Lowering Drug Costs for American Families Act

Bill Number

H.R. 6166

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Health

Status

Introduced

Latest Action

2025-11-20: Referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, and Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

Last Updated

2026-06-05T08:07:06Z

AI-Generated Summary

Summary of H.R. 6166: Lowering Drug Costs for American Families Act

Purpose

This bill aims to reduce prescription drug costs for Americans by expanding the government's ability to negotiate drug prices, extending inflation-based rebates to private insurance markets, and setting limits on out-of-pocket (OOP) expenses for drugs under private health plans. It builds on existing Medicare programs to make lower prices available more broadly, including in employer-sponsored and individual health insurance.

Key Provisions

The bill is divided into three titles, amending laws like the Social Security Act, Public Health Service Act (PHSA), Employee Retirement Income Security Act (ERISA), and Internal Revenue Code (IRC).

Title I: Drug Price Negotiation Program

• Expansion of Negotiated Drugs: Increases the number of drugs eligible for Medicare price negotiation from 20 to 50 per year, starting with high-cost, single-source drugs.
• Extension to Private Insurance: Allows group health plans and individual health insurance (not just Medicare) to voluntarily participate in negotiated "maximum fair prices." Plans that cover a negotiated drug are automatically included unless they opt out publicly. Cost-sharing (like copays) for these drugs cannot exceed the negotiated price.
• International Pricing Consideration: For negotiations starting in 2028, requires factoring in average prices paid for the drug in countries like Australia, Canada, France, Germany, Japan, and the UK (volume-weighted net prices across dosage forms).
• Repeal of Prior Changes: Undoes modifications to the program made by Public Law 119-21 (a 2025 reconciliation act), restoring original rules on drug selection and negotiation timelines.

Title II: Prescription Drug Inflation Rebates

• Application to Commercial Market: Extends Medicare's inflation rebate requirements—where drugmakers pay back excess price increases above inflation—to drugs sold in private (commercial) markets.
• For Part B drugs (outpatient and physician-administered), rebates apply to total U.S. sales minus Medicaid and Medicare units.
• For Part D drugs (pharmacy-dispensed), rebates cover total units sold minus Medicaid, Medicare Part B, and (from 2026) 340B program discounts (a federal program providing discounted drugs to safety-net providers).
• Rebates are calculated quarterly using manufacturer-reported data, with adjustments for billing units (standardized quantities for payment).

Title III: Out-of-Pocket Limits for Prescription Drugs

• Overall and Drug-Specific Caps: Starting in 2027, sets annual OOP limits for group and individual health plans (including employer plans and Affordable Care Act marketplace coverage):
• Overall OOP Limit: Caps total cost-sharing (deductibles, copays, coinsurance) for all essential health benefits. For self-only coverage, starts at the 2014 ACA limit adjusted for inflation (around $9,450 initially, indexed annually); family coverage is double.
• Prescription Drug OOP Limit: Separate cap just for drugs, starting at $2,000 for self-only (double for family), also indexed annually to premium growth.
• Insulin Cost-Sharing Rules: From 2027, plans must cover at least one insulin product per type (e.g., rapid-acting, long-acting) and dosage form (e.g., vial, pen) without deductibles. OOP for a 30-day supply is capped at the lesser of $35 or 25% of the negotiated price (after discounts). Counts toward overall OOP limits; applies to in-network providers, with flexibility for out-of-network.
• Excludes premiums, balance billing (extra charges from out-of-network providers), and non-covered services. Does not apply to standalone dental plans or certain catastrophic plans (though insulin rules extend to them). Sunsets some prior ACA cost-sharing rules after 2026.

Implementation allows use of guidance or interim rules by the Department of Health and Human Services (HHS), Labor, and Treasury.

Significant Changes to Existing Law

• From Medicare-Centric to Broader Application: Transforms the Inflation Reduction Act's (2022) drug negotiation program—previously limited to Medicare Parts B and D—from a public program into one accessible to private insurers, potentially covering 180+ million Americans in commercial plans.
• Reversal of Recent Limits: Repeals Public Law 119-21's restrictions (e.g., on drug selection criteria or timelines), expanding negotiation scope.
• New Rebate Mechanism: Shifts inflation rebates from Medicare-only to include commercial sales data, excluding government programs to avoid double-counting; introduces billing unit conversions for accuracy.
• Enhanced ACA Protections: Replaces and strengthens Affordable Care Act (ACA) OOP limits with inflation-adjusted caps, adds drug-specific limits, and mandates insulin coverage without deductibles (building on a 2022 cap but lowering it and broadening application).
• Aligns rules across PHSA, ERISA, and IRC for consistency in group/individual markets.

Potential Impacts

• On Citizens: Could save patients billions in drug costs by capping OOP at affordable levels (e.g., no more than $2,000/year for drugs in 2027) and applying negotiated prices/lowered inflation to private plans. Benefits chronic condition patients (e.g., diabetes via insulin caps) but may increase premiums if insurers pass on costs.
• On Government Agencies: HHS (via Centers for Medicare & Medicaid Services) gains expanded oversight for negotiations, rebate collection, and plan compliance; requires new data reporting from manufacturers and states. Labor and Treasury handle ERISA/employer plan enforcement. Increased administrative burden but potential savings in Medicare spending.
• On International Relations: Incorporating foreign prices in negotiations may pressure global pharma supply chains, as U.S. prices often subsidize lower international ones; could strain trade ties if seen as "importing" price controls, though limited to negotiation guidance.
• Broader Economy: May reduce overall U.S. drug spending (projected 10-20% savings on selected drugs) but could affect drug innovation if manufacturers cut R&D due to lower revenues.

