64 Medicare Prescription Drugs That Are Getting More Affordable

The coinsurance rates for certain Part B medications are being lowered temporarily. Here’s why

Rachel Nania,

Updated December 23, 2024

AARP

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En español

Published September 30, 2024

/ Updated December 23, 2024

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AARP (Source: Getty Images (2))

Some people with Medicare could end up spending less money on potentially lifesaving medications in the beginning of the new year.

The U.S. Department of Health and Human Services (HHS) announced that 64 drugs available through Medicare Part B will have a lower coinsurance rate between Jan. 1 and March 31, 2025, since the prices set by their manufacturers have risen faster than the rate of inflation.

Drugs that fall under Part B are typically administered in a doctor’s office or hospital and can include cancer treatments, Alzheimer’s treatments and injectable osteoporosis medications.

Under a provision in the AARP-backed prescription drug law passed in 2022, the coinsurance rates for these 64 medications will be 20 percent of what the price would have been if it increased with inflation, which will be less than what the beneficiary would pay otherwise. Drugmakers will also face penalties for the price hikes in the form of a rebate to Medicare, and these funds will be used to help ensure the sustainability of the national health insurance program that provides coverage to more than 67 million Americans who are older or have a disability.

Some could see significant savings

More than 853,000 people with Medicare use the 64 selected drugs annually to treat conditions such as cancer, osteoporosis and substannce use disorder. According to HHS, some people with Medicare taking these medications could see savings in the last quarter of the year that range from $1 a day to more than $10,800 a day.

How much each person pays for their medications varies, depending on whether they have additional insurance that covers or reduces Part B’s 20 percent coinsurance. The list price for some of these drugs is hundreds of thousands of dollars per treatment.

“By discouraging drug companies from raising their prices faster than inflation, we are keeping prices affordable for the people with Medicare who rely on these drugs to live healthier lives,” HHS Secretary Xavier Becerra said in a statement.

The Medicare Prescription Drug Inflation Rebate Program is just one provision under the 2022 law that’s aimed at lowering drug prices and related out-of-pocket costs. The law also gives Medicare the power to negotiate lower prices for certain prescription medications. The first batch of negotiations included 10 common and costly medications, and when the lower prices take effect in 2026 they will save people with Medicare prescription drug plans a collective $1.5 billion in out-of-pocket expenses, health officials project.

Another key provision in the law caps annual out-of-pocket prescription drug expenses at $2,000 starting Jan. 1. The new limit is expected to benefit nearly 3.2 million older Americans with a Medicare prescription drug plan in 2025, AARP research found. That number will swell to more than 4 million in 2029.

“The Inflation Reduction Act is lowering prescription drug costs so that people can access the medications they need,” Centers for Medicare & Medicaid Services Administrator Chiquita Brooks-LaSure said in a news release. “As we head into 2025, people with Medicare will feel substantial relief from high drug prices."