The Share the Savings with Seniors Act adds a new cost-sharing framework for chronic care drugs within Medicare Part D. Beginning in plan year 2027, cost-sharing for these drugs below the annual deductible must not exceed the net price of the drug, while costs above the deductible and below the out-of-pocket threshold are to be paid as coinsurance based on a percentage of the net price, subject to specific exceptions.
The bill also defines chronic care drugs in alignment with USP categories and introduces a definition of net price as the negotiated price minus manufacturer price concessions received by the plan or its PBM. It further amends low-income cost-sharing to cap copayments for chronic drugs at the plan’s own cost-sharing level, and it directs the Secretary to implement these changes through interim final regulations.
At a Glance
What It Does
Creates a chronic-care drug cost-sharing framework in Part D: below-deductible costs capped at net price; above-deductible costs subject to coinsurance based on net price; exceptions for fixed copayments or benchmark-based pricing; defines chronic-care drugs and net price.
Who It Affects
Medicare Part D plans, PBMs, and pharmacies will implement the new rules; beneficiaries who rely on chronic therapies (including seniors and some disabled enrollees) will experience changes in out-of-pocket costs; low-income beneficiaries will see copayment protections aligned with their plan’s cost-sharing.
Why It Matters
This reform targets volatility in patient cost-sharing for chronic therapies, aiming for greater affordability and predictability while preserving plan flexibility. It also tightens the pricing lens on chronic-drug cost-sharing through a net-price construct and USP-aligned drug definitions.
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What This Bill Actually Does
This bill changes how Medicare Part D handles cost-sharing for drugs used to treat chronic conditions. It introduces a new standard for chronic-care drugs, defined by specific USP categories, and ties patient cost-sharing to the net price of the drug (the negotiated price minus manufacturer price concessions not reflected in the negotiated price).
For plan years starting in 2027, costs that fall below the annual deductible cannot exceed that net price. For costs above the deductible but below the out-of-pocket threshold, coinsurance must be a percentage of the net price, with one major exception: if a plan uses fixed copayments or price benchmarks that are not tied to a percentage of price, the percentage-based rule does not apply.
In addition, low-income individuals face a copayment cap that cannot exceed their plan’s own cost-sharing for the drug. The legislation also requires the Secretary to implement these changes through interim final regulations.
Overall, the bill seeks to reduce variability and surprise in out-of-pocket costs for chronic medications while keeping plans and PBMs responsible for applying the new framework.
The Five Things You Need to Know
The bill adds a new cost-sharing framework for chronic care drugs under Medicare Part D (Section 1860D-2(b)(10)).
Below-deductible cost-sharing for chronic-care drugs cannot exceed the drug’s net price, as defined in the measure.
Above-deductible coinsurance for these drugs is based on a percentage of the net price, subject to a defined exception.
An exception allows fixed copayments or benchmark-based pricing to avoid percentage-based coinsurance for chronic-care drugs.
Chronic care drugs are defined by USP categories/classes and must be identified according to the latest USP Medicare Model Guidelines; net price excludes certain manufacturer concessions.
Section-by-Section Breakdown
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Cost-sharing framework for chronic care drugs
This provision adds a new cost-sharing subsection for chronic care drugs. For plan years beginning in 2027, cost-sharing below the annual deductible must not exceed net price, and coinsurance above the deductible (and below the out-of-pocket threshold) must be based on a percentage of net price, with an important exception allowing fixed copayments if they are not percentage-based or are price-based benchmarks. The framework makes clear that the mechanism is driven by the net price concept rather than traditional list prices, aiming to stabilize patient costs for chronic therapies.
Definitions: chronic care drug and net price
Defines chronic care drug as a Part D-covered drug within specified USP categories and classes, as identified by the USP Medicare Model Guidelines. It also defines net price as the negotiated price minus manufacturer price concessions received or expected by the plan or PBM that are not reflected in the negotiated price. These definitions anchor the cost-sharing calculation in real price concessions rather than sticker prices.
Coverage reference to chronic care cost-sharing
Adds a cross-reference indicating that coverage for chronic care drugs follows the cost-sharing framework established in subsection (b)(10). This ensures consistency across the Part D benefit structure and the new chronic-care drug category.
Low-income copayment alignment
Amends low-income cost-sharing rules to cap copayments for chronic drugs at the applicable cost-sharing under the individual's prescription drug plan or MA-PD plan for 2027 and beyond. This tightens protections for vulnerable enrollees while aligning subsidies with plan-specific cost-sharing.
Regulatory implementation
Empowers the Secretary to implement the amendments through interim final regulations, enabling an orderly transition to the new framework while permitting rapid operationalization in the near term.
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Explore Healthcare in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Seniors and disabled Medicare Part D enrollees who rely on chronic-care drugs gain more predictable, potentially lower cost-sharing when costs fall below deductible and a clearer framework when costs rise.
- Low-income beneficiaries see strengthened copayment protections that cap out-of-pocket costs for chronic drugs under their enrolled plan.
- Medicare Part D plan sponsors and PBMs gain a defined pricing anchor (net price) for calculating cost-sharing, which can reduce variability in patient costs.
- Pharmacies and dispensing networks benefit from clearer, rule-based cost-sharing that aligns with net price-based calculations.
- Health systems and clinicians managing chronic patients gain more predictable patient access decisions driven by transparent drug pricing.
Who Bears the Cost
- Drug manufacturers may need to adjust price concessions and negotiation strategies to align with the net price concept used for plan pricing and patient cost-sharing.
- Plan sponsors and PBMs could incur administrative costs to implement the new framework and recalibrate pricing, contracts, and formularies.
- Pharmacies may bear administrative burdens as cost-sharing calculations become more price-constrained and dependent on net price rather than list prices.
- Providers and health systems may face transitional costs as formularies and benefit designs are updated to reflect chronic-care drug classifications under USP guidelines.
Key Issues
The Core Tension
The central dilemma is balancing patient affordability for chronic therapies against the risk of price-shifting and design constraints on plan formularies. While the framework aims to reduce out-of-pocket spikes, it may also alter incentives for pricing, rebates, and plan design, requiring careful monitoring to prevent unintended consequences.
The bill introduces a net-price-based framework that hinges on accurate pricing concessions and consistent application across plans. A potential tension arises between patient affordability and plan flexibility: the net price concept could incentivize plans to seek concessions that lower reported net price but raise negotiated prices elsewhere, complicating price transparency.
The USP-based definition of chronic-care drugs could evolve with new USP model guidelines, creating dynamic scope for which drugs are treated as chronic-care drugs over time. Finally, the 2027 effective date with interim final regulations leaves room for regulatory adjustments that could affect the practical rollout, including how plans implement subparagraph (A) vs. subparagraph (B) exceptions.
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