Prescription Drug Costs

On February 1, the Centers for Medicare & Medicaid Services (CMS) sent initial offers to the participating drug companies of the first ten prescription drugs selected for negotiation in the first cycle of the Medicare Drug Price Negotiation Program. CMS announced the ten initial drugs selected for the first cycle of Medicare drug price negotiation on August 29, 2023, and on October 3, HHS announced that the drug companies of all 10 selected drugs agreed to participate in negotiations with Medicare. Negotiations will continue over the next several months, with negotiations ending by August 1, 2024...

The AARP Public Policy Institute's latest report in their Rx Price Watch series highlights the impact of prescription drug price increases on consumers, employers, private insurers, and taxpayers, affecting programs like Medicare and Medicaid. The report presents annual and 15-year cumulative price changes, until the end of 2020, for a comprehensive set of 943 prescription drugs widely used by older adults, emphasizing the potential long-term consequences on health care coverage costs, taxes, and public programs.

In a recently published press release, the White House announced new actions to promote competition in health care and support lowering prescription drug costs for American families, including the release of a proposed framework for agencies on the exercise of march-in rights on taxpayer-funded drugs and other inventions, which specifies that price can be a factor in considering whether a drug is accessible to the public. This press release details new action to support lowering prescription drug costs and increase Americans’ access to life-saving medications, efforts to stop anticompetitive mergers and anticompetitive practices by dominant corporations in health care markets, and ...

The Administration for Community Living (ACL) and Centers for Medicare & Medicaid Services (CMS) announced actions to improve enrollment in the Extra Help with Medicare Prescription Drug Plan Costs program, also known as the Low-Income Subsidy. The Extra Help program provides eligible older adults and individuals with disabilities with help paying for their Medicare Part D prescription drug premiums and cost-sharing. Up to three million older adults and individuals with disabilities are eligible for the Extra Help program but are not enrolled. Actions to increase uptake of the program include targeted efforts to reach those eligible for the program, including individuals living in rural and underserved communities...

This issue brief reviews the structure of the prescription drug benefit in Medicaid and the traditional policy levers states have used to control drug spending. It also describes state strategies to contain costs, such as efforts to obtain greater rebates, actions concerning generic drugs and biosimilar alternatives, transparency laws and new efforts to draw on federal resources.