H. R. 5376—45 
(b) CONFORMING AMENDMENTS FOR DISCLOSURE OF CERTAIN 
INFORMATION.—Section 1927(b)(3)(D)(i) of the Social Security Act 
(42 U.S.C. 1396r–8(b)(3)(D)(i)) is amended by striking ‘‘or to carry 
out section 1847B’’ and inserting ‘‘or to carry out section 1847B 
or section 1192(f), including rebates under paragraph (4) of such 
section’’. 
(c) IMPLEMENTATION FOR 2026 THROUGH 2028.—The Secretary 
of Health and Human Services shall implement this section, 
including the amendments made by this section, for 2026, 2027, 
and 2028 by program instruction or other forms of program guid-
ance. 
SEC. 11003. EXCISE TAX IMPOSED ON DRUG MANUFACTURERS DURING 
NONCOMPLIANCE PERIODS. 
(a) IN GENERAL.—Subtitle D of the Internal Revenue Code 
of 1986 is amended by adding at the end the following new chapter: 
‘‘CHAPTER 50A—DESIGNATED DRUGS 
‘‘Sec. 5000D. Designated drugs during noncompliance periods. 
‘‘SEC. 5000D. DESIGNATED DRUGS DURING NONCOMPLIANCE PERIODS. 
‘‘(a) IN GENERAL.—There is hereby imposed on the sale by 
the manufacturer, producer, or importer of any designated drug 
during a day described in subsection (b) a tax in an amount such 
that the applicable percentage is equal to the ratio of— 
‘‘(1) such tax, divided by 
‘‘(2) the sum of such tax and the price for which so sold. 
‘‘(b) NONCOMPLIANCE PERIODS.—A day is described in this sub-
section with respect to a designated drug if it is a day during 
one of the following periods: 
‘‘(1) The period beginning on the March 1st (or, in the 
case of initial price applicability year 2026, the October 2nd) 
immediately following the date on which such drug is included 
on the list published under section 1192(a) of the Social Security 
Act and ending on the earlier of— 
‘‘(A) the first date on which the manufacturer of such 
designated drug has in place an agreement described in 
section 1193(a) of such Act with respect to such drug, 
or 
‘‘(B) the date that the Secretary of Health and Human 
Services has made a determination described in section 
1192(c)(1) of such Act with respect to such designated drug. 
‘‘(2) The period beginning on the November 2nd imme-
diately following the March 1st described in paragraph (1) 
(or, in the case of initial price applicability year 2026, the 
August 2nd immediately following the October 2nd described 
in such paragraph) and ending on the earlier of— 
‘‘(A) the first date on which the manufacturer of such 
designated drug and the Secretary of Health and Human 
Services have agreed to a maximum fair price under an 
agreement described in section 1193(a) of the Social Secu-
rity Act, or 
‘‘(B) the date that the Secretary of Health and Human 
Services has made a determination described in section 
1192(c)(1) of such Act with respect to such designated drug. 
‘‘(3) In the case of any designated drug which is a selected 
drug (as defined in section 1192(c) of the Social Security Act)
H. R. 5376—46 
that the Secretary of Health and Human Services has selected 
for renegotiation under section 1194(f) of such Act, the period 
beginning on the November 2nd of the year that begins 2 
years prior to the first initial price applicability year of the 
price applicability period for which the maximum fair price 
established pursuant to such renegotiation applies and ending 
on the earlier of— 
‘‘(A) the first date on which the manufacturer of such 
designated drug has agreed to a renegotiated maximum 
fair price under such agreement, or 
‘‘(B) the date that the Secretary of Health and Human 
Services has made a determination described in section 
1192(c)(1) of such Act with respect to such designated drug. 
‘‘(4) With respect to information that is required to be 
submitted to the Secretary of Health and Human Services 
under an agreement described in section 1193(a) of the Social 
Security Act, the period beginning on the date on which such 
Secretary certifies that such information is overdue and ending 
on the date that such information is so submitted. 
‘‘(c) SUSPENSION OF TAX.— 
‘‘(1) IN GENERAL.—A day shall not be taken into account 
as a day during a period described in subsection (b) if such 
day is also a day during the period— 
‘‘(A) beginning on the first date on which— 
‘‘(i) the notice of terminations of all applicable 
agreements of the manufacturer have been received 
by the Secretary of Health and Human Services, and 
‘‘(ii) none of the drugs of the manufacturer of the 
designated drug are covered by an agreement under 
section 1860D-14A or 1860D-14C of the Social Security 
Act, and 
‘‘(B) ending on the last day of February following the 
earlier of— 
‘‘(i) the first day after the date described in 
subparagraph (A) on which the manufacturer enters 
into any subsequent applicable agreement, or 
‘‘(ii) the first date any drug of the manufacturer 
of the designated drug is covered by an agreement 
under section 1860D-14A or 1860D-14C of the Social 
Security Act. 
‘‘(2) APPLICABLE AGREEMENT.—For purposes of this sub-
section, the term ‘applicable agreement’ means the following: 
‘‘(A) An agreement under— 
‘‘(i) the Medicare coverage gap discount program 
under section 1860D-14A of the Social Security Act, 
or 
‘‘(ii) the manufacturer discount program under sec-
tion 1860D-14C of such Act. 
‘‘(B) A rebate agreement described in section 1927(b) 
of such Act. 
‘‘(d) APPLICABLE PERCENTAGE.—For purposes of this section, 
the term ‘applicable percentage’ means— 
‘‘(1) in the case of sales of a designated drug during the 
first 90 days described in subsection (b) with respect to such 
drug, 65 percent,
H. R. 5376—47 
‘‘(2) in the case of sales of such drug during the 91st 
day through the 180th day described in subsection (b) with 
respect to such drug, 75 percent, 
‘‘(3) in the case of sales of such drug during the 181st 
day through the 270th day described in subsection (b) with 
respect to such drug, 85 percent, and 
‘‘(4) in the case of sales of such drug during any subsequent 
day, 95 percent. 
‘‘(e) DEFINITIONS.—For purposes of this section— 
‘‘(1) DESIGNATED DRUG.—The term ‘designated drug’ means 
any negotiation-eligible drug (as defined in section 1192(d) of 
the Social Security Act) included on the list published under 
section 1192(a) of such Act which is manufactured or produced 
in the United States or entered into the United States for 
consumption, use, or warehousing. 
‘‘(2) UNITED
STATES.—The term ‘United States’ has the 
meaning given such term by section 4612(a)(4). 
‘‘(3) OTHER TERMS.—The terms ‘initial price applicability 
year’, ‘price applicability period’, and ‘maximum fair price’ have 
the meaning given such terms in section 1191 of the Social 
Security Act. 
‘‘(f) SPECIAL RULES.— 
‘‘(1) COORDINATION WITH RULES FOR POSSESSIONS OF THE 
UNITED STATES.—Rules similar to the rules of paragraphs (2) 
and (4) of section 4132(c) shall apply for purposes of this section. 
‘‘(2) ANTI-ABUSE RULE.—In the case of a sale which was 
timed for the purpose of avoiding the tax imposed by this 
section, the Secretary may treat such sale as occurring during 
a day described in subsection (b). 
‘‘(g) EXPORTS.—Rules similar to the rules of section 4662(e) 
(other than section 4662(e)(2)(A)(ii)(II)) shall apply for purposes 
of this chapter. 
‘‘(h) REGULATIONS.—The Secretary shall prescribe such regula-
tions and other guidance as may be necessary to carry out this 
section.’’. 
(b) NO
DEDUCTION
FOR
EXCISE
TAX
PAYMENTS.—Section 
275(a)(6) of the Internal Revenue Code of 1986 is amended by 
inserting ‘‘50A,’’ after ‘‘46,’’. 
(c) CLERICAL AMENDMENT.—The table of chapters for subtitle 
D of the Internal Revenue Code of 1986 is amended by adding 
at the end the following new item: 
‘‘CHAPTER 50A—DESIGNATED DRUGS’’. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to sales after the date of the enactment of this Act. 
SEC. 11004. FUNDING. 
In addition to amounts otherwise available, there is appro-
priated to the Centers for Medicare & Medicaid Services, out of 
any 
money 
in 
the 
Treasury 
not 
otherwise 
appropriated, 
$3,000,000,000 for fiscal year 2022, to remain available until 
expended, to carry out the provisions of, including the amendments 
made by, this part.
H. R. 5376—48 
PART 2—PRESCRIPTION DRUG INFLATION 
REBATES 
SEC. 11101. MEDICARE PART B REBATE BY MANUFACTURERS. 
(a) IN GENERAL.—Section 1847A of the Social Security Act 
(42 U.S.C. 1395w–3a) is amended by redesignating subsection (i) 
as subsection (j) and by inserting after subsection (h) the following 
subsection: 
‘‘(i) REBATE BY MANUFACTURERS FOR SINGLE SOURCE DRUGS 
AND BIOLOGICALS WITH PRICES INCREASING FASTER THAN INFLA-
TION.— 
‘‘(1) REQUIREMENTS.— 
‘‘(A) SECRETARIAL
PROVISION
OF
INFORMATION.—Not 
later than 6 months after the end of each calendar quarter 
beginning on or after January 1, 2023, the Secretary shall, 
for each part B rebatable drug, report to each manufacturer 
of such part B rebatable drug the following for such cal-
endar quarter: 
‘‘(i) Information on the total number of units of 
the billing and payment code described in subpara-
graph (A)(i) of paragraph (3) with respect to such drug 
and calendar quarter. 
‘‘(ii) Information on the amount (if any) of the 
excess average sales price increase described in 
subparagraph (A)(ii) of such paragraph for such drug 
and calendar quarter. 
‘‘(iii) The rebate amount specified under such para-
graph for such part B rebatable drug and calendar 
quarter. 
‘‘(B) MANUFACTURER REQUIREMENT.—For each calendar 
quarter beginning on or after January 1, 2023, the manu-
facturer of a part B rebatable drug shall, for such drug, 
not later than 30 days after the date of receipt from the 
Secretary of the information described in subparagraph 
(A) for such calendar quarter, provide to the Secretary 
a rebate that is equal to the amount specified in paragraph 
(3) for such drug for such calendar quarter. 
‘‘(C) TRANSITION RULE FOR REPORTING.—The Secretary 
may, for each part B rebatable drug, delay the timeframe 
for reporting the information described in subparagraph 
(A) for calendar quarters beginning in 2023 and 2024 until 
not later than September 30, 2025. 
‘‘(2) PART B REBATABLE DRUG DEFINED.— 
‘‘(A) IN GENERAL.—In this subsection, the term ‘part 
B rebatable drug’ means a single source drug or biological 
(as defined in subparagraph (D) of subsection (c)(6)), 
including a biosimilar biological product (as defined in 
subparagraph (H) of such subsection) but excluding a quali-
fying biosimilar biological product (as defined in subsection 
(b)(8)(B)(iii)), for which payment is made under this part, 
except such term shall not include such a drug or 
biological— 
‘‘(i) if, as determined by the Secretary, the average 
total allowed charges for such drug or biological under 
this part for a year per individual that uses such
H. R. 5376—49 
a drug or biological are less than, subject to subpara-
graph (B), $100; or 
‘‘(ii) that is a vaccine described in subparagraph 
(A) or (B) of section 1861(s)(10). 
‘‘(B) INCREASE.—The dollar amount applied under 
subparagraph (A)(i)— 
‘‘(i) for 2024, shall be the dollar amount specified 
under such subparagraph for 2023, increased by the 
percentage increase in the consumer price index for 
all urban consumers (United States city average) for 
the 12-month period ending with June of the previous 
year; and 
‘‘(ii) for a subsequent year, shall be the dollar 
amount specified in this clause (or clause (i)) for the 
previous year (without application of subparagraph 
(C)), increased by the percentage increase in the con-
sumer price index for all urban consumers (United 
States city average) for the 12-month period ending 
with June of the previous year. 
‘‘(C) ROUNDING.—Any dollar amount determined under 
subparagraph (B) that is not a multiple of $10 shall be 
rounded to the nearest multiple of $10. 
‘‘(3) REBATE AMOUNT.— 
‘‘(A) IN GENERAL.—For purposes of paragraph (1), the 
amount specified in this paragraph for a part B rebatable 
drug assigned to a billing and payment code for a calendar 
quarter is, subject to subparagraphs (B) and (G) and para-
graph (4), the estimated amount equal to the product of— 
‘‘(i) the total number of units determined under 
subparagraph (B) for the billing and payment code 
of such drug; and 
‘‘(ii) the amount (if any) by which— 
‘‘(I) the amount equal to— 
‘‘(aa) in the case of a part B rebatable 
drug described in paragraph (1)(B) of sub-
section (b), 106 percent of the amount deter-
mined under paragraph (4) of such section 
for such drug during the calendar quarter; 
or 
‘‘(bb) in the case of a part B rebatable 
drug described in paragraph (1)(C) of such 
subsection, the payment amount under such 
paragraph for such drug during the calendar 
quarter; exceeds 
‘‘(II) the inflation-adjusted payment amount 
determined under subparagraph (C) for such part 
B rebatable drug during the calendar quarter. 
‘‘(B) TOTAL
NUMBER
OF
UNITS.—For purposes of 
subparagraph (A)(i), the total number of units for the 
billing and payment code with respect to a part B rebatable 
drug furnished during a calendar quarter described in 
subparagraph (A) is equal to— 
‘‘(i) the number of units for the billing and payment 
code of such drug furnished during such calendar 
quarter, minus
H. R. 5376—50 
‘‘(ii) the number of units for such billing and pay-
ment code of such drug furnished during such calendar 
quarter— 
‘‘(I) with respect to which the manufacturer 
provides a discount under the program under sec-
tion 340B of the Public Health Service Act or a 
rebate under section 1927; or 
‘‘(II) that are packaged into the payment 
amount for an item or service and are not sepa-
rately payable. 
‘‘(C) DETERMINATION OF INFLATION-ADJUSTED PAYMENT 
AMOUNT.—The inflation-adjusted payment amount deter-
mined under this subparagraph for a part B rebatable 
drug for a calendar quarter is— 
‘‘(i) the payment amount for the billing and pay-
ment code for such drug in the payment amount bench-
mark quarter (as defined in subparagraph (D)); 
increased by 
‘‘(ii) the percentage by which the rebate period 
CPI–U (as defined in subparagraph (F)) for the cal-
endar quarter exceeds the benchmark period CPI–U 
(as defined in subparagraph (E)). 
‘‘(D) PAYMENT
AMOUNT
BENCHMARK
QUARTER.—The 
term ‘payment amount benchmark quarter’ means the cal-
endar quarter beginning July 1, 2021. 
‘‘(E) BENCHMARK PERIOD CPI–U.—The term ‘benchmark 
period CPI–U’ means the consumer price index for all 
urban consumers (United States city average) for January 
2021. 
‘‘(F) REBATE PERIOD CPI–U.—The term ‘rebate period 
CPI–U’ means, with respect to a calendar quarter described 
in subparagraph (C), the greater of the benchmark period 
CPI–U and the consumer price index for all urban con-
sumers (United States city average) for the first month 
of the calendar quarter that is two calendar quarters prior 
to such described calendar quarter. 
‘‘(G) REDUCTION
OR
WAIVER
FOR
SHORTAGES
AND 
SEVERE SUPPLY CHAIN DISRUPTIONS.—The Secretary shall 
reduce or waive the amount under subparagraph (A) with 
respect to a part B rebatable drug and a calendar quarter— 
‘‘(i) in the case of a part B rebatable drug that 
is described as currently in shortage on the shortage 
list in effect under section 506E of the Federal Food, 
Drug, and Cosmetic Act at any point during the cal-
endar quarter; or 
‘‘(ii) in the case of a biosimilar biological product, 
when the Secretary determines there is a severe supply 
chain disruption during the calendar quarter, such as 
that caused by a natural disaster or other unique or 
unexpected event. 
‘‘(4) SPECIAL TREATMENT OF CERTAIN DRUGS AND EXEMP-
TION.— 
‘‘(A) SUBSEQUENTLY APPROVED DRUGS.—In the case of 
a part B rebatable drug first approved or licensed by the 
Food and Drug Administration after December 1, 2020, 
clause (i) of paragraph (3)(C) shall be applied as if the 
term ‘payment amount benchmark quarter’ were defined
H. R. 5376—51 
under paragraph (3)(D) as the third full calendar quarter 
after the day on which the drug was first marketed and 
clause (ii) of paragraph (3)(C) shall be applied as if the 
term ‘benchmark period CPI–U’ were defined under para-
graph (3)(E) as if the reference to ‘January 2021’ under 
such paragraph were a reference to ‘the first month of 
the first full calendar quarter after the day on which the 
drug was first marketed’. 
‘‘(B) TIMELINE FOR PROVISION OF REBATES FOR SUBSE-
QUENTLY
APPROVED
DRUGS.—In the case of a part B 
rebatable drug first approved or licensed by the Food and 
Drug Administration after December 1, 2020, paragraph 
(1)(B) shall be applied as if the reference to ‘January 1, 
2023’ under such paragraph were a reference to ‘the later 
of the 6th full calendar quarter after the day on which 
the drug was first marketed or January 1, 2023’. 
‘‘(C) SELECTED
DRUGS.—In the case of a part B 
rebatable drug that is a selected drug (as defined in section 
1192(c)) with respect to a price applicability period (as 
defined in section 1191(b)(2)), in the case such drug is 
no longer considered to be a selected drug under section 
1192(c), for each applicable period (as defined under sub-
section (g)(7)) beginning after the price applicability period 
with respect to such drug, clause (i) of paragraph (3)(C) 
shall be applied as if the term ‘payment amount benchmark 
quarter’ were defined under paragraph (3)(D) as the cal-
endar quarter beginning January 1 of the last year during 
such price applicability period with respect to such selected 
drug and clause (ii) of paragraph (3)(C) shall be applied 
as if the term ‘benchmark period CPI–U’ were defined 
under paragraph (3)(E) as if the reference to ‘January 
2021’ under such paragraph were a reference to ‘the July 
of the year preceding such last year’. 
‘‘(5) APPLICATION TO BENEFICIARY COINSURANCE.—In the 
case of a part B rebatable drug furnished on or after April 
1, 2023, if the payment amount described in paragraph 
(3)(A)(ii)(I) (or, in the case of a part B rebatable drug that 
is a selected drug (as defined in section 1192(c)), the payment 
amount described in subsection (b)(1)(B) for such drug) for 
a calendar quarter exceeds the inflation adjusted payment for 
such quarter— 
‘‘(A) in computing the amount of any coinsurance 
applicable under this part to an individual to whom such 
drug is furnished, the computation of such coinsurance 
shall be equal to 20 percent of the inflation-adjusted pay-
ment amount determined under paragraph (3)(C) for such 
part B rebatable drug; and 
‘‘(B) the amount of such coinsurance for such calendar 
quarter, as computed under subparagraph (A), shall be 
applied as a percent, as determined by the Secretary, to 
the payment amount that would otherwise apply under 
subparagraphs (B) or (C) of subsection (b)(1). 
‘‘(6) REBATE DEPOSITS.—Amounts paid as rebates under 
paragraph (1)(B) shall be deposited into the Federal Supple-
mentary Medical Insurance Trust Fund established under sec-
tion 1841.
H. R. 5376—52 
‘‘(7) CIVIL MONEY PENALTY.—If a manufacturer of a part 
B rebatable drug has failed to comply with the requirements 
under paragraph (1)(B) for such drug for a calendar quarter, 
the manufacturer shall be subject to, in accordance with a 
process established by the Secretary pursuant to regulations, 
a civil money penalty in an amount equal to at least 125 
percent of the amount specified in paragraph (3) for such drug 
for such calendar quarter. The provisions of section 1128A 
(other than subsections (a) (with respect to amounts of penalties 
or additional assessments) and (b)) shall apply to a civil money 
penalty under this paragraph in the same manner as such 
provisions apply to a penalty or proceeding under section 
1128A(a). 
‘‘(8) LIMITATION ON ADMINISTRATIVE OR JUDICIAL REVIEW.— 
There shall be no administrative or judicial review of any 
of the following: 
‘‘(A) The determination of units under this subsection. 
‘‘(B) The determination of whether a drug is a part 
B rebatable drug under this subsection. 
‘‘(C) The calculation of the rebate amount under this 
subsection. 
‘‘(D) The computation of coinsurance under paragraph 
(5) of this subsection. 
‘‘(E) The computation of amounts paid under section 
1833(a)(1)(EE).’’. 
(b) AMOUNTS PAYABLE; COST-SHARING.—Section 1833 of the 
Social Security Act (42 U.S.C. 1395l) is amended— 
(1) in subsection (a)(1)— 
(A) in subparagraph (G), by inserting ‘‘, subject to 
subsection (i)(9),’’ after ‘‘the amounts paid’’; 
(B) in subparagraph (S), by striking ‘‘with respect to’’ 
and inserting ‘‘subject to subparagraph (EE), with respect 
to’’; 
(C) by striking ‘‘and (DD)’’ and inserting ‘‘(DD)’’; and 
(D) by inserting before the semicolon at the end the 
following: ‘‘, and (EE) with respect to a part B rebatable 
drug (as defined in paragraph (2) of section 1847A(i)) fur-
nished on or after April 1, 2023, for which the payment 
amount for a calendar quarter under paragraph (3)(A)(ii)(I) 
of such section (or, in the case of a part B rebatable 
drug that is a selected drug (as defined in section 1192(c) 
for which, the payment amount described in section 
1847A(b)(1)(B)) for such drug for such quarter exceeds the 
inflation-adjusted payment under paragraph (3)(A)(ii)(II) 
of such section for such quarter, the amounts paid shall 
be equal to the percent of the payment amount under 
paragraph 
(3)(A)(ii)(I) 
of 
such 
section 
or 
section 
1847A(b)(1)(B), as applicable, that equals the difference 
between (i) 100 percent, and (ii) the percent applied under 
section 1847A(i)(5)(B)’’; 
(2) in subsection (i), by adding at the end the following 
new paragraph: 
‘‘(9) In the case of a part B rebatable drug (as defined in 
paragraph (2) of section 1847A(i)) for which payment under this 
subsection is not packaged into a payment for a service furnished 
on or after April 1, 2023, under the revised payment system under 
this subsection, in lieu of calculation of coinsurance and the amount
H. R. 5376—53 
of payment otherwise applicable under this subsection, the provi-
sions of section 1847A(i)(5) and paragraph (1)(EE) of subsection 
(a), shall, as determined appropriate by the Secretary, apply under 
this subsection in the same manner as such provisions of section 
1847A(i)(5) and subsection (a) apply under such section and sub-
section.’’; and 
(3) in subsection (t)(8), by adding at the end the following 
new subparagraph: 
‘‘(F) PART B REBATABLE DRUGS.—In the case of a part 
B rebatable drug (as defined in paragraph (2) of section 
1847A(i), except if such drug does not have a copayment 
amount as a result of application of subparagraph (E)) 
for which payment under this part is not packaged into 
a payment for a covered OPD service (or group of services) 
furnished on or after April 1, 2023, and the payment for 
such drug under this subsection is the same as the amount 
for a calendar quarter under paragraph (3)(A)(ii)(I) of sec-
tion 1847A(i), under the system under this subsection, in 
lieu of calculation of the copayment amount and the amount 
of payment otherwise applicable under this subsection 
(other than the application of the limitation described in 
subparagraph (C)), the provisions of section 1847A(i)(5) 
and paragraph (1)(EE) of subsection (a), shall, as deter-
mined appropriate by the Secretary, apply under this sub-
section in the same manner as such provisions of section 
1847A(i)(5) and subsection (a) apply under such section 
and subsection.’’. 
(c) CONFORMING AMENDMENTS.— 
(1) TO PART B ASP CALCULATION.—Section 1847A(c)(3) of 
the Social Security Act (42 U.S.C. 1395w–3a(c)(3)) is amended 
by inserting ‘‘subsection (i) or’’ before ‘‘section 1927’’. 
(2) EXCLUDING PART B DRUG INFLATION REBATE FROM BEST 
PRICE.—Section 1927(c)(1)(C)(ii)(I) of the Social Security Act 
(42 U.S.C. 1396r–8(c)(1)(C)(ii)(I)) is amended by inserting ‘‘or 
section 1847A(i)’’ after ‘‘this section’’. 
(3) COORDINATION
WITH
MEDICAID
REBATE
INFORMATION 
DISCLOSURE.—Section 1927(b)(3)(D)(i) of the Social Security Act 
(42 U.S.C. 1396r–8(b)(3)(D)(i)) is amended by inserting ‘‘and 
the rebate’’ after ‘‘the payment amount’’. 
(4) EXCLUDING PART B DRUG INFLATION REBATES FROM AVER-
AGE
MANUFACTURER
PRICE.—Section 1927(k)(1)(B)(i) of the 
Social Security Act (42 U.S.C. 1396r–8(k)(1)(B)(i)), as amended 
by section 11001(b)(3), is amended— 
(A) in subclause (V), by striking ‘‘and’’ at the end; 
(B) in subclause (VI), by striking the period at the 
end and inserting a semicolon; and 
(C) by adding at the end the following new subclause: 
‘‘(VII) rebates paid by manufacturers under 
section 1847A(i); and’’. 
(d) FUNDING.—In addition to amounts otherwise available, 
there are appropriated to the Centers for Medicare & Medicaid 
Services, out of any money in the Treasury not otherwise appro-
priated, $80,000,000 for fiscal year 2022, including $12,500,000 
to carry out the provisions of, including the amendments made 
by, this section in fiscal year 2022, and $7,500,000 to carry out 
the provisions of, including the amendments made by, this section
H. R. 5376—54 
in each of fiscal years 2023 through 2031, to remain available 
until expended. 
SEC. 11102. MEDICARE PART D REBATE BY MANUFACTURERS. 
(a) IN GENERAL.—Part D of title XVIII of the Social Security 
Act is amended by inserting after section 1860D–14A (42 U.S.C. 
1395w–114a) the following new section: 
‘‘SEC. 1860D–14B. MANUFACTURER REBATE FOR CERTAIN DRUGS WITH 
PRICES INCREASING FASTER THAN INFLATION. 
‘‘(a) REQUIREMENTS.— 
‘‘(1) SECRETARIAL PROVISION OF INFORMATION.—Not later 
than 9 months after the end of each applicable period (as 
defined in subsection (g)(7)), subject to paragraph (3), the Sec-
retary shall, for each part D rebatable drug, report to each 
manufacturer of such part D rebatable drug the following for 
such period: 
‘‘(A) The amount (if any) of the excess annual manufac-
turer price increase described in subsection (b)(1)(A)(ii) for 
each dosage form and strength with respect to such drug 
and period. 
