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Community Oncology Faces Crossroads Under the Inflation Reduction Act
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Key Takeaways
- The IRA allows Medicare to negotiate drug prices, aiming to reduce costs but potentially impacting oncology practice sustainability.
- Community oncology practices face financial challenges due to reduced drug reimbursement, risking closures and increased hospital-based care reliance.
Despite benefits for reducing drug costs, community oncology practices face the unintended consequences of the IRA.
The Inflation Reduction Act (IRA) marked a historic milestone in legislation, granting Medicare the authority to negotiate prescription drug prices with pharmaceutical companies for the first time; capping the cost of insulin at $35; and extending the Affordable Care Act. The landmark law reshaped health care policy in the United States, strengthening the health care safety net, reducing drug prices, and expanding access to preventive care.1
However, the IRA has also drawn scrutiny, as some community oncology pharmacies have reported challenges stemming from perceived gaps or unintended consequences in the law. At the Community Oncology Alliance (COA) 2025 Community Oncology Conference, panelists Austin Cox, PharmD, Florida Cancer Specialists & Research Institute; Nicolas Ferreyros, managing director of Policy, Advocacy, and Communications at COA; and Barbara McAneny, MD, FASCO, MACP, medical oncologist/hematologist in Albuquerque, New Mexico, and co‐founder and CEO of New Mexico Oncology Hematology Consultants, raised concerns about the IRA’s impact on oncology practices, particularly through changes in drug reimbursement.2
"Congress didn't intend for this to happen,” said McAneny. “They were not after the practices. They just thought, 'Here's a clever way we can negotiate drug plans lower.'"2
The IRA is comprised of a phased approach to drug price negotiations, targeting specific high-cost medications to reduce prescription drug costs for both patients and the Medicare program. Under this framework, Medicare Part D drug negotiations will begin in 2026, followed by negotiations for Medicare Part B drugs in 2028. For the first time, the federal government will be allowed to negotiate maximum fair prices for selected drugs, marking a major shift in how drug pricing is regulated.2
Although these provisions aim to lower costs for patients, they carry significant implications for community oncology practices. By 2028, reimbursement for certain Part B drugs could be reduced by as much as 49.5%, potentially leading to an estimated $25 billion total financial impact across the oncology sector. Independent and community-based oncology practices, which often operate on tighter margins, may be at higher risk of closure.2
This shift poses a serious threat to the sustainability of current financial models in oncology care. Practices may face challenges in managing drug purchasing and inventory, and disruptions in reimbursement could impact their ability to provide timely access to high-cost cancer therapies. In some cases, patients might be redirected to hospital-based care settings, which are often more expensive, leading to higher system-wide costs and potential barriers to access.2
"The irony is that this IRA was supposed to lower drug prices, but it's indirectly driving patients into institutions that are drastically more expensive,” stated Cox.2
The panelists voiced many concerns about the financial and operational challenges these changes could present:
Ferryros: "We are 7 months out from when all of this becomes a reality… And now the practices are left in the middle, trying to figure out whether it's prospective or retrospective reimbursement. We're seven months out. We still don't have full systems in place... and the process isn't clear.”2
McAneny: "We built the practice on the drug margin...now they're taking it away, and they're not putting anything else in its place. This could very well be a practice-ending event for a lot of practices."2
Cox: “At this point in time...I'm not [feeling] good. I feel terrible, actually. This is going to be a considerable challenge for all of us. I think regardless of the model, whether it's retrospective or prospective, there's going to be FTE consumption; there's going to be an enormous amount of education that needs to go in place.”2
The panelists provided various methods and strategic approaches that community oncology practices are using to overcome and ease the financial and operational challenges posed by the IRA. To build greater financial stability, some practices are seeking to reduce their reliance on drug margins by developing multiple revenue streams. This includes offering additional clinical services, such as expanding into adjacent service areas to better meet patient needs and offset financial pressures. For example, adding neurology services, launching Alzheimer’s treatment programs, or establishing chronic disease management offerings.2
The speakers also emphasized careful editing as essential for informed decision-making in this evolving landscape. Practices are conducting time and motion studies, calculating the true cost of care, and identifying inefficiencies in operations. Understanding the real expense per patient encounter enables more precise financial tracking and supports the transition to value-based care models.2
Beyond changing financial or operational approaches, advocacy remains a key cornerstone of combatting challenges posed by the IRA. Practices are forming strategic partnerships, engaging with manufacturers, and developing joint responses to shared challenges. Participation in policy discussions and collaborative research initiatives allows for greater influence in shaping the future of care delivery.2
Ferryros: “It's not just for the ‘Austins’ of the world. It's for everybody from the big to the small and in between in community oncology that we need to come up with a unified solution.”2
McAneny: "We have to redesign value-based care. Value-based care has turned into value for the payers, not value for the patients or the practices… Start thinking about what you can do as value-based contracts. Go to your own practice and figure out how much it costs you to perform the essential functions that you do."2
Cox: “I would almost encourage any practice to develop some type of IRA Task Force to really thoroughly educate that team on how this process is going to look.”2
The insights shared by panelists highlight the urgent need for clear guidance, strategic adaptation, and continued advocacy to ensure that community-based care remains viable. By embracing innovation, refining operational models, and presenting a united front in policy discussions, oncology practices can navigate the challenges ahead while continuing to provide high-quality, patient-centered care.
“This is the time for community oncology to come together, because we've got to fix this as a group,” said McAneny. “We've got to fix this as a profession, because destroying the delivery system is just simply not an option."2
