Committee reviews bill to cap hospital outpatient drug charges; hospitals warn of service cuts

Legislators reviewed proposed changes to H.266 on limiting hospital charges for outpatient prescription drugs during a committee meeting where legislative counsel and hospital representatives described how the bill would set percentage caps linked to CMS’s average sales price (ASP) and permit hospitals to seek relief from the Green Mountain Care Board if access or quality were harmed.

The proposed amendment would bar a hospital from submitting a claim to a health insurer for reimbursement of a prescription drug administered in an outpatient or office setting in an amount that exceeds 120% of the CMS-calculated ASP beginning Jan. 1, 2026, with a transitional higher limit of 130% for the period July 1–Dec. 31, 2025, and a requirement that hospitals update ASP benchmarks Jan. 1 and July 1. The draft text would exempt independent critical access hospitals that are not affiliated with another hospital or network.

The amendment also adds a process in which “if a hospital demonstrates to the board in its budget submissions under hospital budget review that the price cap … is having a negative impact on access to care, quality of care, or sustainability of rural health care services,” the hospital may propose increasing commercial reimbursement rates for preventive care or essential community services; the Green Mountain Care Board would consider the demonstrated impacts and any proposed increases.

Jen Carvey, legislative counsel with the Office of Legislative Counsel, walked members through the…