For far too long, seniors and hard-working families have been paying three to four times more for their prescription drugs than people in other countries. But President Biden, Vice President Harris, and Democrats in Congress took on big drug companies and won. On January 1, the $2,000 out-of-pocket prescription drug cost cap, a major provision of the Inflation Reduction Act, took effect, saving nearly 19 million Americans an average of $400 each year.
Despite widespread support from people across the country, the Inflation Reduction Act passed without a single Republican vote, and now they are working to repeal the Inflation Reduction Act and its prescription drug savings. The Inflation Reduction Act is ensuring seniors can afford the care they need without sacrificing other basic needs like groceries, gas, and rent but Republicans are playing politics with seniors’ benefits. Across the country members of the Biden Administration, Congress, and news outlets highlighted the new savings available for seniors.
HEADLINES
CNN: Seniors Won’t Pay More Than $2,000 for Drugs at the Pharmacy Starting in January.
- “Before the law, there was no cap on what Medicare enrollees might have to spend on medications covered by their Part D drug plans. They were on the hook for 5% of their drugs’ cost in the so-called catastrophic coverage phase, which, in 2023, began when they hit $7,400 in out-of-pocket spending.”
- “More than 3 million enrollees who do not receive Medicare’s low-income subsidy should benefit from the $2,000 cap, according to AARP. That figure will rise to more than 4 million in 2029. About 40% of beneficiaries who reach the limit between 2025 and 2029 will see an estimated annual savings of $1,000 or more.”
CBS: Medicare’s New $2,000 Prescription Drug Cap Goes Into Effect. Here’s How It Works.
- “The out-of-pocket cost cap could be a “game changer” for many seniors, Ryan Ramsey, the associate director of health coverage and benefits at the National Council on Aging (NCOA) told CBS MoneyWatch. In the first year of the cap, about 3.2 million Medicare recipients are likely to see lower costs due to the new rule, particularly seniors who take multiple medications or have high-cost prescriptions, according to an analysis from AARP.”
The Hill: Medicare’s New Drug Price Cap Kicks In Jan. 1.
- “A key cost-saving provision of the Inflation Reduction Act (IRA) goes into effect in the new year, limiting annual out-of-pocket spending on prescription drugs to $2,000 for Medicare beneficiaries. Starting on Jan. 1, 2025, an estimated 19 million Medicare beneficiaries will see their out-of-pocket Medicare Part D spending capped at $2,000 for the year. This annual cap will be indexed to the rate of inflation every year going forward. An interim spending cap of roughly $3,500 was put in place in 2024. According to an administration official, those with Medicare will save an average of $400 a year.”
Fox43: What to Know About Medicare’s Prescription Drug Cost Cap in 2025.
- “In prior years, Part D saw a coverage gap known as a “donut hole,” which forced recipients to pay out-of-pocket costs after an initial coverage threshold was reached. The costs would be paid out-of-pocket until a “catastrophic” threshold was reached. In 2024, that threshold was $8,000. This threshold is now eliminated.”
WBRC: 2025 Marks the Start of Medicare Prescription Drug Cap.
- “Thousands of Alabamians are now saving money at the pharmacy because of a new Medicare prescription drug cap that kicked in Wednesday. Right now, prescription copays are capped at a maximum of $2,000 a year for people on Medicare prescription drug plans. This was a part of the Federal government’s Inflation Reduction Act. AARP estimates 61,000 Alabamians will save on prescriptions.”
WTAE: New Medicare Rules to Cap Prescription Drug Costs for Seniors.
- “The changes aim to remove barriers to healthy living and help lower costs for seniors. ‘[It’s] a really big deal for people with Medicare since most folks on Medicare live on relatively low incomes,’ Cubanski said. In some cases, the changes could help many struggling to keep up with paying and taking their prescriptions. ‘In some cases, they simply don’t fill their prescriptions,’ Health Research Professor Jack Hoadley of George Washington University said. ‘For the system, that means they may not end up in the hospital. It’s improving their health and therefore improving cost and creating savings for the health system as a whole.’”
