Thanks to the Inflation Reduction Act, championed by President Biden and Democrats in Congress, Medicare is better than ever and seniors are protected from outrageous price increases by big drug companies as a result of the law’s penalties on price increases greater than inflation. Hundreds of drugs have seen their list prices grow faster than inflation, forcing seniors to make tough decisions between needed medication and basic necessities — all while big drug companies bring in tens of billions in revenue and spend lavishly to reward shareholders. The Inflation Reduction Act has also brought down the cost of prescription medications for seniors on Medicare by capping insulin costs at $35 per month, providing free vaccines, and allowing Medicare to negotiate drug prices directly with pharmaceutical companies.
This is just the beginning: In 2025, seniors’ total drug costs will be capped at $2,000 per year and, in 2026, new savings from Medicare’s drug price negotiation will take effect. Together, these provisions will save seniors thousands of dollars on prescription drugs.These policies lower costs and improve access to care, which are essential for improving the health and well-being of millions of Americans nationwide.
BY THE NUMBERS
Medicare beneficiaries save as much as $600 per dose thanks to the Inflation Reduction Act’s inflation-pegged price hike rebates.
34 drugs will have reduced copays until the end of the year thanks to the Inflation Reduction Act.
Seniors Will Continue To Save Hundreds On Prescription Costs Through Rebates For Drug Prices That Increase More Than Inflation. Thanks to the Inflation Reduction Act, Medicare beneficiaries save as much as $600 per dose. The new law requires drug companies to pay Medicare rebates if their drug prices rise faster than inflation, and those rebates are passed on as savings to seniors. For decades, big drug companies have been launching new drugs at sky-high prices and continuously raising prices faster than inflation, hurting the individuals reliant on them all while making record profits.
Drug Prices Have More Than Tripled Since Launch For The Top 25 Drugs By Medicare Spending. According to an analysis by the AARP, drug prices have more than tripled – an average increase of 226 percent – for the 25 drugs with the highest aggregate Medicare spending since launch. All but one of the top 25 drugs’ lifetime price hikes exceeded the lifetime average rate of inflation as well, with some increasing prices as much as nine times higher than inflation.
Over 100 Drugs Hiked Prices Above Inflation This Year. According to an analysis by the Center for American Progress, 112 drugs saw their list prices hiked above the annual inflation rate in July 2023, with an average rate increase of 30 percent.
1 In 3 American Adults Report Being Unable To Take Their Medications As Prescribed Due To High Costs. According to KFF, 1 in 3 American adults report being unable to take their medication as prescribed, demonstrating how high and rising drug prices are negatively impacting health outcomes for Americans struggling with affordability challenges. Existing racial and ethnic economic disparities place additional pressures on racial and ethnic minorities and make it even more challenging to keep up with drug prices rising faster than inflation.
…All While Big Drug Companies Bring In Record Profits and Reward Shareholders With Lucrative Stock Buybacks. As hundreds of drug prices rise faster than inflation, their manufacturers are bringing in record profits. Drugmakers of the first ten drugs eligible for Medicare price negotiation under the Inflation Reduction Act have made tens of billions in revenue from Medicare and other sources while spending billions of dollars on stock buybacks and lobbying. For example, Eliquis, a drug used to treat blood clots manufactured by Bristol Myers Squibb and Pfizer, has cost Medicare over $41 billion through 2021. Meanwhile, the two companies have executed more than$97 billion in stock buybacks while bringing in nearly $91 billion in global sales and spending over$172 million on lobbying since launch.
Under Speaker Johnson’s Leadership, Republicans Will Continue Their Agenda of Hiking Drug and Health Insurance Costs, and Eliminating Crucial Protections for the American People
Washington, D.C. — Today, Protect Our Care is releasing a new national report holding Republicans accountable for putting profits over people in their ongoing war on health care during a press call headlined by U.S. Representative Frank Pallone, Jr. (D-NJ-06). Geoff Garin, president of Hart Research, also joined the call and presented recent polling showing how unpopular the Republican war on health care is with the American people.
In Washington and across the country, Republican legislators and Republican-leaning Courts are continuing to attack essential health care, disproportionately targeting people of color, seniors, rural populations, people with disabilities, and the LGBTQI+ community. Right now, Republicans are pushing health care plans that hike costs and trying to repeal the Inflation Reduction Act that lowered care and prescription drug costs for millions of Americans — all to put drug companies back in charge at the expense of seniors across the nation. Republicans rallied behind Rep. Mike Johnson, who has a long history of fighting to raise health care costs and rip away critical protections from the American people, as the newest Speaker of the House.
On the other hand, President Biden and Democrats in Congress continue to fight for the American people by working to build upon the Inflation Reduction Act and Affordable Care Act. Representative Pallone, joined by Representatives Neal, and Scott, has helped lead the way and introduced the Lowering Drug Costs for American Families Act which seeks to reduce prescription drug costs further for all Americans by expanding the drug price provisions to apply to private insurance, including price negotiation and inflation rebates.
Report Key Points:
Every Republican in the House and Senate voted against the Inflation Reduction Act which lowers health care costs for millions of Americans and has vastsupport from voters of all parties.
Big drug companies spent over $100 million trying to kill the Inflation Reduction Act, and they are spending even more to undermine the Medicare Drug Negotiation Program.
Republicans have released budget proposals that seek to repeal the Inflation Reduction Act’s Medicare negotiation program, hike premium costs, and impose deep cuts to Medicaid.
Republican-led states are moving far too quickly to throw people off of Medicaid without taking advantage of all the available tools to minimize coverage losses.
Republicans in Congress are pushing for bills that all promote insurance plans that eliminate protections for people with pre-existing conditions and do not include coverage of essential services like hospital visits and prescription drugs.
Republicans are leveraging their influence in a number of health care-related court cases such as Alliance for Hippocratic Medicine v. U.S. Food and Drug Administration, and Braidwood Management v. Becerra, as well as lawsuits filed by Merck, Bristol Myers Squibb, Johnson & Johnson-owned Janssen Pharmaceuticals, Boehringer Ingelheim, AstraZeneca, Novartis, and Novo Nordisk as well as mega lobbying groups The Pharmaceutical Research and Manufacturers of America (PhRMA) and the US Chamber of Commerce.
