Due to the provisions of the Inflation Reduction Act, Medicare will soon have the authority to engage in direct negotiations with pharmaceutical manufacturers, aiming to reduce the expense of some high-cost, exclusive-brand drugs covered under Medicare Part B and Part D. The legislation mandates that pharmaceutical firms that escalate their prices beyond inflation must refund Medicare, a measure designed to dissuade unwarranted price hikes by these companies.
Here is the anticipated schedule:
– By Sept. 1, 2023, Medicare will identify ten prescription medications for which it will set capped rates.
– In 2024, discussions with drug producers will happen, with finalized prices being made public by September for implementation on Jan. 1, 2026.
– Medicare plans to negotiate price reductions for an additional 30 prescription and office-administered pharmaceuticals over the subsequent two years.
– Starting in 2029, Medicare will annually establish cost negotiations for as many as 20 drugs.
Prescription medications will be suitable for negotiation only following a nine-year period on the market without generic competition. For office-dispensed medications, the negotiation window opens after 13 years.
