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Taxpayers are expected to save billions after the Biden administration inked deals with pharmaceutical companies to knock down the list prices for 10 of Medicare’s costliest drugs.
But how much older Americans can expect to save when they fill a prescription at their local pharmacy remains unclear, since the list cost isn’t the final price people pay.
After months of negotiations with manufacturers, list prices will be reduced by hundreds—in some cases, thousands—of dollars for 30-day supplies of popular drugs used by millions of people on Medicare, including blood thinners, diabetes drugs and blood cancer medications. The reductions, which range between 38% and 79%, take effect in 2026.
Taxpayers spend more than $50 billion yearly on the 10 drugs, which include popular blood thinners Xarelto and Eliquis, and diabetes drugs Jardiance and Januvia.
With the new prices, the administration says savings are expected to total $6 billion for taxpayers and $1.5 billion overall for some of the 67 million people who rely on Medicare. Details on those calculations, however, have not been released. And the White House said it could not provide an average cost-savings for individual Medicare enrollees who use the drugs.
That’s because there are a number of factors—from discounts to the coinsurance or copays for the person’s Medicare drug plan—that determine the final price a person pays when they pick up their drugs at a pharmacy.
The new drug prices are likely to most benefit people who use one of the negotiated drugs and are enrolled in a Medicare plan with coinsurance that leaves enrollees to pay a percentage of a drug’s cost after they’ve met the deductible, said Tricia Neuman, an executive director at the health policy research nonprofit KFF.
“It is hard to say, exactly, what any enrollee will save because it depends on their particular plan and their coinsurance,” Neuman said. “But for the many people who are in the plans that charge coinsurance, the lower negotiated price should translate directly to lower out-of-pocket costs.”
This article was provided by The Associated Press.