Medicare Part D: Major Shifts With the Inflation Reduction Act and a Way Forward

The Inflation Reduction Act (IRA) of 2022 introduced major changes in the Part D benefit that aim to improve medication access and correct several of the financial misalignments in the current Part D benefit. The changes address financial obligations of Medicare beneficiaries, the federal government, Part D plan sponsors (i.e., insurance companies), and drug manufacturers. The changes include new brand and biologic manufacturer obligations to beneficiaries eligible for the low-income subsidy. Effects on the drug supply chain and stakeholder behaviors remain to be seen but current financial arrangements inform likely responses. Currently, the Pharmacy Benefit Managers (PBMs) nestled between the plans, drug manufacturers, and pharmacies heavily influence manufacturers' list prices and squeeze community pharmacies. With the IRA restructuring of Part D, plans are likely to interject more administrative obstacles before beneficiaries can obtain higher-cost therapies, while drug manufacturers might alter their patient assistance programs. Manufacturers have already begun to change their assistance programs at many safety net pharmacies. Many Medicare beneficiaries who relied on these deeply discounted medications will face significant late enrollment penalties if they do enroll in Part D plans, creating a major barrier to participation. Providers and policymakers should understand the Part D changes and leverage the skills of pharmacists to support community and team-based care that improves access to medications and ensures that medications are doing more good than harm.