CMS: 18.7M Seniors Will Save $400/yr on Prescription Drug Costs once IRA's spending cap kicks into effect

via the Centers for Medicare & Medicaid Services (CMS):

New Report Projects Nearly 19 Million Seniors Will Save $400 Per Year on Out-of-Pocket Prescription Drug Costs

Today, the U.S. Department of Health and Human Services (HHS), announced actions to protect consumers from junk health plans, surprise medical bills, and excess costs that lead to medical debt. These actions build on the Biden-Harris Administration’s effort to eliminate hidden fees in every sector of the economy and lower health care costs for American seniors and families.

Coinciding with the actions taken today, HHS also released a new report projecting that nearly 19 million seniors will save approximately $400 per year on prescription drug costs when the $2,000 out-of-pocket prescription drug spending cap from the Inflation Reduction Act – President Biden’s historic lower cost prescription drug law – goes into effect in 2025.

The report follows last week’s actions advancing historic provisions in the law that allow Medicare to negotiate prescription drug prices and cap the cost of each Medicare-covered insulin pump at $35 per month.

“The Biden-Harris Administration continues to take action to lower costs for millions of Americans and improve health outcomes across the nation. Today’s announcement protects patients from junk health insurance and unfair billing practices, and increases transparency in our health care system, while continuing to implement President Biden’s historic prescription drug law that is lowering costs for millions of seniors across the country,” said HHS

Secretary Xavier Becerra. “The Biden-Harris Administration is committed to helping seniors and people with disabilities save money on the medications they need and ensuring hardworking families have insurance when they need it.”

“The Biden-Harris Administration’s efforts to make health care more affordable are life-changing for millions of Americans,” said Centers for Medicare & Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure. “No one should go bankrupt trying to get and keep themself or their family healthy. CMS is committed to a more transparent, fair, and accountable health system for the people we serve. We will continue to clarify consumer rights under the No Surprises Act, work to better understand the impact of medical debt, and limit non-comprehensive junk insurance plans.”

Lowering the Price of Prescription Drugs

HHS released research today on lower out-of-pocket costs resulting from President Biden’s lower cost prescription drug law, which is already saving some seniors and people with disabilities hundreds of dollars annually. According to a new Office of the Assistant Secretary for Planning and Evaluation (ASPE), report, the law’s changes to the Medicare Part D program may reduce out-of-pocket spending by nearly $400 for more than 18.7 million enrollees when the provisions are implemented in 2025, or about one in three people with Medicare Part D. Among this population, the report finds nearly 1.9 million enrollees are projected to save at least $1,000 in 2025. Once all of the provisions modeled in this report are in effect in 2025, they collectively will result in about a $7.4 billion reduction in annual out-of-pocket spending. Today’s report also includes state-by-state projected savings for Medicare enrollees in 2024 and 2025.

Projected Impact of Inflation Reduction Act Medicare Part D Redesign for Enrollees Expected to Have Out-Of-Pocket Savings in 2025, by State: