May is Older Americans Month, and Protect Our Care is highlighting how new policies have lowered health care costs for seniors. Specifically, President Biden’s Inflation Reduction Act is helping older Americans get lifesaving care while giving them breathing room to pay for other essentials. In addition to lowering health care premiums through the Affordable Care Act (ACA) marketplaces, the Inflation Reduction Act has capped insulin costs at $35 per month, made essential vaccinations free, and penalized big drug companies for raising prices faster than inflation. Soon, people on Medicare will pay no more than $2,000 a year on prescription drugs, and they will be able to take advantage of savings under Medicare negotiation. Together, these provisions are saving seniors thousands of dollars on their health care.
President Biden and Democrats in Congress have also worked tirelessly to protect and strengthen Medicaid. Medicaid remains a critical source of coverage as Americans age, serving as a primary funder for long-term care and filling many of the gaps in Medicare coverage, such as premium costs, transportation to medical appointments, and medical equipment. 18.2 million Americans aged 50 and up rely on Medicaid coverage. Without Medicaid, millions of seniors would be forced to go without lifesaving care.
All of this progress is under attack by Republicans. Every single Senate and House Republican voted against the Inflation Reduction Act, and they are still fighting to keep prescription drug costs high. By fighting to repeal the Inflation Reduction Act, Republicans are working with big drug companies and turning their backs on the American people — despite the law’s vast support from voters of all parties. Republican lawmakers are also working to slash trillions from Medicaid, which would throw millions of people off their coverage through block granting and burdensome work reporting requirements. Republican efforts to repeal the Inflation Reduction Act and cut Medicaid funding puts millions of older Americans’ health in jeopardy.
By the Numbers: The State of Health Care for Older Adults Across America
Thanks to the Inflation Reduction Act
- Insulin is capped at $35 per month. 4 million Americans on Medicare who use insulin are now charged no more than $35 per month for an insulin prescription.
- People on Medicare can get recommended vaccines for free. 50.5 million Medicare beneficiaries are able to receive the shingles vaccination and other recommended vaccinations free of cost.
- Drug companies are penalized for outrageous price hikes. Seniors on Medicare will be protected from drug company price hikes thanks to increased inflation rebates.
- Medicare is negotiating lower drug prices. Nearly 9 million people take the first ten drugs that were selected for Medicare negotiation. These drugs account for 20 percent of the annual Medicare Part D spending. Negotiated prices will take effect in 2026.
- More seniors can access affordable medications. 400,000 low-income seniors will receive more help affording prescription drugs through the Medicare Part D Extra Help program.
- Drug costs will be capped at $2,000 for everyone on Medicare. In 2025, out-of-pocket costs in Medicare Part D will be capped at $2,000, saving nearly 19 million Americans an average of $400 each year. This year, drug total out-of-pocket costs are capped at $3,250. These caps especially help people with serious conditions like cancer, diabetes, and arthritis.
Medicare Negotiation For Lower Drug Prices. Right now, 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 2023, 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.
Lower Insulin Costs For Seniors. The Inflation Reduction Act is helping insulin-dependent seniors afford and take their medication as prescribed. In 2020, there were more than 3.2 million insulin users with Medicare. 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. People have also been more likely to fill their prescriptions since the implementation of the insulin copay cap.
Protections From Price Hikes 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 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.
Out-Of-Pocket Caps For Seniors. The Biden administration’s Inflation Reduction Act will save Americans an average of $396 thanks to the $2,000 annual cost cap, which begins in 2025. To help seniors with the highest drug costs starting in 2024, the Act will save over 38 million Americans an average of $462 because they will no longer have to pay a 5% coinsurance when they reach the catastrophic phase of the Part D benefit.
The GOP War on Health Care Threatens Older Adults Across the Nation
Republicans Want To Cut Medicaid Through Block Grants And Work Reporting Requirements. Republicans are fighting to cut trillions from Medicaid, which would harm millions of older adults who rely on these programs. 7.2 million Americans over 65 are enrolled in Medicaid and more than 11 million Americans ages 50 to 64 have health coverage through Medicaid – many thanks to the Affordable Care Act’s Medicaid expansion. Medicaid funds nearly half of long-term care nationwide. As seniors age, long-term care services become more essential, serving about 70 percent of seniors who will need some form of long-term care in their lives.
Republicans Want To Repeal The Inflation Reduction Act And Hike Drug Costs. Big drug companies’ GOP allies in Congress have introduced legislation to repeal the Inflation Reduction Act, which would hike drug costs for millions of seniors. In 2023, Senator Mike Lee reintroduced legislation that would not only repeal Medicare’s new ability to negotiate lower drug prices but would also repeal the new penalties on drug companies that increase prices faster than inflation, and roll back the new $2,000 out-of-pocket spending cap on drug costs for those on Medicare. The Republican Study Committee also released a budget proposal that repeals the Inflation Reduction Act’s Medicare negotiation program entirely. Repealing the Inflation Reduction Act will raise costs for seniors, making it more difficult for them to afford their lifesaving medications, and put money back into the pockets of big drug companies.
Republicans Want To Repeal The Affordable Care Act. Republicans have repeatedly called for repeal of the ACA since its conception. Donald Trump has promised to overturn the ACA at least seven times last year. Overturning the ACA will put older Americans at risk who are currently benefiting from protections guaranteed by the ACA. The law limits the amount older people can be charged to three times more than younger people.If Republicans got their way and repealed the ACA, it would add an average “age tax” of $4,124 for a 60-year-old in the individual market, according to AARP. People who buy insurance on their own, especially early retirees, have been able to save thousands on health insurance thanks to the enhanced premium subsidies passed in the Inflation Reduction Act.
Republicans Are Blocking Medicaid Expansion Across 10 States. 10 states have refused to expand Medicaid under the Affordable Care Act (ACA), stranding many seniors with low incomes in the Medicaid coverage gap. As a result, over 407,000 older Americans with incomes below the federal poverty level are ineligible for Medicaid or ACA marketplace assistance in these states. Over half of these individuals reside in Texas or Florida, and seniors from at least 25 percent of those in the Medicaid coverage gap in Tennessee, Alabama, Georgia, South Carolina, and Florida.
Over 10,000 Older Americans Died Prematurely Due To States’ Decisions Not To Expand Medicaid. Due to states’ decisions not to expand Medicaid under the ACA, 10,444 older Americans died prematurely between 2014 and 2017 alone in the 10 states that have refused to expand the program.