H.R. 7871: MVP Act

H.R. 7871, the "Medicaid VBPs for Patients Act" or "MVP Act," is a targeted health bill aimed at one problem: how Medicaid handles value-based purchasing, or deals where the final price of a drug depends on whether a patient hits defined health outcomes. The bill would let manufacturers report multiple Medicaid best prices for the same dosage form and strength of a drug under a value-based purchasing arrangement, as long as the arrangement is offered to all States. That is a significant change because current best-price rules can discourage outcome-based contracts for very expensive drugs, especially one-time therapies like rare disease gene therapies mentioned in the bill's GAO study mandate.

The bill also rewrites technical pricing rules. For Average Manufacturer Price, or AMP, it says calculations for covered outpatient drugs under value-based purchasing arrangements must include refunds, rebates, reimbursements, free goods, or withholding or reduction of payments when a patient fails to achieve defined outcomes. For installment-payment deals, it says the price must be treated as if the full aggregate price were paid in the first installment during the rebate period. On the Medicare side, Section 3 says ASP calculations for drugs or biologicals sold under a value-based purchasing arrangement must exclude any amount that is excluded from AMP when the manufacturer has elected to include multiple best price points.

The measure is also a deadlines bill. The Secretary of Health and Human Services must implement the Medicaid pricing amendments in Section 2(b) through rulemaking within 180 days of enactment. The same 180-day deadline applies to HHS guidance for State Medicaid agencies on value-based purchasing for inpatient drugs and to rulemaking by the HHS Office of Inspector General for the anti-kickback exception. That speed matters because it means the practical impact would depend less on future congressional action and more on how quickly HHS and OIG write the rules.

Another important piece is legal protection. The bill creates a statutory exception under the Anti-Kickback Statute for remuneration from a manufacturer, or a third party acting on the manufacturer's behalf, to a State under a value-based purchasing arrangement when a patient fails to achieve defined outcomes. That could reduce legal risk for these contracts. Finally, the Government Accountability Office, through the Comptroller General, would have to study the effects on patient access, socioeconomic disparities, the Medicaid drug rebate program, the 340B program, Medicare Part B, State Medicaid spending, and drug prices in non-participating States, with a report due to Congress by June 30, 2029.