‘‘(B) The rebate amount specified under subsection (b) 
for each dosage form and strength with respect to such 
drug and period. 
‘‘(2) MANUFACTURER REQUIREMENTS.—For each applicable 
period, the manufacturer of a part D rebatable drug, for each 
dosage form and strength with respect to such drug, not later 
than 30 days after the date of receipt from the Secretary 
of the information described in paragraph (1) for such period, 
shall provide to the Secretary a rebate that is equal to the 
amount specified in subsection (b) for such dosage form and 
strength with respect to such drug for such period. 
‘‘(3) TRANSITION RULE FOR REPORTING.—The Secretary may, 
for each rebatable covered part D drug, delay the timeframe 
for reporting the information and rebate amount described in 
subparagraphs (A) and (B) of such paragraph for the applicable 
periods beginning October 1, 2022, and October 1, 2023, until 
not later than December 31, 2025. 
‘‘(b) REBATE AMOUNT.— 
‘‘(1) IN GENERAL.— 
‘‘(A) CALCULATION.—For purposes of this section, the 
amount specified in this subsection for a dosage form and 
strength with respect to a part D rebatable drug and 
applicable period is, subject to subparagraph (C), paragraph 
(5)(B), and paragraph (6), the estimated amount equal to 
the product of— 
‘‘(i) subject to subparagraph (B) of this paragraph, 
the total number of units of such dosage form and 
strength for each rebatable covered part D drug dis-
pensed under this part during the applicable period; 
and 
‘‘(ii) the amount (if any) by which— 
‘‘(I) the annual manufacturer price (as deter-
mined in paragraph (2)) paid for such dosage form 
and strength with respect to such part D rebatable 
drug for the period; exceeds 
‘‘(II) the inflation-adjusted payment amount 
determined under paragraph (3) for such dosage
H. R. 5376—55 
form and strength with respect to such part D 
rebatable drug for the period. 
‘‘(B) EXCLUDED UNITS.—For purposes of subparagraph 
(A)(i), beginning with plan year 2026, the Secretary shall 
exclude from the total number of units for a dosage form 
and strength with respect to a part D rebatable drug, 
with respect to an applicable period, units of each dosage 
form and strength of such part D rebatable drug for which 
the manufacturer provides a discount under the program 
under section 340B of the Public Health Service Act. 
‘‘(C) REDUCTION OR WAIVER FOR SHORTAGES AND SEVERE 
SUPPLY CHAIN DISRUPTIONS.—The Secretary shall reduce 
or waive the amount under subparagraph (A) with respect 
to a part D rebatable drug and an applicable period— 
‘‘(i) in the case of a part D rebatable drug that 
is described as currently in shortage on the shortage 
list in effect under section 506E of the Federal Food, 
Drug, and Cosmetic Act at any point during the 
applicable period; 
‘‘(ii) in the case of a generic part D rebatable 
drug (described in subsection (g)(1)(C)(ii)) or a bio-
similar (defined as a biological product licensed under 
section 351(k) of the Public Health Service Act), when 
the Secretary determines there is a severe supply chain 
disruption during the applicable period, such as that 
caused by a natural disaster or other unique or unex-
pected event; and 
‘‘(iii) in the case of a generic Part D rebatable 
drug (as so described), if the Secretary determines 
that without such reduction or waiver, the drug is 
likely to be described as in shortage on such shortage 
list during a subsequent applicable period. 
‘‘(2) DETERMINATION OF ANNUAL MANUFACTURER PRICE.— 
The annual manufacturer price determined under this para-
graph for a dosage form and strength, with respect to a part 
D rebatable drug and an applicable period, is the sum of the 
products of— 
‘‘(A) the average manufacturer price (as defined in 
subsection (g)(6)) of such dosage form and strength, as 
calculated for a unit of such drug, with respect to each 
of the calendar quarters of such period; and 
‘‘(B) the ratio of— 
‘‘(i) the total number of units of such dosage form 
and strength reported under section 1927 with respect 
to each such calendar quarter of such period; to 
‘‘(ii) the total number of units of such dosage form 
and strength reported under section 1927 with respect 
to such period, as determined by the Secretary. 
‘‘(3) DETERMINATION
OF
INFLATION-ADJUSTED
PAYMENT 
AMOUNT.—The inflation-adjusted payment amount determined 
under this paragraph for a dosage form and strength with 
respect to a part D rebatable drug for an applicable period, 
subject to paragraph (5), is— 
‘‘(A) the benchmark period manufacturer price deter-
mined under paragraph (4) for such dosage form and 
strength with respect to such drug and period; increased 
by
H. R. 5376—56 
‘‘(B) the percentage by which the applicable period 
CPI–U (as defined in subsection (g)(5)) for the period 
exceeds the benchmark period CPI–U (as defined in sub-
section (g)(4)). 
‘‘(4) DETERMINATION OF BENCHMARK PERIOD MANUFACTURER 
PRICE.—The benchmark period manufacturer price determined 
under this paragraph for a dosage form and strength, with 
respect to a part D rebatable drug and an applicable period, 
is the sum of the products of— 
‘‘(A) the average manufacturer price (as defined in 
subsection (g)(6)) of such dosage form and strength, as 
calculated for a unit of such drug, with respect to each 
of the calendar quarters of the payment amount benchmark 
period (as defined in subsection (g)(3)); and 
‘‘(B) the ratio of— 
‘‘(i) the total number of units reported under sec-
tion 1927 of such dosage form and strength with 
respect to each such calendar quarter of such payment 
amount benchmark period; to 
‘‘(ii) the total number of units reported under sec-
tion 1927 of such dosage form and strength with 
respect to such payment amount benchmark period. 
‘‘(5) SPECIAL TREATMENT OF CERTAIN DRUGS AND EXEMP-
TION.— 
‘‘(A) SUBSEQUENTLY APPROVED DRUGS.—In the case of 
a part D rebatable drug first approved or licensed by the 
Food and Drug Administration after October 1, 2021, sub-
paragraphs (A) and (B) of paragraph (4) shall be applied 
as if the term ‘payment amount benchmark period’ were 
defined under subsection (g)(3) as the first calendar year 
beginning after the day on which the drug was first mar-
keted and subparagraph (B) of paragraph (3) shall be 
applied as if the term ‘benchmark period CPI–U’ were 
defined under subsection (g)(4) as if the reference to 
‘January 2021’ under such subsection were a reference 
to ‘January of the first year beginning after the date on 
which the drug was first marketed’. 
‘‘(B) TREATMENT OF NEW FORMULATIONS.— 
‘‘(i) IN GENERAL.—In the case of a part D rebatable 
drug that is a line extension of a part D rebatable 
drug that is an oral solid dosage form, the Secretary 
shall establish a formula for determining the rebate 
amount under paragraph (1) and the inflation adjusted 
payment amount under paragraph (3) with respect to 
such part D rebatable drug and an applicable period, 
consistent with the formula applied under subsection 
(c)(2)(C) of section 1927 for determining a rebate obliga-
tion for a rebate period under such section. 
‘‘(ii) LINE EXTENSION DEFINED.—In this subpara-
graph, the term ‘line extension’ means, with respect 
to a part D rebatable drug, a new formulation of the 
drug, such as an extended release formulation, but 
does not include an abuse-deterrent formulation of the 
drug (as determined by the Secretary), regardless of 
whether such abuse-deterrent formulation is an 
extended release formulation.
H. R. 5376—57 
‘‘(C) SELECTED
DRUGS.—In the case of a part D 
rebatable drug that is a selected drug (as defined in section 
1192(c)) with respect to a price applicability period (as 
defined in section 1191(b)(2)), in the case such drug is 
no longer considered to be a selected drug under section 
1192(c), for each applicable period (as defined under sub-
section (g)(7)) beginning after the price applicability period 
with respect to such drug, subparagraphs (A) and (B) of 
paragraph (4) shall be applied as if the term ‘payment 
amount benchmark period’ were defined under subsection 
(g)(3) as the last year beginning during such price applica-
bility period with respect to such selected drug and 
subparagraph (B) of paragraph (3) shall be applied as if 
the term ‘benchmark period CPI–U’ were defined under 
subsection (g)(4) as if the reference to ‘January 2021’ under 
such subsection were a reference to ‘January of the last 
year beginning during such price applicability period with 
respect to such drug’. 
‘‘(6) RECONCILIATION IN CASE OF REVISED INFORMATION.— 
The Secretary shall provide for a method and process under 
which, in the case where a PDP sponsor of a prescription 
drug plan or an MA organization offering an MA–PD plan 
submits revisions to the number of units of a rebatable covered 
part D drug dispensed, the Secretary determines, pursuant 
to such revisions, adjustments, if any, to the calculation of 
the amount specified in this subsection for a dosage form and 
strength with respect to such part D rebatable drug and an 
applicable period and reconciles any overpayments or underpay-
ments in amounts paid as rebates under this subsection. Any 
identified underpayment shall be rectified by the manufacturer 
not later than 30 days after the date of receipt from the Sec-
retary of information on such underpayment. 
‘‘(c) REBATE DEPOSITS.—Amounts paid as rebates under sub-
section (b) shall be deposited into the Medicare Prescription Drug 
Account in the Federal Supplementary Medical Insurance Trust 
Fund established under section 1841. 
‘‘(d) INFORMATION.—For purposes of carrying out this section, 
the Secretary shall use information submitted by— 
‘‘(1) manufacturers under section 1927(b)(3); 
‘‘(2) States under section 1927(b)(2)(A); and 
‘‘(3) PDP sponsors of prescription drug plans and MA 
organization offering MA–PD plans under this part. 
‘‘(e) CIVIL MONEY PENALTY.—If a manufacturer of a part D 
rebatable drug has failed to comply with the requirement under 
subsection (a)(2) with respect to such drug for an applicable period, 
the manufacturer shall be subject to a civil money penalty in 
an amount equal to 125 percent of the amount specified in sub-
section (b) for such drug for such period. The provisions of section 
1128A (other than subsections (a) (with respect to amounts of 
penalties or additional assessments) and (b)) shall apply to a civil 
money penalty under this subsection in the same manner as such 
provisions apply to a penalty or proceeding under section 1128A(a). 
‘‘(f) LIMITATION
ON ADMINISTRATIVE
OR JUDICIAL REVIEW.— 
There shall be no administrative or judicial review of any of the 
following: 
‘‘(1) The determination of units under this section.
H. R. 5376—58 
‘‘(2) The determination of whether a drug is a part D 
rebatable drug under this section. 
‘‘(3) The calculation of the rebate amount under this section. 
‘‘(g) DEFINITIONS.—In this section: 
‘‘(1) PART D REBATABLE DRUG.— 
‘‘(A) IN GENERAL.—Except as provided in subparagraph 
(B), the term ‘part D rebatable drug’ means, with respect 
to an applicable period, a drug or biological described in 
subparagraph (C) that is a covered part D drug (as such 
term is defined under section 1860D–2(e)). 
‘‘(B) EXCLUSION.— 
‘‘(i) IN GENERAL.—Such term shall, with respect 
to an applicable period, not include a drug or biological 
if the average annual total cost under this part for 
such period per individual who uses such a drug or 
biological, as determined by the Secretary, is less than, 
subject to clause (ii), $100, as determined by the Sec-
retary using the most recent data available or, if data 
is not available, as estimated by the Secretary. 
‘‘(ii) INCREASE.—The dollar amount applied under 
clause (i)— 
‘‘(I) for the applicable period beginning October 
1, 2023, shall be the dollar amount specified under 
such clause for the applicable period beginning 
October 1, 2022, increased by the percentage 
increase in the consumer price index for all urban 
consumers (United States city average) for the 12- 
month period beginning with October of 2023; and 
‘‘(II) for a subsequent applicable period, shall 
be the dollar amount specified in this clause for 
the previous applicable period, increased by the 
percentage increase in the consumer price index 
for all urban consumers (United States city aver-
age) for the 12-month period beginning with 
October of the previous period. 
Any dollar amount specified under this clause that 
is not a multiple of $10 shall be rounded to the nearest 
multiple of $10. 
‘‘(C) DRUG
OR
BIOLOGICAL
DESCRIBED.—A drug or 
biological described in this subparagraph is a drug or 
biological that, as of the first day of the applicable period 
involved, is— 
‘‘(i) a drug approved under a new drug application 
under section 505(c) of the Federal Food, Drug, and 
Cosmetic Act; 
‘‘(ii) a drug approved under an abbreviated new 
drug application under section 505(j) of the Federal 
Food, Drug, and Cosmetic Act, in the case where— 
‘‘(I) the reference listed drug approved under 
section 505(c) of the Federal Food, Drug, and Cos-
metic Act, including any ‘authorized generic drug’ 
(as that term is defined in section 505(t)(3) of 
the Federal Food, Drug, and Cosmetic Act), is not 
being marketed, as identified in the Food and Drug 
Administration’s National Drug Code Directory;
H. R. 5376—59 
‘‘(II) there is no other drug approved under 
section 505(j) of the Federal Food, Drug, and Cos-
metic Act that is rated as therapeutically equiva-
lent (under the Food and Drug Administration’s 
most recent publication of ‘Approved Drug Prod-
ucts with Therapeutic Equivalence Evaluations’) 
and that is being marketed, as identified in the 
Food and Drug Administration’s National Drug 
Code Directory; 
‘‘(III) the manufacturer is not a ‘first applicant’ 
during the ‘180-day exclusivity period’, as those 
terms are defined in section 505(j)(5)(B)(iv) of the 
Federal Food, Drug, and Cosmetic Act; and 
‘‘(IV) the manufacturer is not a ‘first approved 
applicant’ for a competitive generic therapy, as 
that term is defined in section 505(j)(5)(B)(v) of 
the Federal Food, Drug, and Cosmetic Act; or 
‘‘(iii) a biological licensed under section 351 of the 
Public Health Service Act. 
‘‘(2) UNIT.—The term ‘unit’ means, with respect to a part 
D rebatable drug, the lowest dispensable amount (such as a 
capsule or tablet, milligram of molecules, or grams) of the 
part D rebatable drug, as reported under section 1927. 
‘‘(3) PAYMENT AMOUNT BENCHMARK PERIOD.—The term ‘pay-
ment amount benchmark period’ means the period beginning 
January 1, 2021, and ending in the month immediately prior 
to October 1, 2021. 
‘‘(4) BENCHMARK
PERIOD
CPI–U.—The term ‘benchmark 
period CPI–U’ means the consumer price index for all urban 
consumers (United States city average) for January 2021. 
‘‘(5) APPLICABLE PERIOD CPI–U.—The term ‘applicable period 
CPI–U’ means, with respect to an applicable period, the con-
sumer price index for all urban consumers (United States city 
average) for the first month of such applicable period. 
‘‘(6) AVERAGE MANUFACTURER PRICE.—The term ‘average 
manufacturer price’ has the meaning, with respect to a part 
D rebatable drug of a manufacturer, given such term in section 
1927(k)(1), with respect to a covered outpatient drug of a manu-
facturer for a rebate period under section 1927. 
‘‘(7) APPLICABLE
PERIOD.—The term ‘applicable period’ 
means a 12-month period beginning with October 1 of a year 
(beginning with October 1, 2022). 
‘‘(h) IMPLEMENTATION FOR 2022, 2023, AND 2024.—The Sec-
retary shall implement this section for 2022, 2023, and 2024 by 
program instruction or other forms of program guidance.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) TO PART B ASP CALCULATION.—Section 1847A(c)(3) of 
the Social Security Act (42 U.S.C. 1395w–3a(c)(3)), as amended 
by section 11101(c)(1), is amended by striking ‘‘subsection (i) 
or section 1927’’ and inserting ‘‘subsection (i), section 1927, 
or section 1860D–14B’’. 
(2) EXCLUDING PART D DRUG INFLATION REBATE FROM BEST 
PRICE.—Section 1927(c)(1)(C)(ii)(I) of the Social Security Act 
(42 U.S.C. 1396r–8(c)(1)(C)(ii)(I)), as amended by section 
11101(c)(2), is amended by striking ‘‘or section 1847A(i)’’ and 
inserting ‘‘, section 1847A(i), or section 1860D–14B’’.
H. R. 5376—60 
(3) COORDINATION
WITH
MEDICAID
REBATE
INFORMATION 
DISCLOSURE.—Section 1927(b)(3)(D)(i) of the Social Security Act 
(42 U.S.C. 1396r–8(b)(3)(D)(i)), as amended by sections 11002(b) 
and 11101(c)(3), is amended by striking ‘‘or section 1192(f), 
including rebates under paragraph (4) of such section’’ and 
inserting ‘‘, section 1192(f), including rebates under paragraph 
(4) of such section, or section 1860D–14B’’. 
(4) EXCLUDING
PART
D
DRUG
INFLATION
REBATES
FROM 
AVERAGE MANUFACTURER PRICE.—Section 1927(k)(1)(B)(i) of the 
Social Security Act (42 U.S.C. 1396r–8(k)(1)(B)(i)), as amended 
by section 11001(b)(3) and section 11101(c)(4), is amended by 
adding at the end the following new subclause: 
(A) in subclause (VI), by striking ‘‘and’’ at the end; 
(B) in subclause (VII), by striking the period at the 
end and inserting a semicolon; and 
(C) by adding at the end the following new subclause: 
‘‘(VIII) rebates paid by manufacturers under 
section 1860D–14B.’’. 
(c) FUNDING.—In addition to amounts otherwise available, there 
are appropriated to the Centers for Medicare & Medicaid Services, 
out of any money in the Treasury not otherwise appropriated, 
$80,000,000 for fiscal year 2022, including $12,500,000 to carry 
out the provisions of, including the amendments made by, this 
section in fiscal year 2022, and $7,500,000 to carry out the provi-
sions of, including the amendments made by, this section in each 
of fiscal years 2023 through 2031, to remain available until 
expended. 
PART 3—PART D IMPROVEMENTS AND MAX-
IMUM OUT-OF-POCKET CAP FOR MEDICARE 
BENEFICIARIES 
SEC. 11201. MEDICARE PART D BENEFIT REDESIGN. 
(a) BENEFIT STRUCTURE REDESIGN.—Section 1860D–2(b) of the 
Social Security Act (42 U.S.C. 1395w–102(b)) is amended— 
(1) in paragraph (2)— 
(A) in subparagraph (A), in the matter preceding clause 
(i), by inserting ‘‘for a year preceding 2025 and for costs 
above the annual deductible specified in paragraph (1) 
and up to the annual out-of-pocket threshold specified in 
paragraph (4)(B) for 2025 and each subsequent year’’ after 
‘‘paragraph (3)’’; 
(B) in subparagraph (C)— 
(i) in clause (i), in the matter preceding subclause 
(I), by inserting ‘‘for a year preceding 2025,’’ after 
‘‘paragraph (4),’’; and 
(ii) in clause (ii)(III), by striking ‘‘and each subse-
quent year’’ and inserting ‘‘through 2024’’; and 
(C) in subparagraph (D)— 
(i) in clause (i)— 
(I) in the matter preceding subclause (I), by 
inserting ‘‘for a year preceding 2025,’’ after ‘‘para-
graph (4),’’; and 
(II) in subclause (I)(bb), by striking ‘‘a year 
after 2018’’ and inserting ‘‘each of years 2019 
through 2024’’; and
H. R. 5376—61 
(ii) in clause (ii)(V), by striking ‘‘2019 and each 
subsequent year’’ and inserting ‘‘each of years 2019 
through 2024’’; 
(2) in paragraph (3)(A)— 
(A) in the matter preceding clause (i), by inserting 
‘‘for a year preceding 2025,’’ after ‘‘and (4),’’; and 
(B) in clause (ii), by striking ‘‘for a subsequent year’’ 
and inserting ‘‘for each of years 2007 through 2024’’; and 
(3) in paragraph (4)— 
(A) in subparagraph (A)— 
(i) in clause (i)— 
(I) by redesignating subclauses (I) and (II) as 
items (aa) and (bb), respectively, and moving the 
margin of each such redesignated item 2 ems to 
the right; 
(II) in the matter preceding item (aa), as 
redesignated by subclause (I), by striking ‘‘is equal 
to the greater of—’’ and inserting ‘‘is equal to— 
‘‘(I) for a year preceding 2024, the greater 
of—’’; 
(III) by striking the period at the end of item 
(bb), as redesignated by subclause (I), and 
inserting ‘‘; and’’; and 
(IV) by adding at the end the following: 
‘‘(II) for 2024 and each succeeding year, $0.’’; 
and 
(ii) in clause (ii)— 
(I) by striking ‘‘clause (i)(I)’’ and inserting 
‘‘clause (i)(I)(aa)’’; and 
(II) by adding at the end the following new 
sentence: ‘‘The Secretary shall continue to cal-
culate the dollar amounts specified in clause 
(i)(I)(aa), including with the adjustment under this 
clause, after 2023 for purposes of section 1860D– 
14(a)(1)(D)(iii).’’; 
(B) in subparagraph (B)— 
(i) in clause (i)— 
(I) in subclause (V), by striking ‘‘or’’ at the 
end; 
(II) in subclause (VI)— 
(aa) by striking ‘‘for a subsequent year’’ 
and inserting ‘‘for each of years 2021 through 
2024’’; and 
(bb) by striking the period at the end and 
inserting a semicolon; and 
(III) by adding at the end the following new 
subclauses: 
‘‘(VII) for 2025, is equal to $2,000; or 
‘‘(VIII) for a subsequent year, is equal to the 
amount specified in this subparagraph for the pre-
vious year, increased by the annual percentage 
increase described in paragraph (6) for the year 
involved.’’; and 
(ii) in clause (ii), by striking ‘‘clause (i)(II)’’ and 
inserting ‘‘clause (i)’’; 
(C) in subparagraph (C)—
H. R. 5376—62 
(i) in clause (i), by striking ‘‘and for amounts’’ 
and inserting ‘‘and, for a year preceding 2025, for 
amounts’’; and 
(ii) in clause (iii)— 
(I) by redesignating subclauses (I) through (IV) 
as items (aa) through (dd) and indenting appro-
priately; 
(II) by striking ‘‘if such costs are borne or 
paid’’ and inserting ‘‘if such costs— 
‘‘(I) are borne or paid—’’; and 
(III) in item (dd), by striking the period at 
the end and inserting ‘‘; or’’; and 
(IV) by adding at the end the following new 
subclause: 
‘‘(II) for 2025 and subsequent years, are 
reimbursed through insurance, a group health 
plan, or certain other third party payment arrange-
ments, but not including the coverage provided 
by a prescription drug plan or an MA–PD plan 
that is basic prescription drug coverage (as defined 
in subsection (a)(3)) or any payments by a manu-
facturer under the manufacturer discount program 
under section 1860D–14C.’’; and 
(D) in subparagraph (E), by striking ‘‘In applying’’ and 
inserting ‘‘For each of years 2011 through 2024, in 
applying’’. 
(b) REINSURANCE PAYMENT AMOUNT.—Section 1860D–15(b) of 
the Social Security Act (42 U.S.C. 1395w–115(b)) is amended— 
(1) in paragraph (1)— 
(A) by striking ‘‘equal to 80 percent’’ and inserting 
‘‘equal to— 
‘‘(A) for a year preceding 2025, 80 percent’’; 
(B) in subparagraph (A), as added by subparagraph 
(A), by striking the period at the end and inserting ‘‘; 
and’’; and 
(C) by adding at the end the following new subpara-
graph: 
‘‘(B) for 2025 and each subsequent year, the sum of— 
‘‘(i) with respect to applicable drugs (as defined 
in section 1860D–14C(g)(2)), an amount equal to 20 
percent of such allowable reinsurance costs attributable 
to that portion of gross covered prescription drug costs 
as specified in paragraph (3) incurred in the coverage 
year after such individual has incurred costs that 
exceed the annual out-of-pocket threshold specified in 
section 1860D–2(b)(4)(B); and 
‘‘(ii) with respect to covered part D drugs that 
are not applicable drugs (as so defined), an amount 
equal to 40 percent of such allowable reinsurance costs 
attributable to that portion of gross covered prescrip-
tion drug costs as specified in paragraph (3) incurred 
in the coverage year after such individual has incurred 
costs that exceed the annual out-of-pocket threshold 
specified in section 1860D–2(b)(4)(B).’’; 
(2) in paragraph (2)— 
(A) by striking ‘‘COSTS.—For purposes’’ and inserting 
‘‘COSTS.—
H. R. 5376—63 
‘‘(A) IN
GENERAL.—Subject to subparagraph (B), for 
purposes’’; and 
(B) by adding at the end the following new subpara-
graph: 
‘‘(B) INCLUSION
OF
MANUFACTURER
DISCOUNTS
ON 
APPLICABLE
DRUGS.—For purposes of applying subpara-
graph (A), the term ‘allowable reinsurance costs’ shall 
include the portion of the negotiated price (as defined in 
section 1860D–14C(g)(6)) of an applicable drug (as defined 
in section 1860D–14C(g)(2)) that was paid by a manufac-
turer under the manufacturer discount program under sec-
tion 1860D–14C.’’; and 
(3) in paragraph (3)— 
(A) in the first sentence, by striking ‘‘For purposes’’ 
and inserting ‘‘Subject to paragraph (2)(B), for purposes’’; 
and 
(B) in the second sentence, by inserting ‘‘(or, with 
respect to 2025 and subsequent years, in the case of an 
applicable drug, as defined in section 1860D–14C(g)(2), by 
a manufacturer)’’ after ‘‘by the individual or under the 
plan’’. 
(c) MANUFACTURER DISCOUNT PROGRAM.— 
(1) IN GENERAL.—Part D of title XVIII of the Social Security 
Act (42 U.S.C. 1395w–101 through 42 U.S.C. 1395w–153), as 
amended by section 11102, is amended by inserting after section 
1860D–14B the following new sections: 
‘‘SEC. 1860D–14C. MANUFACTURER DISCOUNT PROGRAM. 
‘‘(a) ESTABLISHMENT.—The Secretary shall establish a manufac-
turer discount program (in this section referred to as the ‘program’). 
Under the program, the Secretary shall enter into agreements 
described in subsection (b) with manufacturers and provide for 
the performance of the duties described in subsection (c). 
