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How the Inflation Reduction Act Reduces Health Care Costs
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How the Inflation Reduction Act Reduces Health Care Costs

The Inflation Reduction Act’s health insurance subsidies and drug pricing reforms will improve health care affordability for Americans.

High drug and health care costs continue to prevent millions of Americans from achieving full health. Nearly 1 in 2 American adults report difficulty affording health care costs. It’s no wonder that voters consistently rank bringing down prescription drug prices and other measures to reduce the cost of care as among Congress’ top priorities.

The Inflation Reduction Act, when passed by the House of Representatives and signed into law by President Joe Biden, will give a lifeline to people struggling with health costs by providing much-needed financial relief for the health coverage and medications they need to survive and thrive. The bill improves health care and affordability by:

  • Empowering Medicare to negotiate with drug companies to lower prices
  • Preventing drug companies from raising Medicare prices in excess of inflation
  • Setting a new cap for Medicare beneficiaries on annual out-of-pocket costs for drugs, plus a $35 monthly cap on insulin cost sharing
  • Providing more generous subsidies for health insurance marketplace coverage, thereby granting financial help to middle-class families facing high premiums and guaranteeing that lower-income people have a $0 premium plan option

The above excerpt was originally published in the Center for American Progress. Click here to view the full article.

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Authors

Nicole Rapfogel

Policy Analyst, Health

Emily Gee

Senior Vice President, Inclusive Growth

Team

Health Policy

The Health Policy team advances health coverage, health care access and affordability, public health and equity, social determinants of health, and quality and efficiency in health care payment and delivery.

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