Bipartisan Health Insurance Affordability Act

Bill Number

H.R. 6501

Origin Chamber

House

Congress

119th Congress, Session 1

Status

Introduced

Latest Action

2025-12-09: 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

2025-12-27T05:38:19Z

AI-Generated Summary

Bipartisan Health Insurance Affordability Act (H.R. 6501)

Purpose

This legislation aims to improve the affordability and integrity of health insurance coverage under the Affordable Care Act (ACA) and related programs. It extends financial assistance for premiums, strengthens fraud prevention in health insurance marketplaces (called Exchanges), increases transparency and accountability for pharmacy benefit managers (PBMs, entities that manage prescription drug benefits), and expands options for Health Savings Accounts (HSAs, tax-advantaged savings for medical expenses) for certain Exchange enrollees.

Key Provisions

• Extension and Modification of Premium Tax Credits (Sec. 2): Extends enhanced subsidies for health insurance premiums through 2027. For individuals with household incomes up to 150% of the federal poverty line, premiums are capped at $5 per month (after subsidies). Subsidies phase out gradually up to 200% of poverty, and for incomes between 200% and 700% of poverty, new premium percentage tiers apply (e.g., 2-4% for 200-250% of poverty, up to 8.5-9.25% for 600-700%). Applies to tax years after December 31, 2025.

• Fraud Prevention in Exchanges (Sec. 3):
• Imposes civil penalties ($10,000-$50,000 for negligence, up to $200,000 for knowing violations) and criminal penalties (fines and up to 10 years imprisonment) on agents and brokers who provide false information for enrollments.
• Requires verification processes for agent/broker-assisted enrollments in federally operated Exchanges starting no later than 2029, including consent forms, delayed commission payments, notifications to enrollees, and reporting of marketing organizations.
• Regulates field marketing organizations (entities contracting with agents/brokers) and third-party marketing organizations (entities handling lead generation or sales), mandating licensure, fair marketing practices, and termination reporting.
• Mandates quarterly checks against the Death Master File to remove deceased individuals from plans.
• Allows termination of agents/brokers based on a "preponderance of evidence" standard (more likely than not) for violations.
• Requires Exchanges to notify enrollees of their premium tax credit amount before enrollment starting in 2027.

• Extended Open Enrollment for 2026 (Sec. 4): Extends the annual open enrollment period for ACA Exchanges to November 1, 2025, through March 1, 2026, to allow more time for plan selection.

• PBM Accountability in Medicare (Sec. 5):
• For Medicare Part D prescription drug plans (PDPs) and Medicare Advantage plans with drug coverage (MA-PD) starting in 2029, PBMs must:
• Derive income only from "bona fide service fees" (flat fees for actual services, not tied to drug prices or volume), with full pass-through of rebates and discounts.
• Provide transparent definitions for terms like "rebate" and report exclusions in pricing guarantees.
• Submit annual detailed reports on drug utilization, costs, rebates, and affiliate activities (e.g., percentages dispensed by affiliated pharmacies, generic/biosimilar coverage justifications).
• Allow annual audits by plan sponsors and disclose contracts with drug manufacturers.
• PDP sponsors must enforce compliance, report violations, and certify annually.
• Funds $113 million for implementation and $20 million for oversight by the Inspector General.
• Requires a Government Accountability Office (GAO) study on price-related compensation in the drug supply chain and Medicare Payment Advisory Commission (MedPAC) reports on PBM agreements.

• Full Rebate Pass-Through in Group Health Plans (Sec. 6): Amends the Employee Retirement Income Security Act (ERISA) to require PBMs in employer-sponsored group health plans to pass 100% of drug rebates, fees, and discounts to the plan or insurer quarterly starting 30 months after enactment. Includes audit rights and protections for "innocent" plan fiduciaries (those who reasonably believed compliance occurred). Clarifies PBM services as covered under ERISA fiduciary rules.

• HSA Eligibility for Exchange Enrollees (Sec. 7): Allows individuals enrolled in the lowest-cost bronze plan (basic coverage level) on an ACA Exchange—or a cheaper plan than their prior one—to establish and contribute to an HSA starting in tax years after 2025. Coordinates with premium tax credits by reducing HSA contribution limits by any partial credit amounts used.

• Prepayment and Partial Credit Options for HSAs (Sec. 8):
• Allows eligible low-income enrollees to prepay $5 monthly premiums (or $60 annually if during open enrollment) starting in 2026.
• Permits directing 50% of advance premium tax credits into an HSA (up to annual limits), with the rest going to the insurer, for qualified Exchange enrollees starting in 2026.

• Reporting Requirement (Sec. 9): Joint report from Treasury and Health and Human Services Secretaries to Congress within one year on HSA implementation under Secs. 7-8, with recommendations for broader access.