“We may have a new House Speaker, but Republicans are still trying to take away health care,” said U.S. Representative Frank Pallone, Jr. (D-NJ-06). “As today’s new report from Protect Our Care says, ‘Republicans’ position on health care is slash, sabotage, and repeal.’ Last night’s election results once again prove that Republicans are extremely out of touch. Democrats are unified in opposing Republicans’ extreme health care agenda and are focused on fighting to further lower health care and prescription drug costs for the American people.”
“Looking towards 2024, health care can play a very decisive role in how voters vote,” said President of Hart Research Geoff Garin. “A large majority of voters say health care will play a large role in deciding their vote and Democrats and President Biden have powerful accomplishments that are broadly supported by diverse groups of voters, including many Republicans. Republicans are in a world of hurt on this issue. The rejection of their policies on health care has deepened when you talk about not just the policies themselves, but the real-world impacts of those policies – how they affect people’s health and their ability to afford the drugs they need to stay healthy.”
“Republicans are pushing their radical MAGA health care plans that harm the American people,” said Protect Our Care Executive Director Brad Woodhouse. “The GOP will stop at nothing to raise health costs, eliminate critical protections just so the rich can get richer, even if it means leaving their own constituents behind. They want to go back to the status quo of Americans struggling to make ends meet due to outrageous health costs just to line the pockets of drug company CEOs and other billionaires. Some things never change: Republicans want a health care plan that would be disastrous for the well-being of hardworking people across our country.”
Thanks to the Inflation Reduction Act, Medicare is better than ever and seniors can get their shingles shots and all other vaccines recommended by the CDC’s Advisory Committee on Immunization Practices, such as COVID-19, RSV, and the flu, for free. Prior to the Inflation Reduction Act, seniors could be forced to spend hundreds of dollars out of pocket for these vaccines, contributing to particularly low vaccination rates for low-income seniors, seniors of color, and rural seniors. The Inflation Reduction Act also brought down the cost of prescription medications for seniors on Medicare by capping insulin costs at $35 per month, limiting outrageous price hikes, and allowing Medicare to negotiate drug prices directly with pharmaceutical companies.
This is just the beginning: In 2025, seniors’ total drug costs will be capped at $2,000 per year and, in 2026, new savings from Medicare’s drug price negotiation will take effect. Together, these provisions will save seniors thousands of dollars on prescription drugs.
BY THE NUMBERS
50.5 million American seniors can get their shingles vaccine free of cost, including over 9 million Medicare beneficiaries under 65 with disabilities, 15 million beneficiaries of color, and millions of rural beneficiaries.
Seniors will save up to $424 on their two-part shingles shots.
84.5 millionMedicaid recipients will also benefit from increased access to vaccinations.
Seniors Will Continue To Save Hundreds On Their Shingles Vaccine. Thanks to the Inflation Reduction Act, 50.5 million seniors are saving up to hundreds of dollars when getting vaccinated against shingles. With a single shot of Shingrix costing $212, seniors on Medicare Part D are saving over $400 on average on vaccinations. The cost of the shingles vaccine has been a driving factor in keeping vaccination rates especially low for the Black and Latino communities. This will level the playing field for seniors on Medicare, given that Americans on private insurance typically can get their shingles vaccines at no cost.
33 Percent of Americans Will Develop Shingles In Their Lifetime. Shingles is a reactivation of the chicken pox virus, typically occurring in adults older than 50 years old. Symptoms include a painful rash, itching, fever, headache, chills, and nausea. The risk of shingles increases with age, making it paramount for vaccinations to be available and accessible. While complications or death from shingles is not common, seniors with weakened immune systems are particularly vulnerable, with 30 percent of shingles hospitalizations occurring within this population.
Required Vaccine Coverage For Medicaid Recipients Will Benefit Nearly 85 Million Americans. The Inflation Reduction Act also required state Medicaid and CHIP programs to cover vaccines recommended by the CDC’s Advisory Committee on Immunization Practices for no out-of-pocket costs. This allowed an estimated 4 million adults to gain access to shingles vaccines that didn’t previously have access before. Accessible vaccinations will particularly help low-income families on Medicaid, many of whom are people of color and people with disabilities, to help prevent illness and related work absences.
New Report Finds That If All States Achieved Results Like Those in the 10 Best States, 4.5 Million People Would Not Have Been Disenrolled from Medicaid for Paperwork Reasons
Washington, DC – Today, U.S. Representative and Congressional Black Caucus Chair Steven Horsford and U.S Representative and Congressional Asian Pacific American Caucus Member Jill Tokuda joined leaders of civil rights and health equity organizations including Protect Our Care for a press call releasing a new report detailing how six months after Medicaid’s pandemic-era continuous coverage requirement ended, millions of people in America are being needlessly disenrolled from critical health care coverage because of missed paperwork, creating an avoidable civil rights and health equity disaster.
According to the report, more people and more children have lost Medicaid in just six months of unwinding than during any two-year period in American history. The report estimates that more than half of families terminated from Medicaid come from communities of color, including 2.3 million Latinos, 1.8 million African Americans, 400,000 Asian Americans, Native Hawaiians and Pacific Islanders, and more than 400,000 Native Americans, During the call, speakers called on state leaders to halt procedural disenrollments until they make major reforms that cut such disenrollments to the lowest achievable level.
The report finds that 10 million people have been disenrolled from Medicaid – more than 70% of whom were terminated for nothing more than missing paperwork. If all states performed as well as the states with the lowest rates of procedural disenrollment, two-thirds of procedural terminations would have been prevented, and 4.5 million people would not have been terminated because of missing paperwork.
Last month, the Biden administration took an important step to address this crisis by requiring states to restore Medicaid to 500,000 people – mostly children – known to have been wrongly terminated. However, state leaders must make further major reforms to ensure that only people known to be ineligible are terminated from Medicaid.
The report is co-authored by the Asian and Pacific Islander American Health Forum, the Leadership Conference on Civil and Human Rights, NAACP, the National Council of Negro Women, the National Council of Urban Indian Health, the National Urban League, the Southern Poverty Law Center Action Fund, UnidosUS, the Coalition on Human Needs, and Protect Our Care.
