc/42/300gg–91.md?p=d-11) or [beneficiaries](/usc/42/300gg–91.md?p=d-2) in better understanding the plan or coverage or benefits under such plan or coverage;
        - (II) contains only aggregate information; and
        - (III) [states](/usc/42/201.md?p=f) that [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) may request specific, claims-level information required to be furnished under [subsection (c)](#c) from the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2); and
      - (iii) with respect to [drugs](/usc/42/11851.md?p=4) covered by such plan or coverage during such reporting period—
        - (I) the total net spending by the plan or coverage for all such [drugs](/usc/42/11851.md?p=4);
        - (II) the total amount received, or expected to be received, by the plan or issuer from any applicable entity in rebates, fees, alternative discounts, or other remuneration; and
        - (III) to the extent feasible, information on the total amount of remuneration for such [drugs](/usc/42/11851.md?p=4), including copayment assistance dollars paid, copayment cards applied, or other discounts provided by each [drug](/usc/42/11851.md?p=4) [manufacturer](/usc/42/300aa–33.md?p=3) (or entity administering copayment assistance on behalf of such [drug](/usc/42/11851.md?p=4) [manufacturer](/usc/42/300aa–33.md?p=3)) to [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2);
      - (iv) amounts paid directly or indirectly in rebates, fees, or any other type of compensation (as defined in [section 1108(b)(2)(B)(ii)(dd)(AA) of title 29](/usc/29/1108.md)) to brokerage firms, brokers, consultants, advisors, or any other individual or firm, for—
        - (I) the referral of the [group health plan](/usc/42/300bb–8.md?p=1)’s or [health insurance issuer](/usc/42/300gg–91.md?p=b-2)’s business to an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a), including the identity of the recipient of such amounts;
        - (II) consideration of the entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) by the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2); or
        - (III) the retention of the entity by the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2);
      - (v) an explanation of any benefit design parameters that encourage or require [participants](/usc/42/300gg–91.md?p=d-11) and [beneficiaries](/usc/42/300gg–91.md?p=d-2) in such plan or coverage to fill prescriptions at mail order, specialty, or retail pharmacies that are affiliated with or under common ownership with the entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) under such plan or coverage, including mandatory mail and specialty home delivery [programs](/usc/42/274l–1.md?p=4), retail and mail auto-refill [programs](/usc/42/274l–1.md?p=4), and cost-sharing assistance incentives directly or indirectly funded by such entity; and
      - (vi) total gross spending on all [drugs](/usc/42/11851.md?p=4) under the plan or coverage during the reporting period.
  - (3) **Opt-in for group health insurance coverage offered by a specified large employer or that is a specified large plan—** In the case of [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with a [group health plan](/usc/42/300bb–8.md?p=1) that is offered by a specified [large employer](/usc/42/300gg–91.md?p=e-2) or is a specified large plan, such [group health plan](/usc/42/300bb–8.md?p=1) may, on an annual basis, for plan years beginning on or after the date that is 30 months after February 3, 2026, elect to require an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of the [health insurance issuer](/usc/42/300gg–91.md?p=b-2) to submit to such [group health plan](/usc/42/300bb–8.md?p=1) a report that includes all of the information described in [paragraph (2)(A)](#b-2-A), in addition to the information described in [paragraph (2)(B)](#b-2-B).
  - (4) **Privacy requirements—**
    - (A) **In general—** An entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of a [group health plan](/usc/42/300bb–8.md?p=1) or a [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) shall report information under [paragraph (1)](#b-1) in a manner consistent with the privacy [regulations](/usc/42/201.md?p=d) promulgated under [section 17932 of this title](/usc/42/17932.md) and consistent with the privacy [regulations](/usc/42/201.md?p=d) promulgated under the Health Insurance Portability and Accountability Act of 1996 in part 160 and subparts A and E of part [164](/usc/45/164.md) of title 45, Code of Federal [Regulations](/usc/42/201.md?p=d) (or successor [regulations](/usc/42/201.md?p=d)) (referred to in this paragraph as the “HIPAA privacy [regulations](/usc/42/201.md?p=d)”) and shall restrict the use and disclosure of such information according to such privacy [regulations](/usc/42/201.md?p=d) and such HIPAA privacy [regulations](/usc/42/201.md?p=d).
    - (B) **Additional requirements—**
      - (i) **In general—** An entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) that submits a report under [paragraph (1)](#b-1) shall ensure that such report contains only summary health information, as defined in section 164.504(a) of title 45, Code of Federal [Regulations](/usc/42/201.md?p=d) (or successor [regulations](/usc/42/201.md?p=d)).
      - (ii) **Restrictions—** In carrying out this subsection, a [group health plan](/usc/42/300bb–8.md?p=1) shall comply with section 164.504(f) of title 45, Code of Federal [Regulations](/usc/42/201.md?p=d) (or a successor regulation), and a [plan sponsor](/usc/42/300gg–91.md?p=d-13) shall act in accordance with the terms of the agreement described in such section.
    - (C) **Rule of construction—**
      - (i) Nothing in this section shall be construed to modify the requirements for the creation, receipt, maintenance, or transmission of protected health information under the HIPAA privacy [regulations](/usc/42/201.md?p=d).
