Inflation Reduction Act Seeks to Improve Prescription Drug Prices, Reduce Health Care Premiums
With the recent passage of the Inflation Reduction Act in the Senate (by a narrow margin, with VP Kamala Harris casting the tie-breaking vote), many may be wondering what other benefits they could be entitled to when President Joe Biden almost certainly signs the legislation into law.
Ostensibly, millions of Americans will benefit from reduced health insurance fees and prescription drug costs as part of the Inflation Reduction Act.
The provisions of the act include caps on out-of-pocket prescription payments for anyone on Medicare, limiting the amount to $2,000 in an annual cycle by the year 2025. “In addition, it will do something that we have tried — and failed — to do in Washington for decades — allow Medicare to negotiate a better deal on prescription drugs,” said U.S. Department of Health and Human Services (HHS) Secretary Xavier Becerra on Aug. 7.
Becerra is referring to first-of-its-kind legislation that allows the government to be involved in helping to negotiate the fees Americans pay on the most expensive drugs, decreasing the monopoly that manufacturers have had on pricing the medications.
According to NPR, these changes won’t come into effect for a while, however, with the outlet noting that 10 medications will be under negotiation in 2026 while 10 more will be on the table by 2029. Some have also criticized the bill for not pushing forward on a $35/month cap for insulin for those on private insurance — even though it’s one of the most expensive and necessary medications for the 37.3 million Americans diagnosed with diabetes.
In addition to reduced prescription drug costs, an estimated 13 million Americans will enjoy reduced premiums on their monthly health insurance premiums. Those who have coverage through the Affordable Care Act will save an average of $800 per year, according to Becerra.
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