Lethe200
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Medicare Changes and the Inflation Reduction Act
Wealthy Nickel 06Nov2023
Passed in 2022 by President Biden, the IRA law aims to tackle inflation and lower medical costs for Americans. Its goal is to make prescription drugs cost less, as well as combat the national deficit and promote clean energy domestically. Its passage is why Medicare Part D will be changing beginning in 2024.
Medicare can now negotiate the cost of drugs with pharmaceutical companies, which it was not allowed to do before. The Inflation Reduction Act allows the Health and Human Services (HHS) secretary to negotiate drug prices on behalf of Medicare in a tiered method. They are beginning with up to ten prescription drugs negotiated by 2026 and an additional 15 drugs per year until 2028. Then, the HHS secretary may negotiate the prices for up to 20 medications per year in 2029 and beyond.
Medicare Part D will change in three big ways:
Medicare Changes and the Inflation Reduction Act
Wealthy Nickel 06Nov2023
Passed in 2022 by President Biden, the IRA law aims to tackle inflation and lower medical costs for Americans. Its goal is to make prescription drugs cost less, as well as combat the national deficit and promote clean energy domestically. Its passage is why Medicare Part D will be changing beginning in 2024.
Medicare can now negotiate the cost of drugs with pharmaceutical companies, which it was not allowed to do before. The Inflation Reduction Act allows the Health and Human Services (HHS) secretary to negotiate drug prices on behalf of Medicare in a tiered method. They are beginning with up to ten prescription drugs negotiated by 2026 and an additional 15 drugs per year until 2028. Then, the HHS secretary may negotiate the prices for up to 20 medications per year in 2029 and beyond.
Medicare Part D will change in three big ways:
- First, Medicare can negotiate drug costs. Secondly, a maximum out-of-pocket cap is set to $2,000. Finally, insulin costs can not exceed $35 a month for beneficiaries.
- Second, Medicare Part D’s catastrophic coverage phase. Currently, this phase is known for high costs, especially for those participants with high drug costs. Beginning in 2024, Medicare Part D enrollees will no longer be obligated to pay the 5% coinsurance that is currently required during the catastrophic coverage phase. This change translates to a capped out-of-pocket spending threshold for Part D enrollees. Taking away the 5% coinsurance requirement will save participants thousands of dollars.
- Third is a change coming to Medicare Part D involves the Extra Help program. Extra Help aids low-income participants. These beneficiaries pay nothing for premiums and a fixed copayment for prescription drugs. Starting in 2024, Extra Help will be available to more Americans. This program will be expanded to those who fall between 135% and 150% of the federal poverty line and meet the predetermined resource limit requirements.
