In August 2022, President Biden signed the Inflation Reduction Act (IRA) into law. This law enacted changes to Medicare Part D prescription drug coverage. One part of this was the ability of Medicare to negotiate the prices of some medications. It is estimated that drug negotiation will save Medicare over 98 billion dollars in its first 10 years.
This week, the list of the first 10 drugs selected for negotiated prices was released. These drugs were prioritized for this first grouping for several reasons:
- They represent the highest amount of Medicare spending. The drugs are VERY expensive and/or there are many people with Medicare Part D using the medications.
- They have been “on the market” for many years.
- They don’t have “competing” medications that are currently available.
These negotiated prices will go into effect in 2026. More drugs will be added to the negotiated drug list in the future. These drugs are only PART D-covered drugs. Medications covered under part B (those given by IV) are not subject to negotiated prices at this time—this goes into effect in 2028.
The drugs included in the first group are:
- Eliquis-for prevention of stroke and blood clots.
- Jardiance-for diabetes.
- Xarelto- for prevention of stroke and blood clots.
- Januvia-for diabetes.
- Farxiga- for diabetes, chronic kidney disease, and heart failure.
- Entresto-for heart failure.
- Enbrel for arthritis/autoimmune diseases.
- Stelara- for Crohn’s disease.
- Flasp/Novalog-for diabetes.
- Imbruvica-CLL and Waldenstrom’s Macroglobulinemia (WM).
Imbruvica is the only cancer treatment on the list. I know this may be a hard pill to swallow (pun intended) for cancer patients struggling to pay for other oral cancer medications. Because Imbruvica was included in this first group, despite the relatively small number of individuals with CLL/WM, I’m optimistic that other cancer treatment medications will be included in future negotiation lists.
Remember too that cancer patients also have diabetes, blood clots, and cardiac issues. So, they may also benefit from negotiated pricing for these conditions, which hopefully helps their bottom line.
The implementation of drug negotiation is a long time coming. While some manufacturers are trying to challenge the legality of this part of the IRA, the fact of the matter is that Medicare negotiates for almost all other services—from how much they pay your healthcare providers, to what they will pay for medical equipment—these are all negotiated. Hopefully, this gives some weight in the courts to uphold the legality of drug price negotiation.
Remember, that other changes impacting part D that are part of the IRA are already happening!
- Insulin is capped at $35 monthly.
- Vaccines are available with no copay.
- In 2024, we will see the end of the “catastrophic period” of Part D coverage. Drug costs will be capped at around $3,500 (total for ALL prescriptions) in 2024.
- In 2025, the cap for ALL part D spending will be $2,000 annually. This means the most you will spend on ALL of your medications in a year is $2,000 and…
- Beginning in 2025 you will be able to spread out the payments for your medications over the 12-month period…instead of having $2,000 in expenses in January.
These are exciting times for Medicare Part D recipients. It’s important to stay up to date on your coverage options and how your out-of-pocket responsibilities may change in the coming years as a result of the IRA.
Christina Bach is a licensed clinical social worker and board-certified oncology social worker. She is the psychosocial oncology content editor at OncoLink.org. She has over 20 years of experience working with people with cancer and their families and is also the social work facilitator of the Philadelphia Multiple Myeloma Networking Group. She is interested in financial toxicity, life after cancer, educating social work students, and animal assisted interventions. She volunteers regularly with her certified therapy dogs, Linus, Huckleberry, and Eugene (in training). In her spare time she enjoys knitting, cooking, cheering for the Phillies and Eagles, binge-watching great shows and traveling to Cape Cod to spend time with family.