Medicare drug rebates replace direct price cuts for Part B

What does this do?

This bill changes how drug companies deliver price reductions on certain high-cost drugs, like cancer treatments given in a doctor's office or hospital. Instead of charging the lower negotiated price at the point of sale, manufacturers could charge their standard price and send the difference to Medicare as a rebate afterward. Patients would still pay out-of-pocket costs based on the lower negotiated price.

Who does it affect?

Drug manufacturers that take part in Medicare's drug price negotiation program are directly affected. Medicare patients who receive these high-cost drugs in clinical settings, such as cancer treatment, are also affected.

Why does it matter?

This changes when and how the government collects the savings from negotiated drug prices. The rebate money manufacturers pay would go into the Medicare trust fund.

What does it cost, and who pays?

• Manufacturers pay rebate to Medicare
• Rebate funds Medicare trust fund