Congress opens Medicare to digital health products with minimal price guardrails
S. 1702 — Access to Prescription Digital Therapeutics Act of 2025 · Filed by Shelley Capito (R-WV) · 4 cosponsors · Introduced May 8, 2025 · Referred to committee
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What it does
This bill adds prescription digital therapeutics—software-based medical products cleared by the FDA—to Medicare and Medicaid coverage starting January 1, 2026. The Secretary of Health and Human Services must establish a payment method for manufacturers within one year, create billing codes within two years, and require manufacturers to report pricing and usage data annually, with penalties up to $10,000 per day for false reporting.
Why we flagged it
The bill's core function is to add a new category of FDA-cleared digital therapeutics to Medicare and Medicaid coverage, establishing payment and coding infrastructure. It is primarily a coverage and reimbursement mechanism, not a deregulation or subsidy carve-out, though it does create favorable conditions for a nascent industry.
What the text implies
- The bill does not establish a reference pricing benchmark or cost-effectiveness threshold before coverage, unlike traditional drugs. Manufacturers report 'actual list charge' and private-payor rates, but the Secretary has broad discretion to set payment 'as determined appropriate'—potentially allowing high initial prices to anchor reimbursement.
- Manufacturer reporting requirements (pricing, volume, user counts) are subject to confidentiality protections identical to drug pricing data under section 1927, which may limit public transparency and price comparison.
The full analysis lists 5 implications of this text.
Who stands to gain
digital therapeutics manufacturers; software-based medical device companies; FDA-cleared digital health startups