And perhaps most importantly, the government will not negotiate drug prices for people with private insurance or without insurance. Older people who rely on Medicare are high health care users and a significant voting bloc, but more than 200 million people will still pay unconstrained drug prices. For example, the new law puts a cap on insulin co-payment at $35 per month, which is good news for people who need it to stay alive. But again, this provision only applies to 3.3 million insulin users to Medicare, not to the millions of others who are uninsured or private cover.
Democratic candidates could try to use this exclusion to their political advantage. The bill they proposed in the Senate included an insulin co-payment cap for people with private insurance. But because the Senate congressman determined that the provision did not comply with budget rules, Republicans challenged it and voted it down.
One of the law’s most tangible provisions would reduce drug costs for Medicare beneficiaries with particularly high drug expenses. Out-of-pocket drug costs would be capped at $2,000 per year, saving thousands of dollars for some patients with costly diseases like cancer. over a million Medicare beneficiaries would benefit from this cap each year, although the vast majority of enrollees do not have high enough drug expenses to qualify in any given year.
The other big provision of the health care legislation would extend enhanced ACA premium assistance for three years, through 2025. These subsidies, which were added as part of the US bailout in 2021 and allow ACA enrollees to save an average of more than $700 a year on their premiums, which were due to expire at the end of this year. If Congress had not acted, the bonuses would have skyrockets 53%, with notices sent to consumers just before the election. Although Democrats won’t be able to promise even lower bonuses, they can say they’ve prevented a huge hike in bonuses — and a resulting political headache.
After passing the Cut Inflation Act, Democrats enter midterm campaigns with a strong message to voters about lowering health care costs. Yet, as popular as their platform is, its reach has limits. Drug price restrictions will not apply immediately or to everyone, and drugs represent less than 10 percent health expenditure.
As always, election results have consequences. In fact, with the effects of drug price negotiation delayed until 2026 and the ACA’s enhanced premium assistance expiring that year, this election and that of 2024 may well determine the shape of affordability. health care in the future.