Medicare's drug price negotiation program moves from guidance into federal regulation

Medicare's program for negotiating lower prices on some of the most expensive prescription drugs is moving from agency guidance into federal regulation, under a final rule announced Nov. 5.

Negotiated prices for the first 10 drugs took effect this year, and 15 more come in 2027 and another 15 in 2028. The rule sets how later rounds work. Starting with prices that take effect in 2029, Medicare can pick up to 20 drugs a year, and drug plans must cover them at the negotiated price. The next list is due Feb. 1.

More than 121,000 Alaskans were on Medicare as of September 2025, according to the Alaska Commission on Aging.

Congress created the program in 2022, in the Inflation Reduction Act, to let Medicare bargain over high-cost drugs that have no generic competition. Until now, the Centers for Medicare & Medicaid Services ran it under guidance. The agency called the new rule "a permanent framework for negotiating prices of high-cost drugs." It takes effect Dec. 5.

Of the roughly 11,330 comment letters CMS received, many supported the program, some opposed it outright and many raised concerns that it could discourage drug development. CMS said the program will make drugs more affordable without restricting innovation. The rule also sets a temporary price floor in 2029 and 2030 for drugs from small biotech companies.