“We cannot afford to roll back the hard-fought progress we have made on Medicaid, which has helped to narrow racial disparities in health coverage and provide much-needed access to life-saving care in communities of color,” said U.S. Representative Steven Horsford (D-NV-04), Chair of the Congressional Black Caucus. “As a result of Medicaid “unwinding”, nearly 1.8 million Black Americans’ Medicaid coverage has been terminated in the last six months because of missing paperwork, which will only exacerbate existing disparities in access to health care for communities that we serve. The CBC joins our Tri-Caucus colleagues in calling for states to significantly cut rates of procedural terminations by renewing eligible families’ coverage and placing terminations on hold where possible, and by ensuring that beneficiaries have the necessary tools to complete their paperwork needed to determine their eligibility.”
“This report shows what we feared: since the end of the Medicaid continuous coverage requirement, we’ve seen one of the largest losses of health insurance coverage in American history,” said U.S. Representative Nanette Barragán (D-CA-44), Chair of the Congressional Hispanic Caucus. “Millions of Americans, including almost 5 million Latinos, were able to access life-saving health insurance coverage because of the continuous coverage requirement. Now that the requirement has ended, millions of people and especially communities of color, are at risk of losing their health coverage. It’s critical that state leaders take all possible steps to minimize loss of coverage, including by pausing procedural disenrollments as soon as possible. We cannot allow more low-income communities to be left behind. While the Biden Administration has provided states guidance and flexibilities to address this crisis, states must do more to protect families from wrongfully losing Medicaid coverage.”
“As an executive board member of the Congressional Asian Pacific American Caucus and the co-chair of the bipartisan Rural Health Caucus, I know that access to health care is a matter of life and death for our communities of color across the country,” said U.S. Representative Jill Tokuda (D-HI-02), Member of the Congressional Asian Pacific American Caucus. “For too long, black and brown people have been disproportionally represented when it comes both to loss of Medicaid and negative health outcomes due to lack of health access. A majority of Hawaiʻi residents are AANHPI, and I have been particularly concerned about Medicaid redeterminations for our AANHPI communities. There is an ongoing need for in-language materials, community navigators, and outreach from trusted messengers to ensure AANHPI individuals can get the health services and resources they need and in a culturally competent manner. We need to meet patients where they are at. And in doing so, we can improve health outcomes and lower healthcare costs.”
“Advocates and lawmakers alike have been sounding the alarm about Medicaid Unwinding for over a year, urging states to lead and act promptly to preserve health coverage for millions of vulnerable families and children,” said Juliet K. Choi, President and CEO of the Asian & Pacific Islander American Health Forum. “Communities of color, including Asian Americans, Native Hawaiians and Pacific Islanders, are losing life-saving care due to administrative blunders and bureaucracy. We continue to call upon the Biden-Harris administration to act, and on states to mobilize the resources necessary to make sure no family or child is left behind.”
“It is a sad reality that it took a global pandemic for our nation’s elected leadership to expand life-saving healthcare services to hardworking Americans,” said Derrick Johnson, NAACP President & CEO. “The fact of the matter is, our healthcare system has long failed our most vulnerable. This data is further proof that the procedural disenrollment process is steeped in racism. We will not stand by while millions within our community are once again left without a lifeline. The NAACP stands with UnidosUS and other leading civil rights organizations to call for an immediate pause on all procedural Medicaid disenrollments. Our state leaders must make every effort to re-enroll those who have lost coverage, leveraging available data to verify eligibility or providing readily accessible support to complete the paperwork needed to confirm eligibility.”
“The COVID-19 pandemic laid bare inequities in our healthcare system that have plagued the nation, particularly communities of color, for decades,” said Shavon Arline-Bradley, President and CEO of the National Council of Negro Women. “The termination of Medicaid benefitting our children, seniors, and qualified individuals prioritizes procedure over progress. While some states have gotten it right, we call on those states and their lawmakers that have allowed wrongful Medicaid disenrollment to not sit idly by while the constituents that elected them to office go without the critical care they need and deserve. As this comprehensive report shows, the state of health care is in crisis, and this must be reversed immediately.”
“The Medicaid redetermination is proving to be perilous for communities of color, who are disproportionately losing coverage for red tape reasons,” said Marc H. Morial, President and CEO of the National Urban League. “We support the Biden-Harris administration’s actions to enforce the law and call on states to do more to protect their people from becoming uninsured.”
“We are witnessing the deepest and steepest losses in Medicaid insurance coverage in our nation’s history,” said Eric Rodriguez, Senior Vice President, Policy and Advocacy at UnidosUS. “Many have been dropped from Medicaid due to nothing more than missing paperwork and red tape. Communities of color — including 2.3 million Latinos — are bearing the brunt of those losses, making health care unaffordable for them and deepening already serious health inequities across the country. The report finds that most of those that have lost Medicaid health insurance coverage may have still been eligible and that despite having the funds, state leaders did not invest the money needed to protect families from being unjustly dropped from the program.”
“It is unacceptable that millions of Americans are losing life-saving health care because of preventable paperwork issues,” said Leslie Dach, Founder and Chair of Protect Our Care. “Many of the states that are failing to keep people covered, like Texas, Georgia, and Florida, are the same ones that have rejected Medicaid expansion, leaving families with no place to turn for basic health care. If those states continue on the path of refusing to protect families who rely on Medicaid coverage, the consequences will be devastating, particularly for communities of color and children. Losing access to health care means people won’t get the care they need to stay healthy and thrive, often having to make difficult choices between visiting the doctor or keeping a roof over their heads. While the Biden administration has taken a number of important steps to address this crisis, these states must do more to protect families and stop inappropriately kicking people off Medicaid.”
“The nation’s Medicaid program is vital to the health and well-being of individuals and communities,” said Margaret Huang, president and CEO of the Southern Poverty Law Center and the SPLC Action Fund. “It is incredibly alarming that nearly 10 million people — including millions of children — have been terminated from this program largely because of unnecessary red tape. These ‘procedural’ terminations cause harm, especially to communities of color and children. They also deepen the current healthcare crisis in our Deep South states that have not yet expanded the program. Driving hundreds of thousands of people into not having health coverage is unacceptable and states must do more.”
“It is extremely troubling that some states are dropping huge numbers of people from their Medicaid programs because of bureaucratic hurdles, without even knowing whether they remain eligible,” saidDeborah Weinstein, Executive Director of the Coalition on Human Needs. “States with records so much worse than better-performing states should be required to pause terminations while they improve their systems.”
