Overview
Title
To provide for appropriate cost-sharing for individuals 26 years of age or younger for insulin products covered under private health plans.
ELI5 AI
H.R. 2636 is a rule that wants to help people who need insulin and are 26 years old or younger by making sure it doesn't cost too much. It says that starting in 2026, insurance companies have to let these young people pay less for insulin, either just $35 or a small part of its cost, to make it easier for them to afford their medicine.
Summary AI
H.R. 2636, titled the "Making Insulin Affordable for All Children Act," seeks to reduce the financial burden of insulin for individuals aged 26 or younger. For insurance plan years starting on or after January 1, 2026, it requires private health plans to offer coverage for selected types of insulin without applying a deductible and caps the cost-sharing to the lesser of $35 or 25% of the insulin's negotiated price. The bill amends several statutes, including the Public Health Service Act, the Employee Retirement Income Security Act, and the Internal Revenue Code, to ensure compliance. Furthermore, cost-sharing payments for insulin will count toward plan deductibles and out-of-pocket maximums.
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AnalysisAI
General Summary
H.R. 2636, known as the “Making Insulin Affordable for All Children Act,” is a legislative proposal aimed at reducing the financial burden on individuals aged 26 years or younger who need insulin products covered under private health plans. The bill outlines cost-sharing requirements to ensure that the cost to such individuals does not exceed $35 for a 30-day supply or 25% of the negotiated price of insulin products, whichever is lower. It mandates that these conditions take effect from January 1, 2026, and ensures that any payments made towards insulin must count toward the plan's deductibles and out-of-pocket maximums.
Summary of Significant Issues
One major issue with the bill is the restricted age scope. By limiting cost-sharing benefits to those aged 26 and under, it overlooks the needs of older individuals who also depend on insulin but face financial challenges. This could be seen as discriminatory, potentially generating ethical and political debates about equitable access to healthcare.
The bill uses the term "selected insulin products" without clearly defining how these products are chosen, which grants insurers significant discretion. This lack of clarity can lead to inconsistencies, with different plans potentially covering different products based on subjective criteria, raising concerns about fairness and equity.
Another concern is the lack of transparency regarding the calculation of the "negotiated price" and "price concessions." This could lead to consumer confusion about actual costs and create opportunities for misuse by insurance companies, undermining the bill's intent to make insulin affordable.
Additionally, the bill allows for its implementation through sub-regulatory guidance, rather than requiring formal legislative oversight. This might result in non-standardized enforcement and variability in application, potentially affecting how consistently the rules are applied across different states and insurers.
Impact on the Public and Stakeholders
Broadly, the bill aims to lower the cost burden of insulin for young people, potentially providing substantial relief for families with children and young adults needing regular insulin. By capping out-of-pocket costs, the bill could improve adherence to insulin therapy among younger populations, leading to better health outcomes and quality of life.
However, the bill's limited age range means that it might not help all who need assistance, especially those who age out of the program. This limitation could leave many dealing with high insulin costs, thereby negating potential societal benefits such as decreased healthcare disparities or alleviated financial stress for all insulin-dependent individuals.
For private insurers and health plans, the bill mandates coverage without deductibles and restricts additional charges, which might require adjustments in how these organizations manage and negotiate drug prices. While this could lead to challenges in balancing coverage with cost management, it might also drive innovation in drug pricing and management strategies.
Patients and consumer advocates may appreciate the efforts to lower insulin costs, but concerns about how "selected insulin products" are chosen and the transparency of pricing mechanisms require careful monitoring to ensure the bill truly benefits those it intends to help. Furthermore, regulatory bodies must ensure that implementation processes preserve the bill's intent without resulting in administrative burdens or inequalities in application.
Financial Assessment
The bill titled "Making Insulin Affordable for All Children Act" introduces financial measures intended to lower the cost of insulin for individuals 26 years of age or younger. It primarily focuses on setting limits to the cost-sharing aspects of insulin coverage under private health plans.
Financial Provisions and Limitations
The central financial mechanism in the bill is the cap imposed on cost-sharing for insulin. For insurance plan years starting on or after January 1, 2026, group health plans must cover selected insulin products for individuals aged 26 or younger without applying any deductible. The main financial restriction is that cost-sharing should not exceed the lesser of $35 per 30-day supply or 25% of the insulin's negotiated price. These provisions aim to make insulin more affordable but may inadvertently lead to financial disparities.
