Senate panel reviews H.266 changes to cap hospital charges for outpatient drugs; hospitals warn of access risks

The Senate Health and Welfare Committee on May 29 considered House amendments to H.266, a bill that would limit hospital charges for prescription drugs administered in outpatient and office settings by tying allowable charges to a percentage of the Centers for Medicare & Medicaid Services average sales price (ASP).

Jen Carvey of the Office of Legislative Council told the committee that H.266 “is an act relating to the 3 40 b prescription drug pricing program” and summarized the House’s proposed changes, including a new section that would cap hospital outpatient drug claims at either 20% of ASP (as of a specified test date) or the percentage the hospital was charging on 04/01/2025, with annual ASP updates on Jan. 1 and July 1. Carvey also described separate, time-limited language that would apply a 30% cap for part of 2025 before the 20% standard took full effect.

Why it matters: Sponsors and supporters say the cap will lower premiums and blunt outlier hospital markups on drugs that can drive up costs for insurers, employers and patients. Opponents—hospital leaders and clinicians—warn that the change could make some infusion services financially unsustainable, reduce local access to complex therapies and push patients to higher‑cost or more distant providers.

Insurer and regulator testimony

Sarah Teachab, director of media relations for Blue Cross Blue Shield of Vermont, told the committee the insurer strongly supports the amended bill and said its analysis projects a roughly 4% reduction in…