CMS Releases the Final Rules for the Next Set of Price Controls, Including Updates on How It'll Gather Public Input

If you want to search Cost Curve back issues or link to anything you read here, the web links and archive are online at costcurve.beehiiv.com. You can subscribe there, too.

The final guidance for the next round of IRA price controls is now out, and -- honestly -- it’s more of the same, with one exception that’s important for communicators. 

There is a fair amount of coverage, but it’s not very useful. Just read the CMS press release if you want the overview, or skim the final guidance if you care more deeply. 

The upshot is that the program is not going to run fundamentally differently than it did this year: no changes in how drugs are picked, no changes in the standards used, and just some additional process changes to the “negotiations” themselves. 

My read is that the status quo means that Wegovy gets negotiated alongside Ozempic, and CMS has affirmed its thinking on combination products, which means that subcutaneous formations of big-time cancer drugs are -- for now -- protected from price controls. (Those medicines aren’t up for scrutiny until the 2028 cycle, but it’s worth looking at CMS’ thinking.)

There is a ton in the guidance about how the money should flow through the system, which will be handled by the Medicare Payment Facilitator. That’s still a concept that has been further fleshed out, but the MPF still does not exist as an actual, operational thing. So more to come there. 

As for the exception: CMS is going to revamp how it seeks public comment. 

Last year, the agency ran 10 “listening sessions,” which ended up just being a series of three-minute speeches with no feedback or followup.

Next year, CMS will run 15 “roundtables,” which will include a facilitator. There is some allowance for clarifying questions, and the gatherings -- which will be oriented around the patient experience -- will be organized around disease areas, not specific products. The meetings will be private, but redacted transcripts will be released. 

Public input of a more clinical nature will be gathered at a single, public “town hall”-style meeting. 

I posted to LinkedIn about this with a somewhat skeptical tone, but Utah’s Joey Mattingly -- who has been thinking about this in some depth -- said that he was “very impressed with the progress CMS is making.” 

Here’s to progress!

The IRA is going to be a lot more expensive than anyone expected back when it was passed. 

That’s a reality that has set over the past few months, as health plans told the government that the changes in Medicare Part D -- notably the $2,000 out-of-pocket cap -- were going to mean a lot more spending. 

So to keep Part D viable, CMS announced it would be providing “stabilization” payments to plans as a way of keeping premiums under control. But the exact financial impact of that effort hasn’t been very clear. That has made congressional Republicans -- who do not like surprise increases in government spending -- grumpy.

Those Rs asked the CBO to estimate how much the government is going to spend on the stabilization program, and they got their answer yesterday: $5 billion. That’s not an entirely shocking number (recent guesses about the size of the stabilization arrived at similar figures), but it carries with it the gravitas of the CBO. 

More surprising (to me, anyway, as a lay reader) was the CBO’s confession that it had misread the Part D market in its original analysis and that not only did the plans need a $5 billion bailout, the CMS was going to spend a lot more on the government-funded parts of the Part D benefit, namely the 20% reinsurance for spending above the $2,000 cap. 

The CBO said that spending would be $10 billion to $20 billion higher in 2025 than its initial estimate, which feels like a lot of money. 

I don’t have any snark or any particularly deep analysis. The CBO report has -- thus far -- gone almost entirely unnoticed, so I can’t crib off of anyone else’s perspective. I’ll keep you posted as folks smarter than I start digesting this.

On Monday, the Trump campaign said it would push a “most favored nation” approach to drug pricing, per what sounded like not-particularly-ambiguous comments to Politico. 

Yesterday, they told Inside Health Policy that they weren’t going to do MFN. 

I try to keep political process stories somewhat muted around here for this exact reason. I don’t think that the two dueling headlines mean that the Trump position is shifting. I think it’s evidence that they don’t care about the topic, don’t think the American people care, or -- the most likely reason -- both. 

This is not a Republican phenomenon. The official Harris stance on drug pricing, while consistent, is borderline nonsensical. I don’t think that the topic is a priority on the D side, either. 

Anyway: just a brief update around the editorial approach here, which may explain why I didn’t bother diving into the duelling stats thrown around about drug pricing during the VP debate, analyze stump-speech fact checks, or breathlessly link to bon mots from the campaign trail. 

I’m not opposed to thinking and writing about the intersection of policy and politics. There are serious people having serious discussions about this topic right now in Washington, and we’re not done with this topic by a longshot. But those serious discussions ain’t happening on the campaign trail, and I’m trying not to waste my time … or yours. 

Elsewhere: 

• Gilead is licensing -- for free -- its breakthrough long-acting HIV preventative treatment to a number of generics firms that will make the drug available in 120 low-income countries. 

Thanks for reading this far. I’m always flattered when folks share all or part of Cost Curve. All I ask is for a mention or tag. Bonus points if you can direct someone to the subscription page.