Holy Cow: Inflation Reduction Act to save some Medicare enrollees up to $3,800/DAY on prescription drugs!

Via the White House (from a week ago...I'm almost caught up...):

Statement from President Joe Biden on Lower Prescription Drug Prices

For too long, millions of Americans have faced the impossible choice of paying for their prescription drugs or being able to afford other basic needs. While Big Pharma made record profits, Americans footed the bill for the industry’s price hikes. Not anymore. Thanks to my Inflation Reduction Act, companies that increase the price of prescription drugs faster than inflation now must provide a rebate to Medicare.

Today, our Administration is announcing that starting in October, seniors and people with disabilities enrolled in Medicare will pay less for 54 Part B prescription drugs. That means more money will go back into the pockets of people with Medicare – including some of the 822,000 seniors and people with disabilities who use these drugs annually to treat conditions like cancer, osteoporosis, and pneumonia, and some seniors will save more than $3,800 per day. And last month, for the first time ever, Medicare negotiated lower prices on the first 10 prescription drugs selected for negotiation – some of the most expensive and commonly used medications. Starting in 2025, out-of-pocket costs for prescription drugs will be capped at $2,000 for Medicare beneficiaries.

These lower costs are only possible because of the Inflation Reduction Act, which passed with the leadership of Democrats in Congress, and with Vice President Harris casting the tie-breaking vote in the Senate – without a single Republican voting for it. While Republicans in Congress try to repeal the Inflation Reduction Act which would mean high drug costs for seniors, Vice President Harris and I will keep fighting to ensure all Americans can pay less for prescription drugs. 

I've written about the $2,000/yr prescription drug cap for all Medicare enrollees and the Part D prescription drug negotiation breakthrough before, but this is the first time I've noted the rebate requirement for Part B drugs.

I admit I had to do a double-take when I read "$3,800 per day" but I've confirmed that this isn't a typo. This press release from June listed it as 64 drugs at the time):

HHS Announces Cost Savings for 64 Prescription Drugs Thanks to the Medicare Rebate Program Established by the Biden-Harris Administration’s Lower Cost Prescription Drug Law

Under President Biden’s Inflation Reduction Act, some people with Medicare will pay less for some Part B drugs if the drug’s price increased faster than the rate of inflation.

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 64 drugs available through Medicare Part B. The drugs will have a lowered Part B coinsurance rate from July 1, 2024 – September 30, 2024, since each drug company raised prices faster than the rate of inflation.  Over 750,000 people with Medicare use these drugs annually, which treat conditions such as osteoporosis, cancer, and infections. White House Domestic Policy Advisor Neera Tanden will announce the cost savings on these life-saving drugs in a keynote address on the Biden-Harris Administration’s focus on lowering costs today at the Center for American Progress.

“Without the Inflation Reduction Act, seniors were completely exposed to Big Pharma’s price hikes. Not anymore. Thanks to President Biden and the new Medicare inflation rebate program, seniors are protected and benefitting from lower Part B drug costs,” said White House Domestic Policy Advisor Neera Tanden. “The Biden-Harris Administration will continue fighting to bring down the cost of health care and prescription drugs for all Americans.”

“President Biden’s Medicare prescription drug rebate program is putting money back in the pockets of seniors and people with disabilities, said HHS Secretary Xavier Becerra. “President Biden made lowering prescription drug costs for Americans a top priority, and he is delivering on that promise. Our work is not complete, and we will continue to fight for lower health care costs for all Americans.”

Because of President Biden’s 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 during this time period may save between $1 and $4,593 per day.

It sounds like the specific drugs which have to pay rebates change from quarter to quarter, and yes, some of them do run thousands of dollars per day at full price which is insane of course.