Written By: Dr. Zemen Habtemariam
Edited By: Kenneth Dandurand
Just last month the Inflation Reduction Act was passed in Congress. This law, in effect, allows provisions to improve the costs of prescription drugs. Here are a few of those changes:
Lowering the costs of Medicare Part D drugs. The bill allows Medicare to establish a Drug Price Negotiation program negotiate the price of 10 of its highest priced Part D drugs, starting in 2026. That number will rise to 15 by 2027, add on 15 Part B drugs by 2028 and eventually 20 Part D and Part B drugs by 2029. Biosimilar agents and drugs with no generic, however, are not included in this list.
Requires pharmaceutical companies to either “play” or “pay.” The Act also requires pharmaceutical companies to comply with negotiating prices. Otherwise, they can be subject to steep excise taxes and other civil financial penalties.
Cutting down on out-of-pocket drug costs. Starting in 2025, seniors on Medicare would have a $2000 cap on out-of-pocket spending on drug costs. with no additional cost after this limit.
Capping insulin prices (finally) and vaccine costs! Under the new law, insulin prices are capped at $35. Furthermore, all vaccines covered under Part D will be no charge for members, starting in 2023.
Expanding the Low-Income Subsidy Program. Starting in 2024, a program geared toward additional assistance for low-income Medicare recipients will be modifying their eligibility requirements. A program originally open to people within 135 percent of the federal poverty level (FPL), the Act will now expand full benefits to people within 150 percent of the FPL.
About the Author
Zemen Habtemariam, PharmD
Pharmacy Practice Fellow for Clinical Pharmacy Associates
Dr. Zemen Habtemariam, PharmD, is a Pharmacy Practice Fellow for Clinical Pharmacy Associates. He received his B.S. in Chemistry from University of Maryland, College Park and received his Doctor of Pharmacy degree from the University of Maryland School of Pharmacy. He serves as the Pharmacy Practice Research Fellow for Clinical Pharmacy Associates, Inc. He has had broad range of pharmacist experience in community, managed care, and clinical trial settings. He has previously served as the Pharmacist of Record on multiple investigational drug trials. He also assisted in coordinating transitions of care for atypical antipsychotic patients for the Maryland Medicaid Peer Review Program, and conducted comprehensive medication reviews for Spanish-speaking patients for AdhereHealth
Kenneth Dandurand, RPh, MS
Co-Founder and CEO of Clinical Pharmacy Associates, Inc. and Co-Founder and President of MedNovations, Inc. Board Member Asperger/Autism Network
Ken is an ASHP residency trained clinical pharmacist with a BS from Northeastern University and a Master’s from Oregon State University. As an entrepreneur and researcher for 35 years he co-founded Clinical Pharmacy Associates and MedNovations successful leaders in providing direct pharmaceutical care via tele-pharmacy. He is dedicated to improving the delivery of medication therapy management to consumers. To that end, Ken has authored a chapter in the Book “Misadventures in Health Care: Inside Stories” titled “Prescription for Error.”