Draft: Medical Financial Integrity and Anti-Inducement Act (Combined)

Pennsylvania General Assembly

Session of 2026

Printer’s No. _

DRAFT

AN ACT

Providing for the prohibition of financial incentives in medical and health-related insurance decisions; establishing patient-centered educational access; creating the Office of Medical Financial Review; providing for phased implementation; and establishing State patient-centered care departments and national coordination.

The General Assembly of the Commonwealth of Pennsylvania hereby enacts as follows:

Section 1. Short title.

This act shall be known and may be cited as the Medical Financial Integrity and Anti-Inducement Act.

Section 2. Legislative findings and declarations.

The General Assembly finds and declares as follows:

(1) Federal laws, including the Federal Anti-Kickback Statute, the Physician Self-Referral Law and the Physician Payments Sunshine Act, provide protections against financial conflicts of interest but do not eliminate all financial incentives influencing medical and insurance decisions.

(2) Financial incentives across the health care and insurance industries may influence treatment decisions, distort insurance offerings, encourage inappropriate services and undermine patient trust.

(3) It is the intent of the General Assembly to prohibit financial incentives that influence medical or insurance decisions, to establish salary-based compensation structures, to protect pharmacies and providers from financial coercion, to require de-identification of inter-entity data and to create a phased transition toward patient-centered systems.

Section 3. Relationship to existing law.

(a) This act shall supplement and strengthen existing Federal and State anti-kickback, self-referral and transparency laws.

(b) Where a conflict exists between this act and any other provision of law, the stricter provision shall apply.

Section 4. Definitions.

The following words and phrases when used in this act shall have the meanings given to them in this section unless the context clearly indicates otherwise:

“Covered entity.”
Any privately owned company, health insurer, medical insurer, life insurer, pharmacy benefit manager, manufacturer, distributor, broker, agent, third-party administrator, auditing firm or other entity that influences medical care, insurance coverage, reimbursement or dispensing.

“Financial incentive.”
Any direct or indirect payment, bonus, commission, rebate, discount, gift, ownership interest, consulting fee, referral fee, royalty, travel or entertainment, team-based bonus, managerial override commission, group or organizational performance incentive, volume-based compensation or any item of value tied to utilization, enrollment, prescribing, referral or sales performance.

“Health-related insurance.”
Any insurance product based in whole or in part on health status, medical history, disability, mortality, longevity or medical treatment, including health insurance, medical insurance, life insurance, disability insurance, long-term care insurance and supplemental health or accident policies.

“Medical product.”
Any drug, biologic, medical device, diagnostic, therapeutic product, durable medical equipment or digital medical tool.

“Medical provider.”
Any licensed health care professional or entity authorized to provide medical care.

Section 5. Prohibited conduct.

(a) A covered entity may not offer, pay, solicit or receive any financial incentive in connection with the prescribing, referring, recommending, enrolling, selling or utilizing of any medical product, medical service or health-related insurance policy.

(b) The prohibition under subsection (a) shall apply regardless of payer source.

Section 6. Patient-provider decision autonomy.

(a) All decisions regarding the selection, location, timing, provider or nature of medical care shall be determined solely by the patient and the licensed medical provider.

(b) No covered entity, employer, insurer, manufacturer, contractor or other third party may restrict the patient’s selection of a provider, restrict the geographic location at which care may be obtained, restrict appointment timing or scheduling options, require the use of preferred providers, facilities or networks, impose algorithmic, automated or utilization-based restrictions that alter the course of care, or direct or influence the clinical judgment of a provider.

(c) A covered entity may determine whether a service is covered under the terms of a policy, establish reimbursement rates and define contractual benefit structures.

(d) A coverage determination under subsection (c) may not limit the patient’s ability to seek care from any provider of the patient’s choosing, prevent a provider from offering services or restrict the availability of care based on network status or geographic designation.

(e) A covered entity may not market specific providers, facilities or treatment options to patients, promote preferred networks or providers in a manner intended to influence patient choice or use advertising, outreach or algorithmic targeting to steer patients toward specific medical decisions.

(f) No automated system, algorithm or decision-support tool operated by a covered entity may dissuade a patient from seeking care, redirect a patient to a specific provider or facility or influence clinical decision-making between a provider and patient.

