Remember: The savings achieved for the first 10 drugs chosen for Medicare negotiation were released in August, unveiling discounts of 38 percent to 79 percent on the list prices. Since Medicare often pays less for the list price and doesn’t disclose what it actually pays, however, the true savings are unclear.
The negotiated prices will go into effect beginning in 2026.
KFF found that the negotiation process resulted in Medicare paying lower prices than what the Veterans Affairs Department (VA) pays through its own negotiations.
“Big Four drug prices were higher than the new Medicare negotiated prices for all 10 drugs, which represents a change from a prior Congressional Budget Office analysis that showed that Big Four prices for top-selling brand-name drugs were 20% lower on average than net prices paid by Medicare Part D in 2017,” the analysis found, referring to the “Big Four” agencies — the VA, Department of Defense, Public Health Service and Coast Guard — whose drug prices are negotiated for by the VA.
But when compared to 11 other countries that are members of the Organisation for Economic Co-operation and Development, U.S. Medicare still paid significantly more than the average cost in the included peer nations.
The other countries were Switzerland, Germany, Belgium, Austria, Japan, Netherlands, the United Kingdom, Canada, France, Sweden and Australia.
“In all but one instance (the price of Stelara in Germany), every country in this comparison has lower prices than the Medicare negotiated prices for all 10 drugs. In nearly half of cases, Medicare’s negotiated prices are over three times the prices in comparably large and wealthy nations,” KFF noted.
