The Inflation Reduction Act (IRA), enacted in August 2022, changes the way Medicare pays for drugs. IRA drug pricing provisions, include capping Part D enrollee cost-sharing at $2,000; requiring manufacturers to pay rebates when prices for drugs in Medicare Part B and Part D increase faster than inflation; authorizing the Secretary of the Department of Health and Human Services (HHS) to negotiate prices directly with participating manufacturers for selected drugs that are high expenditure, single source drugs without generic or biosimilar competition; expanding financial assistance through Medicare’s low income subsidy (LIS) program; capping insulin cost-sharing at $35 a month for each covered insulin product under Medicare Part B and Part D; and eliminating cost-sharing for recommended adult vaccines covered under Medicare Part D.
