Pharmacists Fight Back in Medicare and Medicaid Act

Bill Number: H.R. 6609
Origin Chamber: House
Congress: 119th Congress, Session 1
Policy Area: Health
Status: Introduced
Latest Action: 2025-12-11: Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, 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: 2026-05-15T08:08:28Z

AI-Generated Summary

Purpose of the Legislation

This bill, titled the "Pharmacists Fight Back in Medicare and Medicaid Act," aims to regulate pharmacy benefit managers (PBMs)—companies that manage prescription drug benefits for health plans—under Medicare Part D and Medicaid. It seeks to ensure fair payments to pharmacies, require the pass-through of drug manufacturer rebates to reduce patient costs, prevent practices that steer patients to specific pharmacies, and increase transparency in drug pricing.

Key Provisions

Medicare Requirements (Effective January 1, 2027):
Prescription Drug Plan (PDP) sponsors and their PBMs must reimburse in-network pharmacies for covered drugs using the national average drug acquisition cost (NADAC, a survey-based average wholesale price) or wholesale acquisition cost if NADAC is unavailable, plus up to 4% of that cost or $50 (whichever is less).
Pharmacies receive a dispensing fee equal to the state's Medicaid rate, which patients do not have to repay.
No additional fees can reduce pharmacy payments.
Manufacturer rebates (price concessions like discounts from drug makers) must be applied at the point of sale to lower patient copays or coinsurance, based on the reimbursement minus the rebate.
PBMs remit unused rebate portions to PDP sponsors, and sponsors remit applicable amounts to the government for low-income subsidy-eligible patients.
Annual reporting by PBMs to sponsors and the Secretary of Health and Human Services (HHS) certifying compliance, starting July 1, 2028.
Ban on "steering," defined as directing patients to specific (often affiliated) pharmacies through network designs, marketing, or restrictions that favor certain pharmacies or exclude others.

Application to Medicare Advantage-Prescription Drug (MA-PD) Plans:
Same PBM requirements apply to these integrated plans.

Medicaid Requirements (Effective for Contracts Starting January 1, 2027):
State contracts with PBMs, managed care entities (health plans covering Medicaid beneficiaries), or other specified entities must prohibit steering.
Payments for covered outpatient drugs must use the same NADAC-based formula plus dispensing fee as in Medicare.
PBMs or entities must remit all manufacturer rebates or discounts to the state.
Conforming changes ensure these rules apply to Medicaid managed care payments.

Penalties for Non-Compliance (Effective January 1, 2027):
Criminal: Felony charges for knowing and willful violations of payment, rebate, or steering rules, with fines up to $1,000,000 and/or up to 10 years imprisonment.
Civil: Monetary penalties up to $1,000,000 per violation.

Medicaid Drug Pricing Transparency Improvements:
Expands NADAC surveys to include non-retail pharmacies (e.g., mail-order, specialty, hospital) but excludes charitable or nonprofit ones.
Pharmacies must report acquisition costs net of all concessions (e.g., discounts, rebates) and respond to surveys.
HHS must publicly release survey data, including response rates, methodology, and concession details.
States cannot use non-retail pharmacy pricing to set retail reimbursement rates.

Significant Changes to Existing Law

Introduces mandatory reimbursement formulas tied to NADAC, replacing more flexible or lower payment structures in current Medicare and Medicaid rules.
Requires point-of-sale application of rebates to beneficiaries, shifting from delayed or partial pass-throughs under prior law.
Explicitly defines and bans steering practices, which were not previously regulated in detail.
Adds new reporting and certification mandates for PBMs, with the first reports due in 2028.
Adjusts Medicare Part D bid calculations to deduct expected rebate remittances, potentially lowering plan premiums.
Expands Medicaid pricing surveys beyond retail pharmacies and mandates public disclosure, while adding limits on how states use the data.
Imposes first-time criminal penalties for PBM violations and increases civil fines.

Potential Impacts

On Citizens (Beneficiaries): Medicare and Medicaid enrollees may see reduced out-of-pocket costs for drugs due to rebate pass-throughs at the pharmacy counter, improving affordability, especially for low-income individuals. Independent pharmacies could remain viable, maintaining local access to medications.
On Government Agencies: The Centers for Medicare & Medicaid Services (CMS) and states will need to oversee compliance, process additional remittances, and conduct expanded surveys, potentially increasing administrative workload but enhancing pricing oversight and transparency to control program costs.
On International Relations: No direct impacts, as the bill focuses on domestic U.S. health programs.

