Sponsors (11)
The bill expands Medicare and Medicaid coverage for prescription digital therapeutics and creates billing and data-reporting structures to support adoption, but it raises federal and state spending, administrative burdens, transparency and evidence risks, and compliance costs that could affect prices and market entry.
Medicare and Medicaid beneficiaries — particularly people with chronic conditions and those in rural/underserved areas — will gain access to FDA-cleared/authorized prescription digital therapeutics under Part B and State Medicaid plans, expanding non-drug treatment options and lowering out-of-pocket costs for approved products.
Hospitals, health systems, and providers will have clearer billing and reimbursement pathways (product-specific HCPCS codes and a payment methodology) and may receive payment for prescribing or integrating covered digital therapeutics into care, supporting adoption and integration into clinical workflows.
CMS will obtain private-payor price and volume data from manufacturers, giving the agency information to help set more market-reflective payment rates for digital therapeutics.
Medicare and State Medicaid programs (and therefore taxpayers) may face increased spending if Part B and State Medicaid adopt coverage for prescription digital therapeutics, putting pressure on federal and state budgets.
Manufacturers could pass compliance and reporting costs or higher negotiated prices onto patients, employers, and insurers, resulting in higher premiums, cost-sharing, or out-of-pocket costs for families and businesses.
If States cover expensive digital therapeutics without strict effectiveness criteria, beneficiaries and programs risk paying for treatments with limited evidence of benefit, wasting funds and exposing patients to ineffective care.
Based on analysis of 3 sections of legislative text.
Creates Medicare and Medicaid coverage categories for FDA-cleared prescription digital therapeutics, sets CMS payment/coding rules, and requires manufacturer price/volume reporting.
Official title: To amend titles XVIII and XIX of the Social Security Act to provide for coverage of prescription digital therapeutics under the Medicare and Medicaid programs, and for other purposes.
Introduced May 8, 2025 by Kevin Hern · Last progress May 8, 2025
Creates a new Medicare and Medicaid coverage category for FDA-cleared prescription digital therapeutics (PDTs), requires CMS to set payment and coding rules, and requires manufacturers to report private-payer prices, volumes, and user counts with civil penalties for misreporting. The changes take effect for items furnished on or after January 1, 2026, and direct CMS to adopt payment methodology, temporary and permanent HCPCS coding, and confidentiality protections for reported data.