CHA News

Senate Passes Democratic Reconciliation Bill

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On Aug. 7, the U.S. Senate passed the Democratic budget reconciliation bill, the Inflation Reduction Act (H.R. 5376), which includes provisions on health care, climate, and tax policies. The roughly $740 billion party-line package passed 51-50, with Vice President Kamala Harris casting the tie-breaking vote.  

The bill includes a CHA-supported $64 billion provision that extends enhanced Affordable Care Act (ACA) subsidies for three years. It also includes several policies aimed at lowering prescription drug prices and invests $300 billion in climate change and clean energy, while directing $300 billion to reduce deficits over the next 10 years.  

Key health care provisions include: 

  • A three-year extension of enhanced subsidies for Americans who purchase coverage through state and federal exchanges under the ACA (the enhancements were established under a pandemic program that was set to expire this year) 
  • A requirement that drug manufacturers provide rebates to Medicare if they increase prices faster than inflation 
  • The establishment of a $2,000 annual cap on seniors’ out-of-pocket costs under Medicare Part D 
  •   A change in policy to allow the Medicare program to negotiate prices on a small number of medicines beginning in 2026 

 The final legislation was changed during floor consideration; final text and summaries have not yet been released. The House is expected to return from recess on Friday to vote on the bill, where it’s expected to pass and move to the president’s desk for signature.