S 5496: Health CARE Act of 2026

S 5496 in plain English: The Health CARE Act of 2026 would expand and strengthen health insurance coverage under the Affordable Care Act by capping out-of-pocket prescription drug costs, limiting premiums, and increasing federal oversight of health plans and hospitals. The bill appropriates $370,000,000 for implementation and allocates $100,000,000 from user fees for states where the federal government runs the insurance marketplace. It also establishes tiered civil penalties for hospitals and other health entities that fail to comply with its requirements.

Stated purpose

The bill aims to expand access to health care and lower its cost by repealing certain recent health-related budget provisions, making enhanced health insurance tax credits permanent, creating a new public health plan option, strengthening Medicaid, lowering drug prices, and increasing transparency across the health care system.

Key points

• Caps prescription drug cost-sharing at $35 per 30-day supply or 25% of the negotiated price, whichever is less
• Sets a $2,000 out-of-pocket limit for self-only coverage for plan years beginning in 2028
• Appropriates $370,000,000 for implementing the law, plus $100,000,000 from user fees for federally run marketplaces
• Imposes daily penalties on noncompliant hospitals ranging from $300–$400 per day for small hospitals to $25–$35 per bed per day for large hospitals
• Allows civil penalties up to $10,000 per day against pharmacy benefit managers or other service providers that violate the bill's requirements

Arguments supporters make

• Making enhanced tax credits permanent and creating a public plan option would give more Americans access to affordable coverage, especially those currently priced out of the market.
• Capping out-of-pocket drug costs, requiring insulin cost-sharing limits, and expanding Medicare drug price negotiation would give patients real relief from rising prescription prices.
• Greater price transparency and reforms to pharmacy benefit managers would expose hidden costs and push the health care industry to compete on price, benefiting consumers.

Arguments opponents make

• Repealing recently enacted budget reconciliation health provisions could undo spending reductions or policy changes that Congress already passed through a lawful process, raising concerns about fiscal and legislative stability.
• Creating a new government-run health plan could draw enrollees away from private insurers, potentially destabilizing private markets and reducing competition over time.
• Expanding subsidies and Medicaid funding without clear offsets could add significantly to federal spending and the national debt, shifting costs to taxpayers.

Tradeoffs

Broader coverage and lower costs for patients may come at the expense of higher federal spending and potential disruption to private insurance markets; tighter rules on providers and drug companies could lower prices but may also affect their willingness to participate or invest in new treatments.

Current status in Congress: In committee.

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