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Pricing Heart Attack Treatments

"In this paper, we estimate price indices for heart attack treatments, demonstrating the techniques that are currently used in official price indices and presenting some alternatives. We consider two types of price indices, a Service Price Index, which prices specific treatments provided, and a Cost of Living Index, which prices the health outcomes of patients. Both indices are complicated by price measurement issues: list prices and transactions prices are fundamentally different in the medical care field."  MORE >>

Will Medicare Drug Price Negotiation Increase Spending for Biologic Drugs?

"Medicare Drug Price Negotiation aims to reduce the prices paid for high cost pharmaceuticals. Traditionally, biologic drug price reductions after loss of exclusivity (LOE) have occurred due to the introduction of biosimilar competitors. A recent paper ... examines whether Medicare Drug Price Negotiation enacted under the Inflation Reduction Act (IRA) is likely to reduce prices more than biosimilar entry."  MORE >>

Most Favored Nation Drug Pricing in the U.S.: Comparing GENEROUS, GLOBE and GUARD

"The Trump administration has introduced three most-favored-nation (MFN) drug pricing initiatives designed to link U.S. pharmaceutical costs to prices paid in economically comparable countries. Most-favored-nation pricing requires manufacturers to provide rebates when U.S. prices exceed those in reference nations—a direct response to the persistent gap between U.S. drug prices and those in other developed economies. [This article summaries three programs that] have been implemented: [1] GENEROUS (GENErating cost Reductions fOr U.S. Medicaid) Model; [2] GLOBE (Global Benchmark for Efficient Drug Pricing) Model; [3] GUARD (Guarding U.S. Medicare Against Rising Drug Costs) Model."  MORE >>

HHS Release Adds Details on Prices Manufacturers Are Expected to Offer Under MFN Drug Pricing Executive Order

"The Order applies to branded products without generic or biosimilar competition (presumably meaning marketed equivalent products).... The countries whose prices will be used to determine the MFN price are those in the Organization for Economic Cooperation and Development (OECD) having GDP per capita of at least 60 percent of U.S. GDP per capita ... The target prices that manufacturers will be asked to offer reflect current lowest prices in these countries, rather than prices somewhere between U.S. prices and those lowest prices in the other countries."  MORE >>

Consumer Out-of-Pocket Drug Prices Grew Faster Than Prices Faced by Insurers After Accounting for Rebates, 2007-20

"[The authors] combined claims data on branded retail prescription drugs with estimates on rebates to provide new price index measures based on pharmacy prices, negotiated prices (after rebates), and out-of-pocket prices for the commercially insured population during the period 2007-20.... [A]lthough retail pharmacy prices increased 9.1 percent annually, negotiated prices grew by a mere 4.3 percent, highlighting the importance of rebates in price measurement.... [C]onsumer out-of-pocket prices diverged from negotiated prices after 2016, growing 5.8 percent annually, while negotiated prices remained flat."  MORE >>

International Prescription Drug Price Comparisons: Current Empirical Estimates and Comparisons with Previous Studies

"U.S. prices were 256 percent of those in the 32 comparison countries combined. In comparisons with individual countries, U.S. prices ranged from 170 percent of prices in Mexico to 779 percent of prices in Turkey. The gap between U.S. prices and prices in other countries was larger for brand-name originator drugs. U.S. prices were 84 percent of prices in all non-U.S. countries for unbranded generics. U.S. prices were 190 percent of prices in other countries after adjusting U.S. prices downward to account for rebates and other discounts."

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International Prescription Drug Price Comparisons

"U.S. prices were 256 percent of those in the 32 comparison countries combined. In comparisons with individual countries, U.S. prices ranged from 170 percent of prices in Mexico to 779 percent of prices in Turkey. The gap between U.S. prices and prices in other countries was larger for brand-name originator drugs. U.S. prices were 84 percent of prices in all non-U.S. countries for unbranded generics. U.S. prices were 190 percent of prices in other countries after adjusting U.S. prices downward to account for rebates and other discounts."

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What if Price Transparency Reduced Commercial Price Variation?

"Based on a sample of nearly 420 million medical claims across 963 markets, [the authors] found that in 2017: [1] If price variation were reduced by applying the median price to the highest-priced half of claims -- for every service within each market -- national spending among the [employer-sponsored insurance (ESI)] population would decrease by nearly 20%; [2] If price variation were reduced by applying the median price to the lowest-priced half of claims -- for every service in each market -- then ESI spending would rise by 10.1%; and [3] If both happened simultaneously -- the median price was assigned to all claims for all services within all markets -- spending would decline by 9.0% nationwide."  MORE >>

Reference Pricing for Health Care Services: A New Twist on the Defined Contribution Concept in Employer-Sponsored Health Plans (PDF)

16 pages. Excerpt: "Potential aggregate savings could reach $9.4 billion if all employers adopted reference pricing for the health care services examined in this paper. The $9.4 billion represents 1.6 percent of all spending on health care services among the 156 million people under age 65 with employment-based health benefits in 2010. Savings from reference pricing materializes through the combination of [1] patients choosing providers at the reference price, [2] patients paying the difference between the reference price and the allowed charge through cost sharing, and [3] providers reducing their prices to the reference price. Any increase in prices among providers below the reference price would reduce the potential for savings."