‘‘(b) TERMS OF AGREEMENT.— 
‘‘(1) IN GENERAL.— 
‘‘(A) AGREEMENT.—An agreement under this section 
shall require the manufacturer to provide, in accordance 
with this section, discounted prices for applicable drugs 
of the manufacturer that are dispensed to applicable bene-
ficiaries on or after January 1, 2025. 
‘‘(B) CLARIFICATION.—Nothing in this section shall be 
construed as affecting— 
‘‘(i) the application of a coinsurance of 25 percent 
of the negotiated price, as applied under paragraph 
(2)(A) of section 1860D–2(b), for costs described in such 
paragraph; or 
‘‘(ii) the application of the copayment amount 
described in paragraph (4)(A) of such section, with 
respect to costs described in such paragraph. 
‘‘(C) TIMING OF AGREEMENT.— 
‘‘(i) SPECIAL RULE FOR 2025.—In order for an agree-
ment with a manufacturer to be in effect under this 
section with respect to the period beginning on January 
1, 2025, and ending on December 31, 2025, the manu-
facturer shall enter into such agreement not later than 
March 1, 2024.
H. R. 5376—64 
‘‘(ii) 2026 AND SUBSEQUENT YEARS.—In order for 
an agreement with a manufacturer to be in effect under 
this section with respect to plan year 2026 or a subse-
quent plan year, the manufacturer shall enter into 
such agreement not later than a calendar quarter or 
semi-annual deadline established by the Secretary. 
‘‘(2) PROVISION OF APPROPRIATE DATA.—Each manufacturer 
with an agreement in effect under this section shall collect 
and have available appropriate data, as determined by the 
Secretary, to ensure that it can demonstrate to the Secretary 
compliance with the requirements under the program. 
‘‘(3) COMPLIANCE WITH REQUIREMENTS FOR ADMINISTRATION 
OF PROGRAM.—Each manufacturer with an agreement in effect 
under this section shall comply with requirements imposed 
by the Secretary, as applicable, for purposes of administering 
the program, including any determination under subparagraph 
(A) of subsection (c)(1) or procedures established under such 
subsection (c)(1). 
‘‘(4) LENGTH OF AGREEMENT.— 
‘‘(A) IN GENERAL.—An agreement under this section 
shall be effective for an initial period of not less than 
12 months and shall be automatically renewed for a period 
of not less than 1 year unless terminated under subpara-
graph (B). 
‘‘(B) TERMINATION.— 
‘‘(i) BY THE SECRETARY.—The Secretary shall pro-
vide for termination of an agreement under this section 
for a knowing and willful violation of the requirements 
of the agreement or other good cause shown. Such 
termination shall not be effective earlier than 30 days 
after the date of notice to the manufacturer of such 
termination. The Secretary shall provide, upon request, 
a manufacturer with a hearing concerning such a 
termination, and such hearing shall take place prior 
to the effective date of the termination with sufficient 
time for such effective date to be repealed if the Sec-
retary determines appropriate. 
‘‘(ii) BY A MANUFACTURER.—A manufacturer may 
terminate an agreement under this section for any 
reason. Any such termination shall be effective, with 
respect to a plan year— 
‘‘(I) if the termination occurs before January 
31 of a plan year, as of the day after the end 
of the plan year; and 
‘‘(II) if the termination occurs on or after 
January 31 of a plan year, as of the day after 
the end of the succeeding plan year. 
‘‘(iii) EFFECTIVENESS OF TERMINATION.—Any termi-
nation under this subparagraph shall not affect dis-
counts for applicable drugs of the manufacturer that 
are due under the agreement before the effective date 
of its termination. 
‘‘(5) EFFECTIVE DATE OF AGREEMENT.—An agreement under 
this section shall take effect at the start of a calendar quarter 
or another date specified by the Secretary. 
‘‘(c) DUTIES DESCRIBED.—The duties described in this subsection 
are the following:
H. R. 5376—65 
‘‘(1) ADMINISTRATION OF PROGRAM.—Administering the pro-
gram, including— 
‘‘(A) the determination of the amount of the discounted 
price of an applicable drug of a manufacturer; 
‘‘(B) the establishment of procedures to ensure that, 
not later than the applicable number of calendar days 
after the dispensing of an applicable drug by a pharmacy 
or mail order service, the pharmacy or mail order service 
is reimbursed for an amount equal to the difference 
between— 
‘‘(i) the negotiated price of the applicable drug; 
and 
‘‘(ii) the discounted price of the applicable drug; 
‘‘(C) the establishment of procedures to ensure that 
the discounted price for an applicable drug under this 
section is applied before any coverage or financial assist-
ance under other health benefit plans or programs that 
provide coverage or financial assistance for the purchase 
or provision of prescription drug coverage on behalf of 
applicable beneficiaries as specified by the Secretary; and 
‘‘(D) providing a reasonable dispute resolution mecha-
nism to resolve disagreements between manufacturers, 
prescription drug plans and MA–PD plans, and the Sec-
retary. 
‘‘(2) MONITORING COMPLIANCE.—The Secretary shall mon-
itor compliance by a manufacturer with the terms of an agree-
ment under this section. 
‘‘(3) COLLECTION OF DATA FROM PRESCRIPTION DRUG PLANS 
AND MA–PD PLANS.—The Secretary may collect appropriate data 
from prescription drug plans and MA–PD plans in a timeframe 
that allows for discounted prices to be provided for applicable 
drugs under this section. 
‘‘(d) ADMINISTRATION.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2), the Secretary 
shall provide for the implementation of this section, including 
the performance of the duties described in subsection (c). 
‘‘(2) LIMITATION.—In providing for the implementation of 
this section, the Secretary shall not receive or distribute any 
funds of a manufacturer under the program. 
‘‘(e) CIVIL MONEY PENALTY.— 
‘‘(1) IN GENERAL.—A manufacturer that fails to provide 
discounted prices for applicable drugs of the manufacturer dis-
pensed to applicable beneficiaries in accordance with an agree-
ment in effect under this section shall be subject to a civil 
money penalty for each such failure in an amount the Secretary 
determines is equal to the sum of— 
‘‘(A) the amount that the manufacturer would have 
paid with respect to such discounts under the agreement, 
which will then be used to pay the discounts which the 
manufacturer had failed to provide; and 
‘‘(B) 25 percent of such amount. 
‘‘(2) APPLICATION.—The provisions of section 1128A (other 
than subsections (a) and (b)) shall apply to a civil money 
penalty under this subsection in the same manner as such 
provisions apply to a penalty or proceeding under section 
1128A(a).
H. R. 5376—66 
‘‘(f) CLARIFICATION REGARDING AVAILABILITY OF OTHER COV-
ERED PART D DRUGS.—Nothing in this section shall prevent an 
applicable beneficiary from purchasing a covered part D drug that 
is not an applicable drug (including a generic drug or a drug 
that is not on the formulary of the prescription drug plan or MA– 
PD plan that the applicable beneficiary is enrolled in). 
‘‘(g) DEFINITIONS.—In this section: 
‘‘(1) APPLICABLE BENEFICIARY.—The term ‘applicable bene-
ficiary’ means an individual who, on the date of dispensing 
a covered part D drug— 
‘‘(A) is enrolled in a prescription drug plan or an MA– 
PD plan; 
‘‘(B) is not enrolled in a qualified retiree prescription 
drug plan; and 
‘‘(C) has incurred costs, as determined in accordance 
with section 1860D–2(b)(4)(C), for covered part D drugs 
in the year that exceed the annual deductible specified 
in section 1860D–2(b)(1). 
‘‘(2) APPLICABLE DRUG.—The term ‘applicable drug’, with 
respect to an applicable beneficiary— 
‘‘(A) means a covered part D drug— 
‘‘(i) approved under a new drug application under 
section 505(c) of the Federal Food, Drug, and Cosmetic 
Act or, in the case of a biologic product, licensed under 
section 351 of the Public Health Service Act; and 
‘‘(ii)(I) if the PDP sponsor of the prescription drug 
plan or the MA organization offering the MA–PD plan 
uses a formulary, which is on the formulary of the 
prescription drug plan or MA–PD plan that the 
applicable beneficiary is enrolled in; 
‘‘(II) if the PDP sponsor of the prescription drug 
plan or the MA organization offering the MA–PD plan 
does not use a formulary, for which benefits are avail-
able under the prescription drug plan or MA–PD plan 
that the applicable beneficiary is enrolled in; or 
‘‘(III) is provided through an exception or appeal; 
and 
‘‘(B) does not include a selected drug (as referred to 
under section 1192(c)) during a price applicability period 
(as defined in section 1191(b)(2)) with respect to such drug. 
‘‘(3) APPLICABLE NUMBER OF CALENDAR DAYS.—The term 
‘applicable number of calendar days’ means— 
‘‘(A) with respect to claims for reimbursement sub-
mitted electronically, 14 days; and 
‘‘(B) with respect to claims for reimbursement sub-
mitted otherwise, 30 days. 
‘‘(4) DISCOUNTED PRICE.— 
‘‘(A) IN GENERAL.—The term ‘discounted price’ means, 
subject to subparagraphs (B) and (C), with respect to an 
applicable drug of a manufacturer dispensed during a year 
to an applicable beneficiary— 
‘‘(i) who has not incurred costs, as determined 
in accordance with section 1860D–2(b)(4)(C), for cov-
ered part D drugs in the year that are equal to or 
exceed the annual out-of-pocket threshold specified in 
section 1860D–2(b)(4)(B)(i) for the year, 90 percent of 
the negotiated price of such drug; and
H. R. 5376—67 
‘‘(ii) who has incurred such costs, as so determined, 
in the year that are equal to or exceed such threshold 
for the year, 80 percent of the negotiated price of 
such drug. 
‘‘(B) PHASE-IN FOR CERTAIN DRUGS DISPENSED TO LIS 
BENEFICIARIES.— 
‘‘(i) IN GENERAL.—In the case of an applicable drug 
of a specified manufacturer (as defined in clause (ii)) 
that is marketed as of the date of enactment of this 
subparagraph and dispensed for an applicable bene-
ficiary who is a subsidy eligible individual (as defined 
in section 1860D–14(a)(3)), the term ‘discounted price’ 
means the specified LIS percent (as defined in clause 
(iii)) of the negotiated price of the applicable drug 
of the manufacturer. 
‘‘(ii) SPECIFIED MANUFACTURER.— 
‘‘(I) IN GENERAL.—In this subparagraph, sub-
ject to subclause (II), the term ‘specified manufac-
turer’ means a manufacturer of an applicable drug 
for which, in 2021— 
‘‘(aa) the manufacturer had a coverage gap 
discount agreement under section 1860D–14A; 
‘‘(bb) the total expenditures for all of the 
specified drugs of the manufacturer covered 
by such agreement or agreements for such 
year and covered under this part during such 
year represented less than 1.0 percent of the 
total expenditures under this part for all cov-
ered Part D drugs during such year; and 
‘‘(cc) the total expenditures for all of the 
specified drugs of the manufacturer that are 
single source drugs and biological products for 
which payment may be made under part B 
during such year represented less than 1.0 
percent of the total expenditures under part 
B for all drugs or biological products for which 
payment may be made under such part during 
such year. 
‘‘(II) SPECIFIED DRUGS.— 
‘‘(aa) IN GENERAL.—For purposes of this 
clause, the term ‘specified drug’ means, with 
respect to a specified manufacturer, for 2021, 
an applicable drug that is produced, prepared, 
propagated, compounded, converted, or proc-
essed by the manufacturer. 
‘‘(bb) AGGREGATION
RULE.—All persons 
treated as a single employer under subsection 
(a) or (b) of section 52 of the Internal Revenue 
Code of 1986 shall be treated as one manufac-
turer for purposes of this subparagraph. For 
purposes of making a determination pursuant 
to the previous sentence, an agreement under 
this section shall require that a manufacturer 
provide and attest to such information as 
specified by the Secretary as necessary. 
‘‘(III) LIMITATION.—The term ‘specified manu-
facturer’ 
shall 
not 
include 
a 
manufacturer
H. R. 5376—68 
described in subclause (I) if such manufacturer 
is acquired after 2021 by another manufacturer 
that is not a specified manufacturer, effective at 
the beginning of the plan year immediately fol-
lowing such acquisition or, in the case of an 
acquisition before 2025, effective January 1, 2025. 
‘‘(iii) SPECIFIED
LIS
PERCENT.—In this subpara-
graph, the ‘specified LIS percent’ means, with respect 
to a year— 
‘‘(I) for an applicable drug dispensed for an 
applicable beneficiary described in clause (i) who 
has not incurred costs, as determined in accord-
ance with section 1860D–2(b)(4)(C), for covered 
part D drugs in the year that are equal to or 
exceed the annual out-of-pocket threshold specified 
in section 1860D–2(b)(4)(B)(i) for the year— 
‘‘(aa) for 2025, 99 percent; 
‘‘(bb) for 2026, 98 percent; 
‘‘(cc) for 2027, 95 percent; 
‘‘(dd) for 2028, 92 percent; and 
‘‘(ee) for 2029 and each subsequent year, 
90 percent; and 
‘‘(II) for an applicable drug dispensed for an 
applicable beneficiary described in clause (i) who 
has incurred costs, as determined in accordance 
with section 1860D–2(b)(4)(C), for covered part D 
drugs in the year that are equal to or exceed 
the annual out-of-pocket threshold specified in sec-
tion 1860D–2(b)(4)(B)(i) for the year— 
‘‘(aa) for 2025, 99 percent; 
‘‘(bb) for 2026, 98 percent; 
‘‘(cc) for 2027, 95 percent; 
‘‘(dd) for 2028, 92 percent; 
‘‘(ee) for 2029, 90 percent; 
‘‘(ff) for 2030, 85 percent; and 
‘‘(gg) for 2031 and each subsequent year, 
80 percent. 
‘‘(C) PHASE-IN FOR SPECIFIED SMALL MANUFACTURERS.— 
‘‘(i) IN GENERAL.—In the case of an applicable drug 
of a specified small manufacturer (as defined in clause 
(ii)) that is marketed as of the date of enactment 
of this subparagraph and dispensed for an applicable 
beneficiary, the term ‘discounted price’ means the 
specified small manufacturer percent (as defined in 
clause (iii)) of the negotiated price of the applicable 
drug of the manufacturer. 
‘‘(ii) SPECIFIED SMALL MANUFACTURER.— 
‘‘(I) IN GENERAL.—In this subparagraph, sub-
ject to subclause (III), the term ‘specified small 
manufacturer’ means a manufacturer of an 
applicable drug for which, in 2021— 
‘‘(aa) the manufacturer is a specified 
manufacturer (as defined in subparagraph 
(B)(ii)); and
H. R. 5376—69 
‘‘(bb) the total expenditures under part 
D for any one of the specified small manufac-
turer drugs of the manufacturer that are cov-
ered by the agreement or agreements under 
section 1860D–14A of such manufacturer for 
such year and covered under this part during 
such year are equal to or more than 80 percent 
of the total expenditures under this part for 
all specified small manufacturer drugs of the 
manufacturer that are covered by such agree-
ment or agreements for such year and covered 
under this part during such year. 
‘‘(II) 
SPECIFIED
SMALL
MANUFACTURER 
DRUGS.— 
‘‘(aa) IN GENERAL.—For purposes of this 
clause, the term ‘specified small manufacturer 
drugs’ means, with respect to a specified small 
manufacturer, for 2021, an applicable drug 
that is produced, prepared, propagated, com-
pounded, converted, or processed by the manu-
facturer. 
‘‘(bb) AGGREGATION
RULE.—All persons 
treated as a single employer under subsection 
(a) or (b) of section 52 of the Internal Revenue 
Code of 1986 shall be treated as one manufac-
turer for purposes of this subparagraph. For 
purposes of making a determination pursuant 
to the previous sentence, an agreement under 
this section shall require that a manufacturer 
provide and attest to such information as 
specified by the Secretary as necessary. 
‘‘(III) LIMITATION.—The term ‘specified small 
manufacturer’ shall not include a manufacturer 
described in subclause (I) if such manufacturer 
is acquired after 2021 by another manufacturer 
that is not a specified small manufacturer, effective 
at the beginning of the plan year immediately 
following such acquisition or, in the case of an 
acquisition before 2025, effective January 1, 2025. 
‘‘(iii) SPECIFIED SMALL MANUFACTURER PERCENT.— 
In this subparagraph, the term ‘specified small manu-
facturer percent’ means, with respect to a year— 
‘‘(I) for an applicable drug dispensed for an 
applicable beneficiary who has not incurred costs, 
as determined in accordance with section 1860D– 
2(b)(4)(C), for covered part D drugs in the year 
that are equal to or exceed the annual out-of- 
pocket threshold specified in section 1860D– 
2(b)(4)(B)(i) for the year— 
‘‘(aa) for 2025, 99 percent; 
‘‘(bb) for 2026, 98 percent; 
‘‘(cc) for 2027, 95 percent; 
‘‘(dd) for 2028, 92 percent; and 
‘‘(ee) for 2029 and each subsequent year, 
90 percent; and 
‘‘(II) for an applicable drug dispensed for an 
applicable beneficiary who has incurred costs, as
H. R. 5376—70 
determined in accordance with section 1860D– 
2(b)(4)(C), for covered part D drugs in the year 
that are equal to or exceed the annual out-of- 
pocket threshold specified in section 1860D– 
2(b)(4)(B)(i) for the year— 
‘‘(aa) for 2025, 99 percent; 
‘‘(bb) for 2026, 98 percent; 
‘‘(cc) for 2027, 95 percent; 
‘‘(dd) for 2028, 92 percent; 
‘‘(ee) for 2029, 90 percent; 
‘‘(ff) for 2030, 85 percent; and 
‘‘(gg) for 2031 and each subsequent year, 
80 percent. 
‘‘(D) TOTAL EXPENDITURES.—For purposes of this para-
graph, the term ‘total expenditures’ includes, in the case 
of expenditures with respect to part D, the total gross 
covered prescription drug costs as defined in section 
1860D–15(b)(3). The term ‘total expenditures’ excludes, in 
the case of expenditures with respect to part B, expendi-
tures for a drug or biological that are bundled or packaged 
into the payment for another service. 
‘‘(E) SPECIAL CASE FOR CERTAIN CLAIMS.— 
‘‘(i) CLAIMS SPANNING DEDUCTIBLE.—In the case 
where the entire amount of the negotiated price of 
an individual claim for an applicable drug with respect 
to an applicable beneficiary does not fall above the 
annual deductible specified in section 1860D–2(b)(1) 
for the year, the manufacturer of the applicable drug 
shall provide the discounted price under this section 
on only the portion of the negotiated price of the 
applicable drug that falls above such annual deduct-
ible. 
‘‘(ii) 
CLAIMS
SPANNING
OUT-OF-POCKET 
THRESHOLD.—In the case where the entire amount of 
the negotiated price of an individual claim for an 
applicable drug with respect to an applicable bene-
ficiary does not fall entirely below or entirely above 
the annual out-of-pocket threshold specified in section 
1860D–2(b)(4)(B)(i) for the year, the manufacturer of 
the applicable drug shall provide the discounted price— 
‘‘(I) in accordance with subparagraph (A)(i) on 
the portion of the negotiated price of the applicable 
drug that falls below such threshold; and 
‘‘(II) in accordance with subparagraph (A)(ii) 
on the portion of such price of such drug that 
falls at or above such threshold. 
‘‘(5) MANUFACTURER.—The term ‘manufacturer’ means any 
entity which is engaged in the production, preparation, propaga-
tion, compounding, conversion, or processing of prescription 
drug products, either directly or indirectly by extraction from 
substances of natural origin, or independently by means of 
chemical synthesis, or by a combination of extraction and chem-
ical synthesis. Such term does not include a wholesale dis-
tributor of drugs or a retail pharmacy licensed under State 
law. 
‘‘(6) NEGOTIATED PRICE.—The term ‘negotiated price’ has 
the meaning given such term for purposes of section 1860D–
H. R. 5376—71 
2(d)(1)(B), and, with respect to an applicable drug, such nego-
tiated price shall include any dispensing fee and, if applicable, 
any vaccine administration fee for the applicable drug. 
‘‘(7) QUALIFIED
RETIREE
PRESCRIPTION
DRUG
PLAN.—The 
term ‘qualified retiree prescription drug plan’ has the meaning 
given such term in section 1860D–22(a)(2). 
‘‘SEC. 1860D–14D. SELECTED DRUG SUBSIDY PROGRAM. 
‘‘With respect to covered part D drugs that would be applicable 
drugs (as defined in section 1860D–14C(g)(2)) but for the application 
of subparagraph (B) of such section, the Secretary shall provide 
a process whereby, in the case of an applicable beneficiary (as 
defined in section 1860D–14C(g)(1)) who, with respect to a year, 
is enrolled in a prescription drug plan or is enrolled in an MA– 
PD plan, has not incurred costs that are equal to or exceed the 
annual out-of-pocket threshold specified in section 1860D– 
2(b)(4)(B)(i), and is dispensed such a drug, the Secretary (periodi-
cally and on a timely basis) provides the PDP sponsor or the 
MA organization offering the plan, a subsidy with respect to such 
drug that is equal to 10 percent of the negotiated price (as defined 
in section 1860D–14C(g)(6)) of such drug.’’. 
(2) SUNSET OF MEDICARE COVERAGE GAP DISCOUNT PRO-
GRAM.—Section 1860D–14A of the Social Security Act (42 U.S.C. 
1395w–114a) is amended— 
(A) in subsection (a), in the first sentence, by striking 
‘‘The Secretary’’ and inserting ‘‘Subject to subsection (h), 
the Secretary’’; and 
(B) by adding at the end the following new subsection: 
‘‘(h) SUNSET OF PROGRAM.— 
‘‘(1) IN GENERAL.—The program shall not apply with respect 
to applicable drugs dispensed on or after January 1, 2025, 
and, subject to paragraph (2), agreements under this section 
shall be terminated as of such date. 
‘‘(2) CONTINUED APPLICATION FOR APPLICABLE DRUGS DIS-
PENSED
PRIOR
TO
SUNSET.—The provisions of this section 
(including all responsibilities and duties) shall continue to apply 
on and after January 1, 2025, with respect to applicable drugs 
dispensed prior to such date.’’. 
(3) SELECTED
DRUG
SUBSIDY
PAYMENTS
FROM
MEDICARE 
PRESCRIPTION DRUG ACCOUNT.—Section 1860D–16(b)(1) of the 
Social Security Act (42 U.S.C. 1395w–116(b)(1)) is amended— 
(A) in subparagraph (C), by striking ‘‘and’’ at the end; 
(B) in subparagraph (D), by striking the period at 
the end and inserting ‘‘; and’’; and 
(C) by adding at the end the following new subpara-
graph: 
‘‘(E) payments under section 1860D–14D (relating to 
selected drug subsidy payments).’’. 
(d) MEDICARE PART D PREMIUM STABILIZATION.— 
(1) 2024 THROUGH 2029.—Section 1860D–13 of the Social 
Security Act (42 U.S.C. 1395w–113) is amended— 
(A) in subsection (a)— 
(i) in paragraph (1)(A), by inserting ‘‘or (8) (as 
applicable)’’ after ‘‘paragraph (2)’’; 
(ii) in paragraph (2), in the matter preceding 
subparagraph (A), by striking ‘‘The base’’ and inserting 
‘‘Subject to paragraph (8), the base’’;
H. R. 5376—72 
(iii) in paragraph (7)— 
(I) in subparagraph (B)(ii), by inserting ‘‘or 
(8) (as applicable)’’ after ‘‘paragraph (2)’’; and 
(II) in subparagraph (E)(i), by inserting ‘‘or 
(8) (as applicable)’’ after ‘‘paragraph (2)’’; and 
(iv) by adding at the end the following new para-
graph: 
‘‘(8) PREMIUM STABILIZATION.— 
‘‘(A) IN
GENERAL.—The base beneficiary premium 
under this paragraph for a prescription drug plan for a 
month in 2024 through 2029 shall be computed as follows: 
‘‘(i) 2024.—The base beneficiary premium for a 
month in 2024 shall be equal to the lesser of— 
‘‘(I) the base beneficiary premium computed 
under paragraph (2) for a month in 2023 increased 
by 6 percent; or 
‘‘(II) the base beneficiary premium computed 
under paragraph (2) for a month in 2024 that 
would have applied if this paragraph had not been 
enacted. 
‘‘(ii) 2025.—The base beneficiary premium for a 
month in 2025 shall be equal to the lesser of— 
‘‘(I) the base beneficiary premium computed 
under clause (i) for a month in 2024 increased 
by 6 percent; or 
‘‘(II) the base beneficiary premium computed 
under paragraph (2) for a month in 2025 that 
would have applied if this paragraph had not been 
enacted. 
‘‘(iii) 2026.—The base beneficiary premium for a 
month in 2026 shall be equal to the lesser of— 
‘‘(I) the base beneficiary premium computed 
under clause (ii) for a month in 2025 increased 
by 6 percent; or 
‘‘(II) the base beneficiary premium computed 
under paragraph (2) for a month in 2026 that 
would have applied if this paragraph had not been 
enacted. 
‘‘(iv) 2027.—The base beneficiary premium for a 
month in 2027 shall be equal to the lesser of— 
‘‘(I) the base beneficiary premium computed 
under clause (iii) for a month in 2026 increased 
by 6 percent; or 
‘‘(II) the base beneficiary premium computed 
under paragraph (2) for a month in 2027 that 
would have applied if this paragraph had not been 
enacted. 
‘‘(v) 2028.—The base beneficiary premium for a 
month in 2028 shall be equal to the lesser of— 
‘‘(I) the base beneficiary premium computed 
under clause (iv) for a month in 2027 increased 
by 6 percent; or 
‘‘(II) the base beneficiary premium computed 
under paragraph (2) for a month in 2028 that 
would have applied if this paragraph had not been 
enacted.
H. R. 5376—73 
‘‘(vi) 2029.—The base beneficiary premium for a 
month in 2029 shall be equal to the lesser of— 
‘‘(I) the base beneficiary premium computed 
under clause (v) for a month in 2028 increased 
by 6 percent; or 
‘‘(II) the base beneficiary premium computed 
under paragraph (2) for a month in 2029 that 
would have applied if this paragraph had not been 
enacted. 
‘‘(B) CLARIFICATION REGARDING 2030 AND SUBSEQUENT 
YEARS.—The base beneficiary premium for a month in 2030 
or a subsequent year shall be computed under paragraph 
(2) without regard to this paragraph.’’; and 
(B) in subsection (b)(3)(A)(ii), by striking ‘‘subsection 
(a)(2)’’ and inserting ‘‘paragraph (2) or (8) of subsection 
(a) (as applicable)’’. 