      - (ii) Nothing in this section shall be construed to affect the application of any Federal or [State](/usc/42/201.md?p=f) privacy or civil rights law, including the HIPAA privacy [regulations](/usc/42/201.md?p=d), the [Genetic Information](/usc/42/300gg–91.md?p=d-16-A) Nondiscrimination Act of 2008 (Public Law 110–233) (including the amendments made by such Act), the Americans with Disabilities Act of 1990 ([42 U.S.C. 12101](/usc/42/12101.md) et seq.), [section 794 of title 29](/usc/29/794.md), [section 18116 of this title](/usc/42/18116.md), title VI of the Civil Rights Act of 1964 ([42 U.S.C. 2000d](/usc/42/2000d.md)[^1] ), and title VII of the Civil Rights Act of 1964 ([42 U.S.C. 2000e](/usc/42/2000e.md)[^1] ).
    - (D) **Written notice—** Each plan year, [group health plans](/usc/42/300bb–8.md?p=1), including with respect to [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with a [group health plan](/usc/42/300bb–8.md?p=1), shall provide to each [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2) written notice informing the [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2) of the requirement for entities providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of the [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) to submit reports to [group health plans](/usc/42/300bb–8.md?p=1) under [paragraph (1)](#b-1), as applicable, which may include incorporating such notification in plan documents provided to the [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2), or providing individual notification.
    - (E) **Limitation to business associates—** A [group health plan](/usc/42/300bb–8.md?p=1) receiving a report under [paragraph (1)](#b-1) may disclose such information only to the entity from which the report was received or to that entity’s business associates as defined in section 160.103 of title 45, Code of Federal [Regulations](/usc/42/201.md?p=d) (or successor [regulations](/usc/42/201.md?p=d)) or as permitted by the HIPAA privacy [regulations](/usc/42/201.md?p=d).
    - (F) **Clarification regarding public disclosure of information—** Nothing in this section shall prevent an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4), from placing reasonable restrictions on the public disclosure of the information contained in a report described in [paragraph (1)](#b-1), except that such plan, issuer, or entity may not—
      - (i) restrict disclosure of such report to the Department of Health and Human [Services](/usc/42/201.md?p=a), the Department of Labor, or the Department of the Treasury; or
      - (ii) prevent disclosure for the purposes of [subsection (c)](#c), or any other public disclosure requirement under this section.
    - (G) **Limited form of report—** The [Secretary](/usc/42/201.md?p=c) shall define through rulemaking a limited form of the report under [paragraph (1)](#b-1) required with respect to any [group health plan](/usc/42/300bb–8.md?p=1) established by a [plan sponsor](/usc/42/300gg–91.md?p=d-13) that is, or is affiliated with, a [drug](/usc/42/11851.md?p=4) [manufacturer](/usc/42/300aa–33.md?p=3), [drug](/usc/42/11851.md?p=4) wholesaler, or other direct [participant](/usc/42/300gg–91.md?p=d-11) in the [drug](/usc/42/11851.md?p=4) supply chain, in order to prevent anti-competitive behavior.
  - (5) **Standard format and regulations—**
    - (A) **In general—** Not later than 18 months after February 3, 2026, the [Secretary](/usc/42/201.md?p=c) shall specify through rulemaking a standard format for entities providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of [group health plans](/usc/42/300bb–8.md?p=1) and [health insurance issuers](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4), to submit reports required under [paragraph (1)](#b-1).
    - (B) **Additional regulations—** Not later than 18 months after February 3, 2026, the [Secretary](/usc/42/201.md?p=c) shall, through rulemaking, promulgate any other final [regulations](/usc/42/201.md?p=d) necessary to implement the requirements of this section. In promulgating such [regulations](/usc/42/201.md?p=d), the [Secretary](/usc/42/201.md?p=c) shall, to the extent practicable, align the reporting requirements under this section with the reporting requirements under [section 300gg–120 of this title](/usc/42/300gg–120.md).
- (c) **Requirement to provide information to participants or beneficiaries—** A [group health plan](/usc/42/300bb–8.md?p=1), including with respect to [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with a [group health plan](/usc/42/300bb–8.md?p=1), upon request of a [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2), shall provide to such [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2)—
  - (1) the summary document described in [subsection (b)(2)(B)(ii)](#b-2-B-ii); and
  - (2) the information described in [subsection (b)(2)(A)(i)(III)](#b-2-A-i-III) with respect to a claim made by or on behalf of such [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2).
- (d) **Enforcement—**
  - (1) **In general—** The [Secretary](/usc/42/201.md?p=c) shall enforce this section. The enforcement authority under this subsection shall apply only with respect to [group health plans](/usc/42/300bb–8.md?p=1) (including [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with such a plan) to which the requirements of subparts I and II of part A and part D apply in accordance with [section 300gg–21 of this title](/usc/42/300gg–21.md), and with respect to entities providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such plans and applicable entities providing [services](/usc/42/201.md?p=a) on behalf of such plans.
  - (2) **Failure to provide information—** A [group health plan](/usc/42/300bb–8.md?p=1), a [health insurance issuer](/usc/42/300gg–91.md?p=b-2) offering [group health insurance coverage](/usc/42/300gg–91.md?p=b-4), an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such a plan or issuer, or an applicable entity providing [services](/usc/42/201.md?p=a) on behalf of such a plan or issuer that violates [subsection (a)](#a); an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such a plan or issuer that fails to provide the information required under [subsection (b)](#b); or a [group health plan](/usc/42/300bb–8.md?p=1) that fails to provide the information required under [subsection (c)](#c), shall be subject to a civil monetary penalty in the amount of $10,000 for each day during which such [violation](/usc/42/2000e–16a.md?p=c) continues or such information is not disclosed or reported.
