The Inflation Reduction Act of 2022 is a widespread bill that covers health care, climate change and taxes, and it also provides many benefits for retirees. To learn more about how the Inflation Reduction Act may impact older Americans, U.S. News & World Report turned to AlphaCore CEO and Founder Dick Pfister, CAIA, for insight.
In addition to potentially slowing inflation, which could provide some relief for seniors living on fixed incomes, the Inflation Reduction Act will also help tackle skyrocketing healthcare prices. One of the bill’s provisions allows the Medicare program to negotiate lower prescription drug prices for seniors on select medications.
“Under the current law, the Medicare program is banned from negotiating drug prices. You have to pay the market price,” Pfister explains. “But with the new law, they actually have to negotiate, and they think that will cause the prices for drugs to drop across the market.”
Another way the Inflation Reduction Act may help relieve America’s retirees is by placing a limit on Medicare out-of-pocket drug expenses. While this provision won’t go into effect until 2025, it is poised to help seniors living on fixed income tackle rising health care and drug costs.
“Prescription drug spending will be capped at $2,000 a year for Medicare beneficiaries,” Pfister tells the publication. “Eventually that will be a good thing, but it’s going to be another three years before that goes into effect.”