Inflation Reduction Act Tamps Down on Prescription Drug Price Increases Above Inflation
New Medicare Prescription Drug Inflation Rebate Program protects people with Medicare and taxpayers when drug companies increase prices faster than the rate of inflation
HHS announces savings for some people with Medicare on 20 Part B prescription drugs
The Biden-Harris Administration has made lowering prescription drug costs in America a key priority — and President Biden is delivering results. Today, the Department of Health and Human Services, through the Centers for Medicare & Medicaid Services (CMS), announced 20 prescription drugs for which Part B beneficiary coinsurances may be lower from April 1 – June 30, 2023. Thanks to President Biden’s new law to lower prescription drug costs, some people with Medicare who take these drugs may save between $1 and $372 per average dose starting April 1, depending on their individual coverage. Through the Inflation Reduction Act, President Biden and his Administration are lowering prescription drug costs for American seniors and families.
“The Biden-Harris Administration believes people with Medicare shouldn’t be on the hook when drug companies inexplicably jack up the prices of their drugs,” said HHS Secretary Xavier Becerra. “President Biden made lowering prescription drug costs for Americans a top priority and we’re using every lever we have to deliver results. With the inflation rebate program, we are fighting to ensure seniors can afford the treatments they need, taxpayers aren’t subsidizing drug company excess prices, and the Medicare program is strong for millions of beneficiaries now and in the future.”
The Medicare Prescription Drug Inflation Rebate Program is one of the many important tools Medicare has to address rising drug costs. By reducing coinsurance for some people with Part B coverage and discouraging drug companies from increasing prices faster than inflation, this policy may lower out-of-pocket costs for some people with Medicare and reduce Medicare program spending for costly drugs.
“The Medicare Prescription Drug Inflation Rebate Program is a critical way to address long-term price increases by drug companies while improving access and affordability for the millions of people with Medicare coverage,” said CMS Administrator Chiquita Brooks-LaSure. “Continued implementation of the new drug law strengthens Medicare, faithfully guards taxpayer dollars, and improves the long-term sustainability of the program for generations to come.”
Lower Part B coinsurance will go into effect on April 1, 2023. This coinsurance adjustment applies to certain drugs and biologicals covered under Medicare Part B. The Part B drugs impacted by this coinsurance adjustment may change quarterly.
See the initial guidance detailing the requirements and procedures for the Medicare Prescription Drug Inflation Rebate Program here.
In addition, HHS released a report on how much Medicare Part D enrollees would have saved on vaccine cost-sharing if the Inflation Reduction Act had been in effect in 2021.