Initial Guidance for Medicare Prescription Drug Inflation Rebate Program

Yesterday the Centers for Medicare & Medicaid Services (CMS) announced next steps describing how the agency will implement the new Medicare Prescription Drug Inflation Rebate Program, including a timeline of key dates. As part of the Inflation Reduction Act (IRA) of 2022 (P.L. 117-169), the Medicare Prescription Drug Inflation Rebate Program requires drug companies to pay a rebate to Medicare if they raise prices for certain drugs faster than the rate of inflation. Based on a 12 month period starting October 1, 2022, drug companies will be required to pay rebates to Medicare for raising prices that outpace inflation on certain Part D drugs.