Senate Bill 1780, 86th Legislature, Regular Session (2019), amended Subchapter B,

Chapter 531 of the Texas Government Code, by adding Section 531.0701, to allow HHSC to enter into a value-based agreement for VDP by written agreement with a drug manufacturer, based on outcome data or other metrics to which HHSC and the drug manufacturer agree in writing. The value-based agreement is a written agreement linking payment for a drug or product to its value and is consistent with federal and state law and approved by CMS as part of the Medicaid state plan.  Agreements may include things of value, including, but not limited to:

  • Rebates
  • Discounts
  • Price reductions
  • Contributions
  • Risk sharing
  • Reimbursements
  • Payment deferral or installment payments
  • Guarantees
  • Patient care
  • Shared savings payments
  • Withholds
  • Bonuses

Complete the Value-Based Agreement Concept (HHS Form 1402) to submit a proposal.  Download the form at