[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4886 Introduced in Senate (IS)]
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119th CONGRESS
2d Session
S. 4886
To 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.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
June 24, 2026
Ms. Blunt Rochester (for herself, Mr. Wyden, Mr. Schumer, Mr. Merkley,
Mr. Lujan, Mr. Markey, Ms. Warren, Mr. Reed, Ms. Duckworth, Mr. Welch,
Mr. Booker, Mrs. Gillibrand, Mr. Padilla, Mr. Van Hollen, and Mrs.
Murray) introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To 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.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Medicare Cost Cap Act of 2026''.
SEC. 2. PROTECTION AGAINST HIGH OUT-OF-POCKET EXPENDITURES FOR MEDICARE
FEE-FOR-SERVICE BENEFITS.
(a) In General.--Title XVIII of the Social Security Act (42 U.S.C.
1395 et seq.) is amended by adding at the end the following new
section:
``SEC. 1899D. PROTECTION AGAINST HIGH OUT-OF-POCKET EXPENDITURES.
``(a) In General.--Notwithstanding any other provision of this
title, in the case of an applicable individual (as defined in
subsection (c)), if the amount of the out-of-pocket cost-sharing (as
defined in subsection (d)) incurred by such individual for a year
(beginning with 2028) equals or exceeds the annual out-of-pocket limit
under subsection (b) for that year, the individual shall not be
responsible for additional out-of-pocket cost-sharing incurred during
that year.
``(b) Annual Out-of-Pocket Limit.--
``(1) In general.--The amount of the annual out-of-pocket
limit under this subsection shall be--
``(A) for 2028, $5,000; or
``(B) for a subsequent year, the amount specified
in this subsection for the preceding year increased by
the annual percentage increase in average per capita
aggregate expenditures under parts A and B, as
determined by the Secretary for the 12-month period
ending in July of the previous year using such methods
as the Secretary shall specify.
``(2) Rounding.--If any amount determined under paragraph
(1)(B) is not a multiple of $5, such amount shall be rounded to
the nearest multiple of $5.
``(c) Applicable Individual Defined.--In this section, the term
`applicable individual' means an individual who is entitled to, or
enrolled for, benefits under part A or enrolled in part B.
``(d) Out-of-Pocket Cost-Sharing Defined.--
``(1) In general.--Subject to paragraphs (2) and (3), in
this section, the term `out-of-pocket cost-sharing' means, with
respect to an applicable individual, the amount of the expenses
incurred by the individual that are attributable to
coinsurance, deductible, copayment, or other cost-sharing
otherwise applicable under part A or B.
``(2) Certain costs not included.--
``(A) Non-covered items and services.--Expenses
incurred for items and services which are not covered
under part A or B shall not be considered incurred
expenses for purposes of determining out-of-pocket
cost-sharing under paragraph (1).
``(B) Items and services not furnished on an
assignment-related basis.--If an item or service is
furnished to an individual under this title and is not
furnished on an assignment-related basis, any
additional expenses the individual incurs above the
amount the individual would have incurred if the item
or service was furnished on an assignment-related basis
shall not be considered incurred expenses for purposes
of determining out-of-pocket cost-sharing under
paragraph (1).
``(3) Application.--For purposes of paragraph (1), the
Secretary shall consider expenses to be incurred by the
individual regardless of whether such costs are reimbursed
through insurance or otherwise, a group health plan, or other
third-party payment arrangement.
``(e) Announcement.--Not later than the first Monday in April of
each year (beginning with 2027), the Secretary shall determine, and
shall announce (in a manner intended to provide notice to interested
parties), the annual out-of-pocket limit under this section for the
succeeding year.
``(f) Implementation.--The Secretary shall establish procedures to
carry out this section, including procedures--
``(1) to track the amount of out-of-pocket cost-sharing
incurred by applicable individuals for items and services
covered under this title during a year; and
``(2) provide notice to the applicable individual and
providers of services and suppliers who furnish items and
services to the applicable individual when the applicable
individual has incurred expenses that exceed the annual out-of-
pocket limit under subsection (b) for the year.
``(g) Payment.--For provisions relating to payment for items and
services furnished to an applicable individual once the annual out-of-
pocket limit has been met, see sections 1813(c) and 1833(ee).''.
