For the first time, Medicare negotiated prices with drug companies.
The cost of prescription drugs Main factors behind rising medical costs Connecticut is expected to grow 7.7% from 2021 to 2022, the highest growth rate of any other category. Medicare covers 1 in 5 Connecticut, a state populated primarily by elderly and disabled people, is the nation’s largest buyer of drugs. The United States is the most expensive On average, medicines cost 2.8 times more than in other countries, which is a huge problem.
The first 10 drugs Announced last weekMedicare negotiated discounts, ranging from 38% to 79% starting in 2026, are expected to save Medicare beneficiaries $1.5 billion, and the program should save $6 billion that year. Reflect the value of the drug The question is not how much pharmaceutical companies can charge, but how much benefit they can deliver to patients. Medicare also considered maintaining sufficient incentives for companies to develop new drugs. And the savings don’t stop there: Medicare will soon announce the next 15 drugs for which it will negotiate prices in 2027, and each year thereafter.
This is something of a miracle in national politics. Until the Inflation Control Act of 2022 was passed, it was illegal for Medicare to negotiate drug prices. Other countries have been negotiating prices for decades, and that’s how they keep drug prices affordable. Even tiny Denmark Negotiating price cut for weight loss drug Ozempic Ozempic is a strain on budgets around the world. It’s made by Novo Nordisk, a Denmark-based company valued at more than the country’s entire GDP, but the company managed to negotiate a steep discount with leading domestic companies.
There is no need to worry about whether pharmaceutical companies will be able to remain solvent if prices fall. Very profitable But they pay very little tax. Spend more money on lobbying We give more to our people in Washington than any other industry. Political Campaigns and Doctor Doctors prescribe medicines. But pressure to contain medical costs has finally intensified.
The pharmaceutical companies are not taking this lying down. Multiple Lawsuits Drugmakers have cited multiple grounds for halting the process — but have lost every case so far — and drug leaders have told investors they’re confident profits will continue.
Would this help Connecticut residents who don’t have Medicare? If Medicare costs go down, Most funded by taxpayers That’s the program’s limit. Many insurers base their rates on a percentage of Medicare fees, so this could help. But there are fears that drug companies will raise premiums to make up for Medicare losses, especially for drugs under patent protection. But some economists argue that drug companies are already raising premiums as much as the market will allow. If Medicare and Medicaid hospital care costs rise, The cost of private insurance remains the same And there No correlation Relationship between private insurance hospital prices and the proportion of Medicare and Medicaid patients.
So this is a historic moment to help turn the tide on rising health care costs that are undermining other important priorities for families, businesses and governments.
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