IRA Unmet Medical Need Comments

The Inflation Reduction Act (IRA) introduces significant reforms to Medicare drug pricing, but its broader implications for unmet medical need—particularly in communicable diseases and safety-net programs—remain uncertain. And, given recent “upheavals” in agency missions, its ongoing mandate is also unclear. While the IRA aims to reduce overall costs, its impact on accessibility, affordability, and the sustainability of critical public health programs requires closer scrutiny.

Defining “Unmet Medical Need” in the Context of the IRA 

For the IRA’s intended cost savings to translate into real patient benefit, a workable definition of unmet medical need must prioritize access, patient-centered value, and long-term public health outcomes—rather than focusing narrowly on cost containment.

1. Gaps in Treatment Efficacy: Unmet need includes conditions where current therapies fail to achieve optimal patient outcomes, pose high toxicity burdens, or are clinically inadequate for certain populations—particularly those historically underrepresented in drug development.
2. Absence of Approved Therapies: Many rare diseases and infectious conditions either lack FDA-approved treatments or rely on outdated therapies that fail to meet evolving clinical needs. In infectious disease care, regulatory and market barriers can delay or discourage new drug development, particularly for conditions with smaller patient populations, high resistance risks, or complex treatment landscapes.
3. Affordability & Access Barriers: Even when therapeutic options exist, insurance design, cost-sharing burdens, and utilization restrictions (e.g., prior authorization, step therapy) systematically undermine access—particularly for safety-net populations who rely on Medicaid, ADAP, and Ryan White programs. Inadequate formulary coverage, exclusionary benefit designs, and pharmacy network limitations further restrict patient choice and treatment continuity.
4. Impact on Patient Outcomes: Conditions with high mortality, severe disability burdens, or significant quality-of-life impairments—particularly among marginalized populations—must be explicitly prioritized to avoid reinforcing existing health disparities. The IRA should not inadvertently de-prioritize access to high-impact treatments simply because alternative, less-effective therapies exist.
5. Emerging Scientific Advances: The IRA must account for—rather than restrict—access to medical breakthroughs—such as long-acting injectables for HIV prevention, next-generation antiretrovirals, or curative therapies for needs like, viral hepatitis (HCV); and others!. Cost-containment mechanisms that ignore pipeline innovation risk impounding advances that could transform patient outcomes and lower long-term system costs.

An Important Distinction—the Impact on Communicable Diseases & Public Health Infrastructure 

Communicable diseases are (still) fundamentally different from many diseases or infections in that there are often (inextricably in the case of HIV) real-world policy and legal frameworks—with implications beyond what we see as “individual” care, in the context of unmet medical need. 

Communicable diseases, such as HIV, tend to involve public health mandates, legal reporting requirements, and broader policy considerations that go beyond the typical doctor–patient, one-on-one care model. These frameworks can include mandatory testing, contact tracing, confidentiality laws, and public health interventions. Consequently, managing communicable diseases often requires a multisector approach—involving health departments, legislators, and community organizations—which differs from diseases that primarily involve individual treatment pathways and fewer external policy constraints.

Factors to Consider

• Statutory & Public Health Requirements: Unlike many chronic conditions, communicable diseases carry legal and public health mandates for treatment, reporting, and exposure management (e.g., HIV, hepatitis, tuberculosis). Coverage gaps, delayed access, or formulary restrictions do not only impact individual patients but also have direct implications for disease transmission and public health compliance.
• Unintended Consequences of Price Negotiations: Drug manufacturers may adjust 340B participation (as we continue to hear for 340B reform calls), limit generics, or restructure pricing in Medicaid and commercial markets to offset revenue losses from Medicare negotiations—potentially reducing access for safety-net providers and those without stable insurance.
• Prescription Drug Affordability Boards (PDABs): State-level pricing caps could introduce competing pressures that alter manufacturer pricing strategies, inadvertently limiting access for programs like ADAP and safety-net providers that rely on rebate-driven sustainability models.

