The White House has announced a deal that will cut the price of popular Medicare drugs by $50 billion a year.
U.S. Senate Majority Leader Chuck Schumer announced that Medicare has reached new, lower, and fairer negotiated prices with 10 of the highest-spend drugs in Medicare. A provision in the Inflation Reduction Act now allows the federal government to directly negotiate drug prices with pharmaceutical companies.
Medicare spent $50 billion covering the drugs last year and taxpayers are expected to save $6 billion on the new prices, which do not go into effect until 2026. Older adults could save as much as $1.5 billion in total on their medications in out-of-pocket costs.
The newly negotiated prices will impact the price of drugs used by millions of older Americans to help manage diabetes, blood cancers and prevent heart failure or blood clots. The drugs include the blood thinners Xarelto and Eliquis and diabetes drugs Jardiance and Januvia.
This year, Medicare selected for negotiation the 10 highest spending drugs in Medicare Part D that do not have generic versions of their drugs but are eligible for such competition. Next year, Medicare will select another 15 Part D drugs for negotiation. In 2027, it will negotiate another 15 drugs while also expanding negotiation to Medicare Part B, which covers drugs administered in a physician’s office. In 2028 and every year after, Medicare will negotiate a new set of 20 drugs. 50 million Americans are enrolled in the Medicare Part D prescription drug program, over 3 million of which are in New York.
Schumer said these new Medicare drug negotiated prices will work in tandem with other major drug affordability provisions he secured in his Inflation Reduction Act, including a cap on total out-of-pocket drug costs that drops to $2,000 per year starting in January, making vaccines free for seniors and a $35 insulin cap for those on Medicare, to help make healthcare more affordable for more than 3.8 million New York seniors on Medicare.
Leave a Reply