Summary:
Today marks the second anniversary of the Inflation Reduction Act, and it’s clear how much progress the Biden-Harris Administration has made since the law was signed on August 16, 2022. I’ve had the opportunity to meet and talk with seniors and people with disabilities with Medicare across the country about lowering prescription drug costs, and the common thread in those conversations is simple – folks want peace of mind and that comes from knowing that their health care needs won’t break the bank. Everyone deserves access to affordable health care, including the medications they need to live a healthy and thriving life.
Deputy Secretary Andrea Palm at a Senior Center Town Hall in Cincinnati Ohio
People like those I met in Laurel, Maryland and Cincinnati, Ohio are already saving money thanks to the President’s lower cost prescription drug law. This year, some seniors and people with disabilities started seeing their out-of-pocket drug costs capped at about $3,500. In just the first quarter of 2024, over 260,000 people benefited from this cap, meaning they will pay no more out-of-pocket through the remainder of the year.
Those costs are about to be lowered even more, with a $2,000 cap going into effect on January 1, 2025. For comparison, by April 1, 2024, more than 1.7 million people had already reached $2,000 in out-of-pocket costs on their prescription drugs. These savings can mean more back in your pocket for the things you’ve always wanted to do, like Martha, who helped her daughter setup a commercial kitchen for her catering business and spent more time with her grandchildren.
In addition to this monumental achievement, millions of people with Medicare have already been benefiting from a $35/month cap on covered insulin. And there’s more good news, eligibility was also expanded for the Low-Income Subsidy program, also known as Extra Help, to provide more enrollees with $0 premiums, $0 deductibles, and fixed, reduced copays, all thanks to the Inflation Reduction Act. Millions of people could benefit from the Extra Help program now but aren’t currently enrolled. Some people qualify automatically, but if you don’t, it’s easy to apply.
Even if you’re fortunate enough not to need a prescription, the Inflation Reduction Act is saving you money. Certain recommended preventive adult vaccines are now free. In 2023, more than 10 million people with Medicare prescription drug coverage received a free vaccine – an increase from just 3.4 million people in 2021.
And this year, a historic part of President Biden’s and Vice President Harris’s landmark lower cost prescription drug law gives Medicare, for the first time ever, the power to negotiate directly with drug companies to lower the price of some of the costliest and most utilized drugs. Just yesterday, we announced the new, lower prices agreed upon between the participating drug companies and Medicare. These prices will go into effect on January 1, 2026 – ushering in a new era of fair pricing. If the new prices had been in effect last year, Medicare would have saved an estimated $6 billion, or approximately 22 percent, across the 10 selected drugs. These negotiated prices range from 38 to 79 percent discounts off of list prices and are estimated to save people with Medicare $1.5 billion in 2026. That’s money that will stay in the pockets of millions of Americans instead of big pharmaceutical companies.
These accomplishments are remarkable, and we will continue to do more to ensure every American has access to quality, affordable health care.
As we celebrate this landmark law, visit LowerDrugCosts.gov for more information and resources on the Inflation Reduction Act. For information in Spanish, visit MedicamentosBajoPrecio.gov.
