As a result of the Inflation Reduction Act Medicare bill be able to negotiate directly with drug manufacturers to lower the price of some of the costliest single-source brand-name Medicare Part B and Part D drugs. This law requires drug companies that raise their drug prices faster than the rate of inflation to pay Medicare a rebate. This is intended to discourage unreasonable price increases by drug companies.
Here’s the current timeline:
– By Sept. 1, 2023 Medicare will announce ten retail drugs to negotiate maximum prices.
– In 2024, the agency will bargain with drug manufacturers and publish prices by September for prices that will take effect Jan. 1, 2026.
– Over the following two years, the federal health program will target another 30 retail and physician-administered drugs.
– Beginning in 2029, Medicare will negotiate prices for up to 20 drugs yearly.
Retail drugs are eligible only after they have been on the market for nine years without a competing generic version. Physician-administered drugs will have 13 years before being subject to negotiation.