CMS Drug Spending Dashboards and the Inflation Reduction Act
Today, the Centers for Medicare & Medicaid Services released the annual update to the Drug Spending Dashboards with data for 2021. These dashboards are interactive, online tools that allow consumers, researchers, policymakers, and other stakeholders to understand changes in spending on prescription drugs in the Medicare Part B, Medicare Part D and Medicaid programs. Today’s release represents the seventh annual update to the Drug Spending Dashboards. Since the first release of the dashboards in 2015, CMS has continued to enhance and expand the dashboards to provide greater transparency into drug spending trends.
This update comes as CMS is implementing the Inflation Reduction Act, the new prescription drug law that will bring extensive changes to lower the cost of prescription drugs. With this historic law, Medicare will finally be able to negotiate drug prices for certain high expenditure, single source Medicare drugs directly with drug companies. In addition, the law requires drug companies to pay a rebate to Medicare if they raise their drug prices on certain Part B and Part D rebatable drugs at a rate that is faster than the rate of inflation. You can learn more about the changes in Medicare, Medicaid and the Children’s Health Insurance Program, and Health Insurance Marketplace as a result of the Inflation Reduction Act here: https://www.cms.gov/newsroom/fact-sheets/inflation-reduction-act-lowers-health-care-costs-millions-americans. You can also sign up to receive CMS Inflation Reduction Act email updates at https://www.cms.gov/About-CMS/Agency-Information/Aboutwebsite/EmailUpdates.
CMS is leveraging data across our implementation of the new prescription drug law. Today’s release of the dashboards covers the time period from January 1, 2017 to December 31, 2021. This is a different time period than the time period of data to be used for the Medicare Drug Price Negotiation Program. The law requires that the Medicare Drug Price Negotiation Program use expenditure data from different specified time periods in order to determine high spending drugs eligible for the negotiation. These timeframes differ for each year the negotiated prices apply. For example, the first 10 Part D drugs selected for negotiation for 2026 are based on Part D expenditure data for the 12-month period from June 1, 2022 to May 31, 2023. In addition, certain categories of drugs are excluded or may be exempt from selection for negotiation. The Drug Spending Dashboards do not apply these same exclusions and exemptions to the list of drugs reported on the dashboards. Therefore, the data in this update to the dashboards is not relevant to and will not be used for purposes of the Medicare Drug Price Negotiation Program.
CMS continues to believe that transparency promotes accountability. Our commitment to transparency is made evident by recent releases of new data, such as detailed information on hospital and nursing facility ownership. While CMS works to implement the new prescription drug law, we plan to also continue our annual updates to the Drug Spending Dashboards to provide the public with comprehensive data on trends related to drug spending for people with Medicare and Medicaid.