Washington, D.C. — Today, the Biden administration announced that dozens of drug companies will be required to pay a rebate to Medicare because they raised prices faster than the rate of inflation. In total, 48 drugs under Medicare Part B hiked prices faster than inflation in the last quarter of 2023, and now the rebate payments are expected to save seniors who take these drugs up to $2,786 per dose. This afternoon, President Biden is expected to provide an update on implementing the Inflation Reduction Act and lowering drug costs for seniors across the nation, including savings from inflation rebates, the $35 monthly cap on insulin, and free vaccines. The president will also highlight how these policies are saving nearly 15 million patients an average of $800 per year on their health insurance premiums.
“Thanks to the Biden administration, the Inflation Reduction Act is lowering drug costs for seniors and families across the nation,” said Protect Our Care Chair Leslie Dach. “Gone are the days when drug companies could raise prices higher than inflation any time they wanted to and without consequence. Now, seniors and taxpayers are saving billions of dollars, and fewer seniors will have to choose between the drugs they need and the drugs they can afford. Meanwhile, Republicans are fighting to repeal all of the Inflation Reduction Act’s drug pricing provisions and savings for families. President Biden stood up to the greed of big drug companies and won, and families are seeing the benefits.”
The Biden administration also announced a new policy to ensure the best value for taxpayers by establishing a fair pricing standard for medical products purchased by the Administration for Strategic Preparedness and Response. Additionally, the administration released a new report on the first 10 drugs selected for Medicare negotiation under the Inflation Reduction Act. Seven of the 10 drugs used taxpayer dollars during development and the rate of growth in spending for these 10 drugs was more than 3 times as fast as for all Part D drugs over the same period.
These announcements follow a long line of actions the Biden-Harris administration has taken to reduce prescription drug and health care costs for the American people. The Inflation Reduction Act lowered drug prices for millions of seniors by capping insulin costs at $35 per month, limiting outrageous price hikes, and making essential vaccines free for people on Medicare. Soon, total out-of-pocket drug costs will be capped at $2,000 per year for seniors and lower drug prices from Medicare negotiation will take effect. Together, these measures could save seniors thousands of dollars on their health care.
At the same time, Republicans in Congress are fighting to roll back this progress and repeal the Inflation Reduction Act’s historic measures to lower drug prices for seniors. Repealing these policies would cost seniors billions of dollars — only putting money back in the pockets of big drug companies.