Millions of Medicare beneficiaries who rely on expensive brand-name medications could see lower out-of-pocket costs starting January 1, 2028, after the Centers for Medicare and Medicaid Services selected 15 additional drugs for federal price negotiations. All 15 manufacturers signed participation agreements by the February 28, 2026 statutory deadline, clearing the way for active negotiations this year. The 2028 cycle breaks new ground by including, for the first time, drugs covered under Medicare Part B, the program that pays for treatments administered in physician offices and hospital outpatient settings.
Why the first Part B drugs change the stakes for 2028
Previous negotiation rounds targeted only Part D drugs, which are dispensed at pharmacies. Adding Part B drugs to the 2028 cycle extends the program’s reach into a different payment stream, one that directly affects how and where patients receive infusions, injections, and other clinician-administered therapies. Under current Medicare rules, Part B drugs are reimbursed based on average sales price formulas, and the interaction between negotiated prices and that reimbursement structure has not been spelled out in public CMS documents. That gap raises a practical question: if negotiated prices significantly lower the reimbursement rate for certain Part B drugs, will providers shift where they administer those treatments?
Hospital outpatient departments typically receive higher facility fees than independent physician offices for the same drug administration. A large enough price reduction could narrow the revenue advantage hospitals hold, giving physician offices a stronger financial case to keep patients in lower-cost settings. Whether that shift actually materializes will depend on the size of the negotiated discounts and how CMS applies them to existing payment rules. Claims data from the first 18 months after January 2028 will be the earliest reliable signal of any migration between care sites.
The inclusion of Part B products also changes the negotiating leverage on both sides. For high-cost biologics administered in clinics, Medicare is often the dominant payer, so a lower negotiated ceiling may reverberate through commercial contracts that reference Medicare benchmarks. At the same time, manufacturers will weigh potential revenue losses in the Medicare market against their ability to sustain research and development pipelines. How CMS balances those competing pressures in the 2028 cycle will shape expectations for future rounds that bring additional Part B drugs under the program.
Key dates and manufacturer commitments driving the 2028 cycle
CMS laid the procedural groundwork over the past year. Draft guidance for the 2028 cycle was issued in mid-2025, and the agency later finalized its approach after reviewing technical feedback from manufacturers, patient advocates, and clinicians. According to a CMS fact sheet, the agency formally selected the 15 drugs on January 27, 2026, and manufacturers had until February 28, 2026 to sign participation agreements. Every company met that deadline, and data submissions from those firms were due by March 1, 2026, the same date CMS set for written public input on each selected drug.
The statutory basis for selecting exactly 15 drugs in this cycle comes from federal law, which specifies how many negotiation-eligible drugs the Secretary must choose for the initial price applicability year 2028 and outlines the criteria for eligibility. The Medicare Drug Price Negotiation Program itself was created by the Inflation Reduction Act, which directed the Department of Health and Human Services to identify high-spend drugs lacking generic or biosimilar competition and bring them into a structured negotiation process.
Negotiations between CMS and each manufacturer take place during 2026, following a schedule that includes data validation, clinical benefit review, and multiple rounds of offers and counteroffers. Any agreed-upon prices become effective at the start of 2028 for both Part D and the newly included Part B drugs. In its public announcement of the 2028 list, CMS emphasized that it will publish the final negotiated maximum fair prices once talks conclude, along with information on how those prices were derived.
For beneficiaries, the most visible change will be at the pharmacy counter and in outpatient clinics when the new prices take effect. Lower negotiated ceilings should translate into reduced coinsurance amounts for covered drugs, although the exact savings will vary by plan design and service setting. For providers, the transition period leading up to January 2028 will be critical for updating billing systems, revising financial projections, and counseling patients who may be affected by site-of-care shifts or formulary adjustments.
Looking ahead, the 2028 cycle will serve as a stress test for how Medicare can simultaneously manage spending, protect access, and integrate Part B drugs into a negotiation framework originally designed around pharmacy-dispensed products. The experience CMS and manufacturers gain in this round is likely to inform not only future drug selections but also potential refinements to payment rules, beneficiary education, and data transparency. As claims and utilization patterns emerge after implementation, they will offer the first concrete evidence of whether negotiated prices can meaningfully reshape the economics of high-cost drugs without disrupting care for the patients who depend on them.
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