This bill changes Medicare Part D, Medicare Advantage with drug coverage (MA-PD), and Medicaid rules about how pharmacy benefit managers (PBMs) and plan sponsors pay pharmacies and handle manufacturer rebates. For plan years and contracts starting January 1, 2027, it requires PBMs and plan sponsors to: pay in-network pharmacies an ingredient cost equal to the national average drug acquisition cost (or WAC if no national average) plus 4% (capped at $50); pay a dispensing fee equal to the State Medicaid dispensing fee and not charge patients for that fee; not impose fees that reduce pharmacy payments; and not engage in "steering" (practices that direct patients to certain pharmacies or limit pharmacy participation).
The bill requires that when a manufacturer rebate exists, the rebate be used at the point of sale to lower a patient’s coinsurance or copayment for covered Part D drugs obtained at an in-network pharmacy. It also requires PBMs that receive rebates to remit rebate amounts to plan sponsors (with specific remittance rules when sponsors receive rebates directly), and requires plan sponsors to remit certain amounts for subsidy-eligible individuals to the Secretary of Health and Human Services. PBMs must certify annual compliance (first certification due July 1, 2028).
For Medicaid, state contracts with PBMs or managed care entities that cover outpatient drugs must include the same no-steering rule, the same pharmacy payment formula, and a requirement that rebates be remitted to the State. The bill expands pharmacy pricing surveys to many pharmacy types, requires pharmacies that receive any payment or price concession to respond to surveys, and requires the Secretary to publish national acquisition price information from surveys. The bill adds criminal and civil penalties for PBMs that knowingly and willfully fail to follow the payment, steering, or rebate rules, including fines up to $1,000,000 and up to 10 years imprisonment for felony violations, and civil monetary penalties.
The bill amends Titles XI, XVIII, and XIX of the Social Security Act and was introduced in the House on December 11, 2025. It has been referred to the Committee on Energy and Commerce and the Committee on Ways and Means and is listed as "In Progress."
No publicly available information on overall federal cost estimates or budgetary effects is included in the bill text. The bill requires Medicare Part D plan bids beginning with plan year 2027 to subtract assumptions about rebate remittance payments from the actuarial value used to produce the bid. It also creates criminal and civil penalties for violations, and requires PBMs to report and certify compliance (first report/certification due July 1, 2028).
No publicly available information.
No publicly available information.