Issues Related to Financial References
Firstly, the bill limits cost-sharing benefits only to those aged 26 or younger, which could create an implicit age-based financial discrimination. While younger individuals might benefit, this age cap could result in higher expenses for older insulin users, raising ethical concerns about equitable healthcare access.
Furthermore, the term "negotiated price" lacks clarity, which may confuse consumers who are expected to pay 25% of this amount for their insulin. This opacity around how the negotiated prices are calculated could lead to inconsistent pricing, potentially resulting in insurers taking advantage, thus creating financial unpredictability for those requiring insulin.
Lack of Financial Transparency
The allowance for cost-sharing up to 25% of the negotiated price introduces another layer of complexity. As this negotiated price could vary significantly based on various factors such as insurance provider and pharmacy benefit manager agreements, there is a risk of significant consumer confusion. This potentially non-uniform pricing could mean some individuals pay far more than others for the same product, undermining the bill's affordability goals.
Implementation and Accountability Concerns
Implementation through sub-regulatory guidance rather than formal legislative oversight may lead to inconsistent application of these financial measures. Without standardized enforcement, the methods by which costs are determined—for example, what constitutes acceptable "price concessions"—could vary broadly, giving insurers leeway that may not align with the bill's intent to curb insulin expenses effectively.
Overall, while the bill endeavors to alleviate insulin costs for younger individuals, it simultaneously raises various concerns about fairness, transparency, and potential inequities in the healthcare system related to financial aspects. The financial specifics, such as cost-sharing caps and definitions of negotiated prices, are central to these discussions, highlighting the need for clearer guidelines and more rigorous regulatory oversight.
Issues
The provision limiting cost-sharing benefits to individuals 26 years of age or younger for insulin products (Sections 2, 726, 9826) could be seen as discriminatory against those older than 26 who also require affordable access to insulin, raising ethical and political concerns about equitable healthcare.
The term 'selected insulin products' (Sections 2, 2799A-11, 726, 9826) is vaguely defined, giving insurers broad discretion without clear criteria, which could lead to inconsistent and potentially preferential selection, raising legal concerns about transparency and fairness in coverage.
The provisions (Sections 2, 726, 9826) allow insurers to impose out-of-pocket costs based on 25% of the negotiated price which is not transparent to consumers. This lack of clarity in the calculation of 'negotiated price' and 'price concessions' could result in significant consumer confusion and potential misuse by insurers.
The implementation clause (Section 2(f)) allowing provisions to be enacted through sub-regulatory guidance without formal legislative oversight may lead to non-standardized enforcement and variability in how the law is applied, raising concerns about accountability and transparency in governmental processes.
The complexity of language and references to multiple legal sections (Sections 2, 2799A-11, 726, 9826) may pose challenges for stakeholders, leading to potential misinterpretation or difficulty in compliance, which could result in legal or financial issues for insurers and insured individuals.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The section gives the official name of the law, stating that it can be referred to as the “Making Insulin Affordable for All Children Act.”
2. Appropriate cost-sharing for individuals 26 years of age or younger for insulin products covered under private health plans Read Opens in new tab
Summary AI
For plan years starting January 1, 2026, private health plans must cover selected insulin products for individuals 26 years old or younger without applying any deductible and keep cost-sharing to the lesser of $35 per 30-day supply or 25% of the negotiated price after discounts. These costs count towards a plan's deductible and out-of-pocket maximums, but this requirement doesn't apply to insulin types not selected by the plan, and the new rules can be implemented by federal departments through guidance or instruction.
Money References
- “(a) In general.—For plan years beginning on or after January 1, 2026, a group health plan or health insurance issuer offering group or individual health insurance coverage shall, with respect to enrolled individuals 26 years of age or younger, provide coverage of selected insulin products, and with respect to such products, shall not— “(1) apply any deductible; or “(2) impose any cost-sharing in excess of the lesser of, per 30-day supply— “(A) $35; or “(B) the amount equal to 25 percent of the negotiated price of the selected insulin product net of all price concessions received by or on behalf of the plan or coverage, including price concessions received by or on behalf of third-party entities providing services to the plan or coverage, such as pharmacy benefit management services.
