What is the Inflation Reduction Act and how will it impact Medicare?

Published by Medicare Made Clear®


The Inflation Reduction Act of 2022 (IRA) is a new federal law that makes improvements to the Medicare program. Among other things, the IRA will expand Medicare benefits and help reduce Medicare members’ out-of-pocket costs for prescription drugs.

What changed in 2023?

Insulin and vaccine coverage changed for Medicare Part D members.

Changes to Medicare insulin coverage

As of January 1, 2023, the IRA capped member cost-sharing for Part D-covered insulin products at $35/month. This means that members can obtain insulin at $35/month per covered prescription (or less if their plan benefit has lower cost for insulin), regardless of benefit phase and without needing to meet their deductible.

Medicare Part D covers these forms of insulin:

  • Injectable insulin that is not used with a traditional/reusable insulin pump
  • Insulin used with a disposable pump 

It’s important to note that the Medicare Part D $35 monthly cost-sharing cap does not currently apply to traditional insulin pumps or insulin patch pumps. However, as of July 1, 2023, if you use a traditional insulin pump that is covered under Medicare Part B as durable medical equipment (DME),1 your Part B-covered insulin will be subject to the $35/month cost-sharing cap.

Changes to Medicare vaccine coverage

As of January 1, 2023, Part D-covered adult vaccines that are recommended by the Advisory Committee on Immunization Practices (ACIP) are now available to members at no cost. This means members with Medicare Part D coverage can get ACIP-recommended vaccines without paying any cost-sharing and without meeting their deductible.1 The shingles vaccine, Tetanus-Diphtheria-Whooping Cough vaccines and the influenza vaccine are just a few of the ACIP-recommended vaccines included. For more information, the Centers for Disease Control and Prevention (CDC) website offers a complete list of vaccinations that are recommended by the Advisory Committee on Immunization Practices.

How will the Inflation Reduction Act affect my Medicare Part D coverage over time?

2024
  • Members will no longer have to pay any cost-sharing once they reach the catastrophic phase of their Medicare Part D drug coverage
  • Full eligibility for the low-income subsidy program (or “Extra Help”) will be expanded for those with Medicare Part D
2025
  • Medicare Part D coverage will have an out-of-pocket maximum of $2,000 for prescription drug costs for the plan year
  • Those with Medicare Part D coverage may have the ability to spread out their out-of-pocket costs for prescription drugs over the course of the plan year
  • The coverage gap phase will be eliminated

For additional information related to the IRA and how it may impact your current or future Medicare Part D coverage, you can visit cms.gov.

About Medicare Made Clear

Medicare Made Clear brought to you by UnitedHealthcare provides Medicare education so you can make informed decisions about your health and Medicare coverage.

Get the latest

Boost your Medicare know-how with the reliable, up-to-date news and information delivered to your inbox every month.