Popular but pricey blood thinners, diabetes medications, cancer treatments make historic list
he names of the first 10 Medicare drugs whose prices the federal government will negotiate directly with manufacturers were released Aug. 29. It marks the first time in history that the price of life-sustaining medications that millions of older Americans in the nation’s largest health program rely upon to prevent strokes and blood clots and to treat diabetes and cancer will be subject to direct negotiation.
“This is an important first step toward finally allowing Medicare to use its purchasing power to lower drug prices,” says Nancy LeaMond, AARP executive vice president and chief advocacy and engagement officer. “Medicare spends more than $135 billion on prescription drugs every year.”
Between June 2022 and May 2023, Medicare Part D spent $50 billion on the first 10 drugs selected for negotiation. That represents 20 percent of Part D spending during that time period. These medications were used by 8.2 million Medicare beneficiaries.
In the long run, Medicare beneficiaries who often must pay a percentage of a drug’s cost would benefit directly from lower negotiated prices, and the government could use the money saved to shore up Medicare’s finances. Negotiations will be expanded to include additional drugs in the years ahead, which would magnify the savings. Lower Medicare spending is also expected to lead to lower Part D premiums.
“Letting Medicare negotiate for lower prices is a commonsense solution that will save seniors money and cut government overspending,” LeaMond says.
Which drugs will Medicare negotiate first?
Here are the 10 drugs that will form the inaugural group of medications subject to negotiations between Medicare and drugmakers. Spending and number of enrollees was between June, 2022 and May, 2023.