There have been a lot of changes underway with Medicare as a result of the Inflation Reduction Act signed in August 2022 by President Biden – the law expands Medicare benefits, lowers drug costs and has been enacted with the goal of improving the viability of the Medicare program for generations to come. Short term, the law will help with reducing prescription drug costs. A debilitating issue for so many on Medicare.
A major aspect of the new law provides medicare the ability to negotiate drug prices directly with manufacturers to help gain control of the spiraling costs consumers are subjected to with many name brand medications.
Now, we have the first 10 medicines that will be subject to Medicare price negotiations:
Januvia – Diabetes
FIasp – Diabetes
Novolog – Diabetes
Farxiga – Diabetes, Heart Failure, Kidney Disease
Enbrel – Rheumatoid Arthritis, Psoriasis
Jardiance – DIabetes, Heart Failure, Kidney Disease
Stelara – Psoriasis, Crohn’s Disease, Ulcerative Colitis
Xarelto – Blood clots, coronery or peripheral artery disease
Eliquis – blood clots
Entresto – Heart Failure
Imbruvica – Blood Cancers
On average the cost reduction is approximately 60% with many higher and a few lower. New pricing will begin January 1, 2026. The new pricing is forecasted to save consumers an estimate $1.5 Billion in out of pocket costs and approximate $6 Billion to the Medicare program savings. Negotiations began in February 2024 and concluded August 2024.
In other areas of impact on Medicare, the Inflation Reduction Act has already capped the cost of most insulins at $35 a month in 2024. Beginning in 2025, out-of-pocket drug costs for Medicare recipients will be capped at $2000 a year. In addition, for the first time, Medicare is offering a payment option to help offset the high deductible phases and upfront costs for many and pay over a 12-month period.