Health Affairs November 20, 2023
The Inflation Reduction Act (IRA) is a landmark piece of legislation that will significantly reduce the cost of prescription drugs. What’s missing from all the discussion though is how narrow its scope actually is.
The IRA was signed into law by President Joe Biden in August 2022. The law is the product of political compromise that will benefit millions of Americans under Medicare. It addresses a lot, from climate change to inflation to prescription drugs. For example, the law creates the Medicare Drug Price Negotiation Program and caps certain out-of-pocket expenses, as well as insulin prices.
But the IRA doesn’t address initial market pricing for new drugs, and Medicare Part B is notably missing.
The Initial Drug Price Loophole
The...
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