Sponsors (3)
Requires Part D plans to place lower-WAC generics and at least two lower-WAC biosimilars in preferred formulary positions and prohibits stricter access limits for those products.
The bill shifts Part D formularies toward lower-cost generics and biosimilars to lower beneficiary costs and reduce program spending, but does so at the risk of higher plan administrative costs, uncertain manufacturer pricing responses, and potential disruption for some patients.
Medicare Part D beneficiaries will face lower out-of-pocket costs when lower-cost generics or biosimilars are placed in preferred formulary positions.
Beneficiaries 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.
Encouraging use of lower-cost generics and biosimilars could reduce overall Part D program spending and exert downward pressure on drug prices, benefiting taxpayers and reducing long-term program costs.
Prescription Drug Plan (PDP) sponsors may incur higher administrative or contracting costs to redesign formularies and adjust benefit tiers by 2027, which could translate into higher premiums or administrative fees for beneficiaries and taxpayers.
Manufacturers of reference products may respond with larger rebates or other contracting changes that complicate net prices and formulary negotiations, creating uncertainty that could offset the expected savings and affect premiums.
Some beneficiaries—particularly those with chronic conditions—could experience disruptions if required biosimilars/generics are promoted over their current reference products, potentially necessitating switches in therapy or additional coordination with providers.
Based on analysis of 2 sections of legislative text.
Official title: To amend title XVIII of the Social Security Act to require PDP sponsors of a prescription drug plan under part D of the Medicare program that use a formulary to include certain generic drugs and biosimilar biological products on such formulary, and for other purposes.
Introduced March 27, 2026 by Doris Matsui · Last progress March 27, 2026
Requires Medicare Part D prescription drug plans to put lower-cost generics and biosimilars ahead of their higher-cost reference products on formularies and prevents plans from using tougher access limits for those lower-cost alternatives. The rule applies to plan years beginning on or after January 1, 2027, and includes definitions of covered generic, covered biosimilar, reference product, preferred position, and wholesale acquisition cost (WAC).