Inflation Reduction Act (IRA) Implementation
Rising pressure on providers. Growing risk for patients.
What’s Happening
The Inflation Reduction Act (IRA) introduces a sweeping drug pricing policy change that disrupts how Medicare Part B medications are reimbursed.
Instead of using the longstanding Average Sales Price (ASP) model, Medicare will now rely on a new benchmark: Potentially dramatically reducing provider reimbursement.
This shift places providers, and their most vulnerable patients, squarely in the middle of a negotiation process between the federal government and pharmaceutical manufacturers. The result? Increased financial risk for providers and increased uncertainty for the patients they serve.
Who it affects
Part B drugs are typically used to treat serious and complex conditions, including:
These therapies are delivered in a clinical setting and managed closely by healthcare providers. The patients receiving them are among the most vulnerable in Medicare—and disruptions to access can be dangerous or even life-threatening.
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Cancer
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Rheumatoid arthritis
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Inflammatory Bowel Disease
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Autoimmune diseases
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Mental illness
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Eye diseases
Why it Matters
The IRA’s new model creates a financially unsustainable environment for physician practices.
By shifting pricing power away from the proven ASP model and failing to account for real-world delivery costs, the system places disproportionate strain on providers already navigating years of reimbursement erosion. Without policy correction, this framework threatens the stability of frontline care and the long-term viability of community-based practices.
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Uncovered Costs
The MFP fails to reflect true overhead costs, such as acquiring, safely storing, and administering Part B medications.
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Financial Risk
Physicians carry the full financial risk, purchasing medications upfront with no assurance of full reimbursement.
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Practice Closures
Independent practices, especially in rural areas, are closing or consolidating, driving care into more expensive hospital settings and reducing patient access.
The Financial implications
The financial toll of the IRA’s new policy is both immediate and long-term, impacting physician practices, care delivery, and Medicare sustainability.
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62%
Reduction in add-on reimbursements for Part B medications
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$56.3 billion
In projected lost Medicare physician reimbursement over the next 10 years
Legislative Solution
Protecting Patient Access to Cancer and Complex Therapies Act of 2025 (H.R. 4299)
Led by Reps. Greg Murphy, M.D. (R-NC), Adam Gray (D-CA), and Neal Dunn, M.D. (R-FL)
This bipartisan bill would:
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Remove providers from the middle of the drug price negotiation process
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Preserve physician reimbursement based on ASP
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Safeguard patient access to lifesaving therapies
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Reduce Medicare spending by $3.3 billion