Employer Benefit Seen From New Medicare Drug Price Law

Employers could reap some of the benefits of the drug pricing provisions in the Inflation Reduction Act, despite fears costs might be shifted to the private market, analysts say.

The law, (H.R. 5376), signed by President Joe Biden on Aug. 16, requires drug companies beginning in 2023 to pay rebates to the Centers for Medicare & Medicaid Services if drug prices rise faster than inflation. In 2026, the CMS will begin negotiating prices for some of Medicare’s highest-cost drugs.

Despite calls by employer groups to allow commercial plans, such as those sponsored by employers, to benefit from the ...