The Centers for Medicare & Medicaid Services (CMS) on Aug. 15 announced the final prices Medicare will pay for the first 10 drugs the agency selected for price negotiation as a result of the Inflation Reduction Act. The new prices will take effect in 2026 and are estimated to reduce out-of-pocket costs for people insured under Medicare Part D by up to $1.5 billion.
The 10 drugs selected for negotiation treat diabetes, arthritis, heart disease, cancer, and other conditions. The selected drugs treat 8.8 million Medicare beneficiaries and account for more than $56 billion in Part D spending, roughly 20 percent of total Part D expenditures in 2023.
CMS has assigned each drug a maximum fair price (MFP); drug manufacturers must offer 340B Drug Pricing Program covered entities the lower of MFP and the 340B ceiling prices. Beginning in 2026, covered entities must exclude 340B claims from Part D.
CMS plans to announce 15 more drugs subject to negotiation by Feb. 1, 2025, and the negotiated prices for these additional drugs are scheduled to take effect in calendar year 2027.
Contact Director of Policy Rob Nelb, MPH, at rnelb@essentialhospitals.org or 202.585.0127 with questions.