On August 29th, CMS announced the first 10 drugs selected for the Medicare Drug Price Negotiation Program. Below are the highlights as well as some additional resources and information. At RetireeFirst, we recognize the significance of providing our clients with the necessary knowledge to make informed decisions.
Key highlights on the Medicare Drug Price Negotiation
- This morning, the Centers for Medicare and Medicaid Services released the first 10 drugs selected for Medicare Price Negotiation – a critical provision under the Inflation Reduction Act that will finally allow Medicare to negotiate lower prescription drug costs for seniors and other beneficiaries.
- For decades, Big Pharma has blocked this from happening. While pharmaceutical companies made record profits and spent hundreds of millions of dollars on lobbying year after year, millions of Americans were forced to choose between paying for medications they need to live, or paying for other basic necessities.
- In 2022 alone, around 9 million seniors and other Medicare beneficiaries spent over $3.4 billion out-of-pocket on the 10 drugs selected for negotiation.
- These drugs are used to treat some of the most common diseases like diabetes, heart disease, arthritis, blood clots, and cancers – and in 2022 cost seniors up to $6,497 in out-of-pocket costs per year for just one of these drugs
- Today’s announcement is a major step forward in the Administration’s efforts to lower costs for American families and make health care more affordable. President Biden, Vice President Harris, and their Administration won’t stop until they finish the job.
- Prices won’t take effect until 2026.
- Drug companies have until Oct. 1 to decide whether to participate in negotiations, though that could be delayed if lawsuits delay the program.
- CMS will publish any agreed-upon negotiated prices for the selected drugs by September 1, 2024; those prices will come into effect starting January 1, 2026
- In future years, CMS will select for negotiation up to 15 more drugs covered under Part D for 2027, up to 15 more drugs for 2028 (including drugs covered under Part B and Part D), and up to 20 more drugs for each year after that, as outlined in the Inflation Reduction Act.
First 10 Drugs Selected for the Medicare Drug Price Negotiation Program
|Drug Name||Commonly Treated Conditions||Total Part D Gross Covered Prescription Drug Costs from June 2022-May 2023||Number of Medicare Part D Enrollees Who Used the Drug from June 2022-May 2023||Average Part D Covered Prescription Drug Costs Per Enrollee|
|Eliquis||Prevention and treatment of blood clots||$16,482,621,000||3,706,000||$4,448|
|Jardiance||Diabetes; Heart failure||$7,057,707,000||1,573,000||$4,487|
|Xarelto||Prevention and treatment of blood clots; Reduction of risk for patients with coronary or peripheral artery disease||$6,031,393,000||1,337,000||$4,511|
|Farxiga||Diabetes; Heart failure; Chronic kidney disease||$3,268,329,000||799,000||$4,091|
|Enbrel||Rheumatoid arthritis; Psoriasis; Psoriatic arthritis||$2,791,105,000||48,000||$58,148|
|Stelara||Psoriasis; Psoriatic arthritis; Crohn’s disease; Ulcerative colitis||$2,638,929,000||22,000||$119,951|
|Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill||Diabetes||$2,576,586,000||777,000||$3,316|
President Biden’s Inflation Reduction Act – Lowering Health Care Costs: By the Numbers
- 9 million: Number of seniors who took the 10 drugs selected for Medicare Price Negotiation in 2022.
- $3.4 billion: Amount Medicare beneficiaries spent in out of pocket costs in 2022 on the 10 drugs.
- $6,497: The out-of-pocket cost seniors had to pay per year for just one of the drugs selected for negotiation
- 33 years: Amount of time leaders spent trying to allow Medicare to negotiate lower drug prices.
- $160 billion: How much taxpayers will save because of the Inflation Reduction Act’s health care provisions
- 4 million: Number of seniors already benefitting from the Inflation Reduction Act’s $35 per month cap on the cost of insulin
- 8: Number of lawsuits Big Pharma has already filed to block the Biden Administration from being able to negotiate lower prescription drug prices.
- Nearly $400 million: The amount Big Pharma spent in lobbying efforts to try to stop the Administration from being able to negotiate lower drug prices and lower health care costs for American families.
- Over 8 in 10: Adults support allowing Medicare to negotiate lower prescription drug prices, according to a recent Kaiser Family Foundation poll.
Fact Sheets and Resources
- HHS Report with State-by-State Numbers on Use and Out-of-pocket Spending on Selected Drugs: https://aspe.hhs.gov/reports/aspe-ira-drug-negotiation-fact-sheet
- View a fact sheet from the Office of the Assistant Secretary for Planning and Evaluation (ASPE): https://aspe.hhs.gov/reports/aspe-ira-drug-negotiation-fact-sheet
- View a CMS fact sheet on the drugs selected for the Medicare Drug Price Negotiation Program: https://www.cms.gov/files/document/fact-sheet-medicare-selected-drug-negotiation-list-ipay-2026.pdf
- More information on the Medicare Drug Price Negotiation Program is available: https://www.cms.gov/inflation-reduction-act-and-medicare/medicare-drug-price-negotiation
- Fierce Healthcare article, August 29, 2023 9:57am: https://www.fiercehealthcare.com/payers/eliquis-jardiance-xarelto-headline-cms-price-negotiated-drug-list
- Talking Points + Resources: Medicare Drug Price Negotiation, August 29, LSN Partners