HHS Releases Initial Guidance for Historic Medicare Drug Price Negotiation Program for Price Applicability Year 2026

For the first time in history, Medicare will have the ability to negotiate lower prescription drug prices because of the Inflation Reduction Act. The U.S. Department of Health and Human Services (HHS), through the Centers for Medicare & Medicaid Services (CMS), issued initial guidance detailing the requirements and parameters—including requests for public comment— on key elements of the new Medicare Drug Price Negotiation Program for 2026, the first year the negotiated prices will apply. Alongside other provisions in the new drug law, the Medicare Drug Price Negotiation Program will strengthen Medicare’s ability to serve people currently in Medicare and for generations to come.

“For far too long, millions of Americans have had to choose between their prescription drugs and other monthly expenses,” said HHS Secretary Xavier Becerra. “President Biden is leading the fight to lower the cost of prescription drugs – and with the Inflation Reduction Act, we’re making historic progress. Through the Medicare Drug Price Negotiation Program, we will make sure seniors get a fair price on Medicare’s costliest prescription drugs, promote competition in the market, and ensure Medicare is strong for beneficiaries today and into the future.”

“Drug price negotiation is a critical piece of how this historic law improves the Medicare program,” said CMS Administrator Chiquita Brooks-LaSure. “By considering factors such as clinical benefit and unmet medical need, drug price negotiation intends to increase access to innovative treatments for people with Medicare.”

The Biden-Harris Administration has made lowering high prescription drug costs and improving access to innovative therapies a key priority. CMS is releasing its initial guidance for how Medicare intends to use its new authority to effectively negotiate with drug companies for lower prices on selected high-cost drugs. The negotiation process will focus on key questions, including but not limited to the selected drug’s clinical benefit, the extent to which it fulfills an unmet medical need, and its impact on people who rely on Medicare. As a result of negotiation, people with Medicare will have access to innovative, life-saving treatments at costs that will be lower for both them and Medicare.

“Negotiation is a powerful tool that will drive drug companies to innovate to stay competitive, fostering the development of new therapies and delivery methods for the treatments people need,” said Meena Seshamani, M.D., Ph.D., CMS Deputy Administrator and Director of the Center for Medicare. “This initial guidance is the next step in the extensive engagement CMS has had to date with interested parties, and we look forward to continuing to receive comment on key policy areas and engage with the public as we implement the Negotiation Program.”

This initial guidance is one of a number of steps CMS laid out in the Medicare Drug Price Negotiation Program timeline for the first year of negotiation. The initial program guidance details the requirements and procedures for implementing the new Negotiation Program for the first set of negotiations, which will occur during 2023 and 2024 and result in prices effective in 2026. Key dates for implementation include:

  • By September 1, 2023, CMS will publish the first 10 Medicare Part D drugs selected for initial price applicability year 2026 under the Medicare Drug Price Negotiation Program.
  • The negotiated maximum fair prices for these drugs will be published by September 1, 2024 and prices will be in effect starting January 1, 2026.
  • In future years, CMS will select for negotiation up to 15 more Part D drugs for 2027, up to 15 more Part B or Part D drugs for 2028, and up to 20 more Part B or Part D drugs for each year after that, as outlined in the Inflation Reduction Act.

CMS is seeking comment on several key elements in today’s guidance. Comments received by April 14, 2023, will be considered for revised guidance. CMS anticipates issuing revised guidance for the first year of negotiation in Summer 2023.

CMS is committed to collaborating and engaging with the public in the implementation of the Inflation Reduction Act. CMS is working closely with patients and consumers, Medicare Part D plan sponsors and Medicare Advantage organizations, drug companies, hospitals and health care providers, wholesalers, pharmacies, and others. Public feedback contributes to the success of the Medicare Drug Price Negotiation Program, and this initial guidance is one tool, among many, that CMS will use to ensure interested parties know when and how they can make their voices heard on implementation of this new drug law.

View a fact sheet on the Medicare Drug Price Negotiation Program Initial Guidance

Read the Medicare Drug Price Negotiation Program Initial Guidance.

The post HHS Releases Initial Guidance for Historic Medicare Drug Price Negotiation Program for Price Applicability Year 2026 appeared first on Pennsylvania Office of Rural Health.

Recommend0 recommendationsPublished in My Healthy Pennsylvania, Rural Health PA

Related Articles

5 Essential Frameworks for Preventing Violent Child Death

The U.S. has a violent child death problem. Developing strategies to prevent violent child deaths death from firearms and traffic crashes is a demanding task that requires consideration of numerous upstream, interrelated, and tangential issues. To help safety advocates develop strategies to prevent violent child death, we compiled five frameworks to help: Understand and explain …
The post 5 Essential Frameworks for Preventing Violent Child Death appeared first on Salud America.

What Are the Risk and Protective Factors for Violent Child Death?

Gun violence and traffic crashes may seem like unpredictable events. But they are not random. They are systematic. Data reveal trends and patterns in gun violence and traffic crashes that can help us identify risk factors and protective factors. This is especially important for addressing violent child deaths. So what does the data show? Join …
The post What Are the Risk and Protective Factors for Violent Child Death? appeared first on Salud America.

As Social Need Screening Advances, Transportation Remains an Afterthought

Some big changes in 2022 and 2023 have set up the healthcare sector to advance screening for non-medical social needs in 2024 and beyond. This is great news as we work to address social determinants of health (SDoH), improve health outcomes, and reduce health disparities. But one key social need – transportation – isn’t getting …
The post As Social Need Screening Advances, Transportation Remains an Afterthought appeared first on Salud America.