  - (3) **False information—** A [health insurance issuer](/usc/42/300gg–91.md?p=b-2), an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a), or a third party [administrator](/usc/42/300bb–8.md?p=4) providing [services](/usc/42/201.md?p=a) on behalf of such issuer offered by a [health insurance issuer](/usc/42/300gg–91.md?p=b-2) that knowingly provides false information under this section shall be subject to a civil monetary penalty in an amount not to exceed $100,000 for each item of false information. Such civil monetary penalty shall be in addition to other penalties as may be prescribed by law.
  - (4) **Procedure—** The provisions of [section 1320a–7a of this title](/usc/42/1320a–7a.md), other than subsections [(a)](#a) and [(b)](#b) and the first sentence of [subsection (c)(1)](/usc/42/1320a–7a.md?p=c-1) of such section shall apply to civil monetary penalties under this subsection in the same manner as such provisions apply to a penalty or proceeding under such section.
  - (5) **Waivers—** The [Secretary](/usc/42/201.md?p=c) may waive penalties under [paragraph (2)](#d-2), or extend the period of time for compliance with a requirement of this section, for an entity in [violation](/usc/42/2000e–16a.md?p=c) of this section that has made a good-faith effort to comply with the requirements in this section.
- (e) **Rule of construction—** Nothing in this section shall be construed to permit a [health insurance issuer](/usc/42/300gg–91.md?p=b-2), [group health plan](/usc/42/300bb–8.md?p=1), entity providing pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2), or other entity to restrict disclosure to, or otherwise limit the access of, the [Secretary](/usc/42/201.md?p=c) to a report described in [subsection (b)(1)](#b-1) or information related to compliance with subsections [(a)](#a), [(b)](#b), [(c)](#c), or [(d)](#d) by such issuer, plan, or entity.
- (f) **Definitions—** In this section:
  - (1) **Applicable entity—** The term “applicable entity” means—
    - (A) an applicable group purchasing organization, [drug](/usc/42/11851.md?p=4) [manufacturer](/usc/42/300aa–33.md?p=3), distributor, wholesaler, rebate aggregator (or other purchasing entity designed to aggregate rebates), or associated third party;
    - (B) any subsidiary, parent, affiliate, or subcontractor of a [group health plan](/usc/42/300bb–8.md?p=1), [health insurance issuer](/usc/42/300gg–91.md?p=b-2), entity that provides pharmacy benefit management [services](/usc/42/201.md?p=a) on behalf of such a plan or issuer, or any entity described in [subparagraph (A)](#f-1-A); or
    - (C) such other entity as the [Secretary](/usc/42/201.md?p=c) may specify through rulemaking.
  - (2) **Applicable group purchasing organization—** The term “applicable group purchasing organization” means a group purchasing organization that is affiliated with or under common ownership with an entity providing pharmacy benefit management [services](/usc/42/201.md?p=a).
  - (3) **Contracted compensation—** The term “contracted compensation” means the sum of any ingredient cost and dispensing fee for a [drug](/usc/42/11851.md?p=4) (inclusive of the out-of-pocket costs to the [participant](/usc/42/300gg–91.md?p=d-11) or [beneficiary](/usc/42/300gg–91.md?p=d-2)), or another analogous compensation structure that the [Secretary](/usc/42/201.md?p=c) may specify through [regulations](/usc/42/201.md?p=d).
  - (4) **Gross spending—** The term “gross spending”, with respect to prescription [drug](/usc/42/11851.md?p=4) benefits under a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance coverage](/usc/42/300gg–91.md?p=b-1), means the amount spent by a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) on prescription [drug](/usc/42/11851.md?p=4) benefits, calculated before the application of rebates, fees, alternative discounts, or other remuneration.
  - (5) **Net spending—** The term “net spending”, with respect to prescription [drug](/usc/42/11851.md?p=4) benefits under a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance coverage](/usc/42/300gg–91.md?p=b-1), means the amount spent by a [group health plan](/usc/42/300bb–8.md?p=1) or [health insurance issuer](/usc/42/300gg–91.md?p=b-2) on prescription [drug](/usc/42/11851.md?p=4) benefits, calculated after the application of rebates, fees, alternative discounts, or other remuneration.
  - (6) **Plan sponsor—** The term “[plan sponsor](/usc/42/300gg–91.md?p=d-13)” has the meaning given such term in [section 1002(16)(B) of title 29](/usc/29/1002.md?p=16-B).
  - (7) **Remuneration—** The term “remuneration” has the meaning given such term by the [Secretary](/usc/42/201.md?p=c) through rulemaking, which shall be reevaluated by the [Secretary](/usc/42/201.md?p=c) every 5 years.
  - (8) **Specified large employer—** The term “specified [large employer](/usc/42/300gg–91.md?p=e-2)” means, in connection with a [group health plan](/usc/42/300bb–8.md?p=1) (including [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with such a plan) established or maintained by a single [employer](/usc/42/300gg–91.md?p=d-6), with respect to a calendar year or a plan year, as applicable, an [employer](/usc/42/300gg–91.md?p=d-6) who employed an average of at least 100 [employees](/usc/42/300gg–91.md?p=d-5) on business days during the preceding calendar year or plan year and who employs at least 1 [employee](/usc/42/300gg–91.md?p=d-5) on the first day of the calendar year or plan year.
  - (9) **Specified large plan—** The term “specified large plan” means a [group health plan](/usc/42/300bb–8.md?p=1) (including [group health insurance coverage](/usc/42/300gg–91.md?p=b-4) offered in connection with such a plan) established or maintained by a [plan sponsor](/usc/42/300gg–91.md?p=d-13) described in clause (ii) or (iii) of [section 1002(16)(B) of title 29](/usc/29/1002.md?p=16-B) that had an average of at least 100 [participants](/usc/42/300gg–91.md?p=d-11) on business days during the preceding calendar year or plan year, as applicable.
  - (10) **Wholesale acquisition cost—** The term “wholesale acquisition cost” has the meaning given such term in [section 1395w–3a(c)(6)(B) of this title](/usc/42/1395w–3a.md?p=c-6-B).

