Tennesseans on Medicare will see big savings next year thanks to the Inflation Reduction Act.
The Act caps prescription drug costs at $2,000 per year for people on Medicare, starting in 2025.
Nina Weiler-Harwell, associate director of advocacy and community engagement for AARP California, said every year from 2025 to 2029, between 3 million and 4 million Part D plan enrollees are estimated to benefit from the new out-of-pocket cap.
"Medicare drug plan enrollees nationwide who reach the new out-of-pocket cap will see an average savings of roughly $1,500 or 56% in 2025 for new prescription drugs," Weiler-Harwell explained.
More than 53,000 Tennessee Medicare Part D enrollees who do not qualify for the low-income subsidy are expected to hit the $2,000-dollar out-of-pocket spending cap next year, amounting to roughly 6.4% of all Tennesseans with a Medicare prescription drug plan, as reported in a recent AARP study.
Weiler-Harwell noted the Inflation Reduction Act introduced a number of new policies to cut costs for Americans on Medicare.
"Copays for insulin capped at $35 a month. Vaccines such as shingles and pneumonia are free," Weiler-Harwell outlined. "The Inflation Reduction Act did allow Medicare to negotiate the price of high-cost prescription drugs. But we won't really start to see that until 2026."
Also thanks to the Inflation Reduction Act, drug companies will have to pay a penalty if they raise their prices higher than the rate of inflation.