Washington, D.C. — The Centers for Medicare and Medicaid Services announcement of the first 10 Medicare Part D drugs subject to price negotiation marks historic progress in bringing down the cost of prescription drugs for seniors. A new CAP article breaks down five key takeaways to know about Medicare drug price negotiations and its impact on beneficiary access and affordability.
Today, more than 80 percent of all U.S. adults believe the cost of prescription drugs is unreasonable, with roughly 1 in 3 older Americans reporting that they cannot afford to take their medications as prescribed. This new CAP article highlights five key facts you should know about what Medicare drug price negotiation means, including:
- Drug price negotiation is historic and has the potential for big change: This policy change will begin to bring the United States in line with the drug regulatory practices of nearly all other high-income countries and narrow the gap between what Americans and those abroad pay for prescription drugs.
- Negotiations will target some of the most expensive and frequently used drugs: The first iteration of drug price negotiation will benefit about 9 million Medicare enrollees who have cancer, blood clots, and chronic conditions such as heart failure or diabetes. Of the 10 selected drugs, beneficiaries spent an average of $500 out-of-pocket for 7 of the 10 drugs and more than $2,000 out-of-pocket for three of the drugs.
- Drug price negotiation will advance health equity: Drug price negotiation will help the people who struggle to afford their medications and face health disparities. Many of the drugs the HHS secretary will negotiate treat chronic conditions such as diabetes and heart failure that marginalized and minority populations are more likely to experience. And women, Black, Latino, and disabled beneficiaries use several of the drugs that will be negotiated at higher rates.
- The benefits of drug price negotiation will grow over the years: Over time, these benefits will compound further, with countless Medicare beneficiaries newly able to treat their health conditions without breaking the bank.
- In addition to drug price negotiation, other Inflation Reduction Act Medicare drug reforms, such as capping out-of-pocket costs, limiting insulin costs to $35/month, and preventing drug companies from increasing their already high prices above the inflation rate will provide substantial cost savings to seniors.
“This is a historic step forward for the United States in helping millions of seniors access and afford the medicine they need,” said Nicole Rapfogel, policy analyst for health policy and author of the article. “The Inflation Reduction Act is charting a new path for affordable prescription drugs and is a pivotal step forward to advancing health equity for years to come.”
Read the article: “5 Facts to Know About Medicare Drug Price Negotiation” by Nicole Rapfogel
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