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Telos Actuarial is in your inbox today with a short update and some Inflation Reduction Act news.
🎉But first, we are so excited to share that this marks four months of publication of this newsletter! Our compliance community has grown to almost 700 readers! We are incredibly grateful and encourage you to forward to like-minded friends!🎉
August has been a slow month for Congress, State Legislatures, and State Departments of Insurance. This means we aren’t providing our usual content. We hope you enjoy this week’s content as we all anxiously await more regulatory changes!
💵💊Medicare Drug Price Negotiations💊💵
The Inflation Reduction Act of 2022, signed into law by President Biden, requires the Centers for Medicare & Medicaid Services (CMS) to negotiate the prices of certain prescription drugs under Medicare beginning in 2026. For a quick refresher, check out this article.
Last week, CMS released the negotiated prices for 10 drugs covered under Medicare Part D that will go into effect beginning January 1, 2026.
Drug Name | Negotiated Price | List Price | # of Part D beneficiaries using drug (2023) |
|---|---|---|---|
Januvia | $113.00 | $527.00 | 843,000 |
Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill | $119.00 | $495.00 | 785,000 |
Farxiga | $178.50 | $556.00 | 994,000 |
Enbrel | $2,355.00 | $7,106.00 | 48,000 |
Jardiance | $197.00 | $573.00 | 1,883,000 |
Stelara | $4,695.00 | $13,836.00 | 23,000 |
Xarelto | $197.00 | $517.00 | 1,324,000 |
Eliquis | $231.00 | $521.00 | 3,928,000 |
Entresto | $295.00 | $628.00 | 664,000 |
Imbruvica | $9,319.00 | $14,934.00 | 17,000 |
Source: CMS Fact Sheet Aug 15, 2024
These drugs are used to treat a variety of conditions, such as:
cardiovascular disease
diabetes
cancer
kidney disease
arthritis
blood clots
In 2023, these ten drugs accounted for $56.2 billion in total Part D gross covered prescription drug costs, with Medicare Part D beneficiaries spending $3.9 billion out-of-pocket for these ten drugs.
If these negotiated prices would have been in effect in 2023, it could have saved an estimated $6 billion in net drug costs.
In 2026, these negotiated prices alone are projected to save an estimated $1.5 billion for Medicare Part D beneficiaries.
CMS published Draft Guidance on the Medicare Drug Price Negotiation Program in May 2024, which details requirements for the second cycle of negotiations occurring in 2025 that will be effective in 2027.
Telos Actuarial’s team of experienced regulatory compliance professionals are ready to help YOU stay informed of legislative and regulatory changes. Reach out to us for more information!