(g) Nothing in this section shall be construed to limit the professional judgment of a licensed medical provider, restrict a provider from recommending appropriate care or prevent a patient from voluntarily selecting any provider or facility.

(h) This section shall be interpreted to ensure that clinical decision-making authority rests exclusively with the patient and provider, free from third-party financial, contractual or algorithmic influence.

Section 7. Permitted compensation.

(a) Compensation shall be permitted only if the compensation is at fair market value, is not based on the volume or value of services, does not influence clinical decision-making and is fully disclosed as required by law.

(b) Permitted compensation shall include fixed salaries, bona fide employment arrangements, fair-market-value service contracts and government-approved research arrangements.

Section 8. Representative compensation and conduct.

(a) All medical and insurance representatives shall be compensated on a salary or hourly basis only.

(b) A representative may not receive commissions, bonuses tied to utilization, enrollment-based pay or team-based or managerial incentives.

(d) Representatives may not engage in sales tactics, solicit purchases or enrollments or initiate patient contact.

Section 9. Educational information spaces.

(a) A medical facility may restrict representative access to clinical areas.

(b) If access is restricted, the facility shall provide a publicly accessible educational information space.

(c) Representatives operating in the space shall be classified as educational representatives and may not engage in sales conduct, solicit patients or close enrollments.

(d) Interaction between a patient and a representative shall occur only when the patient voluntarily approaches the representative or a provider directs the patient to the representative for information.

Section 10. Pharmaceutical sample accountability.

(a) All samples shall be assigned to a specific patient.

(b) Facilities shall maintain inventory logs and monthly dispensing reports.

(d) All survey data shall be fully de-identified before transmission.

Section 11. Universal de-identification requirement.

(a) Any data transmitted between covered entities shall be fully de-identified prior to transmission.

(b) A receiving entity may not attempt to re-identify the data.

Section 12. Pharmacy and insurance protections.

(a) No incentives may be tied to medication selection, formulary placement, policy enrollment or claim denial.

(b) Pharmacies and providers may not be financially penalized, retaliated against or audited directly by insurers or manufacturers.

Section 13. Office of Medical Financial Review.

(a) The Office of Medical Financial Review is established.

(b) The office shall review complaints, authorize audits, conduct administrative hearings and oversee compliance.

Section 14. Enforcement and penalties.

(a) A covered entity that violates this act shall be subject to a civil penalty of not less than $25,000 and not more than $500,000 per violation.

(b) A person who knowingly violates this act commits a felony and may be sentenced to a fine of not more than $1,000,000, imprisonment for not more than 10 years, or both.

Section 15. Private right of action.

A person harmed by a violation of this act may bring a civil action to recover damages, costs and attorney fees.

Section 16. Whistleblower protections.

(a) A person may not retaliate against a whistleblower.

(b) A whistleblower may receive between 10% and 30% of recovered funds.

Section 17. Phased implementation.

(a) Medical facilities shall have up to three years to establish educational information spaces.

(b) Covered entities shall have five years to eliminate prohibited incentive-based compensation structures.

Section 18. State grant programs.

Each state shall establish a grant program to fund educational information spaces, software systems, staffing and compliance infrastructure.

Section 19. State patient-centered care departments.

(a) Each state shall establish a Patient-Centered Care Department.

(b) The department shall conduct facility assessments, identify resource needs, assist with implementation and coordinate transition efforts.

Section 20. Elected nonpartisan transition coordinator.

(a) Each state shall elect a nonpartisan Patient-Centered Care Transition Coordinator.

(b) The coordinator may not be affiliated with a political party, hold partisan office or be a lobbyist or industry executive.

(c) The coordinator shall oversee state implementation, direct the Patient-Centered Care Department and represent the state in national coordination efforts.

Section 21. National coordination council.

(a) A National Patient-Centered Care Coordination Council is established.

(b) The council shall coordinate state implementation strategies, share best practices and publish annual transition reports.

Section 22. Severability.

The provisions of this act are severable. If any provision is held invalid, the remaining provisions shall remain in effect.

Section 23. Effective date.

This act shall take effect on a date determined by the General Assembly, with phased implementation as provided.