Healthcare

Drug Price Controls? Medicare Seniors Paid More for Key Meds in 2025

A new study challenges the narrative of savings, revealing higher out-of-pocket costs for vital prescriptions before federal negotiations begin.

By Neil D'Monte, Palmelle Editorial Team · Reviewed by Neil D'Monte · 7 min read · 2026-05-28

SHORT ANSWER

Despite the Inflation Reduction Act's drug price controls, a Pioneer Institute study found many Medicare seniors faced higher costs for essential medications in 2025, underscoring the complex realities of drug pricing.

The direct answer

While the Inflation Reduction Act (IRA) aims to lower prescription drug costs for Medicare beneficiaries, a recent Pioneer Institute study indicates that many seniors actually experienced higher out-of-pocket expenses for critical medications like Eliquis and Entresto in 2025, even before the IRA's price negotiation provisions fully take effect in 2026

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. This suggests that manufacturers may be shifting costs or that other market dynamics are at play, potentially undermining the intended savings for those who rely on these drugs for chronic conditions. The study's findings challenge the prevailing narrative of immediate savings and highlight a complex reality for aging Americans navigating healthcare expenses

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The IRA's Promise vs. Reality

The Inflation Reduction Act (IRA) was lauded for its potential to bring down the cost of prescription drugs for millions of Medicare beneficiaries. By allowing Medicare to negotiate prices for a select list of high-cost drugs, the legislation promised significant savings. However, the Pioneer Institute's analysis of 2025 data suggests a divergence between the legislative intent and lived experience. For common, essential medications, out-of-pocket costs may have increased for many seniors, a trend that directly contradicts the headline savings often reported

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. This phenomenon, sometimes referred to as 'utilization management' by the industry, can mean that while the list price might not change drastically, access or the effective cost to the patient can be manipulated.

Manufacturer Strategies and Market Dynamics

The data from the Pioneer Institute points to potential strategies employed by pharmaceutical manufacturers in anticipation of the IRA's price negotiation mandates, which begin in 2026. One such strategy could involve increasing list prices or altering rebate structures for drugs that will be subject to negotiation, effectively front-loading costs before federal intervention. This mirrors tactics seen in other regulated industries where companies adjust pricing to maintain profit margins

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. For an aging population that often relies on a consistent supply of critical medications, these shifts can represent a substantial financial burden, forcing difficult choices between managing their health and other essential living expenses.

Who Actually Pays?

The mainstream coverage of drug pricing often focuses on the list price or the government's projected savings. However, the true impact is felt by the individuals paying at the pharmacy counter, particularly those in Medicare Part D. The Pioneer Institute's study highlights that the 'seniors' often discussed in policy debates are real people, like David and Lisa in Pasadena, who are making concrete decisions about their household budgets. When out-of-pocket costs rise for essential drugs like Eliquis, used for stroke prevention, or Entresto, for heart failure, it's not an abstract policy debate; it's a direct financial strain on their fixed incomes

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. The nuances of manufacturer pricing strategies and pharmacy benefit manager negotiations often obscure these real-world costs.

A SCENE

Eleanor, 78, lives in her lifelong home in Phoenix. Her doctor recently increased her dosage of Entresto, a medication crucial for managing her heart failure. The pharmacy called to inform her that her co-pay had jumped by nearly $50 this month, a significant increase that left her staring at the bill on her kitchen counter. Her son, Mark, who lives two states away and helps manage her finances, received the same notification via their shared portal. He was already juggling his own daughter's upcoming college tuition payment and a recent estimate for a new roof on his own house. He saw the news headlines about the Inflation Reduction Act bringing drug prices down and felt a pang of confusion, then frustration, as he tried to explain to his mother why her essential medication was suddenly costing so much more, just weeks before the summer heat would make her condition harder to manage.

Common mistakes

Focusing solely on government savings projections.
The true impact is on individual out-of-pocket costs. Manufacturers' pricing strategies can offset projected savings, leaving seniors to bear higher expenses.
Using generic terms like 'seniors' or 'elderly'.
This dehumanizes the individuals affected. Specificity, like naming medications and the impact on household budgets, is crucial.
Opening with a statistic or a broad statement about the IRA.
Engagement requires starting with a narrative or a specific, compelling fact that draws the reader in, rather than stating the obvious.
Failing to name specific drugs and their uses.
Naming Eliquis and Entresto, and their purposes (stroke prevention, heart failure), grounds the issue in real health concerns and familiar medications.
Implying the IRA has universally lowered drug costs.
The article's contrarian angle is that this isn't always the case in practice, especially in the pre-negotiation phase, and requires nuanced explanation.

PALMELLE'S VIEW

In our view, the narrative surrounding the Inflation Reduction Act's impact on drug prices has been overly simplistic. While the long-term goal is to reduce costs, the reality on the ground for many aging Americans in 2025 appears to be different. The Pioneer Institute's findings about increased out-of-pocket expenses for vital medications like Eliquis and Entresto suggest that manufacturers may be employing strategies to offset future price reductions, or that the market is adapting in unforeseen ways

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. This underscores the importance of scrutinizing the actual financial impact on individuals, not just the projected savings, especially for those managing chronic health conditions where medication costs are a significant concern.

BOTTOM LINE

Contact your pharmacy to confirm your out-of-pocket costs for essential medications and compare them to previous months, noting any significant increases before the IRA's price negotiation provisions fully take effect in 2026.

WHEN THIS CHANGES

The answer regarding drug cost savings changes if the focus shifts from projected government savings to the immediate out-of-pocket expenses incurred by Medicare beneficiaries. While the IRA aims for future reductions, current market dynamics and manufacturer strategies can lead to increased costs in the interim, particularly for widely prescribed medications like Eliquis and Entresto.

Frequently asked

When do Medicare's drug price negotiations actually begin?

The Inflation Reduction Act's provisions for Medicare to negotiate drug prices are set to begin in 2026. However, the Pioneer Institute study indicates that some price shifts may be occurring in anticipation of these changes, impacting costs in 2025.

What are Eliquis and Entresto?

Eliquis is a prescription blood thinner used to prevent stroke and blood clots in certain patients. Entresto is a medication prescribed for heart failure to reduce the risk of hospitalization and death.

How can I find out if my medication costs are increasing?

Contact your pharmacy to inquire about your out-of-pocket costs for prescription drugs. You can also review your Explanation of Benefits (EOB) from Medicare or your Medicare Advantage plan for detailed information on drug expenses.