The payment plan is just one aspect of the IRA that hopes to reduce prescription costs for Medicaid patients. (Getty Images)
The Inflation Reduction Act (IRA) will allow people with Medicare prescription drug coverage to pay out-of-pocket costs in monthly payments spread throughout the year instead of one large payment upfront starting in 2025, under federal guidance issued for implementing the law released this week.
The Centers for Medicare and Medicaid (CMS) released a draft outlining the requirements for a prescription payment plan on Monday which would give seniors and people with disabilities the ability to reduce the burden of high-cost prescriptions by paying in smaller chunks spread out throughout the year.
“This program will bring real relief to Nevada’s seniors, particularly those on fixed incomes who can’t afford to front-load their annual out-of-pocket prescription drug costs,” Anne Shoup, the communications director for health care advocacy organization Protect Our Care, said via email.
The payment plan is just one aspect of the IRA that hopes to reduce prescription costs for Medicaid patients. The law also caps insulin at $35 per month, a measure the White House has projected will help more than 22,000 Nevadans.
The IRA also imposes a tax penalty if drug companies increase their prices faster than inflation, and allows CMS to negotiate prices for high-cost prescription drugs. CMS will publish the list of the 10 drugs selected for price negotiation on September 1.
“People with Medicare are already feeling the benefits of the prescription drug law — such as free recommended vaccines and lower costs for insulin,” said CMS Administrator Chiquita Brooks-LaSure in a statement. “The draft guidance CMS is releasing today is an important step in standing up a new program that will help certain people with Medicare prescription drug coverage who have high upfront drug costs.”
The prescription payment plan applies to standalone Medicare prescription drug plans and Medicare Advantage plans with prescription drug coverage.
CMS is seeking public input for the draft of the program it released on Monday for 30 days, and plans to finalize the plan by next summer and allow qualified Medicare beneficiaries to opt in during enrollment on October 15, 2024. It will start in 2025.
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