White House outlines steps to slash drug costs under signature Biden law
The Biden administration on Wednesday outlined its effort to implement signature legislation that allows Medicare to negotiate the price of drugs for the first time and slashes costs of other drugs that seniors rely on.
White House officials said the Inflation Reduction Act that President Biden and Democrats muscled to passage last year will reduce out-of-pocket costs for more than two dozen drugs under Medicare and make certain vaccines free for 3.4 million Americans.
“Those folks, they paid about $234 million in out-of-pocket costs for those vaccines back in 2021,” Health and Human Services Secretary Xavier Becerra said. “Today, they would pay zero dollars as a result of the president’s new lower prescription drug law.”
Mr. Becerra’s agency also will release guidance on how it plans to implement a marquee part of the law that allows Medicare to negotiate down the cost of certain medicines in Part D, the prescription-drug benefit. Medicare will announce the first 10 drugs selected for negotiation in September.
The administration outlined new and pending benefits for seniors as Mr. Biden leans into the health care debate ahead of the 2024 election cycle.
He is expected to give a campaign-style speech at the University of Nevada, Las Vegas, on Wednesday about his attempts to lower drug costs and contrast it with GOP attempts to repeal his signature law and its cost-lowering provisions, including a $35 cap on out-of-pocket costs for insulin under Medicare.
Repeal would mean “millions of Americans would pay higher health insurance premiums and higher taxes, millions of Americans would pay higher drug prices and insulin prices, and millions of seniors would be unable to get recommended vaccines for free, and billions of dollars would go back into the pockets of Big Pharma, all while increasing the deficit,” White House domestic policy adviser Susan Rice said in a call previewing Mr. Biden’s speech.
Mr. Biden has accused Republicans of targeting key programs such as Medicare, a prized program for tens of millions of seniors, as part of ongoing spending talks — even as GOP leaders say the programs will be protected.
And the president has whipped up the Obamacare wars, saying Republicans would weaken the program even as it enjoys record enrollment on its insurance exchanges.
Mr. Becerra said 16 million Americans have selected a private insurance plan on its portals compared to about 11 million when Mr. Biden took office. Democrats made federal premium subsidies more generous and gave people more time to sign up, making the program more attractive.
Republicans said the administration should have targeted the underlying cost of premiums instead of chasing high costs with bigger payouts from taxpayers. Mr. Biden’s signature law extended the generous subsidies through 2025.
Administration officials said another immediate change from last year’s law will be making the shingles vaccine, which can cost some seniors up to $200, free to enrollees under the vaccine provision that also covers services like the tetanus shot.
The Inflation Reduction Act also said seniors should pay lower out-of-pocket costs when prices rise for doctor-administered drugs in Medicare Part B when the list price of those drugs rises faster than inflation.
Chiquita Brooks-LaSure, the administrator of the Centers for Medicare and Medicaid Services, said she thinks some drugmakers will preemptively lower costs for seniors instead of letting the government hammer down costs for them.
“For the 27 drugs that we’ve listed, cost-sharing for those drugs will go down. We do believe that the inflation rebate proposal, the overall provision, does give a strong incentive for drug companies to not increase their prices above inflation,” Ms. Brooks-LaSure said. “So, it’s sort of, I would say, a two-fold benefit.”