1. Short title This Act may be cited as the Capped Allowable Payments from Seniors for Prescriptions Act or the CAPS for Prescriptions Act . 2. Limiting Medicare part B and D drug out-of-pocket costs (a) Medicare combined part B and D drug OOP catastrophic limit and part D subsidies 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: 1860D–14B. Medicare drug out-of-pocket limit subsidies (a) In general For plan year 2021 and each subsequent plan year, in the case of a part D eligible individual enrolled in a prescription drug plan under this part for such year— (1) if during such year such individual becomes a catastrophic limit subsidy eligible individual, such individual is entitled to the elimination of any beneficiary coinsurance described in section 1860D–2(b)(2) for covered part D drugs furnished to such individual during the remainder of such year; and (2) the Secretary shall provide for payment to the PDP sponsor that offers such prescription drug plan of a catastrophic limit coverage subsidy (calculated under subsection (b)) in accordance with this section for such individual and remainder of such year. (b) Catastrophic limit coverage subsidy amount For purposes of this section, a catastrophic limit coverage subsidy, with respect to a catastrophic limit subsidy eligible individual enrolled for coverage under this part in a prescription drug plan for a plan year, shall be calculated as an amount (or amounts) equal to any cost-sharing amount that— (1) would otherwise apply without application of subsection (a)(1) to such individual under such coverage for covered part D drugs furnished to such individuals during such year