How the Inflation Reduction Act Impacts Medicare
The Inflation Reduction Act (IRA) has passed the Senate and House and was signed into law. Although the act addresses several areas regarding healthcare, the most impactful for Medicare beneficiaries is the prescription drug price reform.
The IRA aims to make prescription drugs more affordable and will cap costs on Part D plans, allow negotiated prices for medications, provide 100% coverage on Part D vaccines, and more.
Insulin - In 2021, the Senior Savings Program was implemented and prohibited participating drug plans from charging more than a $35 copay for specific insulin.
However, not all plans were required to comply. With the new IRA, all Part D and Medicare Advantage plans with drug coverage must cap covered insulin at $35 per month starting January 2023.
Vaccines - The IRA will now cover many of the vaccines that beneficiaries need at 100%.
Though Medicare Part B covers some vaccinations at 100%, such as pneumonia, flu, Covid-19, and Hepatitis B, some important vaccines fall under Part D coverage. One Part D vaccine is the Shingles vaccine. Many beneficiaries are disappointed that this vaccine falls under Part D and can be an additional cost. To benefit many, the Shingles vaccine and many others will no longer require additional out-of-pocket costs.
Prescription Drugs - Beginning in 2023, if a drug manufacturer increases its drug costs faster than the inflation rate, it will have to pay rebates to avoid penalties.
2024 & Beyond:
Below is the implementation timeline of the IRA and the major changes occurring each year:
Negotiated drug prices will start in 2026 with 10 Medicare Part D drugs and then increasing each year after.
We know the ever changing world of Medicare can be challenging to understand from one year to the next. We are here to answer your questions and help you along the way.