“The report highlights the disproportionate impact Medicaid unwinding is having on Native communities,” said Francys Crevier (Algonquin), CEO of the National Council of Urban Indian Health. “Medicaid and CHIP coverage are critical to fulfilling the United States’ trust responsibility to maintain and improve Native health, as inadequate insurance coverage is a significant barrier to healthcare access for Native people. Eligible Native children and families are losing coverage for administrative reasons and the federal government has a trust obligation and must do more to protect them.”
“Medicaid pandemic coverage protections were a lifeline for people who struggled to pay all their bills, helping them to see a doctor if they were sick, or get other vitally necessary health care,” said Maya Wiley, president and CEO of The Leadership Conference on Civil and Human Rights. “Since pandemic coverage expired six months ago, we’ve seen the steepest Medicaid coverage losses in history. Make no mistake. Losing Medicaid coverage is losing that lifeline. Those losses have been disproportionately borne by the communities our coalition represents, including people of color, people with disabilities, children, older adults, low-wage workers, and so many others. This deepens and compounds unfair differences in who can and who can’t get the medical care they need. We urge state leaders to do everything in their power to keep eligible folks covered and prevent further catastrophe that is a deep problem for a country that once made great strides on civil rights.”
Thanks to the Inflation Reduction Act, Medicare is better than ever and seniors will pay no more than $35 per month on insulin. President Biden and Democrats in Congress worked tirelessly to lower health care costs for seniors who have worked hard their whole lives. Too many seniors on fixed incomes have been kept at night worried about paying the bills — gas, groceries, medicines and more. This $35 cap helps millions of insulin users on Medicare afford the medicines they need to stay alive. Before the passage of the Inflation Reduction Act, too many diabetic seniors had to skip doses because of the high costs. Now thousands more seniors are able to fill their prescriptions for insulin each month. While taking insulin as prescribed reduces the likelihood of costly complications such as vision loss, heart disease, and kidney disease.
This is just the beginning: In 2025, seniors’ total drug costs will be capped at $2,000 per year and, in 2026, new savings from Medicare’s drug price negotiation will take effect. Together, these provisions will save seniors thousands of dollars on prescription drugs. And while the Inflation Reduction Act addressed the insulin affordability crisis for seniors, Democrats in Congress are also working to extend that cap so no American will pay more than $35/month for their insulin.
WHAT THE INFLATION REDUCTION ACT’S $35 INSULIN CAP DOES FOR SENIORS WITH DIABETES
Makes Insulin Accessible and Affordable For Seniors. In 2020, there were more than 3.2 million insulin users on Medicare Part D, with nearly 1.7 million purchasing their insulin without low-income subsidies. On average, seniors with Medicare Part D who are not receiving subsidies pay an average of $572 every year for this life saving medication — an unthinkable sum for many on fixed incomes. Under the Inflation Reduction Act, insulin copays for seniors on Medicare are now capped at $35 each month.
Thousands More Seniors Are Filling Their Insulin Prescriptions. The Inflation Reduction Act’s cap on insulin copays has led to increases in the total number of insulin prescriptions filled for Medicare beneficiaries. A study from the USC Schaeffer Center for Health Policy & Economics and University of Wisconsin–Madison found that following the cap’s enactment in January 2023, the number of insulin fills among Medicare Part D enrollees increased from 519,588 to 523,564 per month.
Rural Seniors Are Able to Access Affordable and Quality Care. According to a 2018 study, rural Americans are 17 percent more likely to suffer from diabetes than urban Americans. Diabetes risk factors are higher in rural areas than their urban and suburban counterparts as they have limited access to health care providers, fewer transportation options to receive care, and higher rates of being uninsured. These seniors are forced to stop taking their medication or cut doses in half. Diabetics suffer severe effects such as numbness in feet and nerve damage in the eyes when they stop taking doses as prescribed. Patients who suffer chronic complications can expect to pay upwards of an additional $650 per year. The insulin cap provision in the Inflation Reduction Act vastly improves the lives of millions of these vulnerable insulin users.
Americans Of Color Are Disproportionately Affected By Diabetes. Deaths related to diabetes are three times more likely among people of color than their white counterparts. Over 12 percent of Americans of color experience diabetes due to a combination of genetic, socioeconomic, and environmental risk factors. 11.8 percent of Hispanic adults have diabetes and are 50 percent more likely to develop type 2 diabetes over the course of their lifetime than their white counterparts. Racial and ethnic minority populations are also at a higher burden of diabetes-related complications, such as kidney disease, blindness, and worse glycemic control. Despite the higher risk of complications, Americans of color are less likely to receive recommended preventive care and annual screenings, largely as a result of systemic access barriers to this care. Americans of color spend upwards of $10,000 a year on diabetes-related costs.
Americans Of Color Skip, Ration, Or Delay Insulin Doses At Higher Rates Than Their White Counterparts. With rates of uninsurance also being highest among people of color, these insulin users are at a higher risk of skipping, rationing, or delaying insulin doses. Nearly 24 percent of Black Americans ration insulin compared to 16 percent of their white and Hispanic counterparts. Black adults also continue to be the hardest hit when it comes to affording their prescription drugs and paying medical bills. The Inflation Reduction Act’s insulin cap is promoting health equity by expanding access and increasing affordability for diabetic seniors of color so much so that the prevalence of skipping doses is already beginning to fall.
REPUBLICANS ARE FIGHTING TO KEEP INSULIN PRICES HIGH
Republicans Blocked Insulin Cap for Millions of Americans. As the final negotiations were being made on the Inflation Reduction Act, Republicans in the Senate unified together to make sure that the $35 insulin cap was not universal. In a country where 80 percent of diabetics have had to go into debt in order to pay for insulin, this type of action by Republicans reeks of the influence of Big Pharma. An additional 21 million insulin users of all ages would have benefited from this universal program, including the nearly 300,000 young people under 20 who are diagnosed with diabetes. 1 in 5 people with private insurance pays more than $35 per month and, for people who are uninsured or have poor coverage, insulin can cost up to $1,000 per month. A striking 14 percent of insulin users spend catastrophic amounts, or at least 40 percent of their income, on insulin. The Affordable Insulin Now Act, which will build upon the gains of the Inflation Reduction Act, is supported widely by Democrats but has been continually shot down by Republican legislators.
