The Inflation Reduction Act: Lowering your Health Care Costs
Since I got to Congress, I’ve been focused on making health care affordable and accessible for all Kansans, including prescription drugs. There’s no reason Kansans should be paying three times what people in other countries pay for their needed medications.
That’s why I voted for the Inflation Reduction Act in 2022, which is now law. This historic legislation finally stands up to Big Pharma and allows Medicare to negotiate for lower drug prices, which will benefit all Americans. It lowers premiums for people who buy their own insurance and takes huge strides to lower the cost of insulin and other prescription drugs for our nation’s seniors. Additionally, the Inflation Reduction Act cuts wasteful spending and reduces our nation’s deficit by roughly $300 billion – per the nonpartisan Congressional Budget Office.
Read below to learn about these concrete solutions to lower costs and to find out how to take advantage of the Inflation Reduction Act’s benefits.
Insulin Cap for Medicare
What Changed: The Inflation Reduction Act caps out-of-pocket costs for insulin at $35 a month for seniors who are enrolled in Medicare. This policy takes effect in two phases:
- On January 1, 2023, out-of-pocket costs for insulin are capped at $35 a month for Medicare Part D enrollees in both standalone and Medicare Advantage plans.
- If health care plans charge more than $35 for a month’s supply of a covered insulin product in January and/or February 2023, they must reimburse enrollees within 30 calendar days for any amount paid above the $35 cap.
- On July 1, 2023, out-of-pocket costs for insulin are capped at $35 a month for Medicare Part B and it will no longer be under the deductible.
- Part B often covers people who use traditional insulin pumps.
What You Need to Know: If you are enrolled in Medicare and use a covered insulin product, no additional action is needed on your part to receive these benefits. However, because some of these cost savings were not reflected in the last open enrollment period, CMS created a special enrollment period that may apply to you.
- People who use a covered insulin product can add, drop, or change their Part D coverage one time between now and December 31, 2023.
- Plans are not required to cover all insulin products, so this is an opportunity to find a plan that covers each individual’s needs.
- Call 1-800-MEDICARE if you take insulin and want to change your plan.
Addressing Skyrocketing Drug Costs
What Changed: In addition to the insulin cap, the Inflation Reduction Act made several strides to lower prescription drug costs for seniors and stand up to Big Pharma, including:
- Empowering Medicare to begin negotiating directly to lower the price of prescription drugs.
- The initial list of 10 drugs will be published in 2024 and will go into effect in 2026, eventually expanding to 20 drugs.
- In addition to lowering drug prices and saving Kansans money, this policy is projected to save $100 billion of taxpayer money over 10 years.
- Instituting the first-ever out-of-pocket cap on seniors’ drug costs at $2,000 per year, with the option to break that amount into affordable monthly payments throughout the year.
- An estimated 1.4 million Medicare patients spend more than $2,000 on medications each year, including people who need high-cost cancer drugs.
- This cap will go into effect in 2025.
- Enacting a new “inflation rebate” so that drug companies must pay Medicare back if they raise prices higher than inflation.
- Starting April 1, 2023, this change is expected to lower out-of-pocket costs for people who use those medications.
- Making crucial vaccines for adults, like shingles and tetanus, free for Medicare and Medicaid beginning in 2023.
Lowering Health Insurance Premiums
What Changed: The Inflation Reduction Act lowers premiums for folks who buy their own health insurance by extending savings that were set to expire at the end of 2022.
- The caps are based on income levels, and for 31,000 Kansans in the Third District who purchase their own insurance, this policy will save an average of $980 a year on health care premiums.
What You Need to Know: To sign up for coverage and see how much you can save, go to healthcare.gov. The open enrollment period occurs every year starting in November, but under certain circumstances, individuals may be able to get covered now.