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The names of 27 Part B prescription drugs whose prices were raised more than the rate of inflation were released by the Centers for Medicare & Medicaid Services (CMS) on March 15. Starting April 1, beneficiaries could pay less out of their pockets for these drugs than they would have before the new drug law.
Under the prescription drug provisions of the 2022 Inflation Reduction Act, drugmakers who raise their prices higher than the rate of inflation will have to pay a penalty, in the form of a rebate, to Medicare. The rebate will be the difference between what the price increase would have been if the manufacturer had stuck to the inflation rate for its increase and what the actual price hike was.
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Drug companies won’t have to pay the rebates for these 27 medicines until 2025, but starting April 1, 2023, the 20 percent coinsurance that consumers are charged will be calculated based on what the price would have been if any price hike had been held to the inflation rate.
“This is a sign that this law is in effect and working to reduce prescription drug prices and costs,” says Leigh Purvis, AARP senior director of health care costs and access. “We’re already seeing the benefits of this new law.”
These 27 medications are all paid for under Medicare Part B, which means they are administered in either a doctor’s office or another outpatient setting. Many of the drugs identified are used to treat chronic kidney disease, cancer or the aftereffects of chemotherapy or organ transplants.
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