(b) Conforming Amendments.--
(1) Part a.--Section 1813 of the Social Security Act (42
U.S.C. 1395e) is amended by adding at the end the following new
subsection:
``(c)(1) Notwithstanding subsections (a) and (b), if the amount of
the out-of-pocket cost-sharing for an applicable individual for a year
(beginning with 2028) equals or exceeds the annual out-of-pocket limit
under section 1899D(b) for that year, payment under this part with
respect to any additional incurred expenses for items or services
furnished to the applicable individual in the calendar year shall be
made as if any reduction in the amount payable for such items or
services under subsection (a) due to any deductible or coinsurance that
would (but for the application of section 1899D) otherwise be
applicable no longer applied.
``(2) In this subsection, the terms `applicable individual' and
`out-of-pocket cost sharing' have the meaning given those terms in
section 1899D.''.
(2) Part b.--
(A) Payment.--Section 1833 of the Social Security
Act (42 U.S.C. 1395l) is amended--
(i) by adding at the end the following new
subsection:
``(ee)(1) Notwithstanding subsections (a) and (b), if the amount of
the out-of-pocket cost-sharing for an applicable individual for a year
(beginning with 2028) equals or exceeds the annual out-of-pocket limit
under section 1899D(b) for that year, payment under this part with
respect to any additional incurred expenses for items or services
furnished to the applicable individual in the calendar year shall be
made as if--
``(A) the deductible under subsection (b) no longer
applied;
``(B) the deduction described in the second sentence of
subsection (b) (relating to blood) no longer applied; and
``(C) `100 percent' and `0 percent' were substituted for
`80 percent' and `20 percent', respectively, each place either
appears in subsection (a), in subsection (i)(2), in section
1835(b)(2), and in subsections (b)(2) and (b)(3) of section
1881.
``(2) In this subsection, the terms `applicable individual' and
`out-of-pocket cost sharing' have the meaning given those terms in
section 1899D.''; and
(ii) in subsections (c) and (g), by
striking ``(a) and (b)'' each place it appears
and inserting ``(a), (b), and (ee)''.
(B) Limitation on charges when annual limit
reached.--Section 1866(a)(2)(A) of the Social Security
Act (42 U.S.C. 1395cc(a)(2)(A)) is amended by adding at
the end the following new sentence: ``A provider of
services may not impose a charge under the first
sentence of this subparagraph for services for which
payment is made to the provider pursuant to section
1833(ee) (relating to protection against high out-of-
pocket expenses).''.
(C) Beneficiary protections.--Section 1842(b)(3) of
the Social Security Act (42 U.S.C. 1395u(b)(3)) is
amended--
(i) in subparagraph (L), by striking the
period at the end and inserting ``; and''; and
(ii) by inserting after subparagraph (L)
the following new subparagraph:
``(M) if it makes determinations or payments with respect
to items and services furnished by a physician for which
payment is made pursuant to section 1833(ee) but not on an
assignment-related basis, provide to the physician a notice
that--
``(i) states that the individual provided the
service has reached the annual out-of-pocket limit
under section 1899D(b) for the year, and
``(ii) encourages the physician not to charge the
individual amounts in excess of the reasonable charge
recognized under this section and to accept payment on
an assignment-related basis for physicians' services
furnished the individual during the remainder of the
year.''.
SEC. 3. ENHANCEMENTS TO PROGRAMS THAT PROTECT LOW-INCOME MEDICARE
BENEFICIARIES.
(a) Elimination of Resource Standard for Eligibility and Enrollment
Determinations.--
(1) LIS.--Section 1860D-14(a)(3)(A)(iii) of the Social
Security Act (42 U.S.C. 1395w-114(a)(3)(A)(iii)) is amended by
striking ``meets'' and inserting ``with respect to a plan year
beginning before January 1, 2028, meets''.
(2) MSP.--Section 1905(p)(1)(C) of the Social Security Act
(42 U.S.C. 1396d(p)(1)(C)) is amended by striking ``whose
resources'' and inserting ``prior to January 1, 2028, whose
resources''.
(b) Aligning Eligibility Criteria Across MSP and LIS.--
(1) LIS.--Section 1860D-14(a) of the Social Security Act
(42 U.S.C. 1395w-114(a)) is amended--
(A) in paragraph (1), in the matter preceding
subparagraph (A), by inserting ``or, with respect to a
plan year beginning on or after January 1, 2028, 200
percent'' after ``150 percent''; and
(B) in paragraph (3)(A)(ii), by inserting ``(or,
with respect to a plan year beginning on or after
January 1, 2028, 200 percent'' after ``150 percent''.
