How the Inflation Reduction Act Changes Medicare Part D Plans
The Inflation Reduction Act of 2022, which was President Joe Biden’s chief piece of legislation from his first term, was signed into law in August 2022, and the bill also has noticeable benefits of participants of both Medicare and the Affordable Care Act (commonly known as Obamacare).
Centers Health Care takes a look at these benefits and how much you can expect to save.
Health Care Costs Should Drop
A summary of the bill shows that it should save the average enrollee to Obamacare about $800 per year. It also allows Medicare to negotiate the price of 100 drugs over the next decade, and drug companies will also have to issue rebates on price increases that are higher than inflation. From 2024-29, Medicare Part D premiums also will not be able to increase by more than 6% per year.
Expanded Medicare Benefits
Benefits that Medicare enrollees will start to see in 2023 include free vaccines, a cap of $35 per month on insulin, and caps on out-of-pocket drug costs of no more than $4,000 in 2024 and dropping down to $2,000 in 2025.
Details on Part D Caps
The prescription drug cap applies if you either access your Medicare through a private Medicare Advantage Plan or if you are enrolled in original Medicare but get your prescription drugs through a stand-alone Part D plan. In more good news, your existing prescription drug deductible will count toward that cap.
Another benefit for Part D recipients is that starting in 2025, people will be given the option to spread out their costs over the course of the year. The process, called smoothed cost-sharing, will allow you to spread out your payments throughout the year so you don’t have a big prescription drug bill in the first few months and then nothing for the rest of the year once you meet your deductible.
