The Inflation Reduction Act, signed into law in 2022, provides cost-relief benefits to people with Medicare plans. The law sets a timetable for when changes will be implemented, some starting this year. Other changes will begin as late as 2026.

Along with the Pulmonary Hypertension Association’s insurance term glossary, the guide below can help you understand when you might benefit from the law:

This year
Insulin costs covered under Part D plans are capped at $35 a month. This cap takes effect immediately and no Part D deductible payments are required for the coverage to begin. Starting July 1, the $35 monthly cap will include insulin covered under Part B, such as a traditional pump.

Adult vaccines recommended by the Advisory Committee on Immunization Practices are free to Medicare Part D beneficiaries. Starting Oct. 1, most adults with Medicaid or CHIP plans won’t have to pay for the vaccines either.

The enhanced premium tax credit for Affordable Care Act Marketplace coverage, which began in 2021 under the Biden administration’s American Rescue Plan, will be extended through 2025. The enhanced credit lowers the monthly premiums for those whose household incomes fall below 400% of the federal poverty level. In some cases, those whose incomes are slightly over the 400% threshold might qualify for a lower monthly premium. Last year, the federal poverty level was $20,385 for one person.

Drug manufacturers must pay rebates to Medicare for certain Part B drugs if their prices increase faster than the inflation rate. If prices rise faster than inflation in the first quarter of this year, copays for those drugs could decrease starting April 1.

Cost-sharing will be eliminated for Part D catastrophic coverage. When beneficiaries’ out-of-pocket prescription costs reach the catastrophic threshold ($7,400 for 2023), they won’t be responsible for coinsurance.

Medicare Extra Help program will fully cover those with Part D who earn below 150% of the federal poverty level.

Part D premium increases will be capped at no more than 6% each year from 2024 through 2029.

Out-of-pocket costs for prescription drugs will be capped at $2,000 a year for Medicare Part D plans. An optional cost-smoothing program would allow people with Part D to spread out the $2,000 out-of-pocket costs in equal monthly amounts throughout the year.

A manufacturer discount program will replace the Medicare coverage gap discount program. Manufacturer discounts for applicable drugs will be required in for initial coverage and when catastrophic coverage kicks in.


Medicare will implement its drug price negotiation program. Initially, it will set fair price caps for 10 Part D drugs. Medicare recipients who need those drugs will begin feeling the cost-saving benefits of this program that year.

More drugs will be added to the list yearly through 2029 so Medicare can negotiate with manufacturers to lower prices for beneficiaries. By then, Medicare will have to negotiate maximum fair prices for 100 drugs covered under Part B or Part D. Maximum fair prices for the last drugs added to the list will go into effect in 2031.

To learn more about these benefits, review the Centers for Medicare and Medicaid Services Fact Sheet on the Inflation Reduction Act. Read the Kaiser Family Foundation’s issue brief for more information about the law’s changes to Medicare.

As always, you can call PHA’s Treatment Access program at 301-565-3004 x758 or email us with questions.