President Joe Biden will announce penalties on drugmakers Wednesday for raising the prices of some drugs faster than inflation for people with Medicare, a move that will lower people’s coinsurance payments.

Ahead of Biden’s comments, in Las Vegas, administration officials previewed the actions the president and his health care team have taken to lower drug costs in a call with reporters Tuesday night.

The Inflation Reduction Act, which the president signed into law last year, includes prescription drug provisions that penalize pharmaceutical companies for raising the prices of certain drugs faster than the rate of inflation for Medicare beneficiaries, officials said. .

Starting next month, some Medicare beneficiaries will see lower out-of-pocket prices for 27 prescription drugs whose prices rose faster than inflation in the last quarter of 2022, the Department of Health and Human Services announced. Companies that violated the provision of the law will have to pay Medicare a refund to cover the difference in prices.

The Secretary of Health, Xavier Becerra, said that the list of drugs subject to reimbursement will be updated every quarter. Becerra also noted that the Inflation Reduction Act capped the price of insulin at $35 and «negotiates a fair price for more prescription drugs.»

“That will be good news for the American people,” Becerra said on the call with reporters. «It will make certain generic drugs available to Medicare beneficiaries for a $2 copay, bringing peace of mind to millions of Americans.»

Chiquita Brooks-LaSure, administrator of the Centers for Medicare & Medicaid Services, said the law has begun to help Medicare beneficiaries by saving money through recommended three free vaccines and caps on insulin costs. She said the new requirement for drug companies to pay rebates to Medicare for raising drug prices faster than inflation went into effect in October.

Brooks-LaSure said her agency will bill drug companies for reimbursements in 2025, but Medicare will begin deducting out-of-pocket costs from beneficiaries in April.

Health and Human Services will also publish initial guidance on its drug price negotiation process, according to a White House statement.

Biden’s comments Wednesday come a week after the president outlined his budget proposals to boost funding for Medicare, which will seek to increase a tax on the wealthy and expand the program’s ability to negotiate lower prescription drug prices. .

“Medicare is more than a government program. It is the solid guarantee Americans have counted on to be there for them in retirement,» Biden wrote in a statement. New York Times opinion piece before the publication of their budget proposals.

Biden wrote that his proposal will build on drug pricing reforms in the Inflation Reduction Act, strengthening Medicare’s «newly established bargaining power» by allowing it to «negotiate prices for more drugs and negotiate drugs ahead of launch.» .

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