Medicare Drug Price Negotiations: Who really benefits?

Medicare is the single largest health insurer in the United States. Leveraging that beneficiary base to negotiate better prices for drugs sounds like it could be a great idea.

That’s the point of the Medicare Drug Price Negotiation Program, created in 2022 by the federal Inflation Reduction Act (IRA).

Adina Lasser
_{© Alliance for Aging Research}

But so far federal regulators have selected drugs that have the greatest cost to Medicare, not its beneficiaries. That means “beneficiaries deserve better,” and there are policies that could make prescription drugs more accessible and affordable to seniors, according to the Alliance for Aging Research (AAR).

Adina Lasser, AAR director of public policy and government affairs, published a statement responding to the Jan. 17 announcement about the next 15 drugs subject to price negotiation. She also authored an analysis in Health Affairs arguing the U.S. Centers for Medicare & Medicaid Services in the U.S. Department of Health and Human Services could set up regulatory guardrails that ensure greater financial relief for patients.

What’s more: A program intended to help beneficiaries could create barriers to care, she said.

Lasser spoke with Medical Economics to discuss the potential unintended side effects of the Medicare Drug Price Negotiation Program, as created by the federal Inflation Reduction Act. Talks with federal regulators and pharmaceutical makers began last year to determine prices on 10 drugs, with the new prices to take effect in 2026.