(2) ADJUSTMENT TO BENEFICIARY PREMIUM PERCENTAGE FOR 
2030
AND
SUBSEQUENT
YEARS.—Section 1860D–13(a) of the 
Social Security Act (42 U.S.C. 1395w–113(a)), as amended by 
paragraph (1), is amended— 
(A) in paragraph (3)(A), by inserting ‘‘(or, for 2030 
and each subsequent year, the percent specified under para-
graph (9))’’ after ‘‘25.5 percent’’; and 
(B) by adding at the end the following new paragraph: 
‘‘(9) PERCENT SPECIFIED.— 
‘‘(A) IN
GENERAL.—Subject to subparagraph (B), for 
purposes of paragraph (3)(A), the percent specified under 
this paragraph for 2030 and each subsequent year is the 
percent that the Secretary determines is necessary to 
ensure that the base beneficiary premium computed under 
paragraph (2) for a month in 2030 is equal to the lesser 
of— 
‘‘(i) the base beneficiary premium computed under 
paragraph (8)(A)(vi) for a month in 2029 increased 
by 6 percent; or 
‘‘(ii) the base beneficiary premium computed under 
paragraph (2) for a month in 2030 that would have 
applied if this paragraph had not been enacted. 
‘‘(B) FLOOR.—The percent specified under subpara-
graph (A) may not be less than 20 percent.’’. 
(3) CONFORMING AMENDMENTS.— 
(A) Section 1854(b)(2)(B) of the Social Security Act 
42 U.S.C. 1395w–24(b)(2)(B)) is amended by striking ‘‘sec-
tion 1860D–13(a)(2)’’ and inserting ‘‘paragraph (2) or (8) 
(as applicable) of section 1860D–13(a)’’. 
(B) Section 1860D–11(g)(6) of the Social Security Act 
(42 U.S.C. 1395w–111(g)(6)) is amended by inserting ‘‘(or, 
for 2030 and each subsequent year, the percent specified 
under section 1860D–13(a)(9))’’ after ‘‘25.5 percent’’. 
(C) Section 1860D–13(a)(7)(B)(i) of the Social Security 
Act (42 U.S.C. 1395w–113(a)(7)(B)(i)) is amended— 
(i) in subclause (I), by inserting ‘‘(or, for 2030 and 
each subsequent year, the percent specified under para-
graph (9))’’ after ‘‘25.5 percent’’; and 
(ii) in subclause (II), by inserting ‘‘(or, for 2030 
and each subsequent year, the percent specified under 
paragraph (9))’’ after ‘‘25.5 percent’’.
H. R. 5376—74 
(D) Section 1860D–15(a) of the Social Security Act 
(42 U.S.C. 1395w–115(a)) is amended— 
(i) in the matter preceding paragraph (1), by 
inserting ‘‘(or, for each of 2024 through 2029, the per-
cent applicable as a result of the application of section 
1860D–13(a)(8), or, for 2030 and each subsequent year, 
100 percent minus the percent specified under section 
1860D–13(a)(9))’’ after ‘‘74.5 percent’’; and 
(ii) in paragraph (1)(B), by striking ‘‘paragraph 
(2) of section 1860D–13(a)’’ and inserting ‘‘paragraph 
(2) or (8) of section 1860D–13(a) (as applicable)’’. 
(e) CONFORMING AMENDMENTS.— 
(1) Section 1860D–2 of the Social Security Act (42 U.S.C. 
1395w–102) is amended— 
(A) in subsection (a)(2)(A)(i)(I), by striking ‘‘, or an 
increase in the initial’’ and inserting ‘‘or, for a year pre-
ceding 2025, an increase in the initial’’; 
(B) in subsection (c)(1)(C)— 
(i) in the subparagraph heading, by striking ‘‘AT 
INITIAL COVERAGE LIMIT’’; and 
(ii) by inserting ‘‘for a year preceding 2025 or the 
annual out-of-pocket threshold specified in subsection 
(b)(4)(B) for the year for 2025 and each subsequent 
year’’ after ‘‘subsection (b)(3) for the year’’ each place 
it appears; and 
(C) in subsection (d)(1)(A), by striking ‘‘or an initial’’ 
and inserting ‘‘or, for a year preceding 2025, an initial’’. 
(2) Section 1860D–4(a)(4)(B)(i) of the Social Security Act 
(42 U.S.C. 1395w–104(a)(4)(B)(i)) is amended by striking ‘‘the 
initial’’ and inserting ‘‘for a year preceding 2025, the initial’’. 
(3) Section 1860D–14(a) of the Social Security Act (42 
U.S.C. 1395w–114(a)) is amended— 
(A) in paragraph (1)— 
(i) in subparagraph (C), by striking ‘‘The continu-
ation’’ and inserting ‘‘For a year preceding 2025, the 
continuation’’; 
(ii) in subparagraph (D)(iii), by striking ‘‘1860D– 
2(b)(4)(A)(i)(I)’’ 
and 
inserting 
‘‘1860D– 
2(b)(4)(A)(i)(I)(aa)’’; and 
(iii) in subparagraph (E), by striking ‘‘The elimi-
nation’’ and inserting ‘‘For a year preceding 2024, the 
elimination’’; and 
(B) 
in 
paragraph 
(2)(E), 
by 
striking 
‘‘1860D– 
2(b)(4)(A)(i)(I)’’ and inserting ‘‘1860D–2(b)(4)(A)(i)(I)(aa)’’. 
(4) Section 1860D–21(d)(7) of the Social Security Act (42 
U.S.C. 1395w–131(d)(7)) is amended by striking ‘‘section 
1860D–2(b)(4)(B)(i)’’ and inserting ‘‘section 1860D–2(b)(4)(C)(i)’’. 
(5) Section 1860D–22(a)(2)(A) of the Social Security Act 
(42 U.S.C. 1395w–132(a)(2)(A)) is amended— 
(A) by striking ‘‘the value of any discount’’ and 
inserting the following: ‘‘the value of— 
‘‘(i) for years prior to 2025, any discount’’; 
(B) in clause (i), as inserted by subparagraph (A) of 
this paragraph, by striking the period at the end and 
inserting ‘‘; and’’; and 
(C) by adding at the end the following new clause:
H. R. 5376—75 
‘‘(ii) for 2025 and each subsequent year, any dis-
count provided pursuant to section 1860D–14C.’’. 
(6) Section 1860D–41(a)(6) of the Social Security Act (42 
U.S.C. 1395w–151(a)(6)) is amended— 
(A) by inserting ‘‘for a year before 2025’’ after ‘‘1860D– 
2(b)(3)’’; and 
(B) by inserting ‘‘for such year’’ before the period. 
(7) Section 1860D–43 of the Social Security Act (42 U.S.C. 
1395w–153) is amended— 
(A) in subsection (a)— 
(i) by striking paragraph (1) and inserting the 
following: 
‘‘(1) participate in— 
‘‘(A) for 2011 through 2024, the Medicare coverage 
gap discount program under section 1860D–14A; and 
‘‘(B) for 2025 and each subsequent year, the manufac-
turer discount program under section 1860D–14C;’’; 
(ii) by striking paragraph (2) and inserting the 
following: 
‘‘(2) have entered into and have in effect— 
‘‘(A) for 2011 through 2024, an agreement described 
in subsection (b) of section 1860D–14A with the Secretary; 
and 
‘‘(B) for 2025 and each subsequent year, an agreement 
described in subsection (b) of section 1860D–14C with the 
Secretary; and’’; and 
(iii) in paragraph (3), by striking ‘‘such section’’ 
and inserting ‘‘section 1860D–14A’’; and 
(B) by striking subsection (b) and inserting the fol-
lowing: 
‘‘(b) EFFECTIVE DATE.—Paragraphs (1)(A), (2)(A), and (3) of 
subsection (a) shall apply to covered part D drugs dispensed under 
this part on or after January 1, 2011, and before January 1, 2025, 
and paragraphs (1)(B) and (2)(B) of such subsection shall apply 
to covered part D drugs dispensed under this part on or after 
January 1, 2025.’’. 
(8) Section 1927 of the Social Security Act (42 U.S.C. 1396r– 
8) is amended— 
(A) in subsection (c)(1)(C)(i)(VI), by inserting before 
the period at the end the following: ‘‘or under the manufac-
turer discount program under section 1860D–14C’’; and 
(B) in subsection (k)(1)(B)(i)(V), by inserting before the 
period at the end the following: ‘‘or under section 1860D– 
14C’’. 
(f) IMPLEMENTATION FOR 2024 THROUGH 2026.—The Secretary 
shall implement this section, including the amendments made by 
this section, for 2024, 2025, and 2026 by program instruction or 
other forms of program guidance. 
(g) FUNDING.—In addition to amounts otherwise available, there 
are appropriated to the Centers for Medicare & Medicaid Services, 
out of any money in the Treasury not otherwise appropriated, 
$341,000,000 for fiscal year 2022, including $20,000,000 and 
$65,000,000 to carry out the provisions of, including the amend-
ments made by, this section in fiscal years 2022 and 2023, respec-
tively, and $32,000,000 to carry out the provisions of, including 
the amendments made by, this section in each of fiscal years 2024 
through 2031, to remain available until expended.
H. R. 5376—76 
SEC. 11202. MAXIMUM MONTHLY CAP ON COST-SHARING PAYMENTS 
UNDER PRESCRIPTION DRUG PLANS AND MA–PD PLANS. 
(a) IN GENERAL.—Section 1860D–2(b) of the Social Security 
Act (42 U.S.C. 1395w–102(b)) is amended— 
(1) in paragraph (2)— 
(A) in subparagraph (A), by striking ‘‘and (D)’’ and 
inserting ‘‘, (D), and (E)’’; and 
(B) by adding at the end the following new subpara-
graph: 
‘‘(E) MAXIMUM MONTHLY CAP ON COST-SHARING PAY-
MENTS.— 
‘‘(i) IN GENERAL.—For plan years beginning on or 
after January 1, 2025, each PDP sponsor offering a 
prescription drug plan and each MA organization 
offering an MA–PD plan shall provide to any enrollee 
of such plan, including an enrollee who is a subsidy 
eligible individual (as defined in paragraph (3) of sec-
tion 1860D–14(a)), the option to elect with respect to 
a plan year to pay cost-sharing under the plan in 
monthly amounts that are capped in accordance with 
this subparagraph. 
‘‘(ii) DETERMINATION OF MAXIMUM MONTHLY CAP.— 
For each month in the plan year for which an enrollee 
in a prescription drug plan or an MA–PD plan has 
made an election pursuant to clause (i), the PDP 
sponsor or MA organization shall determine a max-
imum monthly cap (as defined in clause (iv)) for such 
enrollee. 
‘‘(iii) BENEFICIARY
MONTHLY
PAYMENTS.—With 
respect to an enrollee who has made an election pursu-
ant to clause (i), for each month described in clause 
(ii), the PDP sponsor or MA organization shall bill 
such enrollee an amount (not to exceed the maximum 
monthly cap) for the out-of-pocket costs of such enrollee 
in such month. 
‘‘(iv) MAXIMUM
MONTHLY
CAP
DEFINED.—In this 
subparagraph, the term ‘maximum monthly cap’ 
means, with respect to an enrollee— 
‘‘(I) for the first month for which the enrollee 
has made an election pursuant to clause (i), an 
amount determined by calculating— 
‘‘(aa) the annual out-of-pocket threshold 
specified in paragraph (4)(B) minus the 
incurred costs of the enrollee as described in 
paragraph (4)(C); divided by 
‘‘(bb) the number of months remaining in 
the plan year; and 
‘‘(II) for a subsequent month, an amount deter-
mined by calculating— 
‘‘(aa) the sum of any remaining out-of- 
pocket costs owed by the enrollee from a pre-
vious month that have not yet been billed 
to the enrollee and any additional out-of- 
pocket costs incurred by the enrollee; divided 
by 
‘‘(bb) the number of months remaining in 
the plan year.
H. R. 5376—77 
‘‘(v) ADDITIONAL
REQUIREMENTS.—The following 
requirements shall apply with respect to the option 
to make an election pursuant to clause (i) under this 
subparagraph: 
‘‘(I) SECRETARIAL RESPONSIBILITIES.—The Sec-
retary shall provide information to part D eligible 
individuals on the option to make such election 
through educational materials, including through 
the notices provided under section 1804(a). 
‘‘(II) TIMING OF ELECTION.—An enrollee in a 
prescription drug plan or an MA–PD plan may 
make such an election— 
‘‘(aa) prior to the beginning of the plan 
year; or 
‘‘(bb) in any month during the plan year. 
‘‘(III) PDP
SPONSOR
AND
MA
ORGANIZATION 
RESPONSIBILITIES.—Each PDP sponsor offering a 
prescription drug plan or MA organization offering 
an MA–PD plan— 
‘‘(aa) may not limit the option for an 
enrollee to make such an election to certain 
covered part D drugs; 
‘‘(bb) shall, prior to the plan year, notify 
prospective enrollees of the option to make 
such an election in promotional materials; 
‘‘(cc) shall include information on such 
option in enrollee educational materials; 
‘‘(dd) shall have in place a mechanism to 
notify a pharmacy during the plan year when 
an enrollee incurs out-of-pocket costs with 
respect to covered part D drugs that make 
it likely the enrollee may benefit from making 
such an election; 
‘‘(ee) shall provide that a pharmacy, after 
receiving a notification described in item (dd) 
with respect to an enrollee, informs the 
enrollee of such notification; 
‘‘(ff) shall ensure that such an election 
by an enrollee has no effect on the amount 
paid to pharmacies (or the timing of such pay-
ments) with respect to covered part D drugs 
dispensed to the enrollee; and 
‘‘(gg) shall have in place a financial rec-
onciliation process to correct inaccuracies in 
payments made by an enrollee under this 
subparagraph with respect to covered part D 
drugs during the plan year. 
‘‘(IV) FAILURE TO PAY AMOUNT BILLED.—If an 
enrollee fails to pay the amount billed for a month 
as required under this subparagraph— 
‘‘(aa) the election of the enrollee pursuant 
to clause (i) shall be terminated and the 
enrollee shall pay the cost-sharing otherwise 
applicable for any covered part D drugs subse-
quently dispensed to the enrollee up to the 
annual out-of-pocket threshold specified in 
paragraph (4)(B); and
H. R. 5376—78 
‘‘(bb) the PDP sponsor or MA organization 
may preclude the enrollee from making an 
election pursuant to clause (i) in a subsequent 
plan year. 
‘‘(V) CLARIFICATION
REGARDING
PAST
DUE 
AMOUNTS.—Nothing in this subparagraph shall be 
construed as prohibiting a PDP sponsor or an MA 
organization from billing an enrollee for an amount 
owed under this subparagraph. 
‘‘(VI) TREATMENT OF UNSETTLED BALANCES.— 
Any unsettled balances with respect to amounts 
owed under this subparagraph shall be treated 
as plan losses and the Secretary shall not be liable 
for any such balances outside of those assumed 
as losses estimated in plan bids.’’; and 
(2) in paragraph (4)— 
(A) in subparagraph (C), by striking ‘‘subparagraph 
(E)’’ and inserting ‘‘subparagraph (E) or subparagraph (F)’’; 
and 
(B) by adding at the end the following new subpara-
graph: 
‘‘(F) INCLUSION
OF
COSTS
PAID
UNDER
MAXIMUM 
MONTHLY CAP OPTION.—In applying subparagraph (A), with 
respect to an enrollee who has made an election pursuant 
to clause (i) of paragraph (2)(E), costs shall be treated 
as incurred if such costs are paid by a PDP sponsor or 
an MA organization under the option provided under such 
paragraph.’’. 
(b) APPLICATION
TO ALTERNATIVE PRESCRIPTION DRUG COV-
ERAGE.—Section 1860D–2(c) of the Social Security Act (42 U.S.C. 
1395w–102(c)) is amended by adding at the end the following new 
paragraph: 
‘‘(4) SAME MAXIMUM MONTHLY CAP ON COST-SHARING.—The 
maximum monthly cap on cost-sharing payments shall apply 
to coverage with respect to an enrollee who has made an 
election pursuant to clause (i) of subsection (b)(2)(E) under 
the option provided under such subsection.’’. 
(c) IMPLEMENTATION FOR 2025.—The Secretary shall implement 
this section, including the amendments made by this section, for 
2025 by program instruction or other forms of program guidance. 
(d) FUNDING.—In addition to amounts otherwise available, 
there are appropriated to the Centers for Medicare & Medicaid 
Services, out of any money in the Treasury not otherwise appro-
priated, $10,000,000 for fiscal year 2023, to remain available until 
expended, to carry out the provisions of, including the amendments 
made by, this section.
H. R. 5376—79 
PART 4—CONTINUED DELAY OF IMPLEMENTA-
TION 
OF 
PRESCRIPTION 
DRUG 
REBATE 
RULE 
SEC. 11301. EXTENSION OF MORATORIUM ON IMPLEMENTATION OF 
RULE RELATING TO ELIMINATING THE ANTI-KICKBACK 
STATUTE SAFE HARBOR PROTECTION FOR PRESCRIP-
TION DRUG REBATES. 
The Secretary of Health and Human Services shall not, prior 
to January 1, 2032, implement, administer, or enforce the provisions 
of the final rule published by the Office of the Inspector General 
of the Department of Health and Human Services on November 
30, 2020, and titled ‘‘Fraud and Abuse; Removal of Safe Harbor 
Protection for Rebates Involving Prescription Pharmaceuticals and 
Creation of New Safe Harbor Protection for Certain Point-of-Sale 
Reductions in Price on Prescription Pharmaceuticals and Certain 
Pharmacy Benefit Manager Service Fees’’ (85 Fed. Reg. 76666). 
PART 5—MISCELLANEOUS 
SEC. 11401. COVERAGE OF ADULT VACCINES RECOMMENDED BY THE 
ADVISORY COMMITTEE ON IMMUNIZATION PRACTICES 
UNDER MEDICARE PART D. 
(a) ENSURING TREATMENT OF COST-SHARING AND DEDUCTIBLE 
IS CONSISTENT WITH TREATMENT OF VACCINES UNDER MEDICARE 
PART B.—Section 1860D–2 of the Social Security Act (42 U.S.C. 
1395w–102), as amended by sections 11201 and 11202, is 
amended— 
(1) in subsection (b)— 
(A) in paragraph (1)(A), by striking ‘‘The coverage’’ 
and inserting ‘‘Subject to paragraph (8), the coverage’’; 
(B) in paragraph (2)— 
(i) in subparagraph (A), by inserting ‘‘and para-
graph (8)’’ after ‘‘and (E)’’; 
(ii) in subparagraph (C)(i), in the matter preceding 
subclause (I), by striking ‘‘paragraph (4)’’ and inserting 
‘‘paragraphs (4) and (8)’’; and 
(iii) in subparagraph (D)(i), in the matter preceding 
subclause (I), by striking ‘‘paragraph (4)’’ and inserting 
‘‘paragraphs (4) and (8)’’; 
(C) in paragraph (3)(A), in the matter preceding clause 
(i), by striking ‘‘and (4)’’ and inserting ‘‘(4), and (8)’’; 
(D) in paragraph (4)(A)(i), by striking ‘‘The coverage’’ 
and inserting ‘‘Subject to paragraph (8), the coverage’’; 
and 
(E) by adding at the end the following new paragraph: 
‘‘(8) TREATMENT OF COST-SHARING FOR ADULT VACCINES REC-
OMMENDED
BY
THE
ADVISORY
COMMITTEE
ON
IMMUNIZATION 
PRACTICES CONSISTENT WITH TREATMENT OF VACCINES UNDER 
PART B.— 
‘‘(A) IN GENERAL.—For plan years beginning on or after 
January 1, 2023, with respect to an adult vaccine rec-
ommended by the Advisory Committee on Immunization 
Practices (as defined in subparagraph (B))— 
‘‘(i) the deductible under paragraph (1) shall not 
apply; and
H. R. 5376—80 
‘‘(ii) there shall be no coinsurance or other cost- 
sharing under this part with respect to such vaccine. 
‘‘(B) ADULT VACCINES RECOMMENDED BY THE ADVISORY 
COMMITTEE ON IMMUNIZATION PRACTICES.—For purposes of 
this paragraph, the term ‘adult vaccine recommended by 
the Advisory Committee on Immunization Practices’ means 
a covered part D drug that is a vaccine licensed under 
section 351 of the Public Health Service Act for use by 
adult populations and administered in accordance with rec-
ommendations of the Advisory Committee on Immunization 
Practices of the Centers for Disease Control and Preven-
tion.’’; and 
(2) in subsection (c), by adding at the end the following 
new paragraph: 
‘‘(5) TREATMENT OF COST-SHARING FOR ADULT VACCINES REC-
OMMENDED
BY
THE
ADVISORY
COMMITTEE
ON
IMMUNIZATION 
PRACTICES.—The coverage is in accordance with subsection 
(b)(8).’’. 
(b) CONFORMING AMENDMENTS
TO COST-SHARING
FOR LOW- 
INCOME INDIVIDUALS.—Section 1860D–14(a) of the Social Security 
Act (42 U.S.C. 1395w–114(a)), as amended by section 11201, is 
amended— 
(1) in paragraph (1)(D), in each of clauses (ii) and (iii), 
by striking ‘‘In the case’’ and inserting ‘‘Subject to paragraph 
(6), in the case’’; 
(2) in paragraph (2)— 
(A) in subparagraph (B), by striking ‘‘A reduction’’ and 
inserting ‘‘Subject to section 1860D–2(b)(8), a reduction’’; 
(B) in subparagraph (D), by striking ‘‘The substitution’’ 
and inserting ‘‘Subject to paragraph (6), the substitution’’; 
and 
(C) in subparagraph (E), by striking ‘‘subsection (c)’’ 
and inserting ‘‘paragraph (6) of this subsection and sub-
section (c)’’; and 
(3) by adding at the end the following new paragraph: 
‘‘(6) NO APPLICATION OF COST-SHARING OR DEDUCTIBLE FOR 
ADULT VACCINES RECOMMENDED BY THE ADVISORY COMMITTEE 
ON
IMMUNIZATION
PRACTICES.—For plan years beginning on 
or after January 1, 2023, with respect to an adult vaccine 
recommended by the Advisory Committee on Immunization 
Practices (as defined in section 1860D–2(b)(8)(B))— 
‘‘(A) the deductible under section 1860D–2(b)(1) shall 
not apply; and 
‘‘(B) there shall be no cost-sharing under this section 
with respect to such vaccine.’’. 
(c) TEMPORARY RETROSPECTIVE SUBSIDY.— 
(1) IN GENERAL.—Section 1860D–15 of the Social Security 
Act (42 U.S.C. 1395w–115) is amended by adding at the end 
the following new subsection: 
‘‘(h) TEMPORARY RETROSPECTIVE SUBSIDY FOR REDUCTION IN 
COST-SHARING
AND
DEDUCTIBLE
FOR
ADULT
VACCINES
REC-
OMMENDED BY THE ADVISORY COMMITTEE ON IMMUNIZATION PRAC-
TICES DURING 2023.— 
‘‘(1) IN GENERAL.—In addition to amounts otherwise pay-
able under this section to a PDP sponsor of a prescription 
drug plan or an MA organization offering an MA–PD plan, 
for plan year 2023, the Secretary shall provide the PDP sponsor
H. R. 5376—81 
or MA organization offering the plan subsidies in an amount 
equal to the aggregate reduction in cost-sharing and deductible 
by reason of the application of section 1860D–2(b)(8) for individ-
uals under the plan during the year. 
‘‘(2) TIMING.—The Secretary shall provide a subsidy under 
paragraph (1), as applicable, not later than 18 months following 
the end of the applicable plan year.’’. 
(2) TREATMENT
AS
INCURRED
COSTS.—Section 1860D– 
2(b)(4)(C)(iii)(I) of the Social Security Act (42 U.S.C. 1395w– 
102(b)(4)(C)(iii)(I)), as amended by section 11201(a)(3)(C), is 
amended— 
(A) in item (cc), by striking ‘‘or’’ at the end; and 
(B) by adding at the end the following new item: 
‘‘(dd) under section 1860D–15(h); or’’. 
(d) RULE OF CONSTRUCTION.—Nothing in this section shall be 
construed as limiting coverage under part D of title XVIII of the 
Social Security Act for vaccines that are not recommended by the 
Advisory Committee on Immunization Practices. 
(e) IMPLEMENTATION FOR 2023 THROUGH 2025.—The Secretary 
shall implement this section, including the amendments made by 
this section, for 2023, 2024, and 2025, by program instruction 
or other forms of program guidance. 
SEC. 11402. PAYMENT FOR BIOSIMILAR BIOLOGICAL PRODUCTS 
DURING INITIAL PERIOD. 
Section 1847A(c)(4) of the Social Security Act (42 U.S.C. 1395w– 
3a(c)(4)) is amended— 
(1) in each of subparagraphs (A) and (B), by redesignating 
clauses (i) and (ii) as subclauses (I) and (II), respectively, and 
moving such subclauses 2 ems to the right; 
(2) by redesignating subparagraphs (A) and (B) as clauses 
(i) and (ii) and moving such clauses 2 ems to the right; 
(3) by striking ‘‘UNAVAILABLE.—In the case’’ and inserting 
‘‘UNAVAILABLE.— 
‘‘(A) IN GENERAL.—Subject to subparagraph (B), in the 
case’’; and 
(4) by adding at the end the following new subparagraph: 
‘‘(B) LIMITATION ON PAYMENT AMOUNT FOR BIOSIMILAR 
BIOLOGICAL PRODUCTS DURING INITIAL PERIOD.—In the case 
of a biosimilar biological product furnished on or after 
July 1, 2024, during the initial period described in subpara-
graph (A) with respect to the biosimilar biological product, 
the amount payable under this section for the biosimilar 
biological product is the lesser of the following: 
‘‘(i) The amount determined under clause (ii) of 
such 
subparagraph 
for 
the 
biosimilar 
biological 
product. 
‘‘(ii) The amount determined under subsection 
(b)(1)(B) for the reference biological product.’’. 
SEC. 11403. TEMPORARY INCREASE IN MEDICARE PART B PAYMENT 
FOR CERTAIN BIOSIMILAR BIOLOGICAL PRODUCTS. 
