Chairwoman Maloney Releases New Data Analysis Showing How the Inflation Reduction Act Will Make Prescription Drugs and Health Insurance More Affordable for Millions of Americans
Washington, D.C. (Nov. 3, 2022)—Today, Rep. Carolyn B. Maloney, Chairwoman of the Committee on Oversight and Reform, released new data showing the benefits of the Inflation Reduction Act for millions of Americans—across both Democratic and Republican congressional districts. This landmark law, which was passed by Democrats in Congress and signed into law by President Biden, will allow people across the country to get more affordable prescription drugs and lower health insurance premiums.
“For far too long, Americans have been forced to choose between paying for health care and putting food on the table. By passing the Inflation Reduction Act, Democrats in Congress took bold steps to rein in out-of-control prices for lifesaving medication and to make health insurance more affordable,” said Chairwoman Maloney. “I’m proud to have voted for this transformational legislation to lower health care costs for families across the country.”
Even though Americans across the country will benefit from the Inflation Reduction Act, Republicans in Congress are trying to undo the law’s benefits. On October 6, 2022, Senators Mike Lee (R-UT), James Lankford (R-OK), Cynthia Lummis (R-WY), and Marco Rubio (R-FL) introduced a bill to repeal the Inflation Reduction Act provision authorizing Medicare to negotiate lower drug prices on behalf of beneficiaries. The top Republican on the House Ways and Means Committee said recently that repealing this provision is a “top priority for Republicans.”
The major health care benefits provided by the Inflation Reduction Act impact both prescription drug prices and health insurance coverage. The data released today provides a specific, district-by-district view of the impact of the Inflation Reduction Act on drug prices and health insurance coverage. The Committee’s analysis of this data shows:
Making Health Insurance Affordable
By extending critical tax credits set to expire this year, the Inflation Reduction Act will help nearly 14 million people get or keep affordable health insurance.
An average of roughly 62,000 people in each congressional district who are enrolled in Affordable Care Act coverage will benefit from this provision of the law.
- Thanks to the Inflation Reduction Act, a family with two adults, two children, and a household income of $75,000 could save $2,832 on their premiums next year.
- A household of two adults over the age of 60 with a joint income of $70,000 could save roughly $15,700 on their premiums next year.
Lower Prescription Drug Costs
The Inflation Reduction Act caps Medicare beneficiaries’ annual out-of-pocket costs for prescription drugs covered by Medicare Part D at $2,000 per year starting in 2025. At least 1.4 million Medicare beneficiaries will benefit from the cap on out-of-pocket costs.
The IRA finally allows the government to negotiate lower drug prices with Big Pharma and requires drug companies to pay a rebate if prices rise faster than inflation.
If the Inflation Reduction Act’s drug pricing reform provisions had been fully in effect in 2020, Medicare beneficiaries would have saved a total of $4.5 billion in reduced premiums and out-of-pocket costs. Nationwide, the total savings from the Inflation Reduction Act’s drug pricing reform provisions would have amounted to nearly $15 billion in 2020.
Beginning in 2023, the Inflation Reduction Act caps monthly copayments for insulin at $35 per month for Medicare beneficiaries. There are 3.2 million Medicare beneficiaries who use insulin—including 1.7 million who do not receive financial subsidies—who will benefit from the insulin co-pay cap.
The urgent need for drug pricing reforms was demonstrated by the Committee’s landmark drug pricing investigation, which revealed how the pharmaceutical industry’s uninhibited pricing practices lead to price gouging and runaway costs for millions of Americans.
For data on how the Inflation Reduction Act will lower drug costs for people by congressional district, click here.
For data on how the Inflation Reduction Act will make health insurance more affordable for people by congressional district, click here.