HHS Announced Key Dates for the Inflation Reduction Act’s Medicare Drug Price Negotiation Program
- The Inflation Reduction Act allows Medicare to negotiate directly with drug manufacturers for the prices of prescription drugs.
- CMS will publish the first 10 Medicare Part D drugs selected for the Medicare Drug Price Negotiation Program.
- The negotiated maximum fair prices for these drugs will be announced by September 1, 2024. Prices will be in effect starting January 1, 2026.
The Department of Health and Human Services (HHS) announced dates for the first year of the Medicare Drug Price Negotiation Program under the Inflation Reduction Act (IRA). This $739 billion package aims to lower drug costs for millions of Americans. According to the HHS statement, in 2023, the Biden-Harris Administration will begin negotiating to lower these prices for people with Medicare.
According to HHS Secretary Xavier Becerra, the department finally has the authority to get American families the lower prescription drug costs they deserve.
“Today, we are releasing our plan for implementing Medicare drug price negotiation under this landmark law. We will be transparent and aggressive in implementation every step of the way,” Becerra stated.
To clarify, this historic legislation allows Medicare to negotiate directly with drug manufacturers for prices of prescription drugs for the first time. The IRA authorizes Medicare to directly negotiate these prices for certain high-expenditure, single-source Medicare Part B or Part D drugs.
Medicare Drug Price Negotiation Program Implementation
- By September 1, 2023, CMS will publish the first 10 Medicare Part D drugs chosen for the Medicare Drug Price Negotiation Program.
- The negotiated maximum fair prices for these drugs will be announced by September 1, 2024, and costs will be in effect starting January 1, 2026.
- CMS will select for negotiation 15 more Part D drugs for 2027. For 2028, the entity will choose 15 more Part B or Part D drugs. Also, as outlined in the IRA, 20 more Part B or Part D drugs for each year after that.
For a complete timeline of the Drug Price Negotiation Program implementation process, visit here.
According to Dr. Meena Seshamani, Deputy Administrator & Director of the Center for Medicare, public feedback is critical. This feedback will help them successfully implement this law. It will also allow them to ensure access to affordable and innovative treatments and therapies.
“Through this detailed timeline, we offer stakeholders the predictability they need to contribute to our implementation efforts. We want the public to know when and how they can make their voices heard on forthcoming policies,”, Seshamani added.
For decades, Americans have paid higher prices for prescription drugs than people in other countries. Also, HHS data shows that U.S. prescription drug prices are more than double (2.56 times as high) as in high-income countries.