AbbVie's Humira among 27 drugs subject to Medicare drug price inflation cap rebates

The Department of Health and Human Services (HHS) has unveiled the first set of Medicare Part B prescription drugs that must repay the program for raising prices above inflation in the last quarter of 2022. 

A new HHS report released Wednesday outlines the products—including AbbVie’s blockbuster arthritis drug Humira—that must pay Medicare back for hiking prices faster than inflation. Officials said the goal in part is to send a message to other drug companies.

“We do believe that the inflation rebate proposal, the overall provision, does give a strong incentive for drug companies to not increase their prices above inflation,” said Chiquita Brooks-LaSure, administrator of the Centers for Medicare & Medicaid Services (CMS), during a call with reporters Tuesday.

Affected drug companies will have to pay back Medicare via rebates for the difference. CMS will start to invoice drugmakers for the rebates in 2025 in order to give time to set up the operations. 

“Starting in April, some Medicare beneficiaries will have lower coinsurance for the 27 prescription drugs that raised prices faster than inflation in the last quarter of 2022,” according to HHS’ report. “Seniors may see their out-of-pocket costs for these drugs decrease by $2 to as high as $390 per average dose starting April 1.”

The amount of lower out-of-pocket costs will vary depending on several factors, including what type of supplemental coverage they have as well as the dose or protocol they are on, said Center for Medicare Director Meena Seshmani during the reporter call. 

The inflationary cap was one of several drug price reforms passed under the Inflation Reduction Act last year. Other reforms include a $35 monthly cap for insulin for Medicare beneficiaries and giving Medicare the power to negotiate prices for a small subset of drugs.