Section 1847A(b)(8) of the Social Security Act (42 U.S.C. 1395w– 
3a(b)(8)) is amended— 
(1) by redesignating subparagraphs (A) and (B) as clauses 
(i) and (ii), respectively, and moving the margin of each such 
redesignated clause 2 ems to the right;
H. R. 5376—82 
(2) by striking ‘‘PRODUCT.—The amount’’ and inserting the 
following: ‘‘PRODUCT.— 
‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 
amount’’; and 
(3) by adding at the end the following new subparagraph: 
‘‘(B) TEMPORARY PAYMENT INCREASE.— 
‘‘(i) IN GENERAL.—In the case of a qualifying bio-
similar biological product that is furnished during the 
applicable 5-year period for such product, the amount 
specified in this paragraph for such product with 
respect to such period is the sum determined under 
subparagraph (A), except that clause (ii) of such 
subparagraph shall be applied by substituting ‘8 per-
cent’ for ‘6 percent’. 
‘‘(ii) APPLICABLE 5-YEAR PERIOD.—For purposes of 
clause (i), the applicable 5-year period for a qualifying 
biosimilar biological product is— 
‘‘(I) in the case of such a product for which 
payment was made under this paragraph as of 
September 30, 2022, the 5-year period beginning 
on October 1, 2022; and 
‘‘(II) in the case of such a product for which 
payment is first made under this paragraph during 
a calendar quarter during the period beginning 
October 1, 2022, and ending December 31, 2027, 
the 5-year period beginning on the first day of 
such calendar quarter during which such payment 
is first made. 
‘‘(iii) QUALIFYING BIOSIMILAR BIOLOGICAL PRODUCT 
DEFINED.—For purposes of this subparagraph, the term 
‘qualifying biosimilar biological product’ means a bio-
similar biological product described in paragraph (1)(C) 
with respect to which— 
‘‘(I) in the case of a product described in clause 
(ii)(I), the average sales price under paragraph 
(8)(A)(i) for a calendar quarter during the 5-year 
period described in such clause is not more than 
the average sales price under paragraph (4)(A) 
for such quarter for the reference biological 
product; and 
‘‘(II) in the case of a product described in 
clause (ii)(II), the average sales price under para-
graph (8)(A)(i) for a calendar quarter during the 
5-year period described in such clause is not more 
than the average sales price under paragraph 
(4)(A) for such quarter for the reference biological 
product.’’. 
SEC. 11404. EXPANDING ELIGIBILITY FOR LOW-INCOME SUBSIDIES 
UNDER PART D OF THE MEDICARE PROGRAM. 
Section 1860D–14(a) of the Social Security Act (42 U.S.C. 
1395w–114(a)), as amended by sections 11201 and 11401, is 
amended— 
(1) in the subsection heading, by striking ‘‘INDIVIDUALS’’ 
and all that follows through ‘‘LINE’’ and inserting ‘‘CERTAIN 
INDIVIDUALS’’; 
(2) in paragraph (1)—
H. R. 5376—83 
(A) by striking the paragraph heading and inserting 
‘‘INDIVIDUALS WITH CERTAIN LOW INCOMES’’; and 
(B) in the matter preceding subparagraph (A)— 
(i) by inserting ‘‘(or, with respect to a plan year 
beginning on or after January 1, 2024, 150 percent)’’ 
after ‘‘135 percent’’; and 
(ii) by inserting ‘‘(or, with respect to a plan year 
beginning on or after January 1, 2024, paragraph 
(3)(E))’’ after ‘‘the resources requirement described in 
paragraph (3)(D)’’; and 
(3) in paragraph (2)— 
(A) by striking the paragraph heading and inserting 
‘‘OTHER LOW-INCOME INDIVIDUALS’’; and 
(B) in the matter preceding subparagraph (A), by 
striking ‘‘In the case of a subsidy’’ and inserting ‘‘With 
respect to a plan year beginning before January 1, 2024, 
in the case of a subsidy’’. 
SEC. 11405. IMPROVING ACCESS TO ADULT VACCINES UNDER MED-
ICAID AND CHIP. 
(a) MEDICAID.— 
(1) REQUIRING COVERAGE OF ADULT VACCINATIONS.— 
(A) IN GENERAL.—Section 1902(a)(10)(A) of the Social 
Security Act (42 U.S.C. 1396a(a)(10)(A)) is amended in 
the matter preceding clause (i) by inserting ‘‘(13)(B),’’ after 
‘‘(5),’’. 
(B) MEDICALLY
NEEDY.—Section 1902(a)(10)(C)(iv) of 
such Act (42 U.S.C. 1396a(a)(10)(C)(iv)) is amended by 
inserting ‘‘, (13)(B),’’ after ‘‘(5)’’. 
(2) NO COST SHARING FOR VACCINATIONS.— 
(A) 
GENERAL
COST-SHARING
LIMITATIONS.—Section 
1916 of the Social Security Act (42 U.S.C. 1396o) is 
amended— 
(i) in subsection (a)(2)— 
(I) in subparagraph (G), by inserting a comma 
after ‘‘State plan’’; 
(II) in subparagraph (H), by striking ‘‘; or’’ 
and inserting a comma; 
(III) in subparagraph (I), by striking ‘‘; and’’ 
and inserting ‘‘, or’’; and 
(IV) by adding at the end the following new 
subparagraph: 
‘‘(J) vaccines described in section 1905(a)(13)(B) and 
the administration of such vaccines; and’’; and 
(ii) in subsection (b)(2)— 
(I) in subparagraph (G), by inserting a comma 
after ‘‘State plan’’; 
(II) in subparagraph (H), by striking ‘‘; or’’ 
and inserting a comma; 
(III) in subparagraph (I), by striking ‘‘; and’’ 
and inserting ‘‘, or’’; and 
(IV) by adding at the end the following new 
subparagraph: 
‘‘(J) vaccines described in section 1905(a)(13)(B) and 
the administration of such vaccines; and’’. 
(B) APPLICATION TO ALTERNATIVE COST SHARING.—Sec-
tion 1916A(b)(3)(B) of the Social Security Act (42 U.S.C.
H. R. 5376—84 
1396o–1(b)(3)(B)) is amended by adding at the end the 
following new clause: 
‘‘(xiv) Vaccines described in section 1905(a)(13)(B) 
and the administration of such vaccines.’’. 
(3) INCREASED
FMAP
FOR
ADULT
VACCINES
AND
THEIR 
ADMINISTRATION.—Section 1905(b) of the Social Security Act 
(42 U.S.C. 1396d(b)) is amended— 
(A) by striking ‘‘and (5)’’ and inserting ‘‘(5)’’; 
(B) by striking ‘‘services and vaccines described in sub-
paragraphs (A) and (B) of subsection (a)(13), and prohibits 
cost-sharing for such services and vaccines’’ and inserting 
‘‘services described in subsection (a)(13)(A), and prohibits 
cost-sharing for such services’’; 
(C) by striking ‘‘medical assistance for such services 
and vaccines’’ and inserting ‘‘medical assistance for such 
services’’; and 
(D) by inserting ‘‘, and (6) during the first 8 fiscal 
quarters beginning on or after the effective date of this 
clause, in the case of a State which, as of the date of 
enactment of the Act titled ‘An Act to provide for reconcili-
ation pursuant to title II of S. Con. Res. 14’, provides 
medical assistance for vaccines described in subsection 
(a)(13)(B) and their administration and prohibits cost- 
sharing for such vaccines, the Federal medical assistance 
percentage, as determined under this subsection and sub-
section (y), shall be increased by 1 percentage point with 
respect to medical assistance for such vaccines and their 
administration’’ before the first period. 
(b) CHIP.— 
(1) REQUIRING COVERAGE OF ADULT VACCINATIONS.—Section 
2103(c) of the Social Security Act (42 U.S.C. 1397cc(c)) is 
amended by adding at the end the following paragraph: 
‘‘(12) REQUIRED
COVERAGE
OF
APPROVED, RECOMMENDED 
ADULT
VACCINES
AND
THEIR
ADMINISTRATION.—Regardless of 
the type of coverage elected by a State under subsection (a), 
if the State child health plan or a waiver of such plan provides 
child health assistance or pregnancy-related assistance (as 
defined in section 2112) to an individual who is 19 years of 
age or older, such assistance shall include coverage of vaccines 
described in section 1905(a)(13)(B) and their administration.’’. 
(2) 
NO
COST-SHARING
FOR
VACCINATIONS.—Section 
2103(e)(2) of such Act (42 U.S.C. 1397cc(e)(2)) is amended by 
inserting ‘‘vaccines described in subsection (c)(12) (and the 
administration of such vaccines),’’ after ‘‘in vitro diagnostic 
products described in subsection (c)(10) (and administration 
of such products),’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
take effect on the 1st day of the 1st fiscal quarter that begins 
on or after the date that is 1 year after the date of enactment 
of this Act and shall apply to expenditures made under a State 
plan or waiver of such plan under title XIX of the Social Security 
Act (42 U.S.C. 1396 through 1396w–6) or under a State child 
health plan or waiver of such plan under title XXI of such Act 
(42 U.S.C. 1397aa through 1397mm) on or after such effective 
date.
H. R. 5376—85 
SEC. 11406. APPROPRIATE COST-SHARING FOR COVERED INSULIN 
PRODUCTS UNDER MEDICARE PART D. 
(a) IN GENERAL.—Section 1860D–2 of the Social Security Act 
(42 U.S.C. 1395w–102), as amended by sections 11201, 11202, and 
11401, is amended— 
(1) in subsection (b)— 
(A) in paragraph (1)(A), by striking ‘‘paragraph (8)’’ 
and inserting ‘‘paragraphs (8) and (9)’’; 
(B) in paragraph (2)— 
(i) in subparagraph (A), by striking ‘‘paragraph 
(8)’’ and inserting ‘‘paragraphs (8) and (9)’’; 
(ii) in subparagraph (C)(i), in the matter preceding 
subclause (I), by striking ‘‘and (8)’’ and inserting ‘‘, 
(8), and (9)’’; and 
(iii) in subparagraph (D)(i), in the matter preceding 
subclause (I), by striking ‘‘and (8)’’ and inserting ‘‘, 
(8), and (9)’’; 
(C) in paragraph (3)(A), in the matter preceding clause 
(i), by striking ‘‘and (8)’’ and inserting ‘‘(8), and (9)’’; 
(D) in paragraph (4)(A)(i), by striking ‘‘paragraph (8)’’ 
and inserting ‘‘paragraphs (8) and (9)’’; and 
(E) by adding at the end the following new paragraph: 
‘‘(9) TREATMENT OF COST-SHARING FOR COVERED INSULIN 
PRODUCTS.— 
‘‘(A) NO APPLICATION OF DEDUCTIBLE.—For plan year 
2023 and subsequent plan years, the deductible under para-
graph (1) shall not apply with respect to any covered insulin 
product. 
‘‘(B) APPLICATION OF COST-SHARING.— 
‘‘(i) PLAN YEARS 2023 AND 2024.—For plan years 
2023 and 2024, the coverage provides benefits for any 
covered insulin product, regardless of whether an indi-
vidual has reached the initial coverage limit under 
paragraph (3) or the out-of-pocket threshold under 
paragraph (4), with cost-sharing for a month’s supply 
that does not exceed the applicable copayment amount. 
‘‘(ii) PLAN
YEAR
2025
AND
SUBSEQUENT
PLAN 
YEARS.—For a plan year beginning on or after January 
1, 2025, the coverage provides benefits for any covered 
insulin product, prior to an individual reaching the 
out-of-pocket threshold under paragraph (4), with cost- 
sharing for a month’s supply that does not exceed 
the applicable copayment amount. 
‘‘(C) COVERED INSULIN PRODUCT.—In this paragraph, 
the term ‘covered insulin product’ means an insulin product 
that is a covered part D drug covered under the prescription 
drug plan or MA–PD plan that is approved under section 
505 of the Federal Food, Drug, and Cosmetic Act or licensed 
under section 351 of the Public Health Service Act and 
marketed pursuant to such approval or licensure, including 
any covered insulin product that has been deemed to be 
licensed under section 351 of the Public Health Service 
Act pursuant to section 7002(e)(4) of the Biologics Price 
Competition and Innovation Act of 2009 and marketed 
pursuant to such section. 
‘‘(D) APPLICABLE COPAYMENT AMOUNT.—In this para-
graph, the term ‘applicable copayment amount’ means, with
H. R. 5376—86 
respect to a covered insulin product under a prescription 
drug plan or an MA–PD plan dispensed— 
‘‘(i) during plan years 2023, 2024, and 2025, $35; 
and 
‘‘(ii) during plan year 2026 and each subsequent 
plan year, the lesser of— 
‘‘(I) $35; 
‘‘(II) an amount equal to 25 percent of the 
maximum fair price established for the covered 
insulin product in accordance with part E of title 
XI; or 
‘‘(III) an amount equal to 25 percent of the 
negotiated price of the covered insulin product 
under the prescription drug plan or MA–PD plan. 
‘‘(E) SPECIAL RULE FOR FIRST 3 MONTHS OF 2023.—With 
respect to a month’s supply of a covered insulin product 
dispensed during the period beginning on January 1, 2023, 
and ending on March 31, 2023, a PDP sponsor offering 
a prescription drug plan or an MA organization offering 
an MA–PD plan shall reimburse an enrollee within 30 
days for any cost-sharing paid by such enrollee that exceeds 
the cost-sharing applied by the prescription drug plan or 
MA–PD plan under subparagraph (B)(i) at the point-of- 
sale for such month’s supply.’’; and 
(2) in subsection (c), by adding at the end the following 
new paragraph: 
‘‘(6) TREATMENT OF COST-SHARING FOR COVERED INSULIN 
PRODUCTS.—The coverage is provided in accordance with sub-
section (b)(9).’’. 
(b) CONFORMING AMENDMENTS
TO COST-SHARING
FOR LOW- 
INCOME INDIVIDUALS.—Section 1860D–14(a) of the Social Security 
Act (42 U.S.C. 1395w–114(a)), as amended by sections 11201, 11401, 
and 11404, is amended— 
(1) in paragraph (1)— 
(A) in subparagraph (D)(iii), by adding at the end the 
following new sentence: ‘‘For plan year 2023 and subse-
quent plan years, the copayment amount applicable under 
the preceding sentence to a month’s supply of a covered 
insulin product (as defined in section 1860D–2(b)(9)(C)) 
dispensed to the individual may not exceed the applicable 
copayment amount for the product under the prescription 
drug plan or MA–PD plan in which the individual is 
enrolled.’’; and 
(B) in subparagraph (E), by inserting the following 
before the period at the end: ‘‘or under section 1860D– 
2(b)(9) in the case of a covered insulin product (as defined 
in subparagraph (C) of such section)’’; and 
(2) in paragraph (2)— 
(A) in subparagraph (B), by striking ‘‘section 1860D– 
2(b)(8)’’ and inserting ‘‘paragraphs (8) and (9) of section 
1860D–2(b)’’; 
(B) in subparagraph (D), by adding at the end the 
following new sentence: ‘‘For plan year 2023, the amount 
of the coinsurance applicable under the preceding sentence 
to a month’s supply of a covered insulin product (as defined 
in section 1860D–2(b)(9)(C)) dispensed to the individual 
may not exceed the applicable copayment amount for the
H. R. 5376—87 
product under the prescription drug plan or MA–PD plan 
in which the individual is enrolled.’’; and 
(C) in subparagraph (E), by adding at the end the 
following new sentence: ‘‘For plan year 2023, the amount 
of the copayment or coinsurance applicable under the pre-
ceding sentence to a month’s supply of a covered insulin 
product (as defined in section 1860D–2(b)(9)(C)) dispensed 
to the individual may not exceed the applicable copayment 
amount for the product under the prescription drug plan 
or MA–PD plan in which the individual is enrolled.’’. 
(c) TEMPORARY RETROSPECTIVE SUBSIDY.—Section 1860D–15(h) 
of the Social Security Act (42 U.S.C. 1395w–115(h)), as added 
by section 11401(c), is amended— 
(1) in the subsection heading, by inserting ‘‘AND INSULIN’’ 
after ‘‘PRACTICES’’; and 
(2) in paragraph (1), by striking ‘‘section 1860D–2(b)(8)’’ 
and inserting ‘‘paragraph (8) or (9) of section 1860D–2(b)’’. 
(d) IMPLEMENTATION FOR 2023 THROUGH 2025.—The Secretary 
shall implement this section for plan years 2023, 2024, and 2025 
by program instruction or other forms of program guidance. 
(e) FUNDING.—In addition to amounts otherwise available, there 
is appropriated to the Centers for Medicare & Medicaid Services, 
out of any money in the Treasury not otherwise appropriated, 
$1,500,000 for fiscal year 2022, to remain available until expended, 
to carry out the provisions of, including the amendments made 
by, this section. 
SEC. 11407. LIMITATION ON MONTHLY COINSURANCE AND ADJUST-
MENTS TO SUPPLIER PAYMENT UNDER MEDICARE PART 
B FOR INSULIN FURNISHED THROUGH DURABLE MED-
ICAL EQUIPMENT. 
(a) WAIVER
OF DEDUCTIBLE.—The first sentence of section 
1833(b) of the Social Security Act (42 U.S.C. 1395l(b)) is amended— 
(1) by striking ‘‘and (12)’’ and inserting ‘‘(12)’’; and 
(2) by inserting before the period the following: ‘‘, and 
(13) such deductible shall not apply with respect to insulin 
furnished on or after July 1, 2023, through an item of durable 
medical equipment covered under section 1861(n).’’. 
(b) COINSURANCE.— 
(1) IN GENERAL.—Section 1833(a)(1)(S) of the Social Secu-
rity Act (42 U.S.C. 1395l(a)(1)(S)) is amended— 
(A) by inserting ‘‘(i) except as provided in clause (ii),’’ 
after ‘‘(S)’’; and 
(B) by inserting after ‘‘or 1847B),’’ the following: ‘‘and 
(ii) with respect to insulin furnished on or after July 1, 
2023, through an item of durable medical equipment cov-
ered under section 1861(n), the amounts paid shall be, 
subject to the fourth sentence of this subsection, 80 percent 
of the payment amount established under section 1847A 
(or section 1847B, if applicable) for such insulin,’’. 
(2) ADJUSTMENT TO SUPPLIER PAYMENTS; LIMITATION ON 
MONTHLY COINSURANCE.—Section 1833(a) of the Social Security 
Act (42 U.S.C. 1395l(a)) is amended, in the flush matter at 
the end, by adding at the end the following new sentence: 
‘‘The Secretary shall make such adjustments as may be nec-
essary to the amounts paid as specified under paragraph 
(1)(S)(ii) for insulin furnished on or after July 1, 2023, through
H. R. 5376—88 
an item of durable medical equipment covered under section 
1861(n), such that the amount of coinsurance payable by an 
individual enrolled under this part for a month’s supply of 
such insulin does not exceed $35.’’. 
(c) IMPLEMENTATION.—The Secretary of Health and Human 
Services shall implement this section for 2023 by program instruc-
tion or other forms of program guidance. 
SEC. 11408. SAFE HARBOR FOR ABSENCE OF DEDUCTIBLE FOR 
INSULIN. 
(a) IN GENERAL.—Paragraph (2) of section 223(c) of the Internal 
Revenue Code of 1986 is amended by adding at the end the following 
new subparagraph: 
‘‘(G) SAFE HARBOR FOR ABSENCE OF DEDUCTIBLE FOR 
CERTAIN INSULIN PRODUCTS.— 
‘‘(i) IN GENERAL.—A plan shall not fail to be treated 
as a high deductible health plan by reason of failing 
to have a deductible for selected insulin products. 
‘‘(ii) SELECTED INSULIN PRODUCTS.—For purposes 
of this subparagraph— 
‘‘(I) IN GENERAL.—The term ‘selected insulin 
products’ means any dosage form (such as vial, 
pump, or inhaler dosage forms) of any different 
type (such as rapid-acting, short-acting, inter-
mediate-acting, long-acting, ultra long-acting, and 
premixed) of insulin. 
‘‘(II) INSULIN.—The term ‘insulin’ means 
insulin that is licensed under subsection (a) or 
(k) of section 351 of the Public Health Service 
Act (42 U.S.C. 262) and continues to be marketed 
under such section, including any insulin product 
that has been deemed to be licensed under section 
351(a) of such Act pursuant to section 7002(e)(4) 
of the Biologics Price Competition and Innovation 
Act of 2009 (Public Law 111–148) and continues 
to be marketed pursuant to such licensure.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to plan years beginning after December 31, 2022. 
Subtitle C—Affordable Care Act Subsidies 
SEC. 12001. IMPROVE AFFORDABILITY AND REDUCE PREMIUM COSTS 
OF HEALTH INSURANCE FOR CONSUMERS. 
(a) IN GENERAL.—Clause (iii) of section 36B(b)(3)(A) of the 
Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘in 2021 or 2022’’ and inserting ‘‘after 
December 31, 2020, and before January 1, 2026’’, and 
(2) by striking ‘‘2021 AND 2022’’ in the heading and inserting 
‘‘2021 THROUGH 2025’’. 
(b) EXTENSION THROUGH 2025 OF RULE TO ALLOW CREDIT TO 
TAXPAYERS WHOSE HOUSEHOLD INCOME EXCEEDS 400 PERCENT OF 
THE POVERTY LINE.—Section 36B(c)(1)(E) of the Internal Revenue 
Code of 1986 is amended— 
(1) by striking ‘‘in 2021 or 2022’’ and inserting ‘‘after 
December 31, 2020, and before January 1, 2026’’, and
H. R. 5376—89 
(2) by striking ‘‘2021 AND 2022’’ in the heading and inserting 
‘‘2021 THROUGH 2025’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2022. 
Subtitle D—Energy Security 
SEC. 13001. AMENDMENT OF 1986 CODE. 
Except as otherwise expressly provided, whenever in this sub-
title an amendment or repeal is expressed in terms of an amend-
ment to, or repeal of, a section or other provision, the reference 
shall be considered to be made to a section or other provision 
of the Internal Revenue Code of 1986. 
PART 1—CLEAN ELECTRICITY AND REDUCING 
CARBON EMISSIONS 
SEC. 13101. EXTENSION AND MODIFICATION OF CREDIT FOR ELEC-
TRICITY 
PRODUCED 
FROM 
CERTAIN 
RENEWABLE 
RESOURCES. 
(a) IN GENERAL.—The following provisions of section 45(d) are 
each amended by striking ‘‘January 1, 2022’’ each place it appears 
and inserting ‘‘January 1, 2025’’: 
(1) Paragraph (2)(A). 
(2) Paragraph (3)(A). 
(3) Paragraph (6). 
(4) Paragraph (7). 
(5) Paragraph (9). 
(6) Paragraph (11)(B). 
(b) BASE CREDIT AMOUNT.—Section 45 is amended— 
(1) in subsection (a)(1), by striking ‘‘1.5 cents’’ and inserting 
‘‘0.3 cents’’, and 
(2) in subsection (b)(2), by striking ‘‘1.5 cent’’ and inserting 
‘‘0.3 cent’’. 
(c) APPLICATION OF EXTENSION TO GEOTHERMAL AND SOLAR.— 
Section 45(d)(4) is amended by striking ‘‘and which’’ and all that 
follows through ‘‘January 1, 2022’’ and inserting ‘‘and the construc-
tion of which begins before January 1, 2025’’. 
(d) EXTENSION OF ELECTION TO TREAT QUALIFIED FACILITIES 
AS
ENERGY
PROPERTY.—Section 48(a)(5)(C)(ii) is amended by 
striking ‘‘January 1, 2022’’ and inserting ‘‘January 1, 2025’’. 
(e) APPLICATION OF EXTENSION TO WIND FACILITIES.— 
(1) IN GENERAL.—Section 45(d)(1) is amended by striking 
‘‘January 1, 2022’’ and inserting ‘‘January 1, 2025’’. 
(2) APPLICATION OF PHASEOUT PERCENTAGE.— 
(A) RENEWABLE
ELECTRICITY
PRODUCTION
CREDIT.— 
Section 45(b)(5) is amended by inserting ‘‘which is placed 
in service before January 1, 2022’’ after ‘‘using wind to 
produce electricity’’. 
(B) ENERGY CREDIT.—Section 48(a)(5)(E) is amended 
by inserting ‘‘placed in service before January 1, 2022, 
and’’ before ‘‘treated as energy property’’. 
(3) QUALIFIED OFFSHORE WIND FACILITIES UNDER ENERGY 
CREDIT.—Section 48(a)(5)(F)(i) is amended by striking ‘‘offshore 
wind facility’’ and all that follows and inserting the following: 
‘‘offshore wind facility, subparagraph (E) shall not apply.’’.
H. R. 5376—90 
(f) WAGE AND APPRENTICESHIP REQUIREMENTS.—Section 45(b) 
is amended by adding at the end the following new paragraphs: 
‘‘(6) INCREASED
CREDIT
AMOUNT
FOR
QUALIFIED
FACILI-
TIES.— 
‘‘(A) IN GENERAL.—In the case of any qualified facility 
which satisfies the requirements of subparagraph (B), the 
amount of the credit determined under subsection (a) 
(determined after the application of paragraphs (1) through 
(5) and without regard to this paragraph) shall be equal 
to such amount multiplied by 5. 
‘‘(B) QUALIFIED FACILITY REQUIREMENTS.—A qualified 
facility meets the requirements of this subparagraph if 
it is one of the following: 
‘‘(i) A facility with a maximum net output of less 
than 1 megawatt (as measured in alternating current). 
‘‘(ii) A facility the construction of which begins 
prior to the date that is 60 days after the Secretary 
publishes guidance with respect to the requirements 
of paragraphs (7)(A) and (8). 
‘‘(iii) A facility which satisfies the requirements 
of paragraphs (7)(A) and (8). 
‘‘(7) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements described in this 
subparagraph with respect to any qualified facility are 
that the taxpayer shall ensure that any laborers and 
mechanics employed by the taxpayer or any contractor 
or subcontractor in— 
‘‘(i) the construction of such facility, and 
‘‘(ii) with respect to any taxable year, for any por-
tion of such taxable year which is within the period 
described in subsection (a)(2)(A)(ii), the alteration or 
repair of such facility, 
shall be paid wages at rates not less than the prevailing 
rates for construction, alteration, or repair of a similar 
character in the locality in which such facility is located 
as most recently determined by the Secretary of Labor, 
in accordance with subchapter IV of chapter 31 of title 
40, United States Code. For purposes of determining an 
increased credit amount under paragraph (6)(A) for a tax-
able year, the requirement under clause (ii) is applied 
to such taxable year in which the alteration or repair 
of the qualified facility occurs.’’ 
