CMS Releases Draft Guidance on Medicare Drug Price Negotiations for 2026-28 Implementation

The Centers for Medicare & Medicaid Services (CMS) have released draft guidance for the third cycle of the Medicare Drug Price Negotiation Program, including the first cycle of renegotiation and manufacturer effectuation of maximum fair prices for 2026 through 2028, as part of implementing the Inflation Reduction Act (IRA). This third round will, for the first time, include Medicare Part B drugs, expanding beyond the Part D medications targeted in previous negotiations, with CMS planning to announce 15 eligible drugs by February 2026. The guidance also introduces a renegotiation process for drugs with new uses or changes in monopoly status and aims to enhance transparency by soliciting public comments on pricing methodologies. Meanwhile, research from the University of Pennsylvania and Harvard highlights the critical importance of drug subsidies, showing that low-income Medicare beneficiaries who lose Medicaid and its associated Medicare Part D Low-Income Subsidy (LIS) face significantly higher mortality rates. Approximately 900,000 people lose Medicaid annually, risking loss of LIS and access to essential medications, emphasizing the health impact of affordability and subsidy programs. These developments underscore ongoing efforts to balance drug price regulation with ensuring access to life-saving medications for vulnerable populations.