The IRA Fixed One Medicare Part D Distortion—But Patients Now Face New Tradeoffs

By Bryce Platt, PharmD For years, Medicare Part D plans often preferred high-list/high-rebate branded multiple sclerosis (MS) drugs over lower-cost generics. That was rational behavior inside an irrational system. The Inflation Reduction Act (IRA) offers one example of how incentives can change behavior in the system. New research in JAMA Health Forum reveals a significant reversal in Medicare Part D formulary coverage for MS drugs. After years of plans favoring brand-name drugs over generics, 2025 formularies shifted to near-universal generic coverage. However, in return patients got narrower formularies, higher upfront costs, and way more taxpayer dollars spent than expected. While…

By Bryce Platt, PharmD

For years, Medicare Part D plans often preferred high-list/high-rebate branded multiple sclerosis (MS) drugs over lower-cost generics. That was rational behavior inside an irrational system.

The Inflation Reduction Act (IRA) offers one example of how incentives can change behavior in the system. New research in JAMA Health Forum reveals a significant reversal in Medicare Part D formulary coverage for MS drugs. After years of plans favoring brand-name drugs over generics, 2025 formularies shifted to near-universal generic coverage.

However, in return patients got narrower formularies, higher upfront costs, and way more taxpayer dollars spent than expected.

While this wasn’t the case for all drug classes, in MS, the IRA Part D redesign has forced plans to care more about net drug spending. Below, we analyze the formulary data and explain why the coverage patterns changed so abruptly—and what new tradeoffs have emerged.
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