Part D changes
For the first time, out-of-pocket costs for Medicare Part D prescription drugs will be capped. Starting in 2025, beneficiaries will not have to pay more than $2,000 a year for their share of Part D drug prices.
Beginning in January, most vaccines will be free in Medicare.
Part D premiums cannot increase more than 6 percent a year through at least 2029. The income threshold for beneficiaries to qualify for a subsidy to help pay for Part D out-of-pocket costs is increased from 135 percent of the federal poverty level ($18,347 for an individual in 2022) to 150 percent ($20,385 for an individual in 2022).
Negotiating drug prices
The law authorizes the Health and Human Services secretary to begin negotiating the prices of 10 high-cost prescription drugs in 2023, and the negotiated prices will go into effect in 2026 for Part D medications and in 2028 for drugs covered under Medicare Part B. The number of drugs whose prices will be negotiated on behalf of Medicare will increase in subsequent years, and by 2029 a total of 60 drugs will be subject to negotiated prices.
Inflation rebate
Beginning in October, if the price of a Part D prescription drug is raised by more than the rate of general inflation, the drugmaker will have to rebate to Medicare the amount of the increase above the inflation rate. Rebates for higher-than-inflation price hikes for medications covered under Medicare Part B (usually office-based infusions, such as for cancer drugs) will begin in January 2023.
Health care subsidies extended
For people who buy their health insurance through the ACA marketplaces, the bill extends through 2025 the expanded federal premium subsidy and other financial enhancements made under the American Rescue Plan. For those 50 to 64 years of age, these subsidies provide an average savings of over $950 annually, and all consumers will continue to pay no more than 8.5 percent of their income for ACA health insurance premiums.