Protect Our Care launched a new campaign, “Medicare Autumn,” to educate seniors on how Medicare is better than ever. Thanks to the Medicare Drug Price Negotiation Program included in the Inflation Reduction Act, Medicare now has the ability to negotiate drug prices to lower costs for seniors on Medicare. The Biden administration recently announced the first round of high-cost drugs whose prices will come down from negotiation. This includes some of the highest-priced prescription drugs used to treat conditions like diabetes, heart disease, cancer, arthritis, chronic kidney disease, psoriasis, Crohn’s disease, and ulcerative colitis – many of which disproportionately impact women, communities of color, and people in rural areas.
For too long, Americans have been paying three to four times more than people in other countries for the prescription drugs they depend on, forcing people to choose between filling a prescription or filling their refrigerator. Giving Medicare the power to negotiate with drug companies will help bring the price of medicines in the U.S. more in line with what other countries pay.
The impact of lower prescription drug costs thanks to the Inflation Reduction Act will be felt by people across the country. Negotiating lower prices on certain popular high-cost drugs will help:
3,505,000 Americans who pay an average of $441 out-of-pocket per year for Eliquis, sold by Bristol Myers Squibb, to treat blood clots.
47,000 Americans who pay an average of $921 out-of-pocket per year for Enbrel, sold by Amgen, to treat arthritis and psoriasis.
521,000 Americans who pay an average of $357 out-of-pocket per year for Entresto, sold by Novartis, to treat heart failure.
639,000 Americans who pay an average of $260 out-of-pocket per year for Farxiga, sold by AstraZeneca to treat diabetes.
763,000 Americans who pay an average of $121 out-of-pocket per year for Fiasp/NovoLog, sold by Novo Nordisk, to treat diabetes.
22,000 Americans who pay an average of $5,247 out-of-pocket per year for Imbruvica, sold by AbbVie, to treat blood cancers.
885,000 Americans who pay an average of $270 out-of-pocket per year for Januvia, sold by Merck, to treat diabetes.
1,321,000 Americans who pay an average of $290 out-of-pocket per year for Jardiance, sold by Boehringer Ingelheim, to treat diabetes.
20,000 Americans who pay an average of $2,058 out-of-pocket per year for Stelara, sold by Johnson & Johnson, to treat psoriasis and Crohn’s disease.
1,311,000 Americans who pay an average of $451 out-of-pocket per year for Xarelto, sold by Johnson & Johnson, to treat blood clots.
Drug Price Negotiation Improves Other Medicare Benefits. As a result of Medicare negotiation negotiations, Americans with Medicare will have access to innovative, life-saving treatments at lower prices, translating into lower premiums and out-of-pocket costs for older Americans and producing savings that are being used to improve benefits, including:
a new $35 cap on monthly insulin prescriptions;
free recommended vaccines;
a $2,000 annual cap on prescription drug costs taking effect in 2025.
The First 10 Drugs Are Just The Beginning. Negotiations will occur over the coming year and new, lower prices will be announced by September 1, 2024, and take effect in 2026. The first ten drugs that will see lower prices are responsible for about 20% of total Medicare Part D prescription drug costs every year. The companies that market them have made more than $493 billion in revenue from these drugs. Medicare will negotiate lower prices for an additional 15 drugs for prices effective in 2027, and by 2029, Medicare will negotiate lower prices for 20 drugs per year. And President Biden and Democrats in Congress are already working to expand these cost savings to more Americans, no matter what age they are or how they get their health coverage.
Medicare Drug Price Negotiation Is Overwhelmingly Popular. Negotiating lower prices is overwhelmingly popular across the country, yet big drug companies are suing the federal government to protect their massive profits by halting the program. A recent Hart Research poll shows that 96 percent of Americans agree that lowering drug prices “is an important way to help people afford the cost of living,” and nearly three-quarters of Americans favor Medicare negotiation. Meanwhile, pharmaceutical companies’ arguments against negotiation are overwhelmingly rejected by the American people.
Big Drug Companies Are Threatening To Keep Drug Prices High Through The Courts. Drug company giants including Merck, Bristol Myers Squibb, Johnson & Johnson-owned Janssen Pharmaceuticals, Boehringer Ingelheim, AstraZeneca, and Novartis, as well as mega lobbying groups PhRMA and the US Chamber of Commerce, have sued the federal government in an effort to stop Medicare from negotiating for lower prescription drug prices for Medicare beneficiaries. If the big drug companies get their way patients will pay more so the drug companies can make more money:
GONE: Medicare’s power to negotiate lower prices for the most popular and expensive prescription drugs. Under the Inflation Reduction Act, Medicare is set to begin negotiating prices for 10 of the top 50 most expensive Part D drugs in 2026, adding another 15 drugs in 2027 and 2028, and another 20 in 2029 and subsequent years.
GONE: $98.6 billion in Medicare savingsover the next decade from the drug negotiation program, which translates into savings for patients and taxpayers.
GONE:Lower Part D premiums and lower out-of-pocket drug costs for certain Medicare beneficiaries who rely on qualifying drugs.
The plaintiffs assert several sweeping claims, including under the First Amendment, the Fifth Amendment, and the Eighth Amendment across the lawsuits, but experts agree that these meritless arguments are merely an attempt to maintain the status quo where drug companies can protect their massive profits by charging whatever they want at the expense of patients and taxpayers.
Seniors Will Save in 2024 Thanks to the Inflation Reduction Act: Lower Drug Costs, Monthly Insulin Cost Cap, and Free Vaccines
Medicare open enrollment began on October 15 and runs through December 7. Millions of seniors will begin selecting their coverage for 2024. It is important that seniors understand the savings available to them as they make decisions about enrolling in a Medicare plan.
As Medicare beneficiaries review plans for 2024, seniors will see new benefits thanks to the Inflation Reduction Act’s measures to drive down drug costs. As they did during the 2023 Medicare open enrollment, seniors will see lower premiums for prescription drug coverage. As of January 1, 2023, critical vaccines are now free, monthly insulin costs are capped at $35 per prescription, and drug companies cannot take advantage of seniors by raising drug prices faster than the rate of inflation. Additionally, in the years ahead, Medicare beneficiaries will see lower drug prices across the board thanks to the Inflation Reduction Act’s provisions to give Medicare the power to negotiate and cap out-of-pocket drug costs at $2,000 a year. This translates to thousands of dollars in savings for millions of seniors and people with disabilities nationwide.
