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Inflation Reduction Act 

Changes to Medicare Prescription Benefits

On 8/16/2022, President Biden signed into law the Inflation Reduction Act

This act has several provisions which will impact Medicare Prescription Drug (Part D) coverage.

The new guidelines for Part D coverage will be implemented from 2022 to 2026. 

    • Inflation protected medication costs
      • As of 10/01/2022 pharmaceutical manufacturers must pay a penalty if the cost of a medication increases faster than inflation over a 12 month period
    • Coverage for Shingles Vaccine at no cost
      • All adult vaccines recommended by the Centers for Disease Control and Prevention will be covered by Part D Plans without imposing Plan deductibles or cost sharing.
      • Also includes Varicella (chicken pox),Hepatitis A, Hepatitis B, Meningococcal B vaccines
      • The following vaccines are currently covered under Medicare Part B and therefore are not impacted by the new legislation: Influenza, COVID, and Pneumococcal/Pneumonia
    • Injectable Insulin’s = $35/month and not subject to the Plan’s deductible.
      • Included = Injectable insulins (either vial or pen) which are included in a Plan’s Part D Formulary (list of covered medications)
      • Not included = Oral diabetic meds or injectable A1C meds.
    • Removal of 5% co-insurance during catastrophic phase
    • Part D premium increase cap of 6%/year
    • Maximum out of pocket implemented
      • Medicare Beneficiaries with Part D Plans cannot pay more than $2,000 in out of pocket costs for medications.
      • The cap may be adjusted each year for inflation.
    • Medicare Prescription Payment Plan implemented

Inflation Reduction Act Summary 3m 1s

Federal Government can negotiate costs for medications

    • 2023-2026 Medicare will negotiate prices for up to 60 drugs covered under Medicare Part D and Part B, and up to an additional 20 drugs every year after that 
    • The first ten drugs have been selected. Negotiations for this first group will begin in 2023 will negotiated prices going into effect in 2026. 
    • Click for a list of the first 10 drugs selected for price negotiation

1st Medications for Negotiation

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