FRIDAY, NOVEMBER 18, 2022

Lower prescription drug costs and more affordable healthcare are on the way thanks to President Biden’s Inflation Reduction Act. This multi-year plan will bring significant benefits to seniors across the country. Key elements include lower prescription drug prices in Medicare through price negotiation with manufacturers, a yearly cap on out-of-pocket prescription drug costs in Medicare, and expanded benefits for people with Medicare such as enhanced vaccine coverage.
Let’s take a look at some of the things to expect over the next several years:
In 2022…
- Starting October 1, Medicare will temporarily pay an add-on fee of 8% instead of 6% for qualifying biosimilars which will encourage competition, lower costs for prescription drugs, and improve patient access to biosimilars.
- Starting October 1, drug manufacturers will be required to pay rebates to Medicare if their prices for certain Part D drugs increase faster than the rate of inflation over a 12-month period.
In 2023…
- Starting January 1, people enrolled in a Medicare prescription drug plan will not pay more than $35 for a month’s supply of each insulin that they take and is covered by their Medicare prescription drug plan and dispensed at a pharmacy or through a mail-order pharmacy. Part D deductibles won’t apply to the covered insulin product.
- Starting July 1, people with Traditional Medicare who take insulin through a traditional pump will not pay more than $35 for a month’s supply of insulin, and the deductible will not apply to the insulin. This will apply to people using pumps covered through the durable medical equipment benefit under Part B.
- Starting January 1, adult vaccines recommended by the Advisory Committee on Immunization Practices, such as the shingles vaccine, will be available to people with Medicare Part D at no cost.
- Starting April 1, people with Traditional Medicare may pay a lower coinsurance for some Part B drugs if the drug’s price increased faster than the rate of inflation.
In 2024…
- Starting January 1, people with Medicare prescription drug coverage who fall into the catastrophic phase of the prescription drug benefit won’t have to pay any coinsurance or co-payments during that phase for covered Medicare prescription drugs.
- The average premium increase across most Part D plans will be limited to 6% over the previous year.
- The low-income subsidy program under Medicare Part D will be fully available to certain people with Medicare with limited resources who earn less than 150% of the federal poverty level.
- Starting July 1, there will be a cap on the Part B payment amount for new biosimilars when average sales price data is not available.
- By September 1, CMS will publish the maximum fair prices negotiated for the first 10 Medicare Part D drugs selected for negotiation, and they will go into effect in 2026.
In 2025…
- People with Medicare Part D won’t pay more than $2,000 out-of-pocket for prescription drugs and will have the option to pay out-of-pocket Part D costs in monthly amounts spread out over the year.
- Government reinsurance in the catastrophic phase of Part D will decrease from 80% to 20% for brand-name drugs, biologicals, and biosimilars. It will decrease from 80% to 40% for generics.
For a complete timeline from 2022-2029, visit https://www.cms.gov/files/document/10522-inflation-reduction-act-timeline.pdf.
For helpful FAQs, visit https://www.cms.gov/files/document/10522-external-faqs-about-inflation-reduction-act.pdf.
Posted 2:48 PM
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