Bill Amendment: IL HB4327 | 2025-2026 | 104th General Assembly

NOTE: For additional amemendments please see the Bill Drafting List

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Bill Title: AUDITOR GENERAL-340B AUDIT

Status: 2026-06-26 - Sent to the Governor [HB4327 Detail]

Download: Illinois-2025-HB4327-House_Amendment_001.html

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Rep. Camille Y. Lilly

Filed: 5/22/2026

 

 

 

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AMENDMENT TO HOUSE BILL 4327
AMENDMENT NO. ______. Amend House Bill 4327 by replacing
everything after the enacting clause with the following:
"Section 1. Short title. This Act may be cited as the 340B
Transparency, Reporting, and Accountability Act.
Section 5. Findings. The General Assembly finds that:
(1) The intent of the 340B Drug Discount Program is to
provide discounted medicines to eligible healthcare
organizations for the purpose of improving access to
affordable medications for low-income, underinsured,
uninsured, or otherwise vulnerable patients being treated
at eligible hospitals, clinics, federally qualified health
centers (FQHC), and safety-net hospitals in or adjacent to
vulnerable communities.
(2) Congress intended the 340B Drug Discount Program
to provide discounts only to federally-funded clinics and

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qualified hospitals that provide direct clinical care to
uninsured Americans who meet the definitions of vulnerable
communities and vulnerable patients.
(3) The appropriate and effective use of the 340B Drug
Discount Program is essential for improving health
outcomes, particularly for vulnerable and underserved
communities in rural, suburban, and urban areas throughout
Illinois meeting the definitions of vulnerable communities
and vulnerable patients.
(4) There is a need for increased, consistent,
statewide data to evaluate program utilization, financial
impact, and patient benefits. Increased transparency in
aggregate financial and operational reporting enhances
legislative oversight without interfering with federal
law. Increased transparency is needed to ensure that
vulnerable communities receive the benefits intended from
the Patient Access to Pharmacy Protection Act.
(5) To protect vulnerable communities, the General
Assembly must pass the Health Equity Infrastructure Access
and Stabilization Act. This includes creation of and
funding of the following components:
(A) the Vulnerable Community Health Capital Fund
Voluntary investment program;
(B) the Community Health Networks of Continuum
Care;
(C) the Illinois Safety Net Hospital Package;

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(D) the Behavioral and Mental Health (BMH) Access
and Expansion Fund;
(E) the Stabilization and Sustainability
Operational Funding Program;
(F) the 340B Grantee Contract Pharmacy Access Act
integration;
(G) sustainable funding opportunities through
transparency of the 340B Federal Program; and
(H) the Unified Health Equity Omnibus Package.
(6) Revenues associated with the federal 340B Drug
Discount Program may support the financial stability of
hospitals, federally qualified health centers, Ryan White
providers, rural providers, and other historical
safety-net institutions serving vulnerable communities
experiencing health care access shortages, provider
scarcity, or risk of service reduction or closure.
(7) Vulnerable communities in the State of Illinois
are populations or geographic areas whose residents
experience disproportionate barriers to achieving optimal
health outcomes due to cumulative social, economic,
environmental, and structural disadvantages. These
communities are characterized by elevated health
disparities, limited access to health care services, and
increased exposure to risk factors, such as poverty,
inadequate insurance coverage, geographic isolation,
systemic discrimination, and unmet social determinants of

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health, including housing, transportation, food security,
and environmental conditions, and who, as a result of
these conditions, experience reduced access to timely,
culturally competent, and geographically proximate
community-based hospital and health care services.
(8) This Act is intended solely to establish a
state-level reporting and transparency framework and shall
not regulate pricing, reimbursement, or participation in
the federal 340B Program.
(9) This Act is intended as a step toward either
annual or biennial 340B covered entity reporting.
Section 10. Definitions. As used in this Act:
"340B covered entity" or "covered entity" means a covered
entity as defined in 42 U.S.C. 256b(a)(4), with a service
address in Illinois as of January 1 of the reporting year.
"340B Drug Discount Program" means the program established
under Section 340B of the federal Public Health Service Act,
42 U.S.C. 256b.
"340B entity type" means the designation of the 340B
covered entity according to the entity types specified in 42
U.S.C. 256b(a)(4).
"340B identification number" means the unique
identification number provided by the Health Resources and
Services Administration to identify a 340B-eligible entity in
the 340B Office of Pharmacy Affairs Information System.

