Medicare and its enrollees saved $78 million since 2013 by paying adjusted, lower prices for certain drugs administered under Part B rather than the prices manufacturers originally reported, according to a data brief the Department of Health and Human Services’ Office of Inspector General released September 21, 2026. Of that total, $1.6 million came from price adjustments made to 14 drugs based on 2024 pricing data alone. The savings come from a review process that has run quietly in the background of Medicare’s physician-administered drug program for more than a decade, adjusting what both the government and individual patients pay without requiring either one to file a claim or make a phone call.
How OIG tracks these prices, and what it found
The mechanism behind the savings works on a quarterly cycle. OIG identifies and refers to the Centers for Medicare & Medicaid Services any Part B drug whose reported price exceeds a specific threshold, and CMS then applies its own price-substitution policy to lower the Medicare payment amount for that drug going forward. The data brief credits that back-and-forth with $78 million in combined Medicare and enrollee savings since the policy began in 2013, including the $1.6 million tied specifically to 2024 pricing data across 14 drugs.
Where these automatic savings don’t reach: Part B’s price substitutions run in the background regardless of what an enrollee does, but a Part D prescription denial or a confusing monthly drug bill somewhere else does not resolve itself the same way. The Medicare Cost & Coverage Protection Kit pairs 51 state Medicare cost-help packs with a medication and cost tracker for the costs that still need a hands-on push.
What a price substitution actually changes
Medicare normally sets Part B drug payment limits using each drug’s average sales price, or ASP, plus an add-on that is typically 6 percent, or 8 percent for qualifying biosimilar products, according to the Centers for Medicare & Medicaid Services’ own ASP reporting guidance. Manufacturers calculate and submit that price every calendar quarter, with deadlines about 30 days after each quarter closes, and CMS uses the updated figures to set payment limits going forward. Because that formula relies on manufacturers reporting their own prices, it depends on those numbers being accurate in the first place.
A price substitution overrides the normal ASP-based calculation for a specific drug when OIG’s quarterly referral shows the reported price is out of line with what the drug actually costs. Rather than waiting for a manufacturer to correct its own submission, CMS resets the payment amount for that drug directly, based on OIG’s referral, which is why the savings show up as a distinct, separately tracked figure rather than blending into the routine quarterly ASP updates every drug receives.
Why the savings reach enrollees, not just Medicare
The data brief describes the $78 million as savings for “Medicare and its enrollees” together, which reflects how Part B cost-sharing works. Under the program’s standard structure, an enrollee generally pays 20 percent of the Medicare-approved amount for a covered drug after meeting the annual Part B deductible, with Medicare covering the other 80 percent. When a price substitution lowers that approved amount, both shares shrink together, so a lower payment limit on an infused or injected drug lowers what Medicare pays and what a patient’s own 20 percent coinsurance comes to on the same claim.
For a household managing regular infusions or injections billed under Part B, such as certain cancer, arthritis or eye-disease treatments, that coinsurance share can add up over a year of repeated visits. A price substitution does not change which drugs a doctor prescribes or how often treatment happens; it changes the price tag those visits are billed against every time the substituted drug is used, for as long as the corrected price stays in effect.
The 31 drugs OIG could not check
The review was not able to confirm every drug on its list. Potential errors in the average manufacturer price data that drug companies submit to CMS prevented OIG from determining whether 31 additional drugs qualified for a price substitution during the period it reviewed. That data problem does not undo the $78 million already credited to the program, but it does mean the total number of drugs eligible for a lower Medicare payment is likely larger than the number CMS has actually substituted so far. The full breakdown of which drugs were checked, which were substituted and which 31 could not be verified is laid out in the underlying data brief itself.
101 drugs adjusted since the policy began
Since 2013, CMS has implemented price substitutions for 101 drugs under this policy, a scale that puts the 14 drugs adjusted using 2024 data into context as one year’s worth of an ongoing, cumulative effort rather than a one-time fix. Averaged out, that works out to roughly eight drugs a year receiving a corrected price, though the actual pace has varied from year to year depending on how many reported prices cross OIG’s threshold in a given quarter. The data brief contains no recommendations, since its purpose is to report the measured impact of an existing policy rather than to propose new changes to it, and OIG frames the $78 million figure as evidence the underlying referral process is still doing what it was designed to do more than a decade after it began.
Part B’s quiet savings and the costs still outside them
OIG’s price-substitution savings apply specifically to certain drugs billed under Medicare Part B, the outpatient and physician-administered side of Medicare, and even this report could not verify whether 31 additional drugs qualified for the same treatment. Nothing about this program touches Part D prescription costs, a denied prior authorization, or the separate out-of-pocket cap that applies to retail prescriptions.
The Medicare Cost & Coverage Protection Kit tracks the new Part D out-of-pocket cap alongside the prior-authorization appeal steps, for the drug costs that don’t get fixed automatically the way Part B’s price substitutions do.
See the appeal steps and the medication and cost tracker in The Medicare Cost & Coverage Protection Kit.
This article was produced with AI assistance and reviewed by a human editor, drawing on the federal report linked throughout.
