Week in Washington is brought to you by Michael Cohen, PhD. Tune in each week to read the latest on healthcare policy and get a glimpse of what’s on the horizon.
Week in Washington
08/31/2023
First 10 Drugs Selected for Medicare Price Negotiation
As part of Inflation Reduction Act the Department of HHS announced this week the first 10 drugs that were selected for negotiation. The Drugs were
- Eliquis
- Jardiance
- Xarelto
- Januvia
- Farxiga
- Entresto
- Enbrel
- Imbruvica
- Stelara
- Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill
The drugs accounted, according to HHS, for $50.5 billion in total part D gross covered prescription drug costs or about 20% of total Part D gross covered prescription drug costs. As a next step the selected drug companies need to agree to negotiations by October 1st. The negotiations would occur in 2023 and 2024 with the prices finalized by September 1, 2024, effective January 1, 2026.
A few notes on the selection process:
- A qualifying drug must have been approved at least 7 years before the Selected Drug Publication date to qualify for price negotiation (for a biologic, 11 years). Since the Selected Drug Publication Date is 23 months before the start of the plan year, new-to-market drugs have ~9 years (small molecule) or ~13 years (biologics) before being subject to price negotiation.
- A drug must be in the top 50 Part D or Part B drugs ranked by total expenditures (not on a per script basis).
- For 2026 and 2027, only Part D drugs are eligible. Beginning in 2028, Part B drugs will be eligible for selection.
- All selected drugs become like protected class drugs in that every MA-PD and PDP participant must include these drugs on their formularies.
As an important reminder there are multiple lawsuits in multiple jurisdictions over implementation of drug negotiations/Inflation Reduction Act. An adverse ruling could delay, alter, or end this process.
Medicaid Unwinding
- CMS announced this week that they are making states that were conducting household-level determinations (rather than individual-level determinations) pause procedural terminations and reinstate coverage for affected people. They did NOT name which states this applies to. However an indicator of household-level determinations is if there are a lot of kids being disenrolled (since kids have much higher FPL eligibility).
- Medicaid unwinding disenrollment stands at about 5.5 million people with disenrollment rates ranging from 72% in Texas to 8% in Wyoming.
Research You Can Use
- Research appearing in Health Affairs by Meiselbach et al found that hospital prices for commercial plans are twice those for Medicare Advantage plans when negotiated by the same insurer.
- Spending on mental health services was about 39% higher in August of 2022 relative to pre-pandemic.
Previous editions:
08/24/2023: Week in Washington
08/17/2023: Week in Washington
08/10/2023: Week in Washington
07/27/2023: Week in Washington
07/20/2023: Week in Washington
07/13/2023: Week in Washington
06/29/2023: Week in Washington
06/22/2023: Week in Washington