Congressional Budget Office (CBO) reports and official Medicare spending data

Inflation Reduction Act Cuts Drug Costs, Caps Insulin Prices, Saves $237 Billion

Jul 10, 2024, 12:44 PM

The Inflation Reduction Act, championed by President Biden and signed into law, is significantly impacting the cost of prescription drugs in the United States. Key provisions include a cap on Medicare-covered insulin at $35 per month and making preventive vaccines free under Medicare Part D. The Congressional Budget Office projects that the Act will reduce Medicare spending by $237 billion through 2031, primarily by reducing program spending on prescription drugs. Additionally, the Act includes a $2,000 cap on out-of-pocket expenses for Medicare beneficiaries. These measures are aimed at making medications more affordable and accessible for Americans, while also reining in corporate greed in the pharmaceutical industry. However, some critics argue that the Act may lead to fewer available drugs and higher premiums. The Act is expected to save $113M for Medicare Part D enrollees in Michigan.