The Inflation Reduction Act (the “IRA”) requires drug manufacturers to pay rebates to Medicare when the prices of their Part B and Part D prescription drug increase faster than the rate of inflation. We recently discussed the guidance documents issued by the Centers for Medicare and Medicaid Services (“CMS”) detailing the proposed implementation of the Medicare Part B and Medicare Part D Prescription Drug Inflation Rebate Programs.
On March 15, 2023, CMS announced the first 27 Part B drugs and biological products prescription drugs that will have an adjusted coinsurance rate based on the inflation-adjusted payment amount. CMS has released information for the April 1 to June 30, 2023 quarter, providing HCPCS codes and inflation-adjusted coinsurance percentages for each drug Part B rebatable drug that CMS has identified. This information has also been published in the April 2023 Medicare Part B Quarterly Average Sales Pricing public files. CMS will post payment information each quarter for separately payable Part B drugs, and the drugs impacted by a coinsurance adjustment may change quarterly.
CMS states that people with Traditional Medicare and Medicare Advantage who use these drugs may, depending on other health insurance coverage they may have, pay a reduced amount for their coinsurance during this specific quarter. Further, CMS states that for April 1 to June 30, 2023, people with Medicare may experience coinsurance amounts that are lower than what they would have paid before the new law was enacted by as much as $2 to $390 per average dose. The Biden Administration also released a fact sheet which provides new data on the prescription drug provisions of the IRA, including that the Part B Rebate Program will discourage other companies from increasing their prices faster than inflation.