Relatively Few Drugs Account for a Large Share of Medicare Prescription Drug Spending

(By Juliette Cubanski and Tricia Neuman for Kaiser Family Foundation Published: Apr 19, 2021)

Policymakers are once again focusing attention on proposals to lower prescription drug costs. During the previous session of Congress, the House passed legislation (H.R. 3) to allow the federal government to negotiate drug prices for Medicare Part D, Medicare’s outpatient prescription drug benefit, and private insurers. Under H.R. 3, the HHS Secretary would negotiate prices for up to 250 brand-name drugs lacking generic or biosimilar competition with the highest net spending. In contrast, other drug price negotiation proposals placed no limit on the number of covered drugs subject to negotiation. In a similar vein, the Trump administration issued a final rule to establish a model through the CMS Innovation Center that would base Medicare’s payment for the 50 highest-spending Part B drugs (i.e., drugs administered by physicians in outpatient settings) on the lowest price paid by certain other similar countries. (In light of pending litigation, the Biden Administration has stated that it will not implement this model without further rulemaking.)  Continue reading the brief here…

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