Affordable Health Care for America Act Introduced in House

October 29, 2009

By Alan M. Kirschenbaum & Kurt R. Karst

Earlier today, House Speaker Nancy Pelosi (D-CA) unveiled the Affordable Health Care for America Act (H.R. 3962).  The bill, which is the latest version of the House’s healthcare reform proposal and the one that will go to the House floor, is almost 2,000 pages in length.  A section-by-section analysis of the bill is available here.  Various other documents related to the bill are posted on the House Energy and Commerce Committee website.  (A second, and much shorter bill – H.R. 3961, the Medicare Physician Payment Reform Act of 2009 – was also introduced.)

Some of the provisions that will be of most interest to FDA Law blog readers are the following:
Federal Food, Drug, and Cosmetic Act and Public Health Service Act amendments

  • Pathway for licensure of biosimilars established (§§ 2575-2577)
  • National directory for Class III and certain Class II devices established (§ 2571)
  • Patent infringement settlements between brand and generic manufacturers that delay generic entry (“reverse payments”) prohibited (§ 2573)
  • Nutrition labeling required for standard menu items at chain restaurants (§ 2572)

Public Option

  • HHS may negotiate payment rates for items and services, including prescription drugs (§ 323)
  • Federal health care program fraud and abuse laws apply to public option (§ 326).

Medicare Part D

  • Drug manufacturers provide discounts of 50% on brand drugs dispensed to enrollees in the coverage gap (§ 1182)
  • Coverage gap phased out by 2019 (§ 1181)
  • Repeal of non-interference provision:  HHS may negotiate prices with drug manufacturers (§ 1186)
  • Drug manufacturer rebates required for drugs dispensed to Medicare/Medicaid dual eligibles (§ 1181)

Physician Payment Sunshine

  • Requires reports on payments of value by drug and device companies to physicians and other health care providers (§ 1451)


  • Federal upper limits on Medicaid payment for multiple source drugs changed to 130% of weighted average of AMPs (§ 1741)
  • AMP definition amended to exclude sales to most non-retail pharmacy entities (§ 1741)
  • Minimum Medicaid Rebate for innovator drugs increased to 22.1% of AMP and rebates increased for new formulations  (§ 1742)
  • Rebates required for drugs dispensed to Medicaid managed care enrollees (§ 1743)

340B Program

  • Program expanded to certain cancer hospitals, critical access hospitals, and other new covered entities (§ 2501)
  • HRSA oversight enhanced (§ 2502)

Other provisions

  • New 2.5% excise tax on non-retail sales of medical devices (§ 552)
  • HHS to conduct study on use of physician prescriber information in sales and marketing by drug manufacturers, and recommend ways to protect providers from biased marketing (§ 239)

We’ll be posting a more detailed summary of these and other H.R. 3962 provisions of interest to our readers in the near future.

The House Democratic Leadership intends to begin floor debate on the bill beginning on Thursday, November 5, and members have been asked to be  prepared to vote over the following weekend in order to complete the bill.