BY THE NUMBERS: Seniors Will Pay Less for Health Care
The Inflation Reduction Act is drastically reducing the cost of prescription drugs for the more than 50 million Americans enrolled in Medicare’s Part D drug benefit, reducing racial, income, and geographic disparities in health care, and saving lives. Seniors will no longer have to choose between paying for the drugs they need and other essentials like food and housing.
Over 50 million Medicare beneficiaries no longer face big drug companies’ outrageous price hikes that exceed inflation.
All Medicare Part D beneficiaries have access to covered vaccines, such as shingles and pneumonia, at no cost.
No Medicare beneficiary pays more than $35 a month for an insulin copay.
Over 50 million Medicare Part D beneficiaries will have out-of-pocket costs for prescription drugs capped at $2,000 per year beginning in 2025.
Lower prices are being negotiated for the first 10 drugs selected for the Negotiation Program, with more drugs to be named each year. The first ten drugs are Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica, Stelara, and Fiasp/NovoLog.
Premiums for the average Medicare Part D plan are decreasing by 1.8 percent in 2024.
The Inflation Reduction Act Lowers Prescription Drug Prices
Medicare Negotiation For Lower Drug Prices. The Biden administration is implementing the Medicare Drug Price Negotiation Program which is supported by over 80 percent of Americans — the most popular provision in the Inflation Reduction Act. In August, the first round of high-cost drugs that will be negotiated was announced: Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica, Stelara, and Fiasp/ NovoLog. These high-cost drugs treat conditions like cancer, diabetes, and blood clots. The first ten drugs selected for negotiation are taken by nearly 9 million people on Medicare, who spent $3.4 billion in out-of-pocket costs last year alone. The negotiated prices will be effective starting in 2026.
Game-Changer For Insulin-Dependent Seniors. In 2020, there were more than 3.2 million insulin users with Medicare, with nearly 1.7 million purchasing their insulin without low-income subsidies. On average, seniors with Medicare Part D or B who are not receiving subsidies pay an average of $572 every year for this life-saving medication — an unthinkable sum for many on fixed incomes. Patients who suffer chronic complications can expect to pay upwards of an additional $650 per year. Under the Inflation Reduction Act, insulin copays for people on Medicare are capped at $35 per prescription each month. A recent study showed that 1.5 million people on Medicare would have saved an average of $500 in 2020 from the $35 insulin copay cap.
Ends Outrageous Price Increases For Seniors. The Inflation Reduction Act penalized drug companies for raising drug prices faster than the rate of inflation starting at the beginning of 2023. An analysis by KFF showed that half of all drugs covered by Medicare had list price increases exceeding the rate of inflation in 2020. For example, Humira, a medication commonly used to treat rheumatoid arthritis, is one of the nation’s highest revenue-generating drugs, raking in $21 billion in sales in 2019. AbbVie, Humira’s manufacturer, has hiked the price of Humira 27 times, including in January 2021 when it raised its cost by 7.4 percent. Over the past 20 years, price increases for brand-name drugs in Medicare Part D have risen at more than twice the rate of inflation.
Free Shingles Vaccinations. Thanks to the Inflation Reduction Act, 50.5 million seniors are eligible for no-cost shingles vaccinations. In 2020, nearly 4 million Medicare beneficiaries received the two-part shingles vaccination. With a single shot of Shingrix costing $212, seniors on Medicare Part D are saving over $400 on average on vaccinations in 2023. The high out-of-pocket cost of the shingles vaccine has been a key factor in low vaccination rates, especially among Black and Latino communities. This extends an important affordable preventive service to seniors on Medicare; Americans with private insurance could already typically receive shingles vaccinations at no cost.
As Republicans are on the verge of forcing a reckless government shutdown, they are once again considering legislation to promote the use of health savings accounts (HSA), which overwhelmingly benefit high-income people. This legislation incentivizes the expansion of HSAs through tax breaks, rewarding the highest-paid workers while worsening racial and ethnic inequities in health care. This comes as Republicans are working to repeal the Inflation Reduction Act, raise prescription drug prices, and throw millions off of Medicaid. Once again, Republicans prove they are dead set on prioritizing tax breaks for the wealthy over helping people get the health care they need.
HSAs Make Health Care Less Accessible And Affordable. Republican efforts to promote the use of HSAs directly undermines the ACA’s goals to make quality health care more accessible and affordable for all Americans. The promotion of employer-sponsored high-deductible health plans that use HSAs increases the cost of health care for employees and continues the difficult decisions low-income working families have to make between putting food on the table or paying for medical care.
HSAs Benefit The Wealthy. HSAs largely benefit high-income individuals. Contributions to HSAs are not taxed, which helps wealthy people decrease their taxable income and avoid paying their fair share. These contributions can also be invested in stocks and bonds to accrue tax-free earnings that carry over year to year — further exacerbating the wealth gap.
HSAs Do Not Make Care More Affordable for Low-Income Individuals. HSAs do not benefit low-income individuals as they often do not have the ability to contribute to HSAs and need to use their available income to pay for medical bills and care upfront. Nearly 70 percent of adults under 200 percent of the poverty line would not have been able to pay a $1,000 medical bill within 30 days in 2022, let alone contribute to a HSA. Low-income individuals also do not benefit as much from tax-free earnings as high-income individuals due to the lower amount of tax deductions from being in a lower income tax bracket. Employers who offer high deductible health plans, where HSAs are necessary, typically contribute little to nothing to their employees’ HSAs.
HSAsExacerbate Racial And Ethnic Inequities In Health Care. Black and Latino people with private insurance are half as likely to have HSAs as white and Asian people. Per the Center on Budget and Policy Priorities: “Against a backdrop of long-standing racial disparities in wealth — a typical white family in 2019 had eight times the wealth of a typical Black family and five times the wealth of a typical Latino family — HSAs provide preferential tax treatment that is disproportionately out of reach for people of color.”
