H.R. 2554

119th CONGRESS 1st Session

To amend title XVIII of the Social Security Act to apply prescription drug inflation rebates to drugs furnished in the commercial market and to change the base year for rebate calculations.

IN THE HOUSE OF REPRESENTATIVES · April 1, 2025 · Sponsor: Mr. Horsford

Table of contents

• H.R. 2554
  • SEC. 1. Short title
  • SEC. 2. Application of prescription drug inflation rebates to drugs furnished in the commercial market

SEC. 1. Short title

• This Act may be cited as the Lower Drug Costs for Families Act.

SEC. 2. Application of prescription drug inflation rebates to drugs furnished in the commercial market

• (a) Part B drugs
  • (1) Application of prescription drug inflation rebates to drugs furnished in the commercial market
    • Section 1847A(i) of the Social Security Act (42 U.S.C. 1395w–3a(i)) is amended—
    • Application of prescription drug inflation rebates to drugs furnished in the commercial market
      • in paragraph (1)(A)(i), by striking unitsand inserting billing units;
      • in paragraph (2)(A), by striking for which payment is made under this partand inserting that would be payable under this part if such drug were furnished to an individual enrolled under this part;
      • in paragraph (3)—
        • (i) in subparagraph (A)(i), by striking unitsand inserting billing units; and
        • (ii) by striking subparagraph (B) and inserting the following:
          • (B) Total number of billing units
            • For purposes of subparagraph (A)(i), the total number of billing units with respect to a part B rebatable drug is determined as follows:
              • (i) Determine the total number of units equal to—
              • the total number of units, as reported under subsection (c)(1)(B) for each National Drug Code of such drug during the calendar quarter that is two calendar quarters prior to the calendar quarter as described in subparagraph (A), minus
              • the total number of units with respect to each National Drug Code of such drug for which payment was made under a State plan under title XIX (or waiver of such plan), as reported by States under section 1927(b)(2)(A) for the rebate period that is the same calendar quarter as described in subclause (I).
              • (ii) Convert the units determined under clause (i) to billing units for the billing and payment code of such drug, using a methodology similar to the methodology used under this section, by dividing the units determined under clause (i) for each National Drug Code of such drug by the billing unit for the billing and payment code of such drug.
              • (iii) Compute the sum of the billing units for each National Drug Code of such drug in clause (ii).
  • (2) Change of base year for rebate calculation
    • Section 1847A(i) of the Social Security Act (42 U.S.C. 1395w–3a(i)) is amended—
    • Change of base year for rebate calculation
      • in paragraph (3)—
        • (i) in subparagraph (D), by striking July 1, 2021and inserting July 1, 2016; and
        • (ii) in subparagraph (E), by striking January 2021and inserting January 2016; and
      • in paragraph (4)—
        • (i) in subparagraph (A)—
        • by striking December 1, 2020and inserting December 31, 2015; and
        • by striking January 2021and inserting January 2016;
        • (ii) in subparagraph (B), by striking December 1, 2020and inserting December 31, 2015; and
        • (iii) in subparagraph (C), by striking January 2021and inserting January 2016.
  • (3) Effective date
    • The amendments made by this subsection shall apply with respect to calendar quarters beginning on or after January 1, 2026.
• (b) Covered part D drugs
  • (1) Application of prescription drug inflation rebates to drugs furnished in the commercial market
    • Section 1860D–14B of the Social Security Act () is amended— 42 U.S.C. 1395w–114b
    • Application of prescription drug inflation rebates to drugs furnished in the commercial market
      • in subsection (b)—
        • (i) in paragraph (1)—
        • in subparagraph (A)(i), by striking the total number of unitsand all that follows through the semicolon and inserting the following: ; and
          • (B) Excluded units
            • For purposes of subparagraph (A)(i), the Secretary shall exclude from the total number of units for a dosage form and strength with respect to a part D rebatable drug, with respect to an applicable period, the following:
              • (i) Units of each dosage form and strength of such part D rebatable drug for which payment was made under a State plan under title XIX (or waiver of such plan), as reported by States under section 1927(b)(2)(A).
              • (ii) Units of each dosage form and strength of such part D rebatable drug for which a rebate is paid under section 1847A(i).
              • (iii) Beginning with plan year 2026, units of each dosage form and strength of such part D rebatable drug for which the manufacturer provides a discount under the program under section 340B of the Public Health Service Act.
        • by striking subparagraph (B) and inserting the following:
        • (ii) in paragraph (6), by striking and all that follows through and inserting the following: ; and
        • (d) Information
          • For purposes of carrying out this section, the Secretary shall use information submitted by manufacturers under section 1927(b)(3) and information submitted by States under section 1927(b)(2)(A).
      • by striking subsection (d) and inserting the following:
  • (2) Change of base year for rebate calculation
    • Section 1860D–14B of the Social Security Act () is amended— 42 U.S.C. 1395w–114b
    • Change of base year for rebate calculation
      • in subsection (b)(5)—
        • (i) in subparagraph (A)—
        • by striking October 1, 2021and inserting October 1, 2016; and
        • by striking January 2021and inserting January 2016; and
        • (ii) in subparagraph (C), by striking January 2021and inserting January 2016; and
      • in subsection (g)—
        • (i) in paragraph (3)—
        • by striking January 1, 2021and inserting January 1, 2016; and
        • by striking October 1, 2021and inserting October 1, 2016; and
        • (ii) in paragraph (4), by striking January 2021and inserting January 2016.
  • (3) Effective date
    • The amendments made by this subsection shall take apply with respect to applicable periods (as defined in section 1860D–14B(g)(7) of the Social Security Act (42 U.S.C. 1395w–114b(g)(7))) beginning on or after October 1, 2025.