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The Inflation Reduction Act and Medicare

The Inflation Reduction Act is a new federal law that helps improve Medicare. It expands Medicare benefits. And it helps lower out-of-pocket drug costs.

 

The Inflation Reduction Act lowers costs of insulin and other drugs under Medicare.

Lower copays for insulin and vaccines

 

Vaccines at $0 copay

 

With this new law, there is a $0 copay* for most Part D vaccines at any network pharmacy. That includes the shingles vaccine.

 

Insulin copay limit of $35

 

With the new law, your copay for a month’s supply of covered insulins will be no more than $35.* That’s with Medicare Part B or Part D. Just go to any network pharmacy.

 

For Part B insulin, this copay limit only applies to:

  • Insulin dispensed through a pump
  • Medicare-covered durable medical equipment
 

These benefits apply no matter what tier the drug is on. Even if you haven’t paid your deductible yet. These copay limits apply through all coverage phases. That includes the coverage gap.

 

Other benefits of the Inflation Reduction Act

 

Lower coinsurance for some Part B drugs

The new law has rebates that will also lower the cost share for some other Part B drugs. Certain Part B drugs will get a coinsurance adjustment. We pass those savings on to you.

 

These drugs may change each quarter. This change doesn’t apply to Part D drug coverage. Ask your pharmacist to learn if your drug is part of this change.

$0 copay in the catastrophic phase

There’s a limit to what you have to pay out-of-pocket for your covered Part D drugs each year. Once you reach that limit, you enter the Medicare catastrophic phase. In the catastrophic phase, you would normally pay a lower copay for your drugs.

 

With the Inflation Reduction Act, that lower copay is now $0. This benefit started on January 1, 2024.

Expanded low-income subsidy (LIS or “Extra Help”)

Do you qualify for the Extra Help program? It’s open to Medicare Part D members with incomes up to 150% of the federal poverty level. Starting in January 2024, if you qualify, you’ll pay:

 

  • A reduced drug plan premium
  • A $0 drug plan deductible
  • A lower cost for covered generic and brand-name drugs
 

No more coverage gap (donut hole)

Starting in 2025, your drug benefit won't have a coverage gap. In 2025, your prescription drug benefit will only have three phases:
 

  • The deductible phase
  • Initial coverage phase
  • Catastrophic coverage phase  

Lower out-of-pocket limit for Part D plans

In 2025, your maximum prescription out-of-pocket costs will be lowered to $2,000 for covered Part D drugs. Your out-of-pocket costs include your:
 

  • Part D deductible
  • Copay
  • Co-insurance costs

If you reach this amount, you move to the catastrophic phase. You will pay $0 copay for covered Part D prescription drugs for the rest of the plan year.  

New Medicare Prescription Payment Plan

The Medicare Prescription Payment Plan is a new payment option. It works with your current Part D drug coverage. Participation is voluntary and there’s no extra cost to join. You can set-up payments that vary throughout the year for your out-of-pocket costs. This payment option may help you manage your expenses. It doesn’t save you money or lower your drug costs. Discover how Medicare Prescription Payment Plan works.

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