‘‘(B) CORRECTION AND PENALTY RELATED TO FAILURE 
TO SATISFY WAGE REQUIREMENTS.— 
‘‘(i) IN
GENERAL.—In the case of any taxpayer 
which fails to satisfy the requirement under subpara-
graph (A) with respect to the construction of any quali-
fied facility or with respect to the alteration or repair 
of a facility in any year during the period described 
in subparagraph (A)(ii), such taxpayer shall be deemed 
to have satisfied such requirement under such subpara-
graph with respect to such facility for any year if, 
with respect to any laborer or mechanic who was paid 
wages at a rate below the rate described in such 
subparagraph for any period during such year, such 
taxpayer—
H. R. 5376—91 
‘‘(I) makes payment to such laborer or 
mechanic in an amount equal to the sum of— 
‘‘(aa) an amount equal to the difference 
between— 
‘‘(AA) the amount of wages paid to 
such laborer or mechanic during such 
period, and 
‘‘(BB) the amount of wages required 
to be paid to such laborer or mechanic 
pursuant to such subparagraph during 
such period, plus 
‘‘(bb) interest on the amount determined 
under item (aa) at the underpayment rate 
established under section 6621 (determined by 
substituting ‘6 percentage points’ for ‘3 
percentage points’ in subsection (a)(2) of such 
section) for the period described in such item, 
and 
‘‘(II) makes payment to the Secretary of a pen-
alty in an amount equal to the product of— 
‘‘(aa) $5,000, multiplied by 
‘‘(bb) the total number of laborers and 
mechanics who were paid wages at a rate 
below the rate described in subparagraph (A) 
for any period during such year. 
‘‘(ii) DEFICIENCY PROCEDURES NOT TO APPLY.—Sub-
chapter B of chapter 63 (relating to deficiency proce-
dures for income, estate, gift, and certain excise taxes) 
shall not apply with respect to the assessment or collec-
tion of any penalty imposed by this paragraph. 
‘‘(iii) INTENTIONAL
DISREGARD.—If the Secretary 
determines that any failure described in clause (i) is 
due to intentional disregard of the requirements under 
subparagraph (A), such clause shall be applied— 
‘‘(I) in subclause (I), by substituting ‘three 
times the sum’ for ‘the sum’, and 
‘‘(II) in subclause (II), by substituting ‘$10,000’ 
for ‘5,000’ in item (aa) thereof. 
‘‘(iv) LIMITATION ON PERIOD FOR PAYMENT.—Pursu-
ant to rules issued by the Secretary, in the case of 
a final determination by the Secretary with respect 
to any failure by the taxpayer to satisfy the require-
ment under subparagraph (A), subparagraph (B)(i) 
shall not apply unless the payments described in sub-
clauses (I) and (II) of such subparagraph are made 
by the taxpayer on or before the date which is 180 
days after the date of such determination. 
‘‘(8) APPRENTICESHIP
REQUIREMENTS.—The requirements 
described in this paragraph with respect to the construction 
of any qualified facility are as follows: 
‘‘(A) LABOR HOURS.— 
‘‘(i) PERCENTAGE
OF
TOTAL
LABOR
HOURS.—Tax-
payers shall ensure that, with respect to the construc-
tion of any qualified facility, not less than the 
applicable percentage of the total labor hours of the 
construction, alteration, or repair work (including such 
work performed by any contractor or subcontractor)
H. R. 5376—92 
with respect to such facility shall, subject to subpara-
graph (B), be performed by qualified apprentices. 
‘‘(ii) APPLICABLE
PERCENTAGE.—For purposes of 
clause (i), the applicable percentage shall be— 
‘‘(I) in the case of a qualified facility the 
construction of which begins before January 1, 
2023, 10 percent, 
‘‘(II) in the case of a qualified facility the 
construction of which begins after December 31, 
2022, and before January 1, 2024, 12.5 percent, 
and 
‘‘(III) in the case of a qualified facility the 
construction of which begins after December 31, 
2023, 15 percent. 
‘‘(B) APPRENTICE
TO
JOURNEYWORKER
RATIO.—The 
requirement under subparagraph (A)(i) shall be subject 
to 
any 
applicable 
requirements 
for 
apprentice-to- 
journeyworker ratios of the Department of Labor or the 
applicable State apprenticeship agency. 
‘‘(C) PARTICIPATION.—Each taxpayer, contractor, or 
subcontractor who employs 4 or more individuals to perform 
construction, alteration, or repair work with respect to 
the construction of a qualified facility shall employ 1 or 
more qualified apprentices to perform such work. 
‘‘(D) EXCEPTION.— 
‘‘(i) IN GENERAL.—A taxpayer shall not be treated 
as failing to satisfy the requirements of this paragraph 
if such taxpayer— 
‘‘(I) satisfies the requirements described in 
clause (ii), or 
‘‘(II) subject to clause (iii), in the case of any 
failure by the taxpayer to satisfy the requirement 
under subparagraphs (A) and (C) with respect to 
the construction, alteration, or repair work on any 
qualified facility to which subclause (I) does not 
apply, makes payment to the Secretary of a penalty 
in an amount equal to the product of— 
‘‘(aa) $50, multiplied by 
‘‘(bb) the total labor hours for which the 
requirement described in such subparagraph 
was not satisfied with respect to the construc-
tion, alteration, or repair work on such quali-
fied facility. 
‘‘(ii) GOOD FAITH EFFORT.—For purposes of clause 
(i), a taxpayer shall be deemed to have satisfied the 
requirements under this paragraph with respect to 
a qualified facility if such taxpayer has requested quali-
fied apprentices from a registered apprenticeship pro-
gram, as defined in section 3131(e)(3)(B), and— 
‘‘(I) such request has been denied, provided 
that such denial is not the result of a refusal 
by the taxpayer or any contractors or subcontrac-
tors engaged in the performance of construction, 
alteration, or repair work with respect to such 
qualified facility to comply with the established 
standards and requirements of the registered 
apprenticeship program, or
H. R. 5376—93 
‘‘(II) the registered apprenticeship program 
fails to respond to such request within 5 business 
days after the date on which such registered 
apprenticeship program received such request. 
‘‘(iii) INTENTIONAL
DISREGARD.—If the Secretary 
determines that any failure described in subclause 
(i)(II) is due to intentional disregard of the require-
ments under subparagraphs (A) and (C), subclause 
(i)(II) shall be applied by substituting ‘$500’ for ‘$50’ 
in item (aa) thereof. 
‘‘(E) DEFINITIONS.—For purposes of this paragraph— 
‘‘(i) LABOR HOURS.—The term ‘labor hours’— 
‘‘(I) means the total number of hours devoted 
to the performance of construction, alteration, or 
repair work by any individual employed by the 
taxpayer or by any contractor or subcontractor, 
and 
‘‘(II) excludes any hours worked by— 
‘‘(aa) foremen, 
‘‘(bb) superintendents, 
‘‘(cc) owners, or 
‘‘(dd) persons employed in a bona fide 
executive, 
administrative, 
or 
professional 
capacity (within the meaning of those terms 
in part 541 of title 29, Code of Federal Regula-
tions). 
‘‘(ii) QUALIFIED APPRENTICE.—The term ‘qualified 
apprentice’ means an individual who is employed by 
the taxpayer or by any contractor or subcontractor 
and who is participating in a registered apprenticeship 
program, as defined in section 3131(e)(3)(B). 
‘‘(9) REGULATIONS
AND
GUIDANCE.—The Secretary shall 
issue such regulations or other guidance as the Secretary deter-
mines necessary to carry out the purposes of this subsection, 
including regulations or other guidance which provides for 
requirements for recordkeeping or information reporting for 
purposes of administering the requirements of this subsection.’’. 
(g) DOMESTIC
CONTENT, PHASEOUT, AND
ENERGY
COMMU-
NITIES.—Section 45(b), as amended by subsection (f), is amended— 
(1) by redesignating paragraph (9) as paragraph (12), and 
(2) by inserting after paragraph (8) the following: 
‘‘(9) DOMESTIC CONTENT BONUS CREDIT AMOUNT.— 
‘‘(A) IN GENERAL.—In the case of any qualified facility 
which satisfies the requirement under subparagraph (B)(i), 
the amount of the credit determined under subsection (a) 
(determined after the application of paragraphs (1) through 
(8)) shall be increased by an amount equal to 10 percent 
of the amount so determined. 
‘‘(B) REQUIREMENT.— 
‘‘(i) IN GENERAL.—The requirement described in 
this clause is satisfied with respect to any qualified 
facility if the taxpayer certifies to the Secretary (at 
such time, and in such form and manner, as the Sec-
retary may prescribe) that any steel, iron, or manufac-
tured product which is a component of such facility 
(upon completion of construction) was produced in the
H. R. 5376—94 
United States (as determined under section 661 of 
title 49, Code of Federal Regulations). 
‘‘(ii) STEEL AND IRON.—In the case of steel or iron, 
clause (i) shall be applied in a manner consistent with 
section 661.5 of title 49, Code of Federal Regulations. 
‘‘(iii) MANUFACTURED PRODUCT.—For purposes of 
clause (i), the manufactured products which are compo-
nents of a qualified facility upon completion of 
construction shall be deemed to have been produced 
in the United States if not less than the adjusted 
percentage (as determined under subparagraph (C)) 
of the total costs of all such manufactured products 
of such facility are attributable to manufactured prod-
ucts (including components) which are mined, pro-
duced, or manufactured in the United States. 
‘‘(C) ADJUSTED PERCENTAGE.— 
‘‘(i) IN GENERAL.—Subject to subclause (ii), for pur-
poses of subparagraph (B)(iii), the adjusted percentage 
shall be 40 percent. 
‘‘(ii) OFFSHORE WIND FACILITY.—For purposes of 
subparagraph (B)(iii), in the case of a qualified facility 
which is an offshore wind facility, the adjusted percent-
age shall be 20 percent. 
‘‘(10) PHASEOUT FOR ELECTIVE PAYMENT.— 
‘‘(A) IN GENERAL.—In the case of a taxpayer making 
an election under section 6417 with respect to a credit 
under this section, the amount of such credit shall be 
replaced with— 
‘‘(i) the value of such credit (determined without 
regard to this paragraph), multiplied by 
‘‘(ii) the applicable percentage. 
‘‘(B) 100 PERCENT APPLICABLE PERCENTAGE FOR CER-
TAIN QUALIFIED FACILITIES.—In the case of any qualified 
facility— 
‘‘(i) which satisfies the requirements under para-
graph (9)(B), or 
‘‘(ii) with a maximum net output of less than 1 
megawatt (as measured in alternating current), 
the applicable percentage shall be 100 percent. 
‘‘(C) PHASED DOMESTIC CONTENT REQUIREMENT.—Sub-
ject to subparagraph (D), in the case of any qualified facility 
which is not described in subparagraph (B), the applicable 
percentage shall be— 
‘‘(i) if construction of such facility began before 
January 1, 2024, 100 percent, and 
‘‘(ii) if construction of such facility began in cal-
endar year 2024, 90 percent. 
‘‘(D) EXCEPTION.— 
‘‘(i) IN GENERAL.—For purposes of this paragraph, 
the Secretary shall provide exceptions to the require-
ments under this paragraph if— 
‘‘(I) the inclusion of steel, iron, or manufac-
tured products which are produced in the United 
States increases the overall costs of construction 
of qualified facilities by more than 25 percent, 
or
H. R. 5376—95 
‘‘(II) relevant steel, iron, or manufactured 
products are not produced in the United States 
in sufficient and reasonably available quantities 
or of a satisfactory quality. 
‘‘(ii) APPLICABLE
PERCENTAGE.—In any case in 
which the Secretary provides an exception pursuant 
to clause (i), the applicable percentage shall be 100 
percent. 
‘‘(11) SPECIAL RULE FOR QUALIFIED FACILITY LOCATED IN 
ENERGY COMMUNITY.— 
‘‘(A) IN GENERAL.—In the case of a qualified facility 
which is located in an energy community, the credit deter-
mined under subsection (a) (determined after the applica-
tion of paragraphs (1) through (10), without the application 
of paragraph (9)) shall be increased by an amount equal 
to 10 percent of the amount so determined. 
‘‘(B) ENERGY COMMUNITY.—For purposes of this para-
graph, the term ‘energy community’ means— 
‘‘(i) a brownfield site (as defined in subparagraphs 
(A), (B), and (D)(ii)(III) of section 101(39) of the Com-
prehensive Environmental Response, Compensation, 
and Liability Act of 1980 (42 U.S.C. 9601(39))), 
‘‘(ii) a metropolitan statistical area or non-metro-
politan statistical area which— 
‘‘(I) has (or, at any time during the period 
beginning after December 31, 2009, had) 0.17 per-
cent or greater direct employment or 25 percent 
or greater local tax revenues related to the extrac-
tion, processing, transport, or storage of coal, oil, 
or natural gas (as determined by the Secretary), 
and 
‘‘(II) has an unemployment rate at or above 
the national average unemployment rate for the 
previous year (as determined by the Secretary), 
or 
‘‘(iii) a census tract— 
‘‘(I) in which— 
‘‘(aa) after December 31, 1999, a coal mine 
has closed, or 
‘‘(bb) after December 31, 2009, a coal-fired 
electric generating unit has been retired, or 
‘‘(II) which is directly adjoining to any census 
tract described in subclause (I).’’. 
(h) CREDIT REDUCED FOR TAX-EXEMPT BONDS.—Section 45(b)(3) 
is amended to read as follows: 
‘‘(3) CREDIT REDUCED FOR TAX-EXEMPT BONDS.—The amount 
of the credit determined under subsection (a) with respect to 
any facility for any taxable year (determined after the applica-
tion of paragraphs (1) and (2)) shall be reduced by the amount 
which is the product of the amount so determined for such 
year and the lesser of 15 percent or a fraction— 
‘‘(A) the numerator of which is the sum, for the taxable 
year and all prior taxable years, of proceeds of an issue 
of any obligations the interest on which is exempt from 
tax under section 103 and which is used to provide 
financing for the qualified facility, and
H. R. 5376—96 
‘‘(B) the denominator of which is the aggregate amount 
of additions to the capital account for the qualified facility 
for the taxable year and all prior taxable years. 
The amounts under the preceding sentence for any taxable 
year shall be determined as of the close of the taxable year.’’. 
(i) ROUNDING ADJUSTMENT.— 
(1) IN GENERAL.—Section 45(b)(2) is amended by striking 
the second sentence and inserting the following: ‘‘If the 0.3 
cent amount as increased under the preceding sentence is not 
a multiple of 0.05 cent, such amount shall be rounded to the 
nearest multiple of 0.05 cent. In any other case, if an amount 
as increased under this paragraph is not a multiple of 0.1 
cent, such amount shall be rounded to the nearest multiple 
of 0.1 cent.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
45(b)(4)(A) 
is 
amended by striking ‘‘last sentence’’ and inserting ‘‘last two 
sentences’’. 
(j) HYDROPOWER.— 
(1) ELIMINATION OF CREDIT RATE REDUCTION FOR QUALIFIED 
HYDROELECTRIC PRODUCTION AND MARINE AND HYDROKINETIC 
RENEWABLE ENERGY.—Section 45(b)(4)(A), as amended by the 
preceding provisions of this section, is amended by striking 
‘‘(7), (9), or (11)’’ and inserting ‘‘or (7)’’. 
(2) MARINE AND HYDROKINETIC RENEWABLE ENERGY.—Sec-
tion 45 is amended— 
(A) in subsection (c)(10)(A)— 
(i) in clause (iii), by striking ‘‘or’’, 
(ii) in clause (iv), by striking the period at the 
end and inserting ‘‘, or’’ and 
(iii) by adding at the end the following: 
‘‘(v) pressurized water used in a pipeline (or similar 
man-made water conveyance) which is operated— 
‘‘(I) for the distribution of water for agricul-
tural, municipal, or industrial consumption, and 
‘‘(II) not primarily for the generation of elec-
tricity.’’, and 
(B) in subsection (d)(11)(A), by striking ‘‘150’’ and 
inserting ‘‘25’’. 
(k) EFFECTIVE DATES.— 
(1) IN
GENERAL.—Except as provided in paragraphs (2) 
and (3), the amendments made by this section shall apply 
to facilities placed in service after December 31, 2021. 
(2) CREDIT REDUCED FOR TAX-EXEMPT BONDS.—The amend-
ment made by subsection (h) shall apply to facilities the 
construction of which begins after the date of enactment of 
this Act. 
(3) DOMESTIC CONTENT, PHASEOUT, ENERGY COMMUNITIES, 
AND HYDROPOWER.—The amendments made by subsections (g) 
and (j) shall apply to facilities placed in service after December 
31, 2022. 
SEC. 13102. EXTENSION AND MODIFICATION OF ENERGY CREDIT. 
(a) EXTENSION OF CREDIT.—The following provisions of section 
48 are each amended by striking ‘‘January 1, 2024’’ each place 
it appears and inserting ‘‘January 1, 2025’’: 
(1) Subsection (a)(2)(A)(i)(II). 
(2) Subsection (a)(3)(A)(ii).
H. R. 5376—97 
(3) Subsection (c)(1)(D). 
(4) Subsection (c)(2)(D). 
(5) Subsection (c)(3)(A)(iv). 
(6) Subsection (c)(4)(C). 
(7) Subsection (c)(5)(D). 
(b) FURTHER EXTENSION
FOR CERTAIN ENERGY PROPERTY.— 
Section 48(a)(3)(A)(vii) is amended by striking ‘‘January 1, 2024’’ 
and inserting ‘‘January 1, 2035’’. 
(c) PHASEOUT OF CREDIT.—Section 48(a) is amended by striking 
paragraphs (6) and (7) and inserting the following new paragraph: 
‘‘(6) PHASEOUT
FOR
CERTAIN
ENERGY
PROPERTY.—In the 
case of any qualified fuel cell property, qualified small wind 
property, or energy property described in clause (i) or clause 
(ii) of paragraph (3)(A) the construction of which begins after 
December 31, 2019, and which is placed in service before 
January 1, 2022, the energy percentage determined under para-
graph (2) shall be equal to 26 percent.’’. 
(d) BASE ENERGY PERCENTAGE AMOUNT; PHASEOUT OF CERTAIN 
ENERGY PROPERTY.— 
(1) BASE ENERGY PERCENTAGE AMOUNT.—Section 48(a) is 
amended— 
(A) in paragraph (2)(A)— 
(i) in clause (i), by striking ‘‘30 percent’’ and 
inserting ‘‘6 percent’’, and 
(ii) in clause (ii), by striking ‘‘10 percent’’ and 
inserting ‘‘2 percent’’, and 
(B) in paragraph (5)(A)(ii), by striking ‘‘30 percent’’ 
and inserting ‘‘6 percent’’. 
(2) PHASEOUT
OF
CERTAIN
ENERGY
PROPERTY.—Section 
48(a), as amended by the preceding provisions of this Act, 
is amended by adding at the end the following new paragraph: 
‘‘(7) PHASEOUT
FOR
CERTAIN
ENERGY
PROPERTY.—In the 
case of any energy property described in clause (vii) of para-
graph (3)(A), the energy percentage determined under para-
graph (2) shall be equal to— 
‘‘(A) in the case of any property the construction of 
which begins before January 1, 2033, and which is placed 
in service after December 31, 2021, 6 percent, 
‘‘(B) in the case of any property the construction of 
which begins after December 31, 2032, and before January 
1, 2034, 5.2 percent, and 
‘‘(C) in the case of any property the construction of 
which begins after December 31, 2033, and before January 
1, 2035, 4.4 percent.’’. 
(e) 
PERCENT
CREDIT
FOR
GEOTHERMAL.—Section 
48(a)(2)(A)(i)(II) is amended by striking ‘‘paragraph (3)(A)(i)’’ and 
inserting ‘‘clause (i) or (iii) of paragraph (3)(A)’’. 
(f) ENERGY STORAGE TECHNOLOGIES; QUALIFIED BIOGAS PROP-
ERTY; MICROGRID CONTROLLERS; EXTENSION OF OTHER PROPERTY.— 
(1) IN GENERAL.—Section 48(a)(3)(A) is amended by striking 
‘‘or’’ at the end of clause (vii), and by adding at the end the 
following new clauses: 
‘‘(ix) energy storage technology, 
‘‘(x) qualified biogas property, or 
‘‘(xi) microgrid controllers,’’.
H. R. 5376—98 
(2) 
APPLICATION
OF
PERCENT
CREDIT.—Section 
48(a)(2)(A)(i) is amended by striking ‘‘and’’ at the end of sub-
clauses (IV) and (V) and adding at the end the following new 
subclauses: 
‘‘(VI) energy storage technology, 
‘‘(VII) qualified biogas property, 
‘‘(VIII) microgrid controllers, and 
‘‘(IX) energy property described in clauses (v) 
and (vii) of paragraph (3)(A), and’’. 
(3) DEFINITIONS.—Section 48(c) is amended by adding at 
the end the following new paragraphs: 
‘‘(6) ENERGY STORAGE TECHNOLOGY.— 
‘‘(A) IN GENERAL.—The term ‘energy storage technology’ 
means— 
‘‘(i) property (other than property primarily used 
in the transportation of goods or individuals and not 
for the production of electricity) which receives, stores, 
and delivers energy for conversion to electricity (or, 
in the case of hydrogen, which stores energy), and 
has a nameplate capacity of not less than 5 kilowatt 
hours, and 
‘‘(ii) thermal energy storage property. 
‘‘(B) MODIFICATIONS
OF
CERTAIN
PROPERTY.—In the 
case of any property which either— 
‘‘(i) was placed in service before the date of enact-
ment of this section and would be described in subpara-
graph (A)(i), except that such property has a capacity 
of less than 5 kilowatt hours and is modified in a 
manner that such property (after such modification) 
has a nameplate capacity of not less than 5 kilowatt 
hours, or 
‘‘(ii) is described in subparagraph (A)(i) and is 
modified in a manner that such property (after such 
modification) has an increase in nameplate capacity 
of not less than 5 kilowatt hours, 
such property shall be treated as described in subparagraph 
(A)(i) except that the basis of any existing property prior 
to such modification shall not be taken into account for 
purposes of this section. In the case of any property to 
which this subparagraph applies, subparagraph (D) shall 
be applied by substituting ‘modification’ for ‘construction’. 
‘‘(C) THERMAL ENERGY STORAGE PROPERTY.— 
‘‘(i) IN GENERAL.—Subject to clause (ii), for pur-
poses of this paragraph, the term ‘thermal energy stor-
age property’ means property comprising a system 
which— 
‘‘(I) is directly connected to a heating, ventila-
tion, or air conditioning system, 
‘‘(II) removes heat from, or adds heat to, a 
storage medium for subsequent use, and 
‘‘(III) provides energy for the heating or cooling 
of the interior of a residential or commercial 
building. 
‘‘(ii) EXCLUSION.—The term ‘thermal energy stor-
age property’ shall not include— 
‘‘(I) a swimming pool,
H. R. 5376—99 
‘‘(II) combined heat and power system prop-
erty, or 
‘‘(III) a building or its structural components. 
‘‘(D) TERMINATION.—The term ‘energy storage tech-
nology’ shall not include any property the construction 
of which begins after December 31, 2024. 
‘‘(7) QUALIFIED BIOGAS PROPERTY.— 
‘‘(A) IN GENERAL.—The term ‘qualified biogas property’ 
means property comprising a system which— 
‘‘(i) converts biomass (as defined in section 
45K(c)(3), as in effect on the date of enactment of 
this paragraph) into a gas which— 
‘‘(I) consists of not less than 52 percent 
methane by volume, or 
‘‘(II) is concentrated by such system into a 
gas which consists of not less than 52 percent 
methane, and 
‘‘(ii) captures such gas for sale or productive use, 
and not for disposal via combustion. 
‘‘(B) INCLUSION OF CLEANING AND CONDITIONING PROP-
ERTY.—The term ‘qualified biogas property’ includes any 
property which is part of such system which cleans or 
conditions such gas. 
‘‘(C) TERMINATION.—The term ‘qualified biogas prop-
erty’ shall not include any property the construction of 
which begins after December 31, 2024. 
‘‘(8) MICROGRID CONTROLLER.— 
‘‘(A) IN
GENERAL.—The term ‘microgrid controller’ 
means equipment which is— 
‘‘(i) part of a qualified microgrid, and 
‘‘(ii) designed and used to monitor and control the 
energy resources and loads on such microgrid. 
‘‘(B) 
QUALIFIED
MICROGRID.—The 
term 
‘qualified 
microgrid’ means an electrical system which— 
‘‘(i) includes equipment which is capable of gener-
ating not less than 4 kilowatts and not greater than 
20 megawatts of electricity, 
‘‘(ii) is capable of operating— 
‘‘(I) in connection with the electrical grid and 
as a single controllable entity with respect to such 
grid, and 
‘‘(II) independently (and disconnected) from 
such grid, and 
‘‘(iii) is not part of a bulk-power system (as defined 
in section 215 of the Federal Power Act (16 U.S.C. 
824o)). 
‘‘(C) TERMINATION.—The term ‘microgrid controller’ 
shall not include any property the construction of which 
begins after December 31, 2024.’’. 
(4) DENIAL OF DOUBLE BENEFIT FOR QUALIFIED BIOGAS PROP-
ERTY.—Section 45(e) is amended by adding at the end the 
following new paragraph: 
‘‘(12) COORDINATION WITH ENERGY CREDIT FOR QUALIFIED 
BIOGAS PROPERTY.—The term ‘qualified facility’ shall not include 
any facility which produces electricity from gas produced by 
qualified biogas property (as defined in section 48(c)(7)) if a
H. R. 5376—100 
credit is allowed under section 48 with respect to such property 
for the taxable year or any prior taxable year.’’. 
(5) PUBLIC
UTILITY
PROPERTY.—Paragraph (2) of section 
50(d) is amended— 
(A) by adding after the first sentence the following 
new sentence: ‘‘At the election of a taxpayer, this paragraph 
shall not apply to any energy storage technology (as defined 
in section 48(c)(6)), provided—’’, and 
(B) by adding the following new subparagraphs: 
‘‘(A) no election under this paragraph shall be per-
mitted if the making of such election is prohibited by 
a State or political subdivision thereof, by any agency or 
instrumentality of the United States, or by a public service 
or public utility commission or other similar body of any 
State or political subdivision that regulates public utilities 
as described in section 7701(a)(33)(A), 
‘‘(B) an election under this paragraph shall be made 
separately with respect to each energy storage technology 
by the due date (including extensions) of the Federal tax 
return for the taxable year in which the energy storage 
technology is placed in service by the taxpayer, and once 
made, may be revoked only with the consent of the Sec-
retary, and 
‘‘(C) an election shall not apply with respect to any 
energy storage technology if such energy storage technology 
has a maximum capacity equal to or less than 500 kilowatt 
hours.’’. 