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"Contract pharmacy" means a pharmacy that enters into a
contract with a 340B covered entity to provide services to the
340B covered entity's patients, including dispensing
entity-owned 340B drugs.
"Reporting year" means the 12-month period to be covered
by the report described in Section 15, as determined by the
Department of Insurance.
"Pharmaceutical manufacturer" means an entity that is
engaged in:
(1) the production, preparation, propagation,
compounding, conversion, or processing of prescription
drug products, either directly or indirectly by extraction
from substances of natural origin, independently by means
of chemical synthesis, or by a combination of extraction
and chemical synthesis; or
(2) the packaging, repackaging, labeling, relabeling,
or distribution of prescription drug products.
"Pharmaceutical manufacturer" does not include a wholesale
distributor of drugs or a retail pharmacy licensed under State
law.
"Vulnerable communities" include, but are not limited to:
(1) low-income and economically disadvantaged
populations, including households below 80% of area median
income;
(2) racial and ethnic minority populations and
historically marginalized groups experiencing systemic

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inequities;
(3) rural and medically underserved areas with limited
provider access or hospital closures;
(4) communities facing environmental justice burdens,
including high pollution exposure;
(5) populations with higher prevalence of chronic
disease and poor health outcomes linked to social
determinants of health; or
(6) individuals with disabilities, older adults,
LGBTQ+ populations, and justice-involved individuals
identified as equity-focused populations under Illinois
law.
Section 15. 340B Drug Discount Program study.
(a) As soon as practical after the effective date of this
Act, the Department of Insurance shall conduct a comprehensive
study of how 340B covered entities within Illinois participate
in the 340B Drug Discount Program. The study shall include an
examination of the impact of this participation by 340B
covered entities on State health programs, such as Medicaid
and the State Employees Group Insurance Program. The study
shall include, but not be limited to, an assessment of:
(1) with respect to each covered entity, the:
(A) name;
(B) service address;
(C) 340B identification number; and

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(D) designation of entity type, as specified in 42
U.S.C 256b(a)(4);
(2) the amount of 340B revenue, defined as the total
patient and payer reimbursement less the total 340B
acquisition cost, generated by 340B covered entities from
both self-administered and physician-administered drugs;
(3) the amount spent on third-party administrators for
the management of the 340B Drug Discount Program;
(4) the amount paid to pharmacy benefit managers, as
defined in subsection (a) of Section 513b1 of the Illinois
Insurance Code, in contract pharmacy arrangements;
(5) the amount paid to contract pharmacies;
(6) whether each covered entity maintains title to
340B drugs in contract pharmacy locations;
(7) the average markup imposed by each covered entity
on 340B-priced drugs;
(8) the aggregate and transaction-level dollar amount
of discounts that each 340B covered entity passes to
patients at the point of sale for both in-house and
contracted pharmacies, as defined by the difference
between the total reimbursement amount to the 340B covered
entity and the 340B price;
(9) the aggregate and transaction-level acquisition
cost paid by a 340B covered entity for all prescription
drugs organized by therapeutic class obtained under the
340B Drug Discount Program and dispensed or administered

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to patients;
(10) the aggregate and transaction-level payment
amount received by a 340B covered entity for all drugs
organized by therapeutic class obtained under the 340B
Drug Discount Program and dispensed or administered to
patients;
(11) the aggregate and transaction-level payment made
to contract pharmacies to dispense drugs obtained under
the 340B Drug Discount Program;
(12) the number of claims for prescription drugs
described in paragraph (10) organized by therapeutic class
of drug;
(13) how the 340B covered entity uses any savings from
participating in the 340B Drug Discount Program, including
the amount of savings used for the provision of charity
care, community benefits (including identification of the
benefit program), and any similar program of providing
unreimbursed or subsidized health care;
(14) the aggregate and transaction-level payment made
for any other administering expense for the 340B Drug
Discount Program;
(15) the percentage of the 340B covered entity's
claims that were for prescription drugs obtained under the
340B Drug Discount Program;
(16) the percentage of total patients of the 340B
covered entity that were:

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(A) served by a sliding fee scale for a
prescription drug dispensed or administered under the
340B Drug Discount Program;
(B) Medicaid customers and uninsured or
underinsured patients;
(C) racial and ethnic minority populations;
(D) patients residing in rural or Medically
Underserved Areas, including Governor's Exceptions,
designated by the Health Resources and Services
Administration, an agency of the United States
Department of Health and Human Services;
(E) populations with a higher prevalence of
chronic disease and poor health outcomes linked to
societal determinants of health; and
(F) individuals with disabilities, older adults,
LGBTQ+ populations, and justice-involved individuals;
(17) the 340B covered entity's total operating costs;
(18) the 340B covered entity's total costs for charity
care;
(19) a copy of the 340B covered entity's financial
assistance policy for the reporting year;
(20) identification of the parties involved in the
340B procurement and dispensing process for each covered
facility;
(21) the aggregate and transaction-level payment made
to a pharmacy services administrative organization that

