New HHS Reports Illustrate Potential Positive Impact of Inflation Reduction Act on Prescription Drug Prices – HHS.gov

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The reports, which track rising drug costs from 2016 to 2022, provide information on how much inflation rebates in the Inflation Reduction Act would protect Medicare beneficiaries from rising drug prices
For decades, Americans have spent more on prescription drugs than people in other countries. The Biden-Harris Administration has prioritized making prescription drugs more affordable for Americans both to improve public health and to provide economic relief to Americans, many of whom pay a significant part of their income for the medication they need to stay healthy.
Today, the U.S. Department of Health and Human Services (HHS) released two new reports that illustrate the urgency of addressing skyrocketing prescription drug costs in America, a key Biden-Harris Administration priority. HHS’s analyses of prescription drug prices from 2016-2022 show that if the Inflation Reduction Act had been in place from July 2021 to July 2022, more than 1,200 prescription drugs potentially would have been subject to the new provision requiring drug manufacturers to pay rebates to Medicare if they enact price increases greater than inflation for drugs. Price increases on those drugs in the month the price change took effect averaged more than 30%.
The publication of these reports coincides with a key date related to a provision of the Inflation Reduction Act, which requires drug manufacturers to pay rebates for drugs in Medicare Part D whose price increases exceed inflation for the 12-month period beginning October 1, 2022.  A similar provision for Part B drugs takes effect beginning in January 2023. In addition, the Inflation Reduction Act requires the federal government to negotiate drug prices on certain high spending prescription drugs for Medicare beneficiaries.
“In recent years, prescription drug prices have skyrocketed, but thanks to the Inflation Reduction Act, America’s families will soon start seeing relief,” said HHS Secretary Xavier Becerra. “The Biden-Harris Administration is focused on providing high-quality, affordable health care to people across the country. No one should have to choose between buying groceries or a prescription, making a home repair or going to the doctor, or splurging on a grandkid or seeking treatment.”
The Biden-Harris Administration has been working to lower costs for American seniors and families – and these provisions of the Inflation Reduction Act are yet another way President Biden is taking action to make that happen. Under President Biden’s leadership, thanks to the American Rescue Plan and other Administration efforts, more Americans than ever before have health insurance coverage – and now, with the Inflation Reduction Act, millions of Americans will see lower health care costs and get relief from high prescription drug prices.
While Republicans in Congress are working to put Medicare on the chopping block, limit access to health care, and deny millions of Americans the cost-savings they would receive from Medicare’s basic ability to negotiate lower prescription drug prices, the Biden-Harris Administration is working tirelessly to protect and strengthen Medicare, lower costs, and expand access to high-quality, affordable health care.
Key findings from today’s reports, published by HHS’s Office of the Assistant Secretary for Planning and Evaluation (ASPE), include the following:
Report: Price Increases for Prescription Drugs, 2016-2022
Key Points:
Report: Trends in Prescription Drug Spending, 2016-2021
Key points:
To read the reports, please click on the links to follow:
Price Increases for Prescription Drugs, 2016-2022
Report: Trends in Prescription Drug Spending, 2016-2021
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