Sponsors (15)
Official title: Amend title XVIII of the Social Security Act to protect against high out-of-pocket expenditures for Medicare fee-for-service benefits, and to amend titles XVIII and XIX of the Social Security Act to enhance programs that protect low-income Medicare beneficiaries.
Introduced June 24, 2026 by Lisa Blunt Rochester · Last progress June 24, 2026
The bill improves financial protection and access to subsidies for many Medicare enrollees (notably low‑income and high‑utilization beneficiaries) by capping Part A/B out-of-pocket costs and aligning eligibility, at the expense of higher federal/state program spending, added state administrative burden, and some remaining coverage gaps and transitional complexity.
Medicare beneficiaries (especially seniors and people with chronic conditions) will face a $5,000 annual cap on Part A/B out-of-pocket spending beginning in 2028, so once they hit the cap they pay no further deductibles or coinsurance that year, reducing risk of catastrophic medical bills.
Low-income Medicare enrollees, dual-eligibles, and SSI recipients will more easily qualify for Part D Low-Income Subsidy and Medicare Savings Program benefits and get faster access (via SSA lead deeming and bidirectional treatment), increasing benefit take-up and lowering prescription and premium costs for these groups.
Providers, payers, beneficiaries, and policymakers will have clearer, administrable rules — including notice requirements and an indexed, transparent annual limit tied to Medicare spending growth — which should simplify implementation, reduce billing disputes once the cap is met, and make future limits more predictable.
Taxpayers and the Medicare program will likely face higher federal spending because Medicare will pick up cost‑sharing once beneficiaries reach the cap, increasing program outlays.
Greater alignment of subsidy and MSP eligibility will likely increase the number of people qualifying for benefits, which could raise federal and state program costs over time and strain budgets.
State governments will face increased administrative workload and implementation costs (systems changes, data processing, timely actions on SSA leads) to meet the new requirements by Jan 1, 2028.
Based on analysis of 3 sections of legislative text.
Imposes an annual Medicare Part A/B out-of-pocket cap ($5,000 in 2028, indexed after) and aligns MSP and Part D LIS eligibility with mutual deeming starting Jan 1, 2028.
Creates an annual out-of-pocket limit for Medicare fee-for-service (Parts A and B) beneficiaries beginning in 2028 — $5,000 in 2028, then indexed each year to Medicare per-capita spending increases — and requires the Secretary to track, announce, and notify beneficiaries when the cap is reached. It also aligns and streamlines eligibility rules between the Medicaid/Medicare Savings Program (MSP) and the Part D Low-Income Subsidy (LIS), establishes mutual deeming so eligibility in one program triggers eligibility in the other, and requires states to act on Social Security Administration (SSA) data as applications, all effective January 1, 2028. The bill defines which costs count toward the limit, excludes noncovered services and excess assignment charges, ties payment consequences to existing Medicare statutory provisions once the cap is reached, and sets administrative and notification duties for the Secretary beginning with an April 2027 announcement of the 2028 limit.