(2) MSP.--
(A) In general.--Section 1905(p) of the Social
Security Act (42 U.S.C. 1396d(p)) is amended--
(i) in paragraph (1)(B), by inserting ``,
except that, beginning with January 1, 2028,
the methodology used in determining income
eligibility under this subsection shall be no
more restrictive than the methodology used by
the Social Security Administration in making
income determinations under section 1860D-
14(a)(3)(C)'' after ``income program''; and
(ii) in paragraph (2)--
(I) in subparagraph (A)--
(aa) by striking ``shall be
at least'' and inserting
``shall be--
``(i) prior to January 1, 2028, at least'';
(bb) in clause (i), as
added by item (aa), by striking
the period and inserting ``;
and''; and
(cc) by adding at the end
the following new clause:
``(ii) on or after January 1, 2028, 200 percent of the
poverty line applicable to a family of the size involved.'';
and
(II) by adding at the end the
following new subparagraph:
``(E) With respect to eligibility for medical assistance on or
after January 1, 2028, in this paragraph, the definition of the term
`family of the size involved' shall be no more restrictive than the
definition of that term for purposes of section 1860D-14.''.
(B) Conforming amendments.--Title XIX of the Social
Security Act (42 U.S.C. 1396 et seq.) is amended--
(i) in section 1902(a)(10)(E)--
(I) in clause (iii), by striking
``for making'' and inserting ``prior to
January 1, 2028, for making''; and
(II) in clause (iv), by striking
``subject to'' and inserting ``prior to
January 1, 2028, subject to''; and
(ii) in section 1933(a), by striking ``A
State plan'' and inserting ``Prior to January
1, 2028, a State plan''.
(3) Bidirectional eligibility deeming between msp and
lis.--
(A) LIS.--Section 1860D-14(a)(3)(B)(v) of the
Social Security Act (42 U.S.C. 1395w-114(a)(3)(B)(v))
is amended to read as follows:
``(v) Treatment of medicaid
beneficiaries.--Subject to subparagraph (F),
the Secretary shall treat a part D eligible
individual as a subsidy eligible individual
described in paragraph (1) if they are--
``(I) a full-benefit dual eligible
individual (as defined in section
1935(c)(6));
``(II) a recipient of supplemental
security income benefits under title
XVI; or
``(III) determined for purposes of
the State plan under title XIX to be
eligible for medical assistance under
section 1902(a)(10)(E)(i).''.
(B) MSP.--Section 1905(p) of the Social Security
Act (42 U.S.C. 1396d(p)) is amended by adding at the
end the following new paragraph:
``(7) Beginning January 1, 2028, a State shall provide that an
individual described in paragraph (1)(A) who is a subsidy eligible
individual described in section 1860D-14(a)(3) shall be treated as a
qualified medicare beneficiary described in paragraph (1).''.
(C) Treatment of leads data.--
(i) Transmittal.--Section 1144(c)(3) of the
Social Security Act (42 U.S.C. 1320b-14(c)(3))
is amended by striking ``which transmittal
shall initiate an application of the individual
for benefits under the Medicare Savings Program
with the State Medicaid agency'' and inserting
``which the State Medicaid agency shall treat
as an application of the individual for
benefits under the Medicare Savings Program
consistent with section 1935(a)(4)''.
(ii) Consideration by states.--Section
1935(a)(4) of the Social Security Act (42
U.S.C. 1396u-5(a)(4)) is amended to read as
follows:
``(4) Consideration of data transmitted by the social
security administration for purposes of medicare savings
program.--
``(A) In general.--The State shall accept data
transmitted under section 1144(c)(3) and--
``(i) in the case of an individual who is a
subsidy eligible individual described in
section 1860D-14(a)(3), promptly treat such
individual as a qualified medicare beneficiary
described in 1905(p)(1); and
``(ii) in the case of any other individual
who is likely to be a qualified medicare
beneficiary, as determined by the Secretary,
act on such data in the same manner and in
accordance with the same deadlines as if the
data constituted an initiation of an
application for benefits under the Medicare
Savings Program (as defined for purposes of
section 1144(c)(3)) that had been submitted
directly by the applicant.
``(B) Date of application.--For purposes of
subparagraph (A)(ii), the date of the individual's
application for the low income subsidy program from
which the data have been derived shall constitute the
date of filing of such application for benefits under
the Medicare Savings Program.''.
(D) Effective date.--The amendments made by this
paragraph shall take effect on January 1, 2028.
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