Commonwealth Fund September 22, 2023
TOPLINES
Therapeutic alternatives can determine the right offer price in Medicare drug negotiations and help reduce prescription drug costs for Medicare beneficiaries
By using therapeutic alternatives to inform initial offer price on Medicare drugs, CMS can help quantify the clinical benefits of brand-name drugs compared to alternatives
In August 2022, President Biden signed the Inflation Reduction Act, giving the Centers for Medicare and Medicaid Services (CMS) the authority to negotiate prescription drug prices for certain high-cost drugs in Medicare. When this provision takes effect in 2026, it will mark the first time the federal government has negotiated with drug manufacturers.
Recently, CMS selected the first 10 drugs for negotiation based on criteria outlined in the law. The agency will now...
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