## Footnotes

[^1]: So in original. Probably should be followed by “et seq.”

## Source credit

(July 1, 1944, ch. 373, title XXVII, § 2799A–11, as added Pub. L. 119–75, div. J, title VII, § 6701(a)(1), Feb. 3, 2026, 140 Stat. 703.)

## Notes

### Editorial Notes

### References in Text

Section 1108(b)(2)(B)(ii)(dd)(AA) of title 29, referred to in subsec. (b)(2)(B)(iv), was in the original “section 408(b)(2)(B)(ii)(dd)(AA) of the Employee Retirement Income Security Act” and was translated as meaning section 408(b)(2)(B)(ii)(dd)(AA) of the Employee Retirement Income Security Act of 1974, to reflect the probable intent of Congress.

The Health Insurance Portability and Accountability Act of 1996, referred to in subsec. (b)(4)(A), is Pub. L. 104–191, Aug. 21, 1996, 110 Stat. 1936. For complete classification of this Act to the Code, see Short Title of 1996 Amendments note set out under section 201 of this title and Tables.

The Genetic Information Nondiscrimination Act of 2008, referred to in subsec. (b)(4)(C)(ii), is Pub. L. 110–233, May 21, 2008, 122 Stat. 881. For complete classification of this Act to the Code, see Short Title note set out under section 2000ff of this title and Tables.

The Americans with Disabilities Act of 1990, referred to in subsec. (b)(4)(C)(ii), is Pub. L. 101–336, July 26, 1990, 104 Stat. 327, which is classified principally to chapter 126 (§ 12101 et seq.) of this title. For complete classification of this Act to the Code, see Short Title note set out under section 12101 of this title and Tables.

The Civil Rights Act of 1964, referred to in subsec. (b)(4)(C)(ii), is Pub. L. 88–352, July 2, 1964, 78 Stat. 241. Title VI of the Act is classified generally to subchapter V (§ 2000d et seq.) of chapter 21 of this title. Title VII of the Act is classified generally to subchapter VI (§ 2000e et seq.) of chapter 21 of this title. For complete classification of this Act to the Code, see Short Title note set out under section 2000a of this title and Tables.