Medicare beneficiaries will start paying less next month for 27 prescription drugs whose prices have risen faster than inflation. (Photo: Healthcare Finance News)
Medicare beneficiaries will start paying less next month for 27 prescription drugs whose prices have risen faster than inflation.
Beneficiaries could save between $2 and $390 per average dose for these drugs beginning April 1, depending on their individual coverage, according to the Centers for Medicare & Medicaid Services. The lower cost applies to certain drugs and biologicals administered in a hospital or other clinical setting — for example, medications used to treat cancer, arthritis, and chronic kidney disease — and are covered by Medicare Part B.
Beneficiaries who pay 20% coinsurance under Part B will decrease their share due to lower inflation-adjusted prices for these 27 prescription drugs on this list. Furthermore, the list of drugs affected by this coinsurance adjustment may change quarterly.
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The change is the result of legislation passed last year
The lower prices for these 27 prescription drugs result from provisions in the Inflation Reduction Act, passed Congress last August.
The law requires pharmaceutical companies to pay a rebate to the Medicare program if their drug prices rise faster than the rate of inflation, which happens frequently. Half of all Medicare-covered drugs had list price increases that outpaced inflation between 2019 and 2020.
More changes to Medicare drug coverage have been implemented
It isn’t the only change to Medicare drug coverage that beneficiaries should be aware of this year.
The Inflation Reduction Act also set a monthly cost-sharing cap of $35 for insulin delivered through Part D, which went into effect on January 1. Part D deductibles, which vary by plan but cannot exceed $505 in 2023, will also not apply to the covered insulin product.
More changes are on the way in the coming years
Other provisions aimed at reducing Part D spending go into effect later.
This includes eliminating the 5% coinsurance in the catastrophic coverage phase, which will take effect in 2024.
Furthermore, beginning in 2025, beneficiaries’ annual out-of-pocket Part D spending will be limited to $2,000 annually. There is currently no out-of-pocket limit, whether you obtain coverage as a standalone Part D option or through an Advantage Plan.
