COVID-19 watch
Tracking Hardship - August 19, 2022
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The health care savings edition. The pandemic’s flames rage on, with nearly 100,000 new cases in the U.S. every day and nearly 500 deaths. But there is good news to report. President Biden this week signed the Inflation Reduction Act of 2022, which will lower prescription drug and other health care costs for millions of Americans. The legislation covers other things of tremendous consequence – the most significant U.S. response to climate change ever and making corporations pay more of their fair share with a 15 percent corporate tax rate, for example. But the health care provisions contained in the bill are historic too.
The Inflation Reduction Act will help an estimated 13 million Americans save an average of $800 each per year by extending subsidies provided earlier in the current pandemic through 2025. These subsidies had been scheduled to expire by year’s end; had that happened, Americans who receive their health care through the ACA marketplace would have seen their premiums skyrocket – and the White House estimates that 3 million people would have lost access to health care altogether.
The legislation will cap prescription drug prices for Medicare recipients at $2,000 out-of-pocket a year. Medicare will for the first time gain the power to negotiate its costs for pharmaceuticals, beginning with 10 drugs in 2026, expanding to another 15 drugs in 2027, and eventually expanding to an additional 20 drugs in 2029 and beyond. According to the White House, 5-7 million Medicare recipients could see their prescription drug costs go down. Some 50 million Americans with Medicare Part D will have their costs capped, directly benefiting about 1.4 million people each year. And the legislation will provide extra help to Medicare recipients with low incomes when it comes to paying for their prescription drugs.
There’s more. Beginning in 2023, Medicare recipients will pay no more than $35 a month for insulin. That provision by itself will benefit 3.3 million people. And the new law will require free adult vaccines for beneficiaries of Medicare, Medicaid, and CHIP.
Congress is on recess now, after both Senators and House members delayed or interrupted their August break to enact the Inflation Reduction Act of 2022. When Congress returns in September, they have unfinished business – long overdue funds to address the pandemic, extending health and prescription drug coverage beyond Medicare, and providing help to families with low incomes.
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About half of U.S. adults say they have difficulty affording health care costs, according to recent polling by the Kaiser Family Foundation. About a quarter of adults say they or a family member in their household have not filled a prescription, cut pills in half, or skipped doses of medicine in the past year because of the cost. Black and Hispanic adults and women are most likely to fall into this category. Tweet this.
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Just over four in ten adults report having debt due to medical or dental bills, including debts owed to credit card companies, collection agencies, family and friends, banks and other lenders. A disproportionate number of Black and Hispanic adults, women, parents, people with low incomes and adults without insurance say they have health care debt. Tweet this.
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Uninsured adults under 65 are much more likely to say affording health care costs is difficult (85 percent) compared to those with health insurance (47 percent). Six in ten Black adults (60 percent) and 65 percent of Hispanic adults report difficulty affording health care costs, compared to 39 percent of White adults. Tweet this.
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According to a new study published last month, 14 percent of people who use insulin face what is described as a “catastrophic” level of spending on the medication, meaning that after they pay for other essentials, such as food and housing, they spend at least 40 percent of their remaining income on insulin. The Inflation Reduction Act will cap insulin costs for Medicare patients at $35 a month. Tweet this.
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Currently, Medicare recipients have to spend $7,050 out of pocket annually on prescription drugs before qualifying for “catastrophic coverage,” which allows patients to only be charged a small copayment, or a coinsurance percentage, which is set at 5 percent of the cost of the drug. Under the new law, that 5 percent coinsurance charge will be eliminated in 2024, a transition year, and in 2025, the $7,050 provision will be lowered to $2,000. Tweet this.
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