Summary:
Did you know that nearly 1.5 million people with Medicare Part D saved almost $1 billion on their prescription drug costs in the first half of 2024 thanks to the Inflation Reduction Act’s new out-of-pocket cap? Well, things are going to get even better in 2025, because that cap lowers to $2,000 for everyone with Part D. At HHS, we’ve been working to lower drug costs because we understand how important it is to have access to affordable care.
Since the Inflation Reduction Act became law in 2022, we’ve heard from countless seniors and people with disabilities who have shared their struggle to afford lifesaving medications, often having to choose between filling their prescriptions and covering everyday expenses. In addition to the out-of-pocket cap on prescription drug costs, the drug law has brought about huge savings for people with Medicare, including:
- A $35 cap on insulin
- Free recommended vaccines, like shingles and RSV
- Lower out-of-pocket costs on Medicare Part B drugs
- Expansion of the Extra-Help program
The Inflation Reduction Act also allows Medicare to negotiate directly with drug companies to lower the prices of prescription drugs. In August 2024, HHS announced that the first round of the negotiation program resulted in lower prices for all 10 of the selected drugs. These drugs are some of the most expensive and most frequently dispensed drugs in the Medicare program and are used to treat conditions such as heart disease, diabetes, and cancer. The new prices will go into effect for people with Part D prescription drug coverage beginning January 1, 2026. The second round of negotiation will kick off early next year when, by law, HHS will select up to 15 drugs for negotiation.
As we look ahead to 2025, it’s important for people with Medicare to review their health care plans now during Medicare Open Enrollment and take full advantage of the benefits provided by the Inflation Reduction Act. With the out-of-pocket cap lowering to $2,000, and new negotiated drug prices on the horizon, it’s more important than ever to review and compare plans to get the best deal for you, and maybe even save money.
At HHS, we are committed to championing initiatives that reach those who need it the most and to work to improve health outcomes for all. We are continuing the fight to lower drug costs. Everyone deserves to have access to the care they need at a price they can afford.
Visit LowerDrugCosts.gov for more information and resources on the Inflation Reduction Act. For information in Spanish, visit MedicamentosBajoPrecio.gov.