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The Impact of Medicare Part B on Pharmaceutical Price Growth (PDF)

"While previous research showed Part B increased launch prices, [the authors] estimate its effect on later prices (net of rebates). Drugs more exposed to Medicare have lower price growth. A drug with above median Part B exposure has a 10% lower price after 3 years than a below median exposure drug that launched at the same price, with a larger effect for newly approved molecules."  MORE >>

Savings from Most-Favored-Nation Drug Pricing Policy (PDF)

13 pages. "To date, the Administration has reached voluntary MFN pricing agreements with 17 of the largest pharmaceutical manufacturers in the world. Moving forward, the Administration expects to reach similar agreements with most manufacturers of sole-source brand name drugs and biologics in the nation. In parallel, the Administration is working with Congress to codify those voluntary agreements into law to ensure that patients continue to benefit from price discounts. This report describes the MFN drug pricing framework and evaluates its fiscal effects."  MORE >>

Out-of-Network Pricing Lawsuits Test MultiPlan, Zelis Business Models

"Billions of dollars and implications for the business models of insurers and pricing vendors are on the line in litigation against MultiPlan (now known as Claritev) and Zelis, along with their insurer clients. In each case, plaintiff providers say insurers conspired with a pricing intermediary to underpay out-of-network claims by deploying repricing tools or algorithms. Both vendors are alleged to have served as a hub that coordinates prices among insurers that otherwise would compete with one another on price."  MORE >>

FTC Settlement with Express Scripts Signals Major Shift in PBM Pricing

"While the FTC's lawsuit originally focused on insulin pricing practices, the settlement goes further, requiring structural changes to how Express Scripts prices drugs, manages rebates, works with pharmacies, and reports information to plan sponsors.... For employers, the agreement may signal a broader shift in the industry toward true net-cost drug pricing models, with potential implications for pharmacy benefit design, budgeting, and future PBM contracting."  MORE >>

Kennedy and Oz Alert Hospitals That Penalties Loom for Price Transparency Noncompliance

"HHS Secretary Robert F. Kennedy Jr. and CMS Administrator Mehmet Oz, MD [announced that] more than 500 hospitals have not complied with changes to price transparency requirements that took effect Jan. 1, with enforcement beginning April [1] The hospitals have received warning letters and, in some cases, requests for corrective action plans (CAPs) and have not heeded that communication, according to the announcement. The two leaders ... indicated there will be no additional grace period."  MORE >>

Taking Stock of Proposed Updates to Health Plan Price Transparency Rules

"More than five years into an era with price transparency requirements on the books, TiC data, along with related price transparency efforts ... are still in a lengthy and iterative implementation phase.... Through the proposed rule amendments and related efforts, the Departments are responding to feedback from TiC data users about needed improvements.... [The authors] provide context on the broader array of recent federal price transparency efforts ... summarize the major changes being proposed in the new TiC amendment and discuss their likely effects."  MORE >>

To Make Health Care Price Transparency Work, Prioritize Actionable Disclosure and Competition Guardrails

"The net effect [of price transparency] is therefore ambiguous and depends on market structure, benefit design, and -- crucially -- who can practically use the information.... In many administered-price systems such as the UK and many EU countries, published prices already exist; transparency is more likely to operate through benchmarking, audit, and governance rather than consumer price shopping.... [The authors] argue that, in the US, transparency must be paired with steerage and competition guardrails to realize savings without inadvertently enabling coordination."  MORE >>

White House Fact Sheet: TrumpRx Website Launched to Bring Lower Drug Prices to American Patients

"Through the website, patients will be able to access large discounts on many of the most popular and highest-priced medicines in the country, paying prices in line with the lowest paid by other developed nations (known as the most-favored-nation, or MFN, price)."  MORE >>

Medicare Drug Price Negotiation: Navigating the Next Wave of Maximum Fair Prices

"With effectuation less than a year away for IPAY 2027 prices, the announcement of these MFPs will quickly flow into financial forecasts, formulary changes, and strategic market decisions. These prices are an indicator of how future negotiations may play out given deeper discounts achieved in this cycle. Navigating competitor dynamics and second-order impacts will be crucial to all stakeholders in the supply chain given the increasing interconnectedness of different markets, continually evolving Part D landscape, and the emphasis on transparency within the pharmaceutical supply chain."  MORE >>

Hospital Prices Post-COVID-19: Troubling Trends From California

"A critical but less mentioned driver of recent premium increases is the post-COVID surge in prices paid by commercial insurers to hospitals. Limited availability and substantial lags in hospital price data have impeded timely analysis of these trends.... [D]ata from the California Department of Health Care Access and Information (HCAI) ... clearly demonstrate a post-COVID hospital price increase in that state, raising questions about whether this will be a temporary shock or a 'new normal' for the health care system going forward."  MORE >>

CRS Legal Sidebar: Most-Favored-Nation Prescription Drug Pricing Executive Order

"[T]he 2025 EO resembles a 2020 MFN drug pricing executive order ... which also directed the HHS Secretary to implement MFN pricing, but which was limited in application to Medicare Part B. This Legal Sidebar ... analyzes selected legal issues related to the HHS Secretary's authority to implement MFN pricing as directed in the 2025 EO.... [It] also explores the HHS Secretary's authority to impose MFN pricing for drugs in federal health care programs ... as well as in private markets. The Sidebar concludes with an analysis of how the MFN prices might interact with other existing federal programs[.]" [LSB11319, Jun. 5, 2025]  MORE >>