Medicare enrollees next year could save on dozens of medications under a federal law that penalizes pharmaceutical companies if they raise prices faster than the rate of inflation, the Biden administration announced Thursday.
Officials with Medicare, the federal health program for adults 65 and older, issued a list of 48 drugs including blood thinners, antibiotics and cancer medications administered at a doctor’s office, clinic or hospital, saying that potential savings on these “Part B” medications would range from $1 to $2,786 per dose, beginning Jan. 1, depending on an individual’s coverage.
Medicare enrollees typically pay 20% coinsurance on doctor-administered medications, but the Biden administration said the inflation penalties will reduce those out-of-pocket expenses by more than half for five drugs. Those drugs include the blood thinner argatroban, the chemotherapy drug bortezomib and antibiotics cefepime, meropenem and vancomycin. You can view a list of the drugs here.
President Joe Biden touted his efforts to promote drug savings during an appearance Thursday at the National Institutes of Health in Bethesda, Maryland. The inflation penalties are part of Biden’s signature 2022 climate and health law, called the Inflation Reduction Act, which pressures drug companies to limit drug prices in several ways.
“It’s about giving folks just a little more breathing room,” said Biden, flanked by doctors and scientists. “For too long, Americans have paid more for prescription drugs than any advanced nation on Earth.”
For the first time, the federal law has empowered the Centers for Medicare & Medicaid Services, or CMS, to negotiate lower Medicare drug prices. The Biden administration has named the first 10 diabetes, heart disease and cancer drugs that Medicare will negotiate, but the price changes on those drugs won’t take effect until 2026. Over the next two years, another 30 drugs will be selected for negotiated prices that take effect in 2027 and 2028.
Biden said price negotiations and other provisions of the federal law will save the federal health program $160 billion over the next decade. He said consumers also will benefit from lower drug prices, including insulin, which is capped at $35 per month for Medicare enrollees.