Bill Introduced to Lower Healthcare Costs

The “Lower Health Care Costs Act” (S.1895) sponsored by Senate Health Committee Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) was passed by the Senate Health Committee by a vote of 20-3

The Congressional Budget Office (CBO) after studying the proposed legislation, reports that the legislation would:

  • Increase access to health, cost, and quality information among patients, providers, and insurers, which would create new administrative responsibilities that would increase costs for insurers and pharmacy benefit managers
  • Increase generic and biosimilar drug competition
  • Reduce delays of generic and biosimilar drugs
  • Help small employers with drug costs
  • Improve competition in the Pharmacy Benefit Manager Industry
  • Increase access to health insurance plans that prioritize higher quality and lower costs
  • Increase employee wages
  • Protect patients from surprise medical billing and reduce payments to some healthcare providers working in facilities where surprise bills are likely
  • Extend funding for community health centers, special diabetes programs, National Health Services Corps, and the Teaching Health Centers Graduate Medical Education Program, plus some other federal healthcare programs
  • Impose intergovernmental and private-sector mandates by prohibiting certain medical billing practices, limit other commercial activities, and prohibit the sale of tobacco products to anyone under the age of 21
  • Reduce federal subsidies for healthcare and health insurance


CBO reports that the legislation containing 55 specific provisions from 65 different Senators will reduce health insurance premiums and lower prescription drug costs. CBO estimates that budgetary effects would primarily stem from reduced federal subsidies for healthcare and health insurance. CBO also estimates there would be significant uncertainty to include accurately anticipating the nature and effects of provider and insurer responses to the bill’s provisions.

CBO also thinks there would be a problem accurately projecting how federal and state agencies would implement the law, problems in dealing with uncertainty in estimating quantities, determining the sales and market effects when introducing new pharmaceutical products, and determining how increased transparency would affect prices and private insurance premiums.

CBO and the Joint Committee on Taxation estimate that on-net, enacting S.1895 would increase direct spending by about $18.7 billion and increase revenues by $26.2 billion over the 2019-2029 period, for a net decrease in the deficit of $7.6 billion.

Share Button