Changes how Medicare’s drug inflation rebates are calculated using real “billing units” and by excluding certain sales from the count. It applies to drugs sold in the commercial market when computing inflation rebates for both Medicare Part B and Part D.

The policy excludes Medicaid-paid units, any units already subject to other rebates, and—starting in 2026—units sold at 340B discounts. It also updates the base years used in the math and staggers effective dates. These adjustments aim to prevent double counting and make rebate amounts more accurate, which could change what manufacturers owe and may affect premiums and prices over time.