Main Stakeholders Affected

• Patients and Consumers: Primary beneficiaries through lower copays, rebates, and OOP caps, especially those with high drug needs (e.g., Medicare enrollees, privately insured families).
• Health Insurers and Plans: Must adopt negotiated prices, disclose opt-outs, and comply with OOP/insulin rules; voluntary participation but automatic inclusion unless opted out, potentially lowering claims costs.
• Drug Manufacturers: Face broader price negotiations (more drugs, international benchmarks), mandatory inflation rebates on commercial sales, and insulin caps; could reduce profits but encourage competition.
• Providers and Pharmacies: Affected by payment rules for administered drugs; must align with maximum fair prices in participating plans.
• Government: HHS, CMS, states (via Medicaid data), and federal agencies enforce and fund implementation.

Notable Legal, Constitutional, or Political Implications

• Legal: Builds on ACA and Inflation Reduction Act authority but extends to private markets, potentially inviting lawsuits from pharma companies claiming "price controls" violate Takings Clause (5th Amendment) or exceed congressional commerce powers. Opt-out provisions and voluntary participation may mitigate coercion claims. Requires coordination across statutes (PHSA/ERISA/IRC), risking implementation challenges.
• Constitutional: No direct challenges noted, but expansion of federal regulation into private insurance could raise federalism issues if states' roles in insurance are overridden.
• Political: Advances Democratic priorities on drug affordability amid partisan divides; repealing Public Law 119-21 (likely Republican-led) signals reversal of recent limits. Could influence 2026 midterms/elections by highlighting cost savings, but opponents may argue it stifles innovation or raises taxes indirectly via rebates. Neutral on bias, focuses on bill's market intervention to achieve affordability goals.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Pallone, Frank [D-NJ-6]

Cosponsors (55)

Rep. Neal, Richard E. [D-MA-1], Rep. Scott, Robert C. "Bobby" [D-VA-3], Rep. Tonko, Paul [D-NY-20], Rep. McClellan, Jennifer L. [D-VA-4], Rep. Beatty, Joyce [D-OH-3], Del. Norton, Eleanor Holmes [D-DC-At Large], Rep. Landsman, Greg [D-OH-1], Rep. Mannion, John W. [D-NY-22], Rep. Craig, Angie [D-MN-2], Rep. Frankel, Lois [D-FL-22], Rep. Matsui, Doris O. [D-CA-7], Rep. Dingell, Debbie [D-MI-6], Rep. Wasserman Schultz, Debbie [D-FL-25], Rep. Thanedar, Shri [D-MI-13], Rep. Goldman, Daniel S. [D-NY-10], Rep. Larson, John B. [D-CT-1], Rep. Hoyer, Steny H. [D-MD-5], Rep. Johnson, Julie [D-TX-32], Rep. Simon, Lateefah [D-CA-12], Rep. Riley, Josh [D-NY-19], Rep. Costa, Jim [D-CA-21], Rep. Clarke, Yvette D. [D-NY-9], Rep. Chu, Judy [D-CA-28], Rep. Underwood, Lauren [D-IL-14], Rep. Dexter, Maxine [D-OR-3], Rep. Courtney, Joe [D-CT-2], Rep. McIver, LaMonica [D-NJ-10], Rep. Gillen, Laura [D-NY-4], Rep. Schakowsky, Janice D. [D-IL-9], Rep. Quigley, Mike [D-IL-5], Rep. Omar, Ilhan [D-MN-5], Rep. Deluzio, Christopher R. [D-PA-17], Rep. Bonamici, Suzanne [D-OR-1], Rep. Fletcher, Lizzie [D-TX-7], Rep. Carson, André [D-IN-7], Rep. Garcia, Robert [D-CA-42], Rep. Stansbury, Melanie A. [D-NM-1], Rep. Grijalva, Adelita S. [D-AZ-7], Rep. Lieu, Ted [D-CA-36], Rep. Ansari, Yassamin [D-AZ-3], Rep. Davids, Sharice [D-KS-3], Rep. Randall, Emily [D-WA-6], Rep. DelBene, Suzan K. [D-WA-1], Rep. Waters, Maxine [D-CA-43], Rep. Krishnamoorthi, Raja [D-IL-8], Rep. Friedman, Laura [D-CA-30], Rep. Pocan, Mark [D-WI-2], Rep. Vindman, Eugene Simon [D-VA-7], Rep. McClain Delaney, April [D-MD-6], Rep. Budzinski, Nikki [D-IL-13] and 5 more

Recent Actions

• 2025-11-20: Referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, and Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-11-20: Referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, and Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-11-20: Referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, and Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-11-20: Introduced in House
• 2025-11-20: Introduced in House

Bill Versions

• Lowering Drug Costs for American Families Act — issued 2025-11-20 — PDF (49 pages)

Related Bills

• H.R. 6255 (119th Congress)