AllOnGeorgia: Sen. Ossoff Announces Start of $2,000/Year Cap on Prescription Drug Spending for Georgia Seniors.
- “Thanks to legislation Sen. Ossoff helped pass into law in 2022, out-of-pocket prescription drug costs for seniors with Medicare Part D are now capped at $2,000 per year starting January 1, 2025. According to AARP, the new prescription drug cap Sen. Ossoff helped pass into law will benefit more than an estimated 100,000 Georgia seniors who spend over $2,000 per year for medicine.”
STATEMENTS
President Joe Biden: “Before I took office, people with Medicare who took expensive drugs could face a crushing burden, paying $10,000 a year or more in copays for the drugs they need to stay alive. When I took on Big Pharma and won, we changed that, capping seniors’ out-of-pocket spending on drugs they get at the pharmacy for the first time ever. Costs were capped at about $3,500 in 2024, and in just the first six months of the year, this policy saved people with Medicare $1 billion in cost-sharing. On January 1, 2025, the cap on drug costs fully phases in, and costs are now capped at $2,000 per year. As a result, 19 million people are expected to save an average of $400 each. That’s a game changer for the American people. My Inflation Reduction Act has changed Medicare for the better, and as a result Americans will have more money back in their pockets in the years to come.” [Press Release, 12/31/24]
HHS Secretary Xavier Becerra: “Starting January 1, millions of seniors begin saving thousands of dollars on their prescription drugs – thanks to the Inflation Reduction Act’s yearly cap on out-of-pocket prescription drug costs. This is yet another pivotal milestone in the Biden-Harris Administrations work to lower prescription drug costs for Americans.” [Press Release, 12/31/24]
CMS Deputy Administrator and Director Meena Seshamani: “Happy New Year! For the first time ever, there is now a $2000 out of pocket cap for #Medicare and a new Medicare Prescription Payment Plan to help spread costs over the year. So honored to work with the Medicare team to bring this needed financial relief to millions.” [X, 01/01/25]
Representative Richard E. Neal (D-MA-01), Ways and Means Committee Ranking Member, and Representative Steven Horsford, Ways and Means Committee Member (D-NV-04): “With the new year comes another way Democrats are delivering on lower costs and more breathing room for the American people. In 2025, seniors will pay no more than $2,000 out-of-pocket for their prescription drugs—it’s a stunning achievement and all thanks to the leadership of President Biden and House Democrats. The underlying legislation, Capping Drug Costs for Seniors Act, proudly came from the Ways and Means Committee and will materially change lives. The Inflation Reduction Act has already saved seniors over $1 billion in just the first six months of last year, and more savings are on the way when the price cap goes into effect today. The American people are better off with affordable, accessible health care, and Democrats will never stop fighting to make it a reality.” [Press Release, 01/01/25]
Representative Frank Pallone (D-NJ-06), House Energy & Commerce Committee Ranking Member: “Great news — Starting today, out-of-pocket costs on prescription drugs for seniors will be capped at $2,000 per year. This is another way the Democrats’ Inflation Reduction Act is providing relief to seniors who have been gouged on their prescription drug bills for too long.” [X, 01/01/25]
Representative Lauren Underwood (D-IL-14): “Starting TODAY, out-of-pocket drug costs for people on Medicare are CAPPED at $2,000 annually because @HouseDemocrats fought to lower costs.” [X, 01/01/25]
Representative Marcy Kaptur (D-OH-09): “Because of the Inflation Reduction Act, beginning today seniors on Medicare across NW Ohio and nationwide will have their prescription drug costs capped at $2,000 annually. I will never stop fighting to lower costs for you.” [X, 01/01/25]
Representative Dina Titus (D-NV-01): “Effective TODAY seniors on Medicare will pay no more than $2,000/year for prescription drugs, thanks to the Inflation Reduction Act I supported.” [X, 01/01/25]