HSAs Cost The Government Billions. HSAs will cost the government $182 billion between 2023 and 2032. Meanwhile, the cost of President Biden’s plan for permanently closing the Medicaid coverage gap or permanently extending marketplace coverage premium tax credits over the next 10 years would cost roughly the same amount at $200 billion and $183 billion respectively. Unlike the bills to expand HSAs, Medicaid expansion and marketplace premium tax credits would allow millions of uninsured individuals to gain quality coverage.
On August 29, the Biden administration announced the first round of high-cost drugs whose prices will come down as Medicare negotiates with the drug companies – a new power they have under the Inflation Reduction Act. This new program will lower prices for some of the highest-priced prescription drugs on the market used to treat conditions like diabetes, heart failure, blood clots, and autoimmune disorders – conditions that disproportionately impact women, communities of color, and people in rural areas. The Inflation Reduction Act was championed by President Biden and Democrats in Congress to lower health care costs for people across the nation.
The first ten drugs selected for negotiation are taken by nearly 9 million people on Medicare and account for about 20 percent of annual Medicare Part D spending. CMS will negotiate lower prices with manufacturers of these drugs, and those prices will take effect in 2026. The drugs are:
Eliquis which is manufactured by Bristol Myers Squibb and Pfizer to treat blood clots
Enbrel which is manufactured by Amgen to treat rheumatoid arthritis, psoriasis, and psoriatic arthritis
Entresto which is manufactured by Novartis to treat heart failure
Farxiga which is manufactured byAstraZenecato treat diabetes, heart failure, and kidney disease
Fiasp,also known as NovoLog, which is manufactured by Novo Nordisk to treat diabetes
Imbruvica which is manufactured by AbbVie and Johnson & Johnson to treat leukemia and lymphoma
Januvia which is manufactured by Merck to treat diabetes
Jardiance which is manufactured by Boehringer Ingelheim and Eli Lilly to treat diabetes
Stelara which is manufactured by Johnson & Johnson to treat psoriasis, psoriatic arthritis, Crohn’s disease, and ulcerative colitis
Xarelto which is manufactured by Johnson & Johnson’s Janssen Pharmaceuticals and Bayer to treat blood clots
The Medicare Drug Price Negotiation Program advances health equity in two key ways:
First, the Negotiation Program will lower drug prices for certain high-cost drugs, which will reduce out-of-pocket costs for Medicare enrollees. Since Black, Latino, women, LGBTQI+, and disabled people on Medicare are more likely to have lower incomes and less savings, reducing prescription drug costs will be especially impactful for their financial security and access to care. Lowering prices through negotiation is one of several ways the law reduces prescription drug costs for Medicare enrollees. Others include: capping monthly copays for insulin at $35, providing vaccines at no cost, limiting annual out-of-pocket spending in Part D to $2,000, which will save seniors with high drug costs over $400 per year, and making the Medicare Extra Help program available to more low-income seniors, reducing their premiums and copays for medication.
Second, negotiating lower prices for the selected drugs will make drugs that are disproportionately needed by historically marginalized communities more affordable and accessible. The ten drugs selected by Medicare for lower negotiated prices treat a number of conditions that disproportionately impact people of color, and Medicare enrollees of color are more likely than the general Medicare population to take six of the ten selected drugs. Of the ten drugs selected by Medicare, eight treat conditions that disproportionately impact people of color including diabetes, heart failure, chronic kidney disease, blood clots, arthritis, and blood cancer (see Table 1). Additionally, six of the ten drugs are taken by a disproportionate number of Black, Latino, Asian, and/or American Indian/Alaska Native Medicare enrollees relative to the Medicare population as a whole (see Table 2), including
Enbrel is taken by a higher percentage of Latino enrollees and American Indian/Alaska Native enrollees than their proportion of the Medicare population.
Entresto is taken by a higher percentage of Black enrollees than their proportion of the Medicare population.
Farxiga is taken by a higher percentage of Black enrollees, Latino enrollees, and Asian American enrollees than their proportion of the Medicare population.
Fiasp/NovoLog is taken by a higher percentage of Black enrollees, Latino enrollees, and American Indian/Alaskan Native enrollees than their proportion of the Medicare population.
Januvia is taken by a higher percentage of Black enrollees, Latino enrollees, and Asian American enrollees than their proportion of the Medicare population.
Jardiance is taken by a higher percentage of Black enrollees, Latino enrollees, Asian American enrollees, and American Indian/Alaskan Native enrollees than their proportion of the Medicare population.
Negotiating lower prices remains overwhelmingly popular among voters of all parties across the country. Unfortunately, big drug companies are suing the federal government to halt the program and protect their massive profits, and Republicans are attempting to repeal the Inflation Reduction Act in its entirety, placing these equity-advancing improvements at risk.
Table 1: Demographic Impact of Conditions Treated by Drugs Selected for Negotiation
Race/Ethnicity
Conditions
Selected Drugs
Black Non-Latino
When compared to White non-Latinos, Black non-Latinos are:
Republicans are at it again – attacking health care on multiple fronts. They want to hike costs and rip away care from millions of Americans in their latest budget proposal, including taking away Medicare’s power to negotiate lower drug prices for seniors. They are threatening a reckless government shutdown that would only make matters worse, and proposed a continuing resolution that would compound the growing health crises as it seeks to cut 8 percent of almost all federal spending. And the legislation they are championing in the House would send us back to the days when insurance companies could make the rules and weaken protections for preexisting conditions. If the GOP gets their way, they would throw millions of people off of Medicaid, reverse prescription drug savings for seniors under the Inflation Reduction Act, and make health care coverage more expensive for families purchasing coverage on their own through the Affordable Care Act.
Here’s a closer look at what the GOP is proposing;
The Budget Details
What The Republican Budget Proposal Means for Americans:
GONE: Medicare’s power to negotiate lower prices for the most expensive prescription drugs.
GONE: Premium savings for 14.3 million Americans who buy insurance on their own — averaging $2,400 per family.
GONE: Medicaid for millions of Americans including people with disabilities, new mothers, and children who can’t meet the bureaucratic paperwork burdens imposed by a work requirement.
GONE: Nearly $4 billion in funding for research on cancer, Alzheimers, and long COVID.
GONE: Over $500 million in savings under the Affordable Care Act.