(g) FUEL CELLS USING ELECTROMECHANICAL PROCESSES.— 
(1) IN GENERAL.—Section 48(c)(1) is amended— 
(A) in subparagraph (A)(i)— 
(i) by inserting ‘‘or electromechanical’’ after 
‘‘electrochemical’’, and 
(ii) by inserting ‘‘(1 kilowatt in the case of a fuel 
cell power plant with a linear generator assembly)’’ 
after ‘‘0.5 kilowatt’’, and 
(B) in subparagraph (C)— 
(i) by inserting ‘‘, or linear generator assembly,’’ 
after ‘‘a fuel cell stack assembly’’, and 
(ii) by inserting ‘‘or electromechanical’’ after 
‘‘electrochemical’’. 
(2) LINEAR
GENERATOR
ASSEMBLY
LIMITATION.—Section 
48(c)(1) is amended by redesignating subparagraph (D) as 
subparagraph (E) and by inserting after subparagraph (C) the 
following new subparagraph: 
‘‘(D) LINEAR GENERATOR ASSEMBLY.—The term ‘linear 
generator assembly’ does not include any assembly which 
contains rotating parts.’’. 
(h) DYNAMIC GLASS.—Section 48(a)(3)(A)(ii) is amended by 
inserting ‘‘, or electrochromic glass which uses electricity to change 
its light transmittance properties in order to heat or cool a struc-
ture,’’ after ‘‘sunlight’’. 
(i) COORDINATION WITH LOW INCOME HOUSING TAX CREDIT.— 
Paragraph (3) of section 50(c) is amended— 
(1) by striking ‘‘and’’ at the end of subparagraph (A), 
(2) by striking the period at the end of subparagraph (B) 
and inserting ‘‘, and’’, and 
(3) by adding at the end the following new subparagraph:
H. R. 5376—101 
‘‘(C) paragraph (1) shall not apply for purposes of deter-
mining eligible basis under section 42.’’. 
(j) INTERCONNECTION PROPERTY.—Section 48(a), as amended 
by the preceding provisions of this Act, is amended by adding 
at the end the following new paragraph: 
‘‘(8) INTERCONNECTION PROPERTY.— 
‘‘(A) IN
GENERAL.—For purposes of determining the 
credit under subsection (a), energy property shall include 
amounts paid or incurred by the taxpayer for qualified 
interconnection property in connection with the installation 
of energy property (as defined in paragraph (3)) which 
has a maximum net output of not greater than 5 megawatts 
(as measured in alternating current), to provide for the 
transmission or distribution of the electricity produced or 
stored by such property, and which are properly chargeable 
to the capital account of the taxpayer. 
‘‘(B) QUALIFIED
INTERCONNECTION
PROPERTY.—The 
term ‘qualified interconnection property’ means, with 
respect to an energy project which is not a microgrid con-
troller, any tangible property— 
‘‘(i) which is part of an addition, modification, or 
upgrade to a transmission or distribution system which 
is required at or beyond the point at which the energy 
project interconnects to such transmission or distribu-
tion system in order to accommodate such interconnec-
tion, 
‘‘(ii) either— 
‘‘(I) which is constructed, reconstructed, or 
erected by the taxpayer, or 
‘‘(II) for which the cost with respect to the 
construction, reconstruction, or erection of such 
property is paid or incurred by such taxpayer, 
and 
‘‘(iii) the original use of which, pursuant to an 
interconnection agreement, commences with a utility. 
‘‘(C) INTERCONNECTION AGREEMENT.—The term ‘inter-
connection agreement’ means an agreement with a utility 
for the purposes of interconnecting the energy property 
owned by such taxpayer to the transmission or distribution 
system of such utility. 
‘‘(D) UTILITY.—For purposes of this paragraph, the 
term ‘utility’ means the owner or operator of an electrical 
transmission or distribution system which is subject to 
the regulatory authority of a State or political subdivision 
thereof, any agency or instrumentality of the United States, 
a public service or public utility commission or other similar 
body of any State or political subdivision thereof, or the 
governing or ratemaking body of an electric cooperative. 
‘‘(E) SPECIAL RULE FOR INTERCONNECTION PROPERTY.— 
In the case of expenses paid or incurred for interconnection 
property, amounts otherwise chargeable to capital account 
with respect to such expenses shall be reduced under rules 
similar to the rules of section 50(c).’’. 
(k) ENERGY PROJECTS, WAGE REQUIREMENTS, AND APPRENTICE-
SHIP REQUIREMENTS.—Section 48(a), as amended by the preceding 
provisions of this Act, is amended by adding at the end the following 
new paragraphs:
H. R. 5376—102 
‘‘(9) INCREASED CREDIT AMOUNT FOR ENERGY PROJECTS.— 
‘‘(A) IN GENERAL.— 
‘‘(i) RULE.—In the case of any energy project which 
satisfies the requirements of subparagraph (B), the 
amount of the credit determined under this subsection 
(determined after the application of paragraphs (1) 
through (8) and without regard to this clause) shall 
be equal to such amount multiplied by 5. 
‘‘(ii) ENERGY PROJECT DEFINED.—For purposes of 
this subsection, the term ‘energy project’ means a 
project consisting of one or more energy properties 
that are part of a single project. 
‘‘(B) PROJECT
REQUIREMENTS.—A project meets the 
requirements of this subparagraph if it is one of the fol-
lowing: 
‘‘(i) A project with a maximum net output of less 
than 1 megawatt of electrical (as measured in alter-
nating current) or thermal energy. 
‘‘(ii) A project the construction of which begins 
before the date that is 60 days after the Secretary 
publishes guidance with respect to the requirements 
of paragraphs (10)(A) and (11). 
‘‘(iii) A project which satisfies the requirements 
of paragraphs (10)(A) and (11). 
‘‘(10) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements described in this 
subparagraph with respect to any energy project are that 
the taxpayer shall ensure that any laborers and mechanics 
employed by the taxpayer or any contractor or subcon-
tractor in— 
‘‘(i) the construction of such energy project, and 
‘‘(ii) for the 5-year period beginning on the date 
such project is originally placed in service, the alter-
ation or repair of such project, 
shall be paid wages at rates not less than the prevailing 
rates for construction, alteration, or repair of a similar 
character in the locality in which such project is located 
as most recently determined by the Secretary of Labor, 
in accordance with subchapter IV of chapter 31 of title 
40, United States Code. Subject to subparagraph (C), for 
purposes of any determination under paragraph (9)(A)(i) 
for the taxable year in which the energy project is placed 
in service, the taxpayer shall be deemed to satisfy the 
requirement under clause (ii) at the time such project is 
placed in service. 
‘‘(B) CORRECTION AND PENALTY RELATED TO FAILURE 
TO
SATISFY
WAGE
REQUIREMENTS.—Rules similar to the 
rules of section 45(b)(7)(B) shall apply. 
‘‘(C) RECAPTURE.—The Secretary shall, by regulations 
or other guidance, provide for recapturing the benefit of 
any increase in the credit allowed under this subsection 
by reason of this paragraph with respect to any project 
which does not satisfy the requirements under subpara-
graph (A) (after application of subparagraph (B)) for the 
period described in clause (ii) of subparagraph (A) (but 
which does not cease to be investment credit property 
within the meaning of section 50(a)). The period and
H. R. 5376—103 
percentage of such recapture shall be determined under 
rules similar to the rules of section 50(a). 
‘‘(11) APPRENTICESHIP REQUIREMENTS.—Rules similar to the 
rules of section 45(b)(8) shall apply.’’. 
(l) DOMESTIC CONTENT; PHASEOUT FOR ELECTIVE PAYMENT.— 
Section 48(a), as amended by the preceding provisions of this Act, 
is amended by adding at the end the following new paragraphs: 
‘‘(12) DOMESTIC CONTENT BONUS CREDIT AMOUNT.— 
‘‘(A) IN GENERAL.—In the case of any energy project 
which satisfies the requirement under subparagraph (B), 
for purposes of applying paragraph (2) with respect to 
such property, the energy percentage shall be increased 
by the applicable credit rate increase. 
‘‘(B) REQUIREMENT.—Rules similar to the rules of sec-
tion 45(b)(9)(B) shall apply. 
‘‘(C) APPLICABLE CREDIT RATE INCREASE.—For purposes 
of subparagraph (A), the applicable credit rate increase 
shall be— 
‘‘(i) in the case of an energy project which does 
not satisfy the requirements of paragraph (9)(B), 2 
percentage points, and 
‘‘(ii) in the case of an energy project which satisfies 
the requirements of paragraph (9)(B), 10 percentage 
points. 
‘‘(13) PHASEOUT FOR ELECTIVE PAYMENT.—In the case of 
a taxpayer making an election under section 6417 with respect 
to a credit under this section, rules similar to the rules of 
section 45(b)(10) shall apply.’’. 
(m) SPECIAL RULE FOR PROPERTY FINANCED BY TAX-EXEMPT 
BONDS.—Section 48(a)(4) is amended to read as follows: 
‘‘(4) SPECIAL RULE FOR PROPERTY FINANCED BY TAX-EXEMPT 
BONDS.—Rules similar to the rule under section 45(b)(3) shall 
apply for purposes of this section.’’. 
(n) TREATMENT
OF CERTAIN CONTRACTS INVOLVING ENERGY 
STORAGE.—Section 7701(e) is amended— 
(1) in paragraph (3)— 
(A) in subparagraph (A)(i), by striking ‘‘or’’ at the end 
of subclause (II), by striking ‘‘and’’ at the end of subclause 
(III) and inserting ‘‘or’’, and by adding at the end the 
following new subclause: 
‘‘(IV) the operation of a storage facility, and’’, 
and 
(B) by adding at the end the following new subpara-
graph: 
‘‘(F) STORAGE FACILITY.—For purposes of subparagraph 
(A), the term ‘storage facility’ means a facility which uses 
energy storage technology within the meaning of section 
48(c)(6).’’, and 
(2) in paragraph (4), by striking ‘‘or water treatment works 
facility’’ and inserting ‘‘water treatment works facility, or stor-
age facility’’. 
(o) INCREASE IN CREDIT RATE FOR ENERGY COMMUNITIES.— 
Section 48(a), as amended by the preceding provisions of this Act, 
is amended by adding at the end the following new paragraph: 
‘‘(14) INCREASE
IN
CREDIT
RATE
FOR
ENERGY
COMMU-
NITIES.—
H. R. 5376—104 
‘‘(A) IN GENERAL.—In the case of any energy project 
that is placed in service within an energy community (as 
defined in section 45(b)(11)(B), as applied by substituting 
‘energy project’ for ‘qualified facility’ each place it appears), 
for purposes of applying paragraph (2) with respect to 
energy property which is part of such project, the energy 
percentage shall be increased by the applicable credit rate 
increase. 
‘‘(B) APPLICABLE CREDIT RATE INCREASE.—For purposes 
of subparagraph (A), the applicable credit rate increase 
shall be equal to— 
‘‘(i) in the case of any energy project which does 
not satisfy the requirements of paragraph (9)(B), 2 
percentage points, and 
‘‘(ii) in the case of any energy project which satis-
fies the requirements of paragraph (9)(B), 10 percent-
age points.’’. 
(p) REGULATIONS.—Section 48(a), as amended by the preceding 
provisions of this Act, is amended by adding at the end the following 
new paragraph: 
‘‘(15) REGULATIONS AND GUIDANCE.—The Secretary shall 
issue such regulations or other guidance as the Secretary deter-
mines necessary to carry out the purposes of this subsection, 
including regulations or other guidance which provides for 
requirements for recordkeeping or information reporting for 
purposes of administering the requirements of this subsection.’’. 
(q) EFFECTIVE DATES.— 
(1) IN
GENERAL.—Except as provided in paragraphs (2) 
and (3), the amendments made by this section shall apply 
to property placed in service after December 31, 2021. 
(2) OTHER
PROPERTY.—The amendments made by sub-
sections (f), (g), (h), (i), (j), (l), (n), and (o) shall apply to 
property placed in service after December 31, 2022. 
(3) SPECIAL RULE FOR PROPERTY FINANCED BY TAX-EXEMPT 
BONDS.—The amendments made by subsection (m) shall apply 
to property the construction of which begins after the date 
of enactment of this Act. 
SEC. 13103. INCREASE IN ENERGY CREDIT FOR SOLAR AND WIND 
FACILITIES PLACED IN SERVICE IN CONNECTION WITH 
LOW-INCOME COMMUNITIES. 
(a) IN GENERAL.—Section 48 is amended by adding at the 
end the following new subsection: 
‘‘(e) SPECIAL RULES FOR CERTAIN SOLAR AND WIND FACILITIES 
PLACED IN SERVICE IN CONNECTION WITH LOW-INCOME COMMU-
NITIES.— 
‘‘(1) IN GENERAL.—In the case of any qualified solar and 
wind facility with respect to which the Secretary makes an 
allocation of environmental justice solar and wind capacity 
limitation under paragraph (4)— 
‘‘(A) the energy percentage otherwise determined under 
paragraph (2) or (5) of subsection (a) with respect to any 
eligible property which is part of such facility shall be 
increased by—
H. R. 5376—105 
‘‘(i) in the case of a facility described in subclause 
(I) of paragraph (2)(A)(iii) and not described in sub-
clause (II) of such paragraph, 10 percentage points, 
and 
‘‘(ii) in the case of a facility described in subclause 
(II) of paragraph (2)(A)(iii), 20 percentage points, and 
‘‘(B) the increase in the credit determined under sub-
section (a) by reason of this subsection for any taxable 
year with respect to all property which is part of such 
facility shall not exceed the amount which bears the same 
ratio to the amount of such increase (determined without 
regard to this subparagraph) as— 
‘‘(i) the environmental justice solar and wind 
capacity limitation allocated to such facility, bears to 
‘‘(ii) the total megawatt nameplate capacity of such 
facility, as measured in direct current. 
‘‘(2) QUALIFIED SOLAR AND WIND FACILITY.—For purposes 
of this subsection— 
‘‘(A) IN GENERAL.—The term ‘qualified solar and wind 
facility’ means any facility— 
‘‘(i) which generates electricity solely from property 
described in section 45(d)(1) or in clause (i) or (vi) 
of subsection (a)(3)(A), 
‘‘(ii) which has a maximum net output of less than 
5 megawatts (as measured in alternating current), and 
‘‘(iii) which— 
‘‘(I) is located in a low-income community (as 
defined in section 45D(e)) or on Indian land (as 
defined in section 2601(2) of the Energy Policy 
Act of 1992 (25 U.S.C. 3501(2))), or 
‘‘(II) is part of a qualified low-income residen-
tial building project or a qualified low-income eco-
nomic benefit project. 
‘‘(B) QUALIFIED
LOW-INCOME
RESIDENTIAL
BUILDING 
PROJECT.—A facility shall be treated as part of a qualified 
low-income residential building project if— 
‘‘(i) such facility is installed on a residential rental 
building which participates in a covered housing pro-
gram (as defined in section 41411(a) of the Violence 
Against Women Act of 1994 (34 U.S.C. 12491(a)(3)), 
a housing assistance program administered by the 
Department of Agriculture under title V of the Housing 
Act of 1949, a housing program administered by a 
tribally designated housing entity (as defined in section 
4(22) of the Native American Housing Assistance and 
Self-Determination Act of 1996 (25 U.S.C. 4103(22))) 
or such other affordable housing programs as the Sec-
retary may provide, and 
‘‘(ii) the financial benefits of the electricity pro-
duced by such facility are allocated equitably among 
the occupants of the dwelling units of such building. 
‘‘(C) 
QUALIFIED
LOW-INCOME
ECONOMIC
BENEFIT 
PROJECT.—A facility shall be treated as part of a qualified 
low-income economic benefit project if at least 50 percent 
of the financial benefits of the electricity produced by such 
facility are provided to households with income of—
H. R. 5376—106 
‘‘(i) less than 200 percent of the poverty line (as 
defined in section 36B(d)(3)(A)) applicable to a family 
of the size involved, or 
‘‘(ii) less than 80 percent of area median gross 
income (as determined under section 142(d)(2)(B)). 
‘‘(D) FINANCIAL
BENEFIT.—For purposes of subpara-
graphs (B) and (C), electricity acquired at a below-market 
rate shall not fail to be taken into account as a financial 
benefit. 
‘‘(3) ELIGIBLE PROPERTY.—For purposes of this section, the 
term ‘eligible property’ means energy property which— 
‘‘(A) is part of a facility described in section 45(d)(1) 
for which an election was made under subsection (a)(5), 
or 
‘‘(B) is described in clause (i) or (vi) of subsection 
(a)(3)(A), 
including energy storage technology (as described in subsection 
(a)(3)(A)(ix)) installed in connection with such energy property. 
‘‘(4) ALLOCATIONS.— 
‘‘(A) IN GENERAL.—Not later than 180 days after the 
date of enactment of this subsection, the Secretary shall 
establish a program to allocate amounts of environmental 
justice solar and wind capacity limitation to qualified solar 
and wind facilities. In establishing such program and to 
carry out the purposes of this subsection, the Secretary 
shall provide procedures to allow for an efficient allocation 
process, including, when determined appropriate, consider-
ation of multiple projects in a single application if such 
projects will be placed in service by a single taxpayer. 
‘‘(B) LIMITATION.—The amount of environmental justice 
solar and wind capacity limitation allocated by the Sec-
retary under subparagraph (A) during any calendar year 
shall not exceed the annual capacity limitation with respect 
to such year. 
‘‘(C) ANNUAL CAPACITY LIMITATION.—For purposes of 
this paragraph, the term ‘annual capacity limitation’ means 
1.8 gigawatts of direct current capacity for each of calendar 
years 2023 and 2024, and zero thereafter. 
‘‘(D) CARRYOVER OF UNUSED LIMITATION.—If the annual 
capacity limitation for any calendar year exceeds the aggre-
gate amount allocated for such year under this paragraph, 
such limitation for the succeeding calendar year shall be 
increased by the amount of such excess. No amount may 
be carried under the preceding sentence to any calendar 
year 
after 
2024 
except 
as 
provided 
in 
section 
48E(h)(4)(D)(ii). 
‘‘(E) PLACED IN SERVICE DEADLINE.— 
‘‘(i) IN GENERAL.—Paragraph (1) shall not apply 
with respect to any property which is placed in service 
after the date that is 4 years after the date of the 
allocation with respect to the facility of which such 
property is a part. 
‘‘(ii) APPLICATION OF CARRYOVER.—Any amount of 
environmental justice solar and wind capacity limita-
tion which expires under clause (i) during any calendar 
year shall be taken into account as an excess described 
in subparagraph (D) (or as an increase in such excess)
H. R. 5376—107 
for such calendar year, subject to the limitation 
imposed by the last sentence of such subparagraph. 
‘‘(5) RECAPTURE.—The Secretary shall, by regulations or 
other guidance, provide for recapturing the benefit of any 
increase in the credit allowed under subsection (a) by reason 
of this subsection with respect to any property which ceases 
to be property eligible for such increase (but which does not 
cease to be investment credit property within the meaning 
of section 50(a)). The period and percentage of such recapture 
shall be determined under rules similar to the rules of section 
50(a). To the extent provided by the Secretary, such recapture 
may not apply with respect to any property if, within 12 months 
after the date the taxpayer becomes aware (or reasonably 
should have become aware) of such property ceasing to be 
property eligible for such increase, the eligibility of such prop-
erty for such increase is restored. The preceding sentence shall 
not apply more than once with respect to any facility.’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall take effect on January 1, 2023. 
SEC. 13104. EXTENSION AND MODIFICATION OF CREDIT FOR CARBON 
OXIDE SEQUESTRATION. 
(a) MODIFICATION
OF
CARBON
OXIDE
CAPTURE
REQUIRE-
MENTS.— 
(1) IN GENERAL.—Section 45Q(d) is amended to read as 
follows: 
‘‘(d) QUALIFIED FACILITY.—For purposes of this section, the 
term ‘qualified facility’ means any industrial facility or direct air 
capture facility— 
‘‘(1) the construction of which begins before January 1, 
2033, and either— 
‘‘(A) construction of carbon capture equipment begins 
before such date, or 
‘‘(B) the original planning and design for such facility 
includes installation of carbon capture equipment, and 
‘‘(2) which— 
‘‘(A) in the case of a direct air capture facility, captures 
not less than 1,000 metric tons of qualified carbon oxide 
during the taxable year, 
‘‘(B) in the case of an electricity generating facility— 
‘‘(i) captures not less than 18,750 metric tons of 
qualified carbon oxide during the taxable year, and 
‘‘(ii) with respect to any carbon capture equipment 
for the applicable electric generating unit at such 
facility, has a capture design capacity of not less than 
75 percent of the baseline carbon oxide production 
of such unit, or 
‘‘(C) in the case of any other facility, captures not 
less than 12,500 metric tons of qualified carbon oxide 
during the taxable year.’’. 
(2) DEFINITIONS.— 
(A) IN GENERAL.—Section 45Q(e) is amended— 
(i) by redesignating paragraphs (1) through (3) 
as paragraphs (3) through (5), respectively, and 
(ii) by inserting after ‘‘For purposes of this sec-
tion—’’ the following new paragraphs:
H. R. 5376—108 
‘‘(1) APPLICABLE
ELECTRIC
GENERATING
UNIT.—The term 
‘applicable electric generating unit’ means the principal electric 
generating unit for which the carbon capture equipment is 
originally planned and designed. 
‘‘(2) BASELINE CARBON OXIDE PRODUCTION.— 
‘‘(A) IN
GENERAL.—The term ‘baseline carbon oxide 
production’ means either of the following: 
‘‘(i) In the case of an applicable electric generating 
unit which was originally placed in service more than 
1 year prior to the date on which construction of the 
carbon capture equipment begins, the average annual 
carbon oxide production, by mass, from such unit 
during— 
‘‘(I) in the case of an applicable electric gener-
ating unit which was originally placed in service 
more than 1 year prior to the date on which 
construction of the carbon capture equipment 
begins and on or after the date which is 3 years 
prior to the date on which construction of such 
equipment begins, the period beginning on the date 
such unit was placed in service and ending on 
the date on which construction of such equipment 
began, and 
‘‘(II) in the case of an applicable electric gener-
ating unit which was originally placed in service 
more than 3 years prior to the date on which 
construction of the carbon capture equipment 
begins, the 3 years with the highest annual carbon 
oxide production during the 12-year period pre-
ceding the date on which construction of such 
equipment began. 
‘‘(ii) In the case of an applicable electric generating 
unit which— 
‘‘(I) as of the date on which construction of 
the carbon capture equipment begins, is not yet 
placed in service, or 
‘‘(II) was placed in service during the 1-year 
period prior to the date on which construction of 
the carbon capture equipment begins, 
the designed annual carbon oxide production, by mass, 
as determined based on an assumed capacity factor 
of 60 percent. 
‘‘(B) CAPACITY
FACTOR.—The term ‘capacity factor’ 
means the ratio (expressed as a percentage) of the actual 
electric output from the applicable electric generating unit 
to the potential electric output from such unit.’’. 
(B) CONFORMING AMENDMENT.—Section 142(o)(1)(B) is 
amended by striking ‘‘section 45Q(e)(1)’’ and inserting ‘‘sec-
tion 45Q(e)(3)’’. 
(b) 
MODIFIED
APPLICABLE
DOLLAR
AMOUNT.—Section 
45Q(b)(1)(A) is amended— 
(1) in clause (i)— 
(A) in subclause (I), by striking ‘‘the dollar amount’’ 
and all that follows through ‘‘such period’’ and inserting 
‘‘$17’’, and
H. R. 5376—109 
(B) in subclause (II), by striking ‘‘the dollar amount’’ 
and all that follows through ‘‘such period’’ and inserting 
‘‘$12’’, and 
(2) in clause (ii)— 
(A) in subclause (I), by striking ‘‘$50’’ and inserting 
‘‘$17’’, and 
(B) in subclause (II), by striking ‘‘$35’’ and inserting 
‘‘$12’’. 
(c) DETERMINATION OF APPLICABLE DOLLAR AMOUNT.— 
(1) IN GENERAL.—Section 45Q(b)(1), as amended by the 
preceding provisions of this Act, is amended— 
(A) by redesignating subparagraph (B) as subpara-
graph (D), and 
(B) by inserting after subparagraph (A) the following 
new subparagraphs: 
‘‘(B) SPECIAL RULE FOR DIRECT AIR CAPTURE FACILI-
TIES.—In the case of any qualified facility described in 
subsection (d)(2)(A) which is placed in service after 
December 31, 2022, the applicable dollar amount shall 
be an amount equal to the applicable dollar amount other-
wise determined with respect to such qualified facility 
under subparagraph (A), except that such subparagraph 
shall be applied— 
‘‘(i) by substituting ‘$36’ for ‘$17’ each place it 
appears, and 
‘‘(ii) by substituting ‘$26’ for ‘$12’ each place it 
appears. 
‘‘(C) APPLICABLE
DOLLAR
AMOUNT
FOR
ADDITIONAL 
CARBON CAPTURE EQUIPMENT.—In the case of any qualified 
facility which is placed in service before January 1, 2023, 
if any additional carbon capture equipment is installed 
at such facility and such equipment is placed in service 
after December 31, 2022, the applicable dollar amount 
shall be an amount equal to the applicable dollar amount 
otherwise determined under this paragraph, except that 
subparagraph (B) shall be applied— 
‘‘(i) by substituting ‘before January 1, 2023’ for 
‘after December 31, 2022’, and 
‘‘(ii) by substituting ‘the additional carbon capture 
equipment installed at such qualified facility’ for ‘such 
qualified facility’.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 45Q(b)(1)(A) is amended by striking ‘‘The 
applicable dollar amount’’ and inserting ‘‘Except as pro-
vided in subparagraph (B) or (C), the applicable dollar 
amount’’. 
(B) Section 45Q(b)(1)(D), as redesignated by paragraph 
(1)(A), is amended by striking ‘‘subparagraph (A)’’ and 
inserting ‘‘subparagraph (A), (B), or (C)’’. 
