Inflation Reduction Act of 2022

The Inflation Reduction Act was passed by both chambers of Congress last week. The bill included several health care provisions including:

  • Empowers Medicare to negotiate directly for the price of prescription drugs in 2023 so that patients with Medicare get the best deal possible on high-priced drugs and pay cost-sharing for those drugs based on the Medicare negotiated price.
  • Caps Medicare patients’ out of pocket costs at $2,000 per year, starting in 2025, with the option to break that amount into affordable monthly payments (i.e., $35 a month for insulin).
  • Institutes a new “inflation rebate” under Medicare which will require drug companies who raise prices in Medicare faster than the rate of inflation to repay Medicare for the additional revenue.
  • Ensures that insurers and manufacturers cannot pass new financial responsibilities onto seniors by restricting how quickly Medicare Part D premiums can rise.
  • Provides free vaccines for Medicare beneficiaries
  • For drugs subject to Medicare price negotiation, allows 340B providers to pay the lower of the 340B ceiling price or the Medicare-negotiated price.
  • Expands premium and co-pay assistance on prescription drugs for low-income individuals, so that Medicare beneficiaries earning less than 150% of the federal poverty level will have full low-income subsidy status instead of partial.
  • Extends the Affordable Care Act enhanced marketplace premium subsidies for three years.
Published on 08/16/2022