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The Inflation Reduction Act provides meaningful financial relief for millions of people with Medicare by expanding benefits, lowering drug costs, and strengthening Medicare for the future.
New Updates in the Medicare Drug Price Negotiation Program
The second round of the Medicare Drug Price Negotiation Program - PDF, established under the Inflation Reduction Act, has kicked off with the selection of 15 more drugs covered under Medicare Part D. The drugs selected are:
- Ozempic; Rybelsus; Wegovy
- Trelegy Ellipta
- Xtandi
- Pomalyst
- Ibrance
- Ofev
- Linzess
- Calquence
- Austedo; Austedo XR
- Breo Ellipta
- Tradjenta
- Xifaxan
- Vraylar
- Janumet; Janumet XR
- Otezla
Between November 2023 and October 2024, about 5.3 million people with Medicare Part D coverage used these drugs to treat a variety of conditions, such as cancer, type 2 diabetes, and asthma. The 15 drugs accounted for $41 billion in total Medicare Part D spending during that time period.
The negotiations with participating drug companies for these 15 drugs will occur in 2025 and any negotiated prices will become effective in 2027.
Medicare previously successfully negotiated new, lower prices for the first 10 drugs selected - PDF, with those lower prices becoming effective in 2026.
New in 2025: $2,000 Out-of-Pocket Cap
This year, people with Medicare Part D prescription drug coverage will benefit from a new $2,000 out-of-pocket cap on prescription drug costs. The new out-of-pocket cap is just one of the ways the Inflation Reduction Act is working to lower drug costs and make health care more accessible for everyone.
About 11.3 million Part D enrollees are projected to meet the $2,000 out-of-pocket cap in 2025. For these 11.3 million enrollees, total out-of-pocket savings are projected to be about $7.2 billion annually, for an average of about $600 annually per enrollee. Check out how much people with Part D coverage saved in the first part of 2024 thanks to the cap.
Check out how the Inflation Reduction Act is lowering drug costs for people with Medicare
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Inflation Reduction Act Toolkit
Learn more about the Inflation Reduction Act
Read the Latest Inflation Reduction Act Blog
Lowering Drug Costs in Action
Accomplishments under the Inflation Reduction Act:
Many people with Medicare are already seeing lower costs for the health care they need:
$35 Insulin Cap and Other Savings
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People with Medicare pay no more than $35 for a month’s supply of each covered insulin product
Over 3 million Medicare Part D enrollees who filled an insulin prescription in 2023 received a monthly supply of insulin for $35 or less
Free recommended preventive vaccines with Medicare Part D prescription drug coverage
Expanded eligibility for the Low-Income Subsidy program, also known as Extra Help, to provide more enrollees with $0 premiums, $0 deductibles, and fixed, reduced copays
Inflation Rebates
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Drug manufacturers pay rebates to Medicare when they raise their prices faster than the rate of inflation
64 Medicare Part B drugs will have lowered costs for from January 1 – March 31, 2025
Drug Price Negotiations
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New, lower prices in 2026 for 10 selected drugs through Medicare negotiations with participating drug companies
These negotiated prices range from 38 to 79 percent discounts off of list prices
About nine million people with Medicare use at least one of the 10 drugs selected for negotiation
Medicare selected 15 Part D drugs for the second round of negotiations
Medicare Part D Out-of-Pocket Costs
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In 2025, Medicare Part D plans will cap annual out-of-pocket costs at $2,000
This year, Medicare Part D plans will offer the option to pay out-of-pocket prescription drug costs in monthly installment payments instead of all at once, allowing for smaller, more predictable payments for high cost drugs
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