Sponsors (3)
The bill aims to lower costs and improve access by favoring generics and biosimilars in Medicare Part D formularies, but savings depend on insurer and manufacturer responses and may be offset by higher plan administrative costs or patient disruptions.
Medicare Part D beneficiaries will pay lower out‑of‑pocket costs when plans place lower‑cost generics or biosimilars in preferred formulary positions.
Medicare Part D beneficiaries with chronic conditions will have easier access to lower‑cost alternatives because plans cannot impose stricter prior authorization or step therapy on required generics/biosimilars than on reference products.
Taxpayers and the Medicare Part D program may see reduced overall drug spending and downward pressure on prices as use of generics and biosimilars is encouraged.
Drug manufacturers of reference products may change rebate strategies or contracting practices, potentially complicating net prices and leading to higher Part D premiums or uncertain program costs for taxpayers and beneficiaries.
Prescription Drug Plan (PDP) sponsors will likely incur administrative and contracting costs to redesign formularies and adjust benefit tiers by 2027, which could contribute to higher premiums or administrative fees affecting beneficiaries and taxpayers.
Some Medicare beneficiaries—especially those stable on reference products—may experience disruption from required switches to preferred generics or biosimilars, needing coordination with providers and risking short‑term adverse effects or reduced adherence.
Based on analysis of 2 sections of legislative text.
Requires Part D plans (starting plan years on/after Jan 1, 2027) to place lower-cost generics and at least two lower-cost biosimilars in preferred formulary positions and not restrict them more than reference drugs.
Introduced March 27, 2026 by Doris Matsui · Last progress March 27, 2026
Requires Medicare Part D plans, for plan years starting on or after January 1, 2027, to place lower-cost generic drugs and at least two lower-cost biosimilar products in a preferred formulary position compared with their higher-cost reference products, and prohibits plans from using stricter limits (like prior authorization or step therapy) on those lower-cost products than on the reference drugs. The bill adds definitions for covered generics, covered biosimilars, preferred position, reference products, and wholesale acquisition cost.