Medicare’s Price Negotiation Power Will Be Stripped Away by Republicans. Currently, negotiations are underway for ten drugs that make up around 20 percent of all Medicare Part D spending. Americans currently pay two to four times more for prescriptions than people in other countries and if Republicans have their way it will stay like that. The Arrington budget would slash Medicare’s power to negotiate and make sure prices stay high for Americans and federal spending is needlessly inflated.
Republicans Want to Make Health Care More Expensive For Millions By Repealing The Inflation Reduction Act’s Premium Subsidies. House Budget Chair Jodey Arrington’s budget proposal would scrap the Inflation Reduction Act’s premium subsidies, which has helped save over 13 million Americans an average of $2,400 per year on health care. It also ensures that no individuals making under $20,000 or families making around $41,000 will have to pay health care premiums at all. These subsidies have led a record breaking 14.3 million people to enroll in affordable health plans. The Republican plan will cause over 3 million people to lose coverage entirely.
Medicaid Work Requirements Would Kick Millions of Americans, Including Mothers and Children, Off of Rolls. Despite all evidence and case studies showing that implementing work requirements on Medicaid kicks off people who do meet the work requirement but can’t jump through the additional bureaucratic reporting hoops and increases the program’s total costs due to increased administrative oversight, Republicans have proposed an 80 hour a month work requirement for Medicaid. Over 60 percent of Medicaid enrollees already work, so an additional work requirement will likely only kick off the 11 percent not able to work due to illness or disabilities, 13 percent not able to work due to caregiving, and 6 percent not able to work due to school attendance. This program will leave disabled Americans, those caring for families, the children of parents who have lost coverage, and those seeking education to better their job opportunities in the future without care.
Critical Research into Cancer, Alzheimers, Long COVID, and Other Diseases Will Be Halted. Republicans plan to cut over $3.8 billion in funding to the National Institute of Health and eliminate funding entirely for the Agency for Healthcare Research and Quality. With NIH funding accounting for 99.4 percent of all FDA approved drugs from 2010-2019, these cuts will significantly undermine novel pharmaceutical innovation and development.
Repealing Bans on Physician Self-Referral Will Increase Health Care Costs and Jeopardize Communities’ Access to Care. In the FY 2024 budget, House Republicans have proposed ending the Stark Law, which would allow physicians to self-refer patients to facilities and services in which they have a financial stake. Importantly, these controversial physician-owned hospitals provide limited or no emergency services, cherry pick the most potentially profitable patients, and incur significantly higher costs on the Medicare program. According to the HHS, up to one-third of these hospitals may violate Medicare requirements by relying on publicly funded services to stabilize patients while still charging the patients exorbitantly. The Affordable Care Act’s closing of the “whole hospital” exception loophole in the Stark Law reduced the federal deficit by half a billion dollars over ten years; Republicans repealing it will cost the federal government and the American people millions of dollars annually.
If Republicans Shut Down the Government Or Fail To Reauthorize Critical Health Programs
If Republicans don’t get their way to cut Medicaid, the Affordable Care Act, and the Inflation Reduction Act, it is more and more likely that they will shut down the entire federal government. Along with crucial federal programs not being funded during a shutdown, there are a range of other health initiatives that need to be reauthorized before the end of fiscal year 2023 on September 30, which Republicans are also neglecting to prioritize. Instead of governing, it seems the Republican party seeks to hold the entire American health care system hostage.
Over 300 Community Health Centers Will Be At Risk. The Community Health Center Fund provides around 70 percent of federal funding to over 300 grantees across the country running vital health centers which integrate local health equity efforts into broader health care. The funding for this program expires September 30th, and without additional resources the lapse in funding could cause a collapse in employment in these centers.
Federal Funding That Offsets Uncompensated Care Hospitals Provide Will Dry Up. In a letter sent by America’s Essential Hospitals, the group warned that the $8 billion cut to DSH payments, which would go into effect on October 1, could dramatically undermine America’s health and safety. As well without this funding, access to life-saving services could disappear for many low-income or otherwise marginalized Americans.
The Global Fight Against HIV/AIDS Will be Undermined. A government shutdown could cause The President’s Emergency Plan for AIDS Relief (PEPFAR) to not be reauthorized. This will sunset seven provisions at the end of fiscal year 2023 which involve how to allocate spending and U.S. contributions to the Global Fund to Fight AIDS, Tuberculosis and Malaria.
Funding the Fight Against the Opioid Epidemic Would Dry Up. Without reauthorization, many programs launched in 2018 aimed at tackling the growing opioid crisis would lapse.
Pandemic Preparedness Would Collapse and Drug Shortages Continue. Due to an ongoing fight in the House, Republicans have held up reauthorizing the Pandemic and All Hazards Preparedness Act (PAHPA). Democrats have fought to address the growing drug shortages using the PAHPA, but Republicans have delayed the reauthorization, now causing it to potentially lapse out entirely due to a Republican shutdown.
The Republican Continuing Resolution Would Only Make Matters Worse
A Short Term CR Offered By Some Republicans Would Slash Federal Spending And Undermine Critical Research And Public Health Programs. Instead of shutting down the government, some Republicans have offered up a short-term funding bill which will keep the federal government running until October 31st. This continuing resolution will only compound the growing health crises as it seeks to cut 8 percent of almost all federal spending. Not only will these cuts increase wait times, slash public spending on disaster initiatives, and undermine critical pharmaceutical research, but it will also drastically decrease access to vital public health services as tens of thousands of Americans face obstacles in maintaining stable social determinants of health.
Republican Legislation Would Weaken Protections For Millions Of Americans With Pre-Existing Conditions
Legislation Offered By Republicans This Summer Would Promote “Junk” Insurance Plans And Undermine the ACA. The Association Health Plans Act and Self Insurance Protection Act passed by the Education & Workforce Committee this summer would expand access to association health plans (AHPs) and other non-ACA compliant health care plans, weakening protections for the over 135 million Americans with pre-existing conditions. AHPs are health plans that are offered to members of trade associations, professional groups, or other organizations. Compared to plans available on state marketplaces, AHPs provide weaker cost and protection coverage and are not required to hold up the same protections that plans under the ACA do. AHPs do not have to participate in the ACA’s single-risk pool rule and can set premiums lower for healthier people and higher for those with pre-existing conditions or who are at risk for health issues in the future.
Contact Our Press Team
For all press inquiries or if you would like to be added to our press list, please contact our press office at [email protected].
Watch the Event Here.
