Bold Move: Medicare Drug Price Negotiation Timeline Revealed!

livewell
May 14, 2025
Noah Bennett

The U.S. Centers for Medicare and Medicaid Services (CMS) reported that, by early February next year, they will publish the list of 15 drugs that will be eligible for a third round under Medicare drug price negotiation.

As stated by CMS, this time the list would, for the first time, include Part B Medicare drugs, which cover prescriptions billed through the doctor’s office and those given in the hospital, along with Part D.

Medicare will negotiate the prices of some selected drugs using certain high-cost, inflation-controlled method, directly with their suppliers. This legislation was designed to reduce healthcare spending for millions of Americans, particularly the elderly population. The drug pricing program was initiated with the enactment of the Inflation Reduction Act of 2022.

Key Dates for Medicare Drug Price Negotiations

The Centers for Medicare & Medicaid Services has provided a detailed timeline for the first set of negotiations that is very detailed. Below is a list of important timelines:

August 2023: Initial 10 Part D drugs were listed by CMS, and they included negotiation lists. The chosen drugs were some of the highest-cost drugs under Medicare.
February 2024: Drug manufacturers negotiated data submission with CMS for the chosen drugs, and within the same month, manufacturers’ initial offers were received. In August of that same year, CMS was reported to have set prices for 10 of the negotiated drugs after a year-long process. This was termed the first cut.
Spring 2024: Negotiation action meetings alongside offer evaluations are in progress by CMS.
September 1, 2024: The negotiated prices considered final will be published by CMS for the selected drugs
November 2025: The second phase is considered active alongside Ozempic, the diabetes medicine from Novo Nordisk, which holds significant profit margins. 10 other medicare drugs are also included. A price decision is anticipated by the end of December of this year.
January 2026: Reset pricing will immediately start receiving direct subsidies from beneficiaries of Medicare.

Prices negotiated for the third round will be effective from January 1, 2028. Furthermore, CMS has stated that it was proposing some issues for public comment pertaining to manufacturers’ participation policy to enhance program transparency and ease the administrative burden.

Impact on Medicare Beneficiaries

The Medicare negotiation aims to ease the financial burden of prescription medications for seniors and people with disabilities. Currently, many beneficiaries struggle with brand-name drug co-payments and deductible costs and are bearing a huge financial burden.

Through Medicare drug price negotiation, it hoped to achieve the following:

Decrease beneficiaries’ prescription drug expenditures.
Ensure equitable pricing based on value, benefit, and cost efficacy against clinical standards.
Reduce the total spending on Medicare, thus enabling some stability of the Part D premiums.

This policy is extremely important in changing the experience of older adults who are economically disadvantaged and face difficult trade-offs.

Response by the Pharmaceutical Industry

The pharmaceutical industry’s response has been mixed. Pharmaceutical companies and associations are taking the Medicare drug price negotiation process to court, arguing that it disrupts free market capitalism as well as means to promote innovation.

Pharmaceutical companies trying to block negotiations through courts have not made an impact yet, as CMS is still pushing forward with the set timeline. They believe that their goals are set to achieve will improve public welfare.

Proposed Future Developments for Medicare Drug

Recent timelines are only applicable to the first set of 10 complex medications, but other negotiations are likely to take place in the coming years:

2025: More advanced negotiations will occur; CMS plans to release another set of 15 Part D drugs for negotiation.
From 2026: The medicare drug price negotiation will be broadened to include drugs in Part B (given in clinical settings), and more Part D drugs will be included to expand the program’s impact.
Mid-2029 is the mark where CMS plans Medicare to begin negotiating prices for 60 drugs annually.