Unbiased Analysis of Today's Healthcare Issues
Medicare Drug Price Negotiation aims to reduce the prices paid for high cost pharmaceuticals. Traditionally, biologic drug price reductions after loss of exclusivity (LOE) have occurred due to the introduction of biosimilar competitors. A recent paper by Beinfeld et al. 2025 examines whether Medicare Drug Price Negotiation enacted under the Inflation Reduction Act (IRA) is…
The Trump administration has introduced three most-favored-nation (MFN) drug pricing initiatives designed to link U.S. pharmaceutical costs to prices paid in economically comparable countries. Most-favored-nation pricing requires manufacturers to provide rebates when U.S. prices exceed those in reference nations—a direct response to the persistent gap between U.S. drug prices and those in other developed economies.…
Rural Emergency Hospitals (REHs) are a new Medicare provider type created to preserve essential emergency and outpatient access in rural communities where low inpatient volume makes full-service hospitals financially unsustainable. They receive enhanced outpatient payments and a fixed monthly facility payment in exchange for forgoing acute inpatient care. CMS has an REH fact sheet that…
That is the question asked in a recent Health Affairs Forefront article by Peter Neumann, Josh Cohen, Sean Sullivan and Feng Xie. They compare the CMS negotiated prices for Initial Price Applicability Year (IPAY) 2027 against value-based prices (using QALYs) from the Tufts Cost-Effectiveness Analysis (CEA) Registry. The authors found that cost-effectiveness estimates varied among…
Today, the Centers for Medicare and Medicaid Services (CMS) released the results from the Medicare Drug Price Negotiation Program for Initial Price Applicability Year (IPAY) 2027 (press release). What was the average reduction in drug prices? Across the 15 drugs included in the 2027 negotiation, on average, drug prices fell by 62% (median: 63%); accounting…
How does formulary restrictions impact health outcomes for patients with multiple sclerosis (MS)? To answer this question, Blaylock, Van Nuys and Joyce (2025) use data 100% Medicare claims data from 2018-2022 covering patients with both prescription drug plans (PDPs) and Medicare Advantage Prescription Drug plans (MA-PDs). Individuals were categorized as above vs. below average formulary…
Does Medicare Part B increase or decrease the prices of physician-administered drugs relative to physician-administered drugs covered by private insurance? That is the question a paper by Acquatella, Ericson and Starc (2023) aim to answer. Before we answer that question, we first need to understand how Part B works, how physicians are reimbursed, and how…
According to a recent Health Affairs Perspective from Michael Chernew, the answer is ‘no’. In fact, physician and hospital prices may be too low. Although much has been made of high prices contributing to high spending in the US, 5 spending growth in Medicare is not driven by price growth. In fact, inflation-adjusted Medicare physician…
There were lots of very interesting sessions at ISPOR 2025 in Montreal. One of my favorites that I was able to attend was titled “Medicare Price Negotiation of Part B Drugs: Implications for Provider Reimbursement and Commercial Spillover“. The session was moderated by Sean Sullivan of University of Washington, with Kristi Martin from the Centers…
How does a hospital’s participation in a health plan’s Medicare Advantage (MA) provider network impact their commercial rates? Since many insurers offer both MA plans and commercial plans, there could be spillovers with respect to negotiating. How would MA network participation impact commercial rates? Marr et al. (2025) offers some hypotheses: On the one hand,…