A new price cap on out-of-pocket prescription drug costs will go into effect for Medicare recipients starting January 1st, 2024, capping annual spending at $2,000. The Inflation Reduction Act provision is expected to provide significant relief for patients, particularly those with cancer who often face exorbitant medication expenses.
Starting Jan. 1, older adults on Medicare will spend no more than $2,000 a year on prescription drugs when a new price cap on out-of-pocket payments from the Inflation Reduction Act goes into effect. Experts say the change is expected to provide major relief for cancer patients who often struggle to afford their medications due to the high cost of cancer drugs.
Diana DiVito, of Canonsburg, Pennsylvania, recalls the shock she felt after she got her first co-payment for the cancer drug Imbruvica in 2016. The 83-year-old was diagnosed with chronic lymphocytic leukemia, a type of blood cancer that begins in the bone marrow, in 2005. She underwent treatment, including chemotherapy, and went into remission. When she had a recurrence, she started taking Imbruvica. By 2021, DiVito had spent $56,000 out-of-pocket on the daily pill. “The co-pays blew me away,” said DiVito, who added she’s been on limited income since her husband died in 2023. “It started out the first year was $8,500 out of pocket, and then it went up about $1,000 every year after that.” The new price cap will apply to all prescription drugs under Medicare Part D; it won’t apply to drugs given to patients in the hospital or other health care settings, such as chemotherapy or anesthesia. Medicare recipients will also have the new option of spreading their payments out over the course of the year, rather than paying a large co-payment all at once. Before the change, people on Medicare typically had to spend $7,000 or more out of pocket on their prescription drugs before they qualified for so-called catastrophic coverage, when insurance kicks in and covers most of the drug’s cost. Under this coverage, patients are charged a small co-payment or a percentage of a drug’s cost, usually 5%. Typically, DiVito would hit catastrophic coverage almost immediately after her plan reset each January. While that helped with costs for most of the year, it meant the first few prescriptions she filled were financially painfu
Medicare Prescription Drugs Inflation Reduction Act Out-Of-Pocket Costs Cancer Patients
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