Strategic Policy Considerations 

The IRA’s drug pricing provisions must be balanced against the broader ecosystem of safety-net care to avoid unintended disruptions:

• Sustained Investment in Communicable Disease Treatment & Prevention: Policymakers must assess whether negotiated price reductions incentivize or discourage continued pharmaceutical innovation and investment in HIV, hepatitis, STI, and TB treatment strategies.
• Coordination Across Medicaid, Ryan White, and Public Health Programs: Adjustments to formulary structures, reimbursement models, and coverage policies must align across safety-net systems to avoid cost-shifting that disproportionately impacts low-income and marginalized communities.
• Addressing Utilization Management & Access Barriers: Realizing the full benefit of price reductions requires more than just lower prices—it requires ensuring that patients can actually access the medications without excessive utilization restrictions (e.g., step therapy, prior authorization, limited pharmacy networks).
• Ensuring Equity in the Definition & Implementation of Unmet Medical Need: CMS must explicitly define unmet need in a way that recognizes disparities in clinical outcomes, access, and affordability—ensuring that the policy does not merely contain costs but actually expands access for those who need it most.

Financial and Policy Implications for Safety-Net Programs, Medicaid, and Drug Pricing Reforms

• Medicaid Rebate Reductions and Budget Pressures: The intersection of drug price negotiations, 340B carve-in policies, and Medicaid rebates has significant financial implications for state budgets. When 340B-covered entities elect to carve-in Medicaid claims, states forgo billions in mandatory Medicaid rebates—a funding gap that may widen as drug pricing reforms shift financial responsibility across stakeholders. With growing state-level budget concerns, policymakers should assess how these evolving policies may limit Medicaid funding for safety-net services or create new cost pressures on publicly funded health programs.
• Patient Cost-Sharing Concerns: Many 340B hospitals and contract pharmacies are not required to pass savings directly to patients, meaning out-of-pocket costs may remain high despite the discounted drug acquisition prices. As policymakers explore reforms to improve affordability, there is a need to ensure that price negotiation mechanisms do not inadvertently increase financial barriers for underinsured populations who rely on Medicaid or 340B-supported care.
• Implications for Communicable Disease Treatment Access: Medicaid populations include a high proportion of individuals living with HIV, hepatitis, STIs, and TB—all of which require continuous, uninterrupted access to treatment. As states reconsider rebate policies, formulary structures, and 340B reimbursement models, it is essential to examine whether these shifts could create new hurdles for infectious disease programs already constrained.
• Role of P&T Committees & Pharmacovigilance: Pharmacy and Therapeutics (P&T) committees play a crucial role in shaping formularies and guiding coverage decisions that determine access to essential medications. Pharmacovigilance measures—such as post-market safety surveillance and real-world evidence assessments—must be integrated into decision-making to ensure that price-focused policies do not compromise patient safety or efficacy outcomes. This includes close monitoring of adverse events, treatment interruptions, and emerging resistance patterns, particularly for infectious diseases that require sustained viral suppression to prevent transmission.

The Broader Picture

The IRA presents an opportunity to rebalance cost, innovation, and access—but its long-term success will depend on how well it integrates with existing public health and safety-net infrastructure. Without careful attention to these dynamics, cost-cutting measures could inadvertently undermine the very programs that have historically filled the gaps in access for vulnerable populations.

The challenge now is not just negotiating lower prices—it’s ensuring that lower prices translate into better access, better outcomes, and a stronger, more equitable public health system.

Implications of IPAY 2027 for HIV Medication Access and Pricing

The IPAY 2027 Final Guidance for the Drug Price Negotiation Program under the Inflation Reduction Act (IRA) sets forth detailed operational requirements for establishing and administering a “maximum fair price” (MFP) for certain high-expenditure Medicare drugs. 

