Biden administration officials are projecting that seniors on Medicare Part D will save hundreds of millions of dollars on vaccines because of the 2022 reconciliation bill, also known as the Inflation Reduction Act (IRA).
Notably, the estimates don’t include COVID-19 vaccines, which fall under Medicare Part B.
“The law makes many recommended vaccines free for Medicare beneficiaries,” said Susan Rice, the administration’s domestic policy czar, in a March 14 call with reporters.
On March 15, the Department of Health and Human Services (HHS) released a study of the IRA’s financial impact on seniors who have Medicare Part D.
Under the law, those older adults won’t have to pay out of pocket for many common vaccines, including the vaccines for shingles, tetanus, hepatitis A, and hepatitis B.
The study calculated that people on Medicare Part D would have saved over $230 million on covered vaccines in 2021—almost $70 per person—if the IRA had been in effect then.
“In some cases, some people paid nearly $200 million for the shingles vaccine by itself,” said HHS Secretary Xavier Becerra.
“Not anymore,” he added.
The HHS study also assessed where seniors on Medicare Part D paid the most for such vaccines in 2021.
States with the highest out-of-pocket costs include Idaho, Wyoming, Kansas, Iowa, Montana, Nebraska, North Dakota, and South Dakota.
Rice and others on the call also touted the IRA’s insulin price cap, set at $35 a month for all seniors on Medicare.
President Joe Biden’s March 9 budget proposal for Fiscal Year 2024 would extend that cap to all individuals.
Both Eli Lilly and Novo Nordisk have cut insulin prices in the United States significantly in the last several weeks. They’re two of the three firms that produce almost all insulin sold in America and worldwide.
The third big insulin supplier, Sanofi, slashed insulin prices to $35 a month for uninsured patients in the United States in 2022.
In 2020, the Centers for Medicare and Medicaid Services (CMS) moved to set insulin prices at $35 per month for some Medicare beneficiaries.
The Trump administration in 2020 reported that Part D beneficiaries saved $1.9 billion since 2017, part of a trend then-CMS Administrator Seema Verma attributed to its actions favoring “competition and choice.”
HHS’s new study comes weeks after House Republicans introduced their own Inflation Reduction Act, which would repeal last year’s IRA.
“Instead of creating any positive change for Americans facing record-breaking economic challenges, Leftists opted to increase federal spending and the deficit–by at least $110 billion dollars through 2031–in order to advance their personal political agendas,” said Rep. Andy Ogles (R-Tenn.), who introduced the legislation, in a Feb. 2 press release.
Days later, the Congressional Budget Office’s 10-year budget outlook revised the United States’ projected 2023 deficit up by $426 billion, attributing $23 billion of that to the IRA. Yet it projects that the act will save $307 billion in Medicare costs through 2032, owing to its effect on prescription drug prices.
Rice targeted Republicans’ counter-IRA in her March 14 phone call, saying it would “mean millions of Americans would pay higher health insurance premiums and higher taxes, millions of Americans would pay higher drug prices and insulin prices, and millions of seniors would be unable to get recommended vaccines for free.”
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