President Joe Biden’s administration is set to announce the first prescription drugs being targeted by the U.S. government for price negotiations as part of an effort to lower Medicare costs.
More than 52 million people who are either 65 or older or have certain severe disabilities or illnesses get prescription drug coverage through Medicare’s Part D program, according to the Centers for Medicare and Medicaid Services, or CMS.
Currently, pharmacy benefit managers that run Medicare prescription plans negotiate rebates off a drug’s price. Those rebates sometimes help reduce premiums customers pay for coverage. But they may not change what a patient spends at the pharmacy counter. PhRMA representatives also have said pharmacy benefit managers can still restrict access to drugs with negotiated prices by moving the drugs to a tier of their formulary — a list of covered drugs — that would require higher out-of-pocket payments. Pharmacy benefit managers also could require patients to try other drugs first or seek approval before a prescription can be covered.
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