Sponsors (17)
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 substantially improves financial protection and streamlines access to subsidies for low‑income and high‑use Medicare beneficiaries, but it increases federal/state program costs, leaves gaps for non‑covered services, and creates administrative and enforcement challenges during implementation.
Medicare beneficiaries (especially people with chronic conditions and high utilization) will face much lower risk of catastrophic Part A/B bills because out-of-pocket spending is capped at $5,000 in 2028 and beneficiaries who hit the cap owe no further Part A/B deductibles or coinsurance that year.
The law creates clearer, predictable rules for implementation — an indexed annual limit and specified administrative/notice requirements — helping beneficiaries, providers, and payers plan and reducing billing disputes once the cap is met.
Low-income Medicare enrollees (including dual-eligibles and SSI recipients) will gain easier and faster access to Part D Low-Income Subsidy and Medicare Savings Program benefits via bidirectional deeming and by states treating SSA leads as MSP applications, which should reduce duplication and raise take-up of cost‑sharing/subsidy supports.
Federal and state program costs and taxpayer liability are likely to rise — the cap shifts more Part A/B cost-sharing onto Medicare once beneficiaries hit the limit and broader eligibility alignment will increase LIS/MSP enrollment and program spending over time.
The cap does not cover services that are not included in Part A/B, so beneficiaries can still face substantial out-of-pocket spending for noncovered items.
Providers who bill outside assignment or do not comply with the new rules could continue to seek higher charges (balance billing), producing billing confusion and uneven consumer protection unless enforcement is robust.
Based on analysis of 3 sections of legislative text.
Caps annual Part A/B out-of-pocket costs for traditional Medicare starting in 2028 and aligns MSP and Part D subsidy eligibility starting Jan 1, 2028.
Establishes an annual out-of-pocket cap for beneficiaries in traditional (fee-for-service) Medicare beginning in 2028 and directs the Secretary to set and announce the limit each year (first announcement April 2027). The initial cap is $5,000 for 2028 and thereafter is indexed to annual growth in per-capita Medicare Parts A and B expenditures. Aligns and streamlines eligibility rules between the Medicaid/Medicare Savings Program (MSP) and the Part D Low-Income Subsidy (LIS) beginning January 1, 2028, creates bidirectional deeming so eligible individuals are treated across programs, and requires states to treat SSA-transmitted data as MSP applications and promptly act on SSA leads.