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provides pharmacy services for a 340B contract pharmacy;
and
(22) the aggregate and transaction-level payment made
to a pharmacy benefit manager that provides pharmacy
benefit management services for a 340B covered entity
organized by therapeutic class of drug.
(b) The Department of Insurance may adopt rules as
necessary to implement this Section.
(c) The Department of Insurance shall request the
information described in subsection (a). All 340B covered
entities, insurers as defined in subsection (a-5) of Section
513b1 of the Illinois Insurance Code, pharmacy benefit
managers, third-party administrators, and administrative
service organizations of the State Employees Group Insurance
Program shall comply with requests for information relevant to
subsection (a) from the Department of Insurance in the format
prescribed and within the timeframe specified. The Department
of Insurance is hereby granted specific authority to fine any
340B covered entity, insurer, pharmacy benefit manager,
third-party administrator, or administrative services
organization that fails to comply with this Section within 14
calendar days after the due date specified by the Department
of Insurance, at a rate of $100 per day for each day beyond 14
calendar days for federally qualified health centers and
historical safety-net hospitals, and at a rate of $1,000 per
day for each day beyond 14 calendar days for all other

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entities, that the information is past due. Fines collected
pursuant to this subsection shall be deposited into the
Vulnerable Community Hospital Capital Investment Fund, which
is hereby created as a special fund in the State treasury. The
Department of Insurance shall enforce this Section pursuant to
the powers granted to it by law, including, but not limited to,
the powers provided under Article XXIV of the Illinois
Insurance Code. Subsections (2) through (5) of Section 403A of
the Illinois Insurance Code shall apply to the imposition of
any fine.
(d) Subject to subsection (e), the Department of Insurance
shall maintain the confidentiality of any information
submitted under subsection (c) for which the submitting person
or entity includes a request that meets the criteria in
paragraph (g) of subsection (1) of Section 7 of the Freedom of
Information Act, and the information shall not be subject to
subpoena in any private civil litigation in this State.
Nothing in this Section shall prevent the Department of
Insurance from furnishing information collected from 340B
covered entities to State or federal authorities that may
investigate, prosecute, or pursue other legal action against a
340B covered entity for violations of 42 U.S.C. 256b or any
applicable State law.
(e) The Department of Insurance shall submit a report of
the findings of its study to the General Assembly and to the
Governor by July 1, 2028. The report shall provide findings

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aggregated across 340B covered entities and shall not disclose
information or data attributed to any specific 340B covered
entity. The report shall address whether the data collected by
the Department indicates a need for annual or biennial
reporting by 340B covered entities. The report may include any
aggregated findings related to the populations identified in
paragraph (16) of subsection (a).
Section 95. Repeal. This Act is repealed on July 1, 2029.
Section 900. If and only if House Bill 2371 of the 104th
General Assembly becomes law, then the Patient Access to
Pharmacy Protection Act is amended by changing Section 40 as
follows:
(10400HB2371sam002, Sec. 40)
Sec. 40. Enforcement.
(a) The Attorney General is authorized to enforce this Act
under its general authority under the Attorney General Act. If
the Attorney General has reasonable cause to believe that
there is or has been a violation of Section 15 of this Act,
then the Attorney General may commence a civil action in the
name of the People of the State of Illinois to enforce the
provisions of this Act in the appropriate circuit court.
(b) Upon finding a violation of Section 15 of this Act, a
court may order:

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(1) temporary, preliminary, or permanent injunctive
relief for any act, policy, or practice that violates this
Act;
(2) money damages to be paid to the 340B covered
entity as a result of the violation of this Act;
(3) the assessment of a civil penalty of up to $1,000
per violation for each violation of Section 15; or
(4) any other relief.
(c) A civil penalty imposed or a settlement or other
payment made pursuant to this Act shall be made payable to the
Attorney General's State Projects and Court Ordered
Distribution Fund.
(Source: 10400HB2371sam002.)
Section 905. The State Finance Act is amended by adding
Section 5.1038 as follows:
(30 ILCS 105/5.1038 new)
Sec. 5.1038. The Vulnerable Community Hospital Capital
Investment Fund.
Section 999. Effective date. This Act takes effect upon
becoming law, but this Act does not take effect at all unless
House Bill 2371 of the 104th General Assembly, as amended by
Senate Amendment No. 2, becomes law.".