The U.S. Department of Health and Human Services (HHS), through the Centers for Medicare & Medicaid Services (CMS), today announced that some Medicare enrollees will pay less for 54 drugs available through Medicare Part B. The drugs will have a lowered Part B coinsurance rate from October 1, 2024 – December 31, 2024, since drug companies raised prices for each of these 54 drugs faster than the rate of inflation. Over 822,000 people with Medicare use these drugs annually to treat conditions such as cancer, osteoporosis, and pneumonia. Since April 1, 2023, people with Medicare have seen savings on over 100 drugs thanks to Inflation Reduction Act’s Medicare Prescription Drug Inflation Rebate Program.
“The President’s lower cost prescription drug law continues to put money back in the pockets of seniors and people with disabilities,” said HHS Secretary Xavier Becerra. “President Biden and Vice President Harris promised to lower prescription drug costs – and they have delivered.”
“No one should have to choose between paying for their health care or putting food on the table,” HHS Deputy Secretary Andrea Palm said at an event announcing the updated list in Pennsylvania today. “The Inflation Reduction Act is all about bringing down the price of health care and making sure the American people benefit.”
Because of the Biden-Harris lower cost prescription drug law, the Inflation Reduction Act, which established the Medicare Prescription Drug Inflation Rebate Program, some people with Medicare who use these drugs in the last quarter of 2024 may save between $1 and $3,854 per day. For example, someone taking a drug called Kymriah, which treats cancer, could save as much as $3,000.
“The Biden-Harris Administration is dedicated to ensuring people with Medicare have access to their prescription drugs, and the Inflation Reduction Act continues to deliver on our goal to improve affordability,” said CMS Administrator Chiquita Brooks-LaSure. “Discouraging price increases above the rate of inflation by drug companies and negotiating lower prices on some of the most expensive and most frequently used drugs in the Medicare program delivers on our promise to bring savings to Medicare enrollees.”
The Medicare Prescription Drug Inflation Rebate Program is just one of the Inflation Reduction Act’s prescription drug provisions aimed at lowering drug costs. In August, the Biden-Harris Administration announced it had reached agreements for new, lower prices for all 10 drugs selected under the first round of the Medicare Drug Price Negotiation program. If these new prices had been in effect last year, Medicare would have saved an estimated $6 billion. Once these prices take effect in 2026, people with Medicare Part D are expected to save an estimated $1.5 billion in total out-of-pocket costs.
In addition to the negotiated prices, another major cost-savings benefit begins in 2025, when all people with Medicare Part D will benefit from a $2,000 cap on annual out-of-pocket prescription drug costs. In 2024, some enrollees who have high drug costs are already seeing their annual out-of-pocket costs capped at about $3,500.
The Inflation Reduction Act requires drug companies to pay rebates to Medicare when prices increase faster than the rate of inflation for certain drugs. CMS intends to begin invoicing prescription drug companies for rebates owed to Medicare no later than fall 2025. The rebate amounts paid by drug companies will be deposited in the Federal Supplementary Medical Insurance Trust Fund, which will help ensure the long-term sustainability of the Medicare program for future generations.
For more information on the Medicare Prescription Drug Inflation Rebate Program visit, https://www.cms.gov/inflation-reduction-act-and-medicare/inflation-rebates-medicare.
To view the fact sheet on the 54 Part B drugs with a coinsurance reduction for the quarter October 1, 2024 – December 31, 2024, visit, https://www.cms.gov/files/document/reduced-coinsurance-certain-part-b-rebatable-drugs-october-1-december-31-2024.pdf.
More information and helpful resources about the Inflation Reduction Act and how it is helping to lower costs for people with Medicare can be found at LowerDrugCosts.gov and MedicamentosBajoPrecio.gov.
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