President Biden will sign an executive order today directing the U.S. Health and Human Services Department (HHS) “to consider additional actions to further drive down prescription drug costs,” the White House said this morning.
“Under the Executive Order, HHS will have 90 days to submit a formal report outlining any plans” to use alternative payment models “to lower drug costs and promote access to innovative drug therapies for Medicare beneficiaries,” a White House fact sheet says. “This action would build on the Inflation Reduction Act’s landmark drug pricing reforms and help provide additional breathing room for American families.”
The announcement comes less than a month before elections that will determine party control of the House and Senate during the last two years of Biden’s term in office. A new Kaiser Family Foundation tracking poll found that “reducing the cost of prescription drugs for people with Medicare” appeals to adults as an election issue, especially to older adults.
“Majorities of voters say they would be more likely to vote for a candidate who supports placing a limit on out-of-pocket prescription drug costs for people on Medicare (66%), capping monthly out-of-pocket insulin costs for people with Medicare (65%) and authorizing the federal government to negotiate the price of some prescription drugs for people on Medicare (59%),” KFF said in its report on the poll’s results.
Capping insulin costs for people on Medicare is especially salient as an election issue across all age groups, the poll shows. Seventy-five percent of voters ages 18-29, 65% ages 30-49, 60% ages 50-64, and 64% ages 65 and above said they are more likely to vote for a candidate in the upcoming midterm election who supports the policy.
The Inflation Reduction Act that Biden signed into law in August lets Medicare negotiate “maximum fair prices” for some Part B and D drugs and requires manufacturers to pay rebates on Part B and D drugs when the average manufacturer price for a particular drug rises faster than inflation. How those laws interact with the 340B program is expected to be clarified in forthcoming proposed regulations that have not been published yet.
The Centers for Medicare & Medicaid Services is publishing a notice in the Federal Register today establishing a Medicare Drug Rebate and Negotiations Group “to implement the Drug Price Negotiation Program and the Inflation Rebate Program in Medicare Part B and Part D as
authorized under the Inflation Reduction Act.” Its duties will include policy development, data collection from manufacturers and other sources, economic analysis, “establishing operational processes to negotiate and re-negotiate drug prices and conducting those negotiations with manufacturers,” “establishing operational processes to calculate and invoice rebates,” and monitoring compliance.
Republican lawmakers have vowed to try to repeal the drug pricing elements of the Inflation Reduction Act if they re-take control of the House and Senate in November. President Biden would likely veto any legislation that waters down the law.