One of the key provisions of the Inflation Rescue Act which was implemented last month will help Medicare policyholders to lower drug costs.
- Medicare will have the right to negotiate prices for prescription drugs for the first time since Congress enacted a prescription drug benefit for seniors in 2003. However the price negotiations will start only in 2026, and Medicare will be allowed to negotiate prices for the 10 highest-cost drugs. In 2027 the numbers increase to 15 part D drugs, in 2028 15 drugs in Part D and Part B, and then in 2029 20 of the highest drugs in Part D and Part B.
- Nevertheless, Medicare policyholders will see already in 2023 some changes. Insulin will be set to cost $ 35. In 2024 most vaccines will be free for Medicare enrollees. In 2025 the total annual out-of-pocket spending on RX drugs will be capped at $ 2000. (Currently, the out-of-pocket maximum is $ 7050 to go into the catastrophic Benefit period. )
- Furthermore starting this year in October, if the price of a Part D prescription drug is raised more than the rate of the general inflation, the drugmaker will have to rebate Medicare the amount of the increase that is higher than the inflation rate.
- Premiums for Medicare Part D drug insurance plans will not increase more than 6 percent a year through at least 2029.
- The income threshold to qualify for a subsidy to help pay for Part D out-of-pocket costs will be increased from 135 percent of the federal poverty level (FPL) to 150 % of the federal poverty level.
All these changes will help Medicare policyholders to lower their drug costs, these are great news during these difficult times.
Remember to read your notice of change letter which the insurance carrier will be sending out for your prescription drug plan Part D and your Medicare Advantage Plan in September. You will be able to make changes to your current plan at the Annual Open Enrollment Period in October.
For American under 65 years who buy health insurance under through Covered California or any ACA marketplace , the inflation reduction act extends through 2025 the federal premium subsidy , read more information here.
Please contact us at Solid Health Insurance Services with any questions you may have concerning your individual health insurance plan,Medicare Supplemental or Part C or Part D plan or group health insurance plan. Our mission is to find you health insurance that fits your budget and medical needs.