Although HIV medications are not (currently) specifically singled out in the guidance, the unique nature of HIV therapy—lifelong adherence, potential single-source brand status, and frequent involvement of safety-net programs like 340B—means IPAY 2027 could have significant effects on both patients and providers.

1. Potential Selection of HIV Medications for Negotiation: 

• Qualifying Single-Source Drugs (QSSD): CMS selects high-expenditure “qualifying single-source drugs” (QSSDs) for negotiation. If a particular HIV therapy meets the QSSD definition—lacking generic/biosimilar equivalents and having passed 7/11 years since FDA approval—it could be chosen for IPAY 2027.
• Impact on Access and Affordability: Once selected, the drug would be subject to an MFP—potentially lowering beneficiary out-of-pocket costs in Medicare Part D. However, operational complexities tied to MFP effectuation—especially for specialty HIV pharmacies or Ryan White clinics and covered entities (FQHCs and HRSA covered entities)—may (operative word) bring added administrative steps to ensure timely reimbursements.

2. 340B Nonduplication Concerns

• Single Discount Requirement: By statute, manufacturers must offer safety-net providers either the MFP or the 340B ceiling price, whichever is lower—not both. The IPAY 2027 Final Guidance maintains that CMS will not manage the “deduplication” between the MFP and 340B; instead, manufacturers are responsible for ensuring each eligible claim receives only one discount.
• Documentation & Verification: Because many HIV service entities use 340B pricing to expand patient services, these clinics will need to collaborate closely with manufacturers. If a medication is eligible for the MFP but already purchased at or below that price through 340B, the clinic would not receive an additional reduction. Clinics and manufacturers should have processes in place to determine which discounted rate applies to each prescription.

3. Manufacturer Refunds and the Medicare Transaction Facilitator (MTF)

• Mandatory Data Module (DM): Under IPAY 2027, manufacturers and dispensing entities (e.g., community health centers, specialty pharmacies) are required to enroll in the MTF Data Module for claims validation. Participation in the optional MTF Payment Module (PM) is at the manufacturer’s discretion, though it simplifies processing and documentation of MFP refunds.
• Cashflow (is King) Mitigation: Smaller providers, including HIV clinics operating with limited cashflow, may struggle if manufacturers choose to offer the MFP as an after-the-fact rebate rather than an up-front discount. Under the Final Guidance, manufacturers must include measures in their MFP effectuation plan to address such cashflow problems, which is critical for providers serving vulnerable HIV populations.

4. Coordination With HIV Safety-Net Programs

• Ryan White, ADAP, and Medicaid: Although Medicare price negotiation does not directly alter Medicaid or Ryan White pricing, changes to manufacturers’ overall pricing strategies often filter down to other payers. Potential unintended consequences—like shifts in list prices or changes in rebate formulas—could affect AIDS Drug Assistance Programs (ADAP) and Ryan White clinics. Ongoing monitoring is advised to ensure any new pricing policies do not create additional barriers for HIV care.
• Formulary Placement: IPAY 2027 requires that selected drugs be covered on Medicare Part D formularies, but each plan may still implement tiering or utilization management. For HIV medications that typically enjoy “protected class” status in Part D, the risk of stringent utilization management is lower, but plan cost-containment tactics could still affect specific formulations or newer therapies.

5. Future Considerations for HIV Stakeholders

• Tracking Implementation: CMS’s new MTF processes, timelines for claims submission (PDE adjustments), and short data-reporting deadlines may require HIV-focused clinics and pharmacies to refine internal workflows to accommodate MFP-related requirements.
• Advocacy and Policy Engagement:  As IPAY 2027 evolves—particularly with respect to negotiated prices and 340B intersections—HIV advocates, public health agencies, and industry can work together to safeguard long-term affordability and continuity for vital HIV treatments. Ensuring that clinics and patients benefit from any new savings while preserving incentives for HIV innovation will be a priority.

Case in-point: https://lgbtq.wa.gov/advocacy/community-work/hiv-medication-access-workgroup

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