Allsup Explains How New Federal Law Addresses Healthcare

Belleville, Illinois, Aug. 29, 2022 (GLOBE NEWSWIRE) — The Inflation Reduction Act of 2022 recently signed into law addresses three key healthcare issues: the cost of drugs for Medicare recipients, a reduction in annual out-of-pocket costs for seniors, and an extension of the subsidies granted under the Affordable Care Act (ACA), according to Allsup, a nationwide provider of disability representation, health insurance benefits and return to work services.

Under the legislation, Medicare will negotiate lower prescription drug prices for some of the most expensive drugs, saving seniors thousands of dollars each year. This will begin in 2026 with 10 drugs, increase to 15 drugs in 2027 and 2028, and 20 drugs in 2029. Effective in 2023, copayments for covered insulin products in Medicare Part D will be limited to $35 per month.

“This is just one provision of the law designed to help Medicare recipients with soaring pharmaceutical costs,” said Bethany Cissell, Allsup Benefits Coordination account manager and healthcare benefits expert. “The law also caps their out-of-pocket costs for medications at $2,000 annually beginning in 2025. Drug manufacturers will also be required to pay rebates if their drug prices increase faster than the rate of inflation.”

Another component of the Inflation Reduction Act is that subsidies, which had been increased through the American Rescue Plan Act of 2021 (ARPA) to help 13 million individuals buy marketplace health insurance with lower premiums, will remain in place through 2025 rather than expire at the end of 2022. Also, the new legislation retains ARPA’s provision to expand subsidies allowing those over 400% of the federal poverty level to have their maximum premiums based on a silver plan capped at 8.5% of their income, thus avoiding the subsidy cliff through 2025. 

As the federal government begins to implement the law, Allsup Benefits Coordination will continue to help employers reduce group health plan…