Beginning in 2026, Medicare enrollees who take 10 commonly prescribed drugs such as Xarelto and Eliquis will receive discounts on their list prices. The negotiated discounts with pharmaceutical companies will save Medicare an estimated $6 billion, with enrollees expected to save $1.5 billion in out-of-pocket costs. These savings are a result of President Joe Biden’s Inflation Reduction Act, which allows Medicare to negotiate prices with pharmaceutical companies. Another 30 drugs will be selected for negotiation in the following years.
These discounts will not apply to most working-age Americans with employer health insurance, as employers typically negotiate lower drug prices through insurance companies and pharmacy managers. The federal law also includes provisions for Medicare enrollees to receive recommended vaccines with no cost-sharing and limits out-of-pocket costs for insulin products.
Despite challenges from drug companies, negotiations have continued, with the Pharmaceutical Research and Manufacturers of America arguing that price negotiations could impact investments in research for lifesaving cures. However, the law has received support from Senator Amy Klobuchar and a majority of Americans who favor Medicare drug price negotiations.
Overall, the negotiated prices on prescription drugs for Medicare enrollees will provide financial relief and cost savings to older Americans who struggle to pay for their medications, with the Biden administration and lawmakers working to ensure that these discounts are implemented effectively.
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