(d) WAGE AND APPRENTICESHIP REQUIREMENTS.—Section 45Q 
is amended by redesignating subsection (h) as subsection (i) and 
inserting after subsection (g) following new subsection: 
‘‘(h) INCREASED CREDIT AMOUNT FOR QUALIFIED FACILITIES AND 
CARBON CAPTURE EQUIPMENT.— 
‘‘(1) IN GENERAL.—In the case of any qualified facility or 
any carbon capture equipment which satisfy the requirements 
of paragraph (2), the amount of the credit determined under
H. R. 5376—110 
subsection (a) shall be equal to such amount (determined with-
out regard to this sentence) multiplied by 5. 
‘‘(2) REQUIREMENTS.—The requirements described in this 
paragraph are that— 
‘‘(A) with respect to any qualified facility the construc-
tion of which begins on or after the date that is 60 days 
after the Secretary publishes guidance with respect to the 
requirements of paragraphs (3)(A) and (4), as well as any 
carbon capture equipment placed in service at such 
facility— 
‘‘(i) subject to subparagraph (B) of paragraph (3), 
the taxpayer satisfies the requirements under subpara-
graph (A) of such paragraph with respect to such 
facility and equipment, and 
‘‘(ii) the taxpayer satisfies the requirements under 
paragraph (4) with respect to the construction of such 
facility and equipment, 
‘‘(B) with respect to any carbon capture equipment 
the construction of which begins on or after the date that 
is 60 days after the Secretary publishes guidance with 
respect to the requirements of paragraphs (3)(A) and (4), 
and which is installed at a qualified facility the construction 
of which began prior to such date— 
‘‘(i) subject to subparagraph (B) of paragraph (3), 
the taxpayer satisfies the requirements under subpara-
graph (A) of such paragraph with respect to such equip-
ment, and 
‘‘(ii) the taxpayer satisfies the requirements under 
paragraph (4) with respect to the construction of such 
equipment, or 
‘‘(C) the construction of carbon capture equipment 
begins prior to the date that is 60 days after the Secretary 
publishes guidance with respect to the requirements of 
paragraphs (3)(A) and (4), and such equipment is installed 
at a qualified facility the construction of which begins 
prior to such date. 
‘‘(3) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements described in this 
subparagraph with respect to any qualified facility and 
any carbon capture equipment placed in service at such 
facility are that the taxpayer shall ensure that any laborers 
and mechanics employed by the taxpayer or any contractor 
or subcontractor in— 
‘‘(i) the construction of such facility or equipment, 
and 
‘‘(ii) with respect to any taxable year, for any por-
tion of such taxable year which is within the period 
described in paragraph (3)(A) or (4)(A) of subsection 
(a), the alteration or repair of such facility or such 
equipment, 
shall be paid wages at rates not less than the prevailing 
rates for construction, alteration, or repair of a similar 
character in the locality in which such facility and equip-
ment are located as most recently determined by the Sec-
retary of Labor, in accordance with subchapter IV of 
chapter 31 of title 40, United States Code. For purposes
H. R. 5376—111 
of determining an increased credit amount under para-
graph (1) for a taxable year, the requirement under clause 
(ii) of this subparagraph is applied to such taxable year 
in which the alteration or repair of qualified facility occurs. 
‘‘(B) CORRECTION AND PENALTY RELATED TO FAILURE 
TO
SATISFY
WAGE
REQUIREMENTS.—Rules similar to the 
rules of section 45(b)(7)(B) shall apply. 
‘‘(4) APPRENTICESHIP REQUIREMENTS.—Rules similar to the 
rules of section 45(b)(8) shall apply. 
‘‘(5) REGULATIONS
AND
GUIDANCE.—The Secretary shall 
issue such regulations or other guidance as the Secretary deter-
mines necessary to carry out the purposes of this subsection, 
including regulations or other guidance which provides for 
requirements for recordkeeping or information reporting for 
purposes of administering the requirements of this subsection.’’. 
(e) CREDIT REDUCED FOR TAX-EXEMPT BONDS.—Section 45Q(f) 
is amended— 
(1) by striking the second paragraph (3), as added at the 
end of such section by section 80402(e) of the Infrastructure 
Investment and Jobs Act (Public Law 117-58), and 
(2) by adding at the end the following new paragraph: 
‘‘(8) CREDIT
REDUCED
FOR
TAX-EXEMPT
BONDS.—Rules 
similar to the rule under section 45(b)(3) shall apply for pur-
poses of this section.’’. 
(f) APPLICATION OF SECTION FOR CERTAIN CARBON CAPTURE 
EQUIPMENT.—Section 45Q(g) is amended by inserting ‘‘the earlier 
of January 1, 2023, and’’ before ‘‘the end of the calendar year’’. 
(g) ELECTION.—Section 45Q(f), as amended by subsection (e), 
is amended by adding at the end the following new paragraph: 
‘‘(9) ELECTION.—For purposes of paragraphs (3) and (4) 
of subsection (a), a person described in paragraph (3)(A)(ii) 
may elect, at such time and in such manner as the Secretary 
may prescribe, to have the 12–year period begin on the first 
day of the first taxable year in which a credit under this 
section is claimed with respect to carbon capture equipment 
which is originally placed in service at a qualified facility on 
or after the date of the enactment of the Bipartisan Budget 
Act of 2018 (after application of paragraph (6), where 
applicable) if— 
‘‘(A) no taxpayer claimed a credit under this section 
with respect to such carbon capture equipment for any 
prior taxable year, 
‘‘(B) the qualified facility at which such carbon capture 
equipment is placed in service is located in an area affected 
by a federally-declared disaster (as defined by section 
165(i)(5)(A)) after the carbon capture equipment is origi-
nally placed in service, and 
‘‘(C) such federally-declared disaster results in a ces-
sation of the operation of the qualified facility or the carbon 
capture equipment after such equipment is originally 
placed in service.’’. 
(h) REGULATIONS FOR BASELINE CARBON OXIDE PRODUCTION.— 
Subsection (i) of section 45Q, as redesignated by subsection (d), 
is amended— 
(1) in paragraph (1), by striking ‘‘and’’, 
(2) in paragraph (2), by striking the period at the end 
and inserting ‘‘, and’’, and
H. R. 5376—112 
(3) by adding at the end the following new paragraph: 
‘‘(3) for purposes of subsection (d)(2)(B)(ii), adjust the base-
line carbon oxide production with respect to any applicable 
electric generating unit at any electricity generating facility 
if, after the date on which the carbon capture equipment is 
placed in service, modifications which are chargeable to capital 
account are made to such unit which result in a significant 
increase or decrease in carbon oxide production.’’. 
(i) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as provided in paragraphs (2), 
(3), and (4), the amendments made by this section shall apply 
to facilities or equipment placed in service after December 
31, 2022. 
(2) MODIFICATION
OF
CARBON
OXIDE
CAPTURE
REQUIRE-
MENTS.—The amendments made by subsection (a) shall apply 
to facilities or equipment the construction of which begins after 
the date of enactment of this Act. 
(3) APPLICATION OF SECTION FOR CERTAIN CARBON CAPTURE 
EQUIPMENT.—The amendments made by subsection (f) shall 
take effect on the date of enactment of this Act. 
(4) ELECTION.—The amendments made by subsection (g) 
shall apply to carbon oxide captured and disposed of after 
December 31, 2021. 
SEC. 13105. ZERO-EMISSION NUCLEAR POWER PRODUCTION CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of subchapter A of 
chapter 1 is amended by adding at the end the following new 
section: 
‘‘SEC. 45U. ZERO-EMISSION NUCLEAR POWER PRODUCTION CREDIT. 
‘‘(a) AMOUNT OF CREDIT.—For purposes of section 38, the zero- 
emission nuclear power production credit for any taxable year is 
an amount equal to the amount by which— 
‘‘(1) the product of— 
‘‘(A) 0.3 cents, multiplied by 
‘‘(B) the kilowatt hours of electricity— 
‘‘(i) produced by the taxpayer at a qualified nuclear 
power facility, and 
‘‘(ii) sold by the taxpayer to an unrelated person 
during the taxable year, exceeds 
‘‘(2) the reduction amount for such taxable year. 
‘‘(b) DEFINITIONS.— 
‘‘(1) QUALIFIED NUCLEAR POWER FACILITY.—For purposes 
of this section, the term ‘qualified nuclear power facility’ means 
any nuclear facility— 
‘‘(A) which is owned by the taxpayer and which uses 
nuclear energy to produce electricity, 
‘‘(B) which is not an advanced nuclear power facility 
as defined in subsection (d)(1) of section 45J, and 
‘‘(C) which is placed in service before the date of the 
enactment of this section. 
‘‘(2) REDUCTION AMOUNT.— 
‘‘(A) IN GENERAL.—For purposes of this section, the 
term ‘reduction amount’ means, with respect to any quali-
fied nuclear power facility for any taxable year, the amount 
equal to the lesser of— 
‘‘(i) the amount determined under subsection (a)(1), 
or
H. R. 5376—113 
‘‘(ii) the amount equal to 16 percent of the excess 
of— 
‘‘(I) subject to subparagraph (B), the gross 
receipts from any electricity produced by such 
facility (including any electricity services or prod-
ucts provided in conjunction with the electricity 
produced by such facility) and sold to an unrelated 
person during such taxable year, over 
‘‘(II) the amount equal to the product of— 
‘‘(aa) 2.5 cents, multiplied by 
‘‘(bb) the amount determined under sub-
section (a)(1)(B). 
‘‘(B) TREATMENT OF CERTAIN RECEIPTS.— 
‘‘(i) IN
GENERAL.—Subject to clause (iii), the 
amount determined under subparagraph (A)(ii)(I) shall 
include any amount received by the taxpayer during 
the taxable year with respect to the qualified nuclear 
power facility from a zero-emission credit program. 
For purposes of determining the amount received 
during such taxable year, the taxpayer shall take into 
account any reductions required under such program. 
‘‘(ii) ZERO-EMISSION
CREDIT
PROGRAM.—For pur-
poses of this subparagraph, the term ‘zero-emission 
credit program’ means any payments with respect to 
a qualified nuclear power facility as a result of any 
Federal, State or local government program for, in 
whole or in part, the zero-emission, zero-carbon, or 
air quality attributes of any portion of the electricity 
produced by such facility. 
‘‘(iii) EXCLUSION.—For purposes of clause (i), any 
amount received by the taxpayer from a zero-emission 
credit program shall be excluded from the amount 
determined under subparagraph (A)(ii)(I) if the full 
amount of the credit calculated pursuant to subsection 
(a) (determined without regard to this subparagraph) 
is used to reduce payments from such zero-emission 
credit program. 
‘‘(3) ELECTRICITY.—For purposes of this section, the term 
‘electricity’ means the energy produced by a qualified nuclear 
power facility from the conversion of nuclear fuel into electric 
power. 
‘‘(c) OTHER RULES.— 
‘‘(1) INFLATION ADJUSTMENT.—The 0.3 cent amount in sub-
section (a)(1)(A) and the 2.5 cent amount in subsection 
(b)(2)(A)(ii)(II)(aa) shall each be adjusted by multiplying such 
amount by the inflation adjustment factor (as determined under 
section 45(e)(2), as applied by substituting ‘calendar year 2023’ 
for ‘calendar year 1992’ in subparagraph (B) thereof) for the 
calendar year in which the sale occurs. If the 0.3 cent amount 
as increased under this paragraph is not a multiple of 0.05 
cent, such amount shall be rounded to the nearest multiple 
of 0.05 cent. If the 2.5 cent amount as increased under this 
paragraph is not a multiple of 0.1 cent, such amount shall 
be rounded to the nearest multiple of 0.1 cent. 
‘‘(2) SPECIAL RULES.—Rules similar to the rules of para-
graphs (1), (3), (4), and (5) of section 45(e) shall apply for 
purposes of this section.
H. R. 5376—114 
‘‘(d) WAGE REQUIREMENTS.— 
‘‘(1) INCREASED CREDIT AMOUNT FOR QUALIFIED NUCLEAR 
POWER FACILITIES.—In the case of any qualified nuclear power 
facility which satisfies the requirements of paragraph (2)(A), 
the amount of the credit determined under subsection (a) shall 
be equal to such amount (as determined without regard to 
this sentence) multiplied by 5. 
‘‘(2) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements described in this 
subparagraph with respect to any qualified nuclear power 
facility are that the taxpayer shall ensure that any laborers 
and mechanics employed by the taxpayer or any contractor 
or subcontractor in the alteration or repair of such facility 
shall be paid wages at rates not less than the prevailing 
rates for alteration or repair of a similar character in 
the locality in which such facility is located as most recently 
determined by the Secretary of Labor, in accordance with 
subchapter IV of chapter 31 of title 40, United States 
Code. 
‘‘(B) CORRECTION AND PENALTY RELATED TO FAILURE 
TO
SATISFY
WAGE
REQUIREMENTS.—Rules similar to the 
rules of section 45(b)(7)(B) shall apply. 
‘‘(3) REGULATIONS
AND
GUIDANCE.—The Secretary shall 
issue such regulations or other guidance as the Secretary deter-
mines necessary to carry out the purposes of this subsection, 
including regulations or other guidance which provides for 
requirements for recordkeeping or information reporting for 
purposes of administering the requirements of this subsection. 
‘‘(e) TERMINATION.—This section shall not apply to taxable years 
beginning after December 31, 2032.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 38(b) is amended— 
(A) in paragraph (32), by striking ‘‘plus’’ at the end, 
(B) in paragraph (33), by striking the period at the 
end and inserting ‘‘, plus’’, and 
(C) by adding at the end the following new paragraph: 
‘‘(34) the zero-emission nuclear power production credit 
determined under section 45U(a).’’. 
(2) The table of sections for subpart D of part IV of sub-
chapter A of chapter 1 is amended by adding at the end the 
following new item: 
‘‘Sec. 45U. Zero-emission nuclear power production credit.’’. 
(c) EFFECTIVE DATE.—This section shall apply to electricity 
produced and sold after December 31, 2023, in taxable years begin-
ning after such date. 
PART 2—CLEAN FUELS 
SEC. 13201. EXTENSION OF INCENTIVES FOR BIODIESEL, RENEWABLE 
DIESEL AND ALTERNATIVE FUELS. 
(a) BIODIESEL AND RENEWABLE DIESEL CREDIT.—Section 40A(g) 
is amended by striking ‘‘December 31, 2022’’ and inserting 
‘‘December 31, 2024’’. 
(b) BIODIESEL MIXTURE CREDIT.— 
(1) IN GENERAL.—Section 6426(c)(6) is amended by striking 
‘‘December 31, 2022’’ and inserting ‘‘December 31, 2024’’.
H. R. 5376—115 
(2) FUELS
NOT
USED
FOR
TAXABLE
PURPOSES.—Section 
6427(e)(6)(B) is amended by striking ‘‘December 31, 2022’’ and 
inserting ‘‘December 31, 2024’’. 
(c) ALTERNATIVE FUEL CREDIT.—Section 6426(d)(5) is amended 
by striking ‘‘December 31, 2021’’ and inserting ‘‘December 31, 2024’’. 
(d) ALTERNATIVE FUEL MIXTURE CREDIT.—Section 6426(e)(3) 
is amended by striking ‘‘December 31, 2021’’ and inserting 
‘‘December 31, 2024’’. 
(e) PAYMENTS FOR ALTERNATIVE FUELS.—Section 6427(e)(6)(C) 
is amended by striking ‘‘December 31, 2021’’ and inserting 
‘‘December 31, 2024’’. 
(f) EFFECTIVE DATE.—The amendments made by this section 
shall apply to fuel sold or used after December 31, 2021. 
(g) SPECIAL RULE.—In the case of any alternative fuel credit 
properly determined under section 6426(d) of the Internal Revenue 
Code of 1986 for the period beginning on January 1, 2022, and 
ending with the close of the last calendar quarter beginning before 
the date of the enactment of this Act, such credit shall be allowed, 
and any refund or payment attributable to such credit (including 
any payment under section 6427(e) of such Code) shall be made, 
only in such manner as the Secretary of the Treasury (or the 
Secretary’s delegate) shall provide. Such Secretary shall issue guid-
ance within 30 days after the date of the enactment of this Act 
providing for a one-time submission of claims covering periods 
described in the preceding sentence. Such guidance shall provide 
for a 180-day period for the submission of such claims (in such 
manner as prescribed by such Secretary) to begin not later than 
30 days after such guidance is issued. Such claims shall be paid 
by such Secretary not later than 60 days after receipt. If such 
Secretary has not paid pursuant to a claim filed under this sub-
section within 60 days after the date of the filing of such claim, 
the claim shall be paid with interest from such date determined 
by using the overpayment rate and method under section 6621 
of such Code. 
SEC. 13202. EXTENSION OF SECOND GENERATION BIOFUEL INCEN-
TIVES. 
(a) IN GENERAL.—Section 40(b)(6)(J)(i) is amended by striking 
‘‘2022’’ and inserting ‘‘2025’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply to qualified second generation biofuel production after 
December 31, 2021. 
SEC. 13203. SUSTAINABLE AVIATION FUEL CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of subchapter A of 
chapter 1 is amended by inserting after section 40A the following 
new section: 
‘‘SEC. 40B. SUSTAINABLE AVIATION FUEL CREDIT. 
‘‘(a) IN GENERAL.—For purposes of section 38, the sustainable 
aviation fuel credit determined under this section for the taxable 
year is, with respect to any sale or use of a qualified mixture 
which occurs during such taxable year, an amount equal to the 
product of— 
‘‘(1) the number of gallons of sustainable aviation fuel 
in such mixture, multiplied by 
‘‘(2) the sum of— 
‘‘(A) $1.25, plus
H. R. 5376—116 
‘‘(B) the applicable supplementary amount with respect 
to such sustainable aviation fuel. 
‘‘(b) APPLICABLE SUPPLEMENTARY AMOUNT.—For purposes of 
this section, the term ‘applicable supplementary amount’ means, 
with respect to any sustainable aviation fuel, an amount equal 
to $0.01 for each percentage point by which the lifecycle greenhouse 
gas emissions reduction percentage with respect to such fuel exceeds 
50 percent. In no event shall the applicable supplementary amount 
determined under this subsection exceed $0.50. 
‘‘(c) QUALIFIED MIXTURE.—For purposes of this section, the 
term ‘qualified mixture’ means a mixture of sustainable aviation 
fuel and kerosene if— 
‘‘(1) such mixture is produced by the taxpayer in the United 
States, 
‘‘(2) such mixture is used by the taxpayer (or sold by 
the taxpayer for use) in an aircraft, 
‘‘(3) such sale or use is in the ordinary course of a trade 
or business of the taxpayer, and 
‘‘(4) the transfer of such mixture to the fuel tank of such 
aircraft occurs in the United States. 
‘‘(d) SUSTAINABLE AVIATION FUEL.— 
‘‘(1) IN GENERAL.—For purposes of this section, the term 
‘sustainable aviation fuel’ means liquid fuel, the portion of 
which is not kerosene, which— 
‘‘(A) meets the requirements of— 
‘‘(i) ASTM International Standard D7566, or 
‘‘(ii) the Fischer Tropsch provisions of ASTM Inter-
national Standard D1655, Annex A1, 
‘‘(B) is not derived from coprocessing an applicable 
material (or materials derived from an applicable material) 
with a feedstock which is not biomass, 
‘‘(C) is not derived from palm fatty acid distillates 
or petroleum, and 
‘‘(D) has been certified in accordance with subsection 
(e) as having a lifecycle greenhouse gas emissions reduction 
percentage of at least 50 percent. 
‘‘(2) DEFINITIONS.—In this subsection— 
‘‘(A) APPLICABLE
MATERIAL.—The term ‘applicable 
material’ means— 
‘‘(i) monoglycerides, diglycerides, and triglycerides, 
‘‘(ii) free fatty acids, and 
‘‘(iii) fatty acid esters. 
‘‘(B) BIOMASS.—The term ‘biomass’ has the same 
meaning given such term in section 45K(c)(3). 
‘‘(e) LIFECYCLE
GREENHOUSE
GAS
EMISSIONS
REDUCTION 
PERCENTAGE.—For purposes of this section, the term ‘lifecycle 
greenhouse gas emissions reduction percentage’ means, with respect 
to any sustainable aviation fuel, the percentage reduction in lifecycle 
greenhouse gas emissions achieved by such fuel as compared with 
petroleum-based jet fuel, as defined in accordance with— 
‘‘(1) the most recent Carbon Offsetting and Reduction 
Scheme for International Aviation which has been adopted 
by the International Civil Aviation Organization with the agree-
ment of the United States, or 
‘‘(2) any similar methodology which satisfies the criteria 
under section 211(o)(1)(H) of the Clean Air Act (42 U.S.C.
H. R. 5376—117 
7545(o)(1)(H)), as in effect on the date of enactment of this 
section. 
‘‘(f) REGISTRATION
OF
SUSTAINABLE
AVIATION
FUEL
PRO-
DUCERS.—No credit shall be allowed under this section with respect 
to any sustainable aviation fuel unless the producer or importer 
of such fuel— 
‘‘(1) is registered with the Secretary under section 4101, 
and 
‘‘(2) provides— 
‘‘(A) certification (in such form and manner as the 
Secretary shall prescribe) from an unrelated party dem-
onstrating compliance with— 
‘‘(i) any general requirements, supply chain 
traceability requirements, and information trans-
mission requirements established under the Carbon 
Offsetting and Reduction Scheme for International 
Aviation described in paragraph (1) of subsection (e), 
or 
‘‘(ii) in the case of any methodology established 
under paragraph (2) of such subsection, requirements 
similar to the requirements described in clause (i), 
and 
‘‘(B) such other information with respect to such fuel 
as the Secretary may require for purposes of carrying out 
this section. 
‘‘(g) COORDINATION WITH CREDIT AGAINST EXCISE TAX.—The 
amount of the credit determined under this section with respect 
to any sustainable aviation fuel shall, under rules prescribed by 
the Secretary, be properly reduced to take into account any benefit 
provided with respect to such sustainable aviation fuel solely by 
reason of the application of section 6426 or 6427(e). 
‘‘(h) TERMINATION.—This section shall not apply to any sale 
or use after December 31, 2024.’’. 
(b) CREDIT MADE PART OF GENERAL BUSINESS CREDIT.— Section 
38(b), as amended by the preceding provisions of this Act, is 
amended by striking ‘‘plus’’ at the end of paragraph (33), by striking 
the period at the end of paragraph (34) and inserting ‘‘, plus’’, 
and by inserting after paragraph (34) the following new paragraph: 
‘‘(35) the sustainable aviation fuel credit determined under 
section 40B.’’. 
(c) COORDINATION WITH BIODIESEL INCENTIVES.— 
(1) IN GENERAL.—Section 40A(d)(1) is amended by inserting 
‘‘or 40B’’ after ‘‘determined under section 40’’. 
(2) CONFORMING AMENDMENT.—Section 40A(f) is amended 
by striking paragraph (4). 
(d) SUSTAINABLE
AVIATION
FUEL
ADDED
TO
CREDIT
FOR 
ALCOHOL FUEL, BIODIESEL, AND ALTERNATIVE FUEL MIXTURES.— 
(1) IN GENERAL.—Section 6426 is amended by adding at 
the end the following new subsection: 
‘‘(k) SUSTAINABLE AVIATION FUEL CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of this section, the sustain-
able aviation fuel credit for the taxable year is, with respect 
to any sale or use of a qualified mixture, an amount equal 
to the product of— 
‘‘(A) the number of gallons of sustainable aviation fuel 
in such mixture, multiplied by 
‘‘(B) the sum of—
H. R. 5376—118 
‘‘(i) $1.25, plus 
‘‘(ii) the applicable supplementary amount with 
respect to such sustainable aviation fuel. 
‘‘(2) DEFINITIONS.—Any term used in this subsection which 
is also used in section 40B shall have the meaning given 
such term by section 40B. 
‘‘(3) REGISTRATION
REQUIREMENT.—For purposes of this 
subsection, rules similar to the rules of section 40B(f) shall 
apply.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 6426 is amended— 
(i) in subsection (a)(1), by striking ‘‘and (e)’’ and 
inserting ‘‘(e), and (k)’’, and 
(ii) in subsection (h), by striking ‘‘under section 
40 or 40A’’ and inserting ‘‘under section 40, 40A, or 
40B’’. 
(B) Section 6427(e) is amended— 
(i) in the heading, by striking ‘‘OR ALTERNATIVE 
FUEL’’ and inserting, ‘‘ALTERNATIVE FUEL, OR SUSTAIN-
ABLE AVIATION FUEL’’, 
(ii) in paragraph (1), by inserting ‘‘or the sustain-
able aviation fuel mixture credit’’ after ‘‘alternative 
fuel mixture credit’’, and 
(iii) in paragraph (6)— 
(I) in subparagraph (C), by striking ‘‘and’’ at 
the end, 
(II) in subparagraph (D), by striking the period 
at the end and inserting ‘‘, and’’, and 
(III) by adding at the end the following new 
subparagraph: 
‘‘(E) any qualified mixture of sustainable aviation fuel 
(as defined in section 6426(k)(3)) sold or used after 
December 31, 2024.’’. 
(C) Section 4101(a)(1) is amended by inserting ‘‘every 
person producing or importing sustainable aviation fuel 
(as defined in section 40B),’’ before ‘‘and every person pro-
ducing second generation biofuel’’. 
(D) The table of sections for subpart D of subchapter 
A of chapter 1 is amended by inserting after the item 
relating to section 40A the following new item: 
‘‘Sec. 40B. Sustainable aviation fuel credit.’’. 
(e) AMOUNT OF CREDIT INCLUDED IN GROSS INCOME.—Section 
87 is amended by striking ‘‘and’’ in paragraph (1), by striking 
the period at the end of paragraph (2) and inserting ‘‘, and’’, and 
by adding at the end the following new paragraph: 
‘‘(3) the sustainable aviation fuel credit determined with 
respect to the taxpayer for the taxable year under section 
40B(a).’’. 
(f) EFFECTIVE DATE.—The amendments made by this section 
shall apply to fuel sold or used after December 31, 2022. 
SEC. 13204. CLEAN HYDROGEN. 
(a) CREDIT FOR PRODUCTION OF CLEAN HYDROGEN.— 
(1) IN GENERAL.—Subpart D of part IV of subchapter A 
of chapter 1, as amended by the preceding provisions of this 
Act, is amended by adding at the end the following new section: