Legislation includes provisions extending ACA subsidies, capping insulin prices for Medicare beneficiaries, allowing Medicaid to negotiate drug prices, investments to combat climate change
Sept. 9, 2022 (ACP) — The recently passed Inflation Reduction Act includes several wins for the health care sector and climate change -- provisions that the American College of Physicians pushed hard for passage.
“The bill is quite significant and includes several provisions that we enthusiastically support,” said Shari Erickson, ACP chief advocacy officer and senior vice president. “We're thrilled that it passed after a long and difficult struggle.”
Thanks to the bill, enhanced subsidies will continue through 2025 for people who buy their own health coverage through the state and federal Affordable Care Act marketplaces. These subsidies “increase the amount of financial help available to those already eligible,” according to the Kaiser Family Foundation (KFF), and they also help “middle-income people, many of whom were previously priced out of coverage.”
“ACP is a firm supporter of expanded access to health insurance, and this is a positive step,” Erickson said. “The College will continue to encourage Congress to work on making these subsidies permanent.”
In addition, there are multiple health-related provisions in the legislation that will be phased in from 2023 through 2029, according to KFF.
The first changes, in 2023, will require pharmaceutical companies to pay rebates if prices outpace inflation and limit Medicare Part D insulin copays to $35 a month. “The limit on insulin is a significant policy change that will help a lot of seniors,” Erickson said.
Also, the legislation dramatically changes vaccine coverage under Medicare, Medicaid and CHIP. Cost sharing for vaccines will be eliminated for seniors under Medicare Part D, and Erickson said this change is especially crucial to expand access to the expensive shingles vaccine.
Negotiation over certain high-cost/sole-source Medicare Part D drugs will begin in 2026 and expand to Medicare Part B in 2028, according to KFF. There is also a 6% annual cap on increases in Medicare Part D premiums from 2024 to 2030, and 2025 brings a $2,000 out-of-pocket cap on spending for Medicare Part D benefits.
“We've long advocated for this to happen,” Erickson said. “Although this reform doesn't go as far as we'd like, it's a move in the right direction.”
Finally, the bill supports major investments through tax credits, rebates and special programs to combat climate change and support clean and renewable energy. The bill includes $60 billion in spending to address the disproportionate burden of pollution and climate change on low-income communities and communities of color, Erickson said.
“We were strongly supportive of these provisions since ACP supports immediate action to protect public health by mitigating global climate change,” Erickson said.
She noted that the cap on insulin copays and the elimination of vaccine copays will take effect within just a few months at the beginning of 2023. “Our members have been contacting us about the vaccine component in particular,” she said. “It will make a huge difference in protecting our members' patients from illness.”