- “(a) In general.—For plan years beginning on or after January 1, 2026, a group health plan or health insurance issuer offering group health insurance coverage shall, with respect to enrolled individuals 26 years of age or younger, provide coverage of selected insulin products, and with respect to such products, shall not— “(1) apply any deductible; or “(2) impose any cost-sharing in excess of the lesser of, per 30-day supply— “(A) $35; or “(B) the amount equal to 25 percent of the negotiated price of the selected insulin product net of all price concessions received by or on behalf of the plan or coverage, including price concessions received by or on behalf of third-party entities providing services to the plan or coverage, such as pharmacy benefit management services.
- “(a) In general.—For plan years beginning on or after January 1, 2026, a group health plan shall, with respect to enrolled individuals 26 years of age or younger, provide coverage of selected insulin products, and with respect to such products, shall not— “(1) apply any deductible; or “(2) impose any cost-sharing in excess of the lesser of, per 30-day supply— “(A) $35; or “(B) the amount equal to 25 percent of the negotiated price of the selected insulin product net of all price concessions received by or on behalf of the plan, including price concessions received by or on behalf of third-party entities providing services to the plan, such as pharmacy benefit management services.
2799A–11. Requirements with respect to cost-sharing for certain insulin products Read Opens in new tab
Summary AI
For health plans starting in 2026, insurers must cover certain insulin products for individuals 26 or younger without applying deductibles and limiting out-of-pocket costs to either $35 or 25% of the negotiated price per 30-day supply. Selected insulin products must include various forms and types, and any payments made must count toward deductibles and out-of-pocket limits.
Money References
- In general.—For plan years beginning on or after January 1, 2026, a group health plan or health insurance issuer offering group or individual health insurance coverage shall, with respect to enrolled individuals 26 years of age or younger, provide coverage of selected insulin products, and with respect to such products, shall not— (1) apply any deductible; or (2) impose any cost-sharing in excess of the lesser of, per 30-day supply— (A) $35; or (B) the amount equal to 25 percent of the negotiated price of the selected insulin product net of all price concessions received by or on behalf of the plan or coverage, including price concessions received by or on behalf of third-party entities providing services to the plan or coverage, such as pharmacy benefit management services.
726. Requirements with respect to cost-sharing for certain insulin products Read Opens in new tab
Summary AI
For health plans starting in 2026, insurers must provide specific insulin products without any deductibles and limit cost-sharing for those 26 and younger to no more than $35 or 25% of the negotiated price. These costs should count toward the plan's deductible or out-of-pocket maximums.
Money References
- In general.—For plan years beginning on or after January 1, 2026, a group health plan or health insurance issuer offering group health insurance coverage shall, with respect to enrolled individuals 26 years of age or younger, provide coverage of selected insulin products, and with respect to such products, shall not— (1) apply any deductible; or (2) impose any cost-sharing in excess of the lesser of, per 30-day supply— (A) $35; or (B) the amount equal to 25 percent of the negotiated price of the selected insulin product net of all price concessions received by or on behalf of the plan or coverage, including price concessions received by or on behalf of third-party entities providing services to the plan or coverage, such as pharmacy benefit management services.
9826. Requirements with respect to cost-sharing for certain insulin products Read Opens in new tab
Summary AI
For plan years starting on or after January 1, 2026, group health plans must provide coverage for selected insulin products for individuals 26 years or younger, without any deductible and with cost-sharing capped at either $35 per 30-day supply or 25% of the negotiated price. Selected insulin products must include at least one form of each insulin type (like rapid-acting or long-acting), and any cost-sharing will count towards the plan's deductible or out-of-pocket limits.
Money References
- In general.—For plan years beginning on or after January 1, 2026, a group health plan shall, with respect to enrolled individuals 26 years of age or younger, provide coverage of selected insulin products, and with respect to such products, shall not— (1) apply any deductible; or (2) impose any cost-sharing in excess of the lesser of, per 30-day supply— (A) $35; or (B) the amount equal to 25 percent of the negotiated price of the selected insulin product net of all price concessions received by or on behalf of the plan, including price concessions received by or on behalf of third-party entities providing services to the plan, such as pharmacy benefit management services.