Main Stakeholders Affected

Pharmacies: Independent and in-network pharmacies benefit from standardized, fairer reimbursements and protections against steering, potentially reducing closures.
Pharmacy Benefit Managers (PBMs): Face new compliance burdens, rebate remittance requirements, and penalties, which could limit profits from retaining rebates or favoring affiliates.
Health Plans and Sponsors: PDP sponsors, MA-PD plans, and Medicaid managed care entities must update contracts and operations to meet payment and reporting rules.
Beneficiaries: Medicare Part D and Medicaid enrollees gain from lower copays and broader pharmacy choices.
Drug Manufacturers: Affected by how rebates are defined and passed through, potentially influencing negotiation strategies.
Government Entities: HHS/CMS and state Medicaid agencies handle enforcement, surveys, and fund remittances, with possible cost savings from transparency.

Notable Legal, Constitutional, or Political Implications

Legal: Establishes new enforceable standards in the Social Security Act, with felony-level criminal penalties (a rare escalation for administrative health violations) and civil fines, enabling stronger HHS enforcement through audits and prosecutions. Definitions of terms like "steering" and "manufacturer rebate" provide clarity but may lead to litigation over interpretations (e.g., what constitutes an "affiliate").
Constitutional: No apparent challenges; the bill regulates federal spending programs (Medicare/Medicaid) under Congress's spending power and commerce clause authority.
Political: Bipartisan sponsorship (from both parties) highlights cross-aisle support for reining in PBM practices, amid broader debates on drug pricing. It could influence ongoing pharmacy industry reforms but may face opposition from PBM trade groups over profit impacts.

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

Sponsor

Rep. Auchincloss, Jake [D-MA-4]

Cosponsors (40)

Rep. Harshbarger, Diana [R-TN-1], Rep. Comer, James [R-KY-1], Rep. Carter, Earl L. "Buddy" [R-GA-1], Rep. Ciscomani, Juan [R-AZ-6], Rep. Moulton, Seth [D-MA-6], Rep. Deluzio, Christopher R. [D-PA-17], Rep. Peters, Scott H. [D-CA-50], Rep. Tlaib, Rashida [D-MI-12], Rep. Budzinski, Nikki [D-IL-13], Rep. Krishnamoorthi, Raja [D-IL-8], Rep. Khanna, Ro [D-CA-17], Rep. Lynch, Stephen F. [D-MA-8], Rep. Goldman, Craig A. [R-TX-12], Rep. Cohen, Steve [D-TN-9], Rep. Pressley, Ayanna [D-MA-7], Rep. Gonzalez, Vicente [D-TX-34], Rep. Moore, Barry [R-AL-1], Rep. Subramanyam, Suhas [D-VA-10], Rep. Pocan, Mark [D-WI-2], Rep. Bishop, Sanford D. [D-GA-2], Rep. McCollum, Betty [D-MN-4], Rep. Westerman, Bruce [R-AR-4], Rep. Scott, Austin [R-GA-8], Rep. Fleischmann, Charles J. "Chuck" [R-TN-3], Rep. Rogers, Harold [R-KY-5], Rep. Fulcher, Russ [R-ID-1], Rep. Maloy, Celeste [R-UT-2], Rep. McGarvey, Morgan [D-KY-3], Rep. Bergman, Jack [R-MI-1], Rep. Sessions, Pete [R-TX-17], Rep. Clyde, Andrew S. [R-GA-9], Rep. Rogers, Mike D. [R-AL-3], Rep. Aderholt, Robert B. [R-AL-4], Rep. Williams, Roger [R-TX-25], Rep. Strong, Dale W. [R-AL-5], Rep. Mann, Tracey [R-KS-1], Rep. James, John [R-MI-10], Rep. Langworthy, Nicholas A. [R-NY-23], Rep. Palmer, Gary J. [R-AL-6], Rep. Tenney, Claudia [R-NY-24]

Recent Actions

2025-12-11: Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, 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.
2025-12-11: Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, 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.
2025-12-11: Introduced in House
2025-12-11: Introduced in House

Bill Versions

Pharmacists Fight Back in Medicare and Medicaid Act — issued 2025-12-11 — PDF (23 pages)