AB Advocacy on the Medicare Part B Provisions of the Senate-passed Inflation Reduction Act of 2022


On Sunday, August 7th,  the U.S. Senate  passed the Inflation Reduction Act (IRA of 2022) – budget reconciliation legislation), marking success for the Democrats’ long-held objective to enable government to negotiate drug prices since enactment of the Medicare Modernization Act in 2003. In addition, the IRA would provide a $35 out-of-pocket (OOP)/month cap for Medicare patients for insulin, a three-year extension of the temporary enhanced ACA premiums, and a cap on Medicare Part D beneficiary annual Part D OOP costs at $2,000. This legislation passed with the support of all 50 Senate Democrats and Independents plus Vice President Harris placing the tie-breaking vote, and all 50 Republicans voting no.

  • The U.S. House is expected to pass the IRA this Friday and the President is expected to sign into law shortly thereafter, giving the Democrats and the White House significant healthcare, tax, climate change/energy and deficit reduction policy wins heading into the 2022 midterm elections.

 Those participating in ACA healthcare plans and Medicare beneficiaries – particularly those who have significant prescription medication needs – stand to benefit greatly from the latter three provisions, and AmerisourceBergen (AB) supports these significant enhancements in access to healthcare for many people. AB, however, shares the concerns of many provider groups that the drug pricing proposals will have the unintended consequences of lowering provider reimbursement for many widely used, essential drugs, leading to reduced access to life saving medications in community settings. See, for example, thisstatement from the CEO of COA, which cites a recent, independent analysis by Avalere Health on an earlier version of the reconciliation bill’s impact on providers, showing it would lead to a 42.9 percent cut in Medicare payments to independent cancer-care providers. PhRMA has also said the bill will harm patients and the ability to provide them with cures.

Due to the projected negative impact to our provider partners, AB supported a potential amendment to IRA of 2022, which would have protected provider reimbursement by requiring manufacturers to refund the government excess costs above the negotiated price. Through AB’s Policy and Advocacy social media channel (@advocacy_abc on Twitter), we encouraged specialty physicians to voice their support of this amendment to their U.S. Senators; the amendment was supported by COA and the ASP Coalition. Unfortunately, this amendment was not ultimately offered, although it could serve as the basis for future attempts to change the anticipated new law (IRA of 2022).

With the November 2022 elections quickly approaching, Republicans are currently favored to gain control of the House, and control of the Senate is in contention. Control of both chambers and the Administration is likewise unknown for 2024. Both elections, however, could bring about changes in Congress and the Administration and there will be potential opportunities to adjust the IRA of 2022, as the drug negotiation provisions apply on a graduated basis in 2026 – 2029 and then beyond. In addition, we will work with partner stakeholders to look for opportunities to alleviate the effects of the new law through regulatory action.

We will keep you abreast of developments and opportunities for AB to educate policymakers about the negative impact these cuts will have on community-based practices, and to advocate for changes to the bill that would keep community practice reimbursement whole. As always, your voice will be instrumental in informing lawmakers to ensure patients will have continued access to the medications prescribed by their physicians in the highest quality, most cost-effective, community-based settings.

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