Inflation Reduction Act Passed
On August 12, 2022 the Inflation Reduction Act (IRA) was passed by the U.S. The House of Representatives and President Biden are expected to sign off on the bill. Already being passed by the Senate, the $740 billion budget reconciliation package includes Medicare drug pricing policies, Affordable Care Act (ACA) subsidies, climate, energy, and taxes.
Allowing Medicare to Negotiate Drug Prices
The IRA enforces the Department of Health and Human Services(HHS) to establish a negotiation program in hopes to make expensive drugs, single sourced, and biological products more affordable. In this program, the HHS Secretary will produce a list of selected drugs that meet certain criteria, and negotiate maximum fair prices on these drugs with suppliers, then renegotiate as needed. The drugs up for negotiation are the top 50 drugs from both Part B and top 50 from Part D with the highest total cost from the latest 12 month period. However, the negotiations for the Part D drugs are limited to 2026 and 2027, these prices must take effect for 10 of the negotiated drugs in 2026 and then increase to 20 in 2029. For 2026 the expenditure period to be reviewed is June 1, 2022 through May 31, 2023, and the selected drugs’ publication date is September 1, 2023. Studies show that seniors aged 65 or older require at least four prescription medications, and 1 out of 4 say that it is difficult to afford all of their prescription drugs. In particular, low-income seniors are more severely impacted, and this act being passed will provide savings of hundreds or thousands of dollars annually.
Addresses Climate Change
The Inflation Reduction Act provides $369 billion to help minimize greenhouse gas emissions that are mostly responsible for climate change and related health complications. This is the most spent to combat the effects of climate change in United States history.
What are the benefits from the passage of this bill?
As of now, 14.5 million people in the United States use a state or federal health insurance marketplace for their insurance needs. The policy will aid millions of lower or middle-class individuals or families to purchase affordable insurance. Since these credits took effect, African-American and Latin communities’ enrollment has seen a significant increase in willingness to enroll in health insurance versus other years.
The IRA is one of the largest spending bills in the history of the U.S. There are many more details than are covered in this article. For more information, please click here!
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