Negotiating Medicare Part D Prices

Can the feds negotiate Medicare Part D prices? It’s trickier than it sounds, according to experts from The Pew Charitable Trusts. Policy makers in Congress and the Centers for Medicare and Medicaid Services (CMS) would have to determine, first, which drugs would be subject to negotiation, if the discussions cover specific drugs or also formulary structures, and if negotiations apply to just one or all Part D plans. Assuming those tricky issues could be resolved (and made legal), the parties would need to devise a negotiating process, including whether and how to use arbitration if there’s no agreement.

It’s not clear that establishing such a negotiating process will save Medicare any money, but growing political pressure may lead to some kind of test of such a process, including further examination of what legislative changes may be needed to move forward. See the posting on the website of the journal Health Affairs.