Millions Of Patients Anticipate Substantial Savings As New Limit On Annual Out-of-Pocket Costs Goes Into Effect January 1st
WASHINGTON, D.C. — Starting this week, everyone with Medicare Part D will have their annual out-of-pocket drug costscappedat $2,000. This historic reform is one of the most substantial provisions from the 2022 prescription drug price law to take effect, reducing financial anxiety and bringing much-needed relief to millions of patients on Medicare who have long struggled with high drug prices.
Approximately 1.4 millionpatients on Medicare who reach the cap between 2025 and 2029 are estimated to save $1,000 or more annually. By 2029, the cumulative total of patients achieving these savings from the annual out-of-pocket cap is projected to exceed 4 million. Below are stories from patients on how the $2,000 out-of-pocket cap will help them:
- “The annual $2,000 out-of-pocket cap in 2025 may allow me to retire or at least only work part-time, it will allow me to spend more time with my family, and give me back some of my independence. It’s life-changing,” Steven Hadfieldsharedwith his local paper, The Charlotte Observer in North Carolina. His prescription drugs carry a combined monthly list price of $18,000.
- “Because of the drug pricing law, I can rest assured knowing that if I were to lose my grant, my portion of my drug’s price would be limited to $2,000 annually —allowing me to continue on the medication responsible for keeping me alive,” Lynn Scarfutosharedwith the New York Daily News. Lynn relies on Imbruvica, a cancer medication which carries a monthly list price of more than $17,000.
- “For myself and millions of others on Medicare who rely on expensive medications, this relief is truly life-changing. The out-of-pocket cap next year promises savings of up to $7,000 next year — a huge financial burden lifted off my shoulders,” Judy Aiken
- “This historic measure offers me and my family peace of mind in knowing that I will be able to better afford my prescription drugs if I ever went without my copay assistance,” Doug Lustysharedwith the Deseret News in Utah. He uses Stelara, which carries a monthly list price of more than $25,000.
- “The $2,000 out-of-pocket cap will save me at least $6,000 a year. But also knowing I will pay no more than $2,000 next year returns me financial freedom and the flexibility to decide with my doctor based on my health and well-being, not my pocketbook,” Lisa McRipley from Texas, whose drugs to treat her multiple sclerosis cost $7,500 per month,sharedat a Department of Health and Human Services (HHS) roundtable last year alongside other patients. Lisa also participated in a White House event where she shared her experience with high drug prices and the relief she felt knowing that the drug price law “is a powerful restoration of dignity to millions of Americans like me.”
- “I have been on Lantus, Humalog, and now I’m on Fiasp, and I asked my pharmacist what the out-pocket price of these three insulins are and alone they are $640 a vial …. If we didn’t have what we have today, a lot of these seniors like myself in assisted living or nursing homes might have to live with their families or maybe die …This is a step in the right direction,” Kaye Peterson, a patient advocate in Kentucky who has lived with type 1 diabetes for over 40 years,sharedat a patient community call hosted by AARP and HHS Secretary Xavier Becerra.
The Inflation Reduction Act has already been lowering costs for people on Medicare by capping insulin prices and providing free recommended vaccines, as well as requiring inflation-based rebates from drug company price gouging. Additionally, in the first half of 2024, 1.5 million people on Medicare saved nearly$1 billionout-of-pocket due to the $3,500 out-of-pocket cap that went into effect January 2024. Looking ahead to 2026, Medicare negotiation will begin to leverage even further savings for patients on Medicare in combination with the rest of the transformative provisions in the historic drug price law.
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Patients For Affordable Drugs is the only nationalpatient advocacy organization focused exclusively on policies that lower prescription drug prices. We empower and mobilize patients by amplifying their experiences with high drug prices to hold those in power to account and fight to shape and achieve system-changing policies that make prescription drugs affordable for all people in the United States. P4AD does not accept funding from organizations that profit from the development and distribution of drugs. To learn more, visitPatientsForAffordableDrugs.org.