Significant Changes to Existing Law

• ACA Premium Subsidies: Extends temporary enhancements (set to expire after 2025) with modified income tiers and caps, expanding eligibility to 700% of poverty (previously 400%) but introducing new sliding scales and tables for higher incomes.
• Fraud and Enrollment Rules: Adds specific penalties and verification for agents/brokers (previously general penalties), new regulations for marketing organizations (not previously defined or overseen), and mandatory death file checks (previously optional).
• Medicare PBM Rules: Introduces comprehensive transparency, reporting, and audit requirements for PBMs (building on but expanding existing direct/indirect remuneration rules), prohibiting non-fee income tied to drug prices.
• ERISA Rebate Rules: Mandates full pass-through of rebates in group plans (previously allowed retention by PBMs/insurers) and clarifies fiduciary duties for PBM arrangements.
• HSA Rules: Newly treats certain ACA Exchange plans as "high-deductible health plans" eligible for HSAs, despite not meeting traditional criteria, and adds options for prepayments and partial credit allocations.

Potential Impacts

• On Citizens: Low- and middle-income individuals (up to 700% of poverty) may see reduced premium costs, potentially increasing enrollment in ACA plans and Medicare drug coverage. Fraud protections could prevent unauthorized enrollments, saving money and ensuring continuity of care. HSA expansions offer tax benefits for savings on medical expenses, but may complicate premium assistance calculations.
• On Government Agencies: Increases administrative burdens for the Department of Health and Human Services (HHS) and Centers for Medicare & Medicaid Services (CMS) in verifying enrollments, auditing PBMs, and processing reports/audits. Treasury handles extended tax credits and HSA contributions. Potential cost savings from fraud reduction and rebate pass-throughs, offset by subsidy extensions (estimated billions in federal spending).
• On International Relations: No direct impacts; focuses on domestic health policy.

Main Stakeholders Affected

• Individuals and Families: ACA Exchange enrollees, especially low-income households, benefit from subsidies and fraud safeguards; Medicare beneficiaries gain from PBM transparency potentially lowering drug costs.
• Health Insurers and Exchanges: Face new notification and verification requirements; may see enrollment shifts due to extended periods and HSA options.
• Agents, Brokers, and Marketing Organizations: Subject to stricter licensing, penalties, and reporting, increasing compliance costs but reducing fraud risks.
• Pharmacy Benefit Managers (PBMs): Must overhaul compensation and reporting practices, facing audits and disgorgement of improper fees, which could reduce profits but improve fairness.
• Employers and Plan Sponsors: Group health plans gain full rebate pass-throughs and audit rights under ERISA, aiding cost control.
• Drug Manufacturers and Pharmacies: Affected by PBM reporting on rebates, generics/biosimilars, and affiliate dispensing, potentially influencing pricing and formulary decisions.
• Government Entities: HHS, CMS, Treasury, and Inspector General handle implementation, enforcement, and studies.

Notable Legal, Constitutional, or Political Implications

• Legal: Enhances enforcement under ACA and ERISA with new civil/criminal penalties and audit standards, potentially increasing litigation over compliance (e.g., fiduciary duties). Aligns with existing anti-fraud laws but adds specificity, reducing ambiguity in PBM contracts.
• Constitutional: No apparent challenges; provisions respect federal authority over interstate commerce and taxation (e.g., subsidies via tax code).
• Political: Bipartisan sponsorship signals cross-aisle support for ACA tweaks amid debates on affordability. Extends popular subsidies without full repeal, but PBM reforms address criticisms of middlemen in drug pricing. Fiscal implications include higher federal outlays for subsidies, balanced by anti-fraud measures; may influence future health policy debates on HSAs and Medicare.

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

Sponsor

Rep. Fitzpatrick, Brian K. [R-PA-1]

Cosponsors (22)

Rep. Golden, Jared F. [D-ME-2], Rep. Bacon, Don [R-NE-2], Rep. Suozzi, Thomas R. [D-NY-3], Rep. Bresnahan, Robert P. [R-PA-8], Rep. Davis, Donald G. [D-NC-1], Rep. Malliotakis, Nicole [R-NY-11], Rep. Perez, Marie Gluesenkamp [D-WA-3], Rep. Lawler, Michael [R-NY-17], Rep. Salazar, Maria Elvira [R-FL-27], Rep. Mackenzie, Ryan [R-PA-7], Rep. Kean, Thomas H. [R-NJ-7], Rep. Van Drew, Jefferson [R-NJ-2], Rep. Valadao, David G. [R-CA-22], Rep. Ciscomani, Juan [R-AZ-6], Rep. LaLota, Nick [R-NY-1], Rep. Kiggans, Jennifer A. [R-VA-2], Rep. Peters, Scott H. [D-CA-50], Rep. Davids, Sharice [D-KS-3], Rep. Costa, Jim [D-CA-21], Rep. Gonzalez, Vicente [D-TX-34], Rep. Hurd, Jeff [R-CO-3], Rep. Wilson, Frederica S. [D-FL-24]

Recent Actions

• 2025-12-09: 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.
• 2025-12-09: 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.
• 2025-12-09: 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.
• 2025-12-09: Introduced in House
• 2025-12-09: Introduced in House

Bill Versions

• Bipartisan Health Insurance Affordability Act — issued 2025-12-09 — PDF (79 pages)