Medicare costs lowered for 10 drugs in latest round of price negotiations

The Biden administration announced today it has reached agreements for new, lower prices for 10 of Medicare’s most popular and costliest prescribed drugs.

The drugs are used to treat conditions such as heart disease, diabetes, and cancer. The new prices will go into effect for people with Medicare Part D prescription drug coverage beginning Jan. 1, 2026.

These negotiated prices range from 38% to 79% discounts off of list prices, the U.S. Department of Health and Human Services announced in a news release.  The list price is the cost of medication before discounts or rebates are applied — not the price people actually pay for prescriptions. About nine million people with Medicare use at least one of the 10 drugs selected for negotiation. People with Medicare prescription drug coverage are expected to see aggregated estimated savings of $1.5 billion in their personal out-of-pocket costs in 2026.

The Office of the Assistant Secretary for Planning and Evaluation also released new data today detailing historic trends of the 10 drugs selected for the first cycle of the negotiation program. The report finds that from 2018 to 2023, list prices increased as much as 55%.

The Centers for Medicare and Medicaid Services will select up to 15 more drugs covered under Part D for negotiation for 2027 by Feb. 1, 2025. CMS will select up to 15 more drugs covered by Part B or Part D for 2028, and up to 20 more Part B or Part D drugs for each year after that, as required by the Inflation Reduction Act.

The price negotiations are part of the Inflation Reduction Act, passed in 2022. The law also capped out-of-pocket spending on Medicare Part D prescription drug costs to $2,000 a year beginning in 2025.

The list of drugs and their negotiated prices to take effect in 2026 is:

Note: Numbers other than prices are rounded to the nearest thousands. List prices are rounded to the nearest dollar and represent the Wholesale Acquisition Costs for the selected drugs based on 30-day supply using 2022 prescription fills. Drug companies’ participation in the Negotiation Program is voluntary; the figures above represent estimates based on continued drug company participation in the Medicare program.

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Susan Rupe is editor in chief, magazine, for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].