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The new Inflation Reduction Act which went into effect in January will greatly help cut health care costs for Tennesseans, the White House announced in a press release.

The Inflation Reduction Act of 2022 was passed by the 117th United States Congress and signed into law by President Joe Biden on August 16, 2022. It went into effect Jan1, 2023, but since it is a 10-year plan, most changes won’t happen immediately.

It will help lower health care costs for millions of Americans. Among those who will benefit the most from the improvements the act makes are middle income older people who have retired or don’t have health coverage through their jobs.

The act will also expand coverage to more than 50,000 teens in Tennessee will have health insurance in 2023 than without the act. Congress estimates that more than 50,000 Tennessean adults will have health insurance in 2024.

A cap will be placed on prescription drug costs, such as insulin, expand coverage for thousands and will help save thousands for Tennesseans with the new act.

Specifically it will place a cap on prescription drug costs and cap insulin co-payments for hundreds of thousands of Tennessee Medicare beneficiaries and reduce health insurance premiums for hundreds of thousands of Tennesseans.

Starting in 2023, the legislation will cap the out of pocket cost of insulin for Medicare beneficiaries at no more than $35 for a month’s supply which will help more than 80,000 Tennesseans who use insulin.

Congress estimates that more than 37,000 Tennesseans all over the state will benefit where they would otherwise have out of pocket costs above the cap.

The Inflation Reduction Act takes on the issue of Americans paying two to three times what citizens of other countries pay for prescription drugs.

The act allows Medicare to negotiate prices for high cost drugs while also providing seniors and people with disabilities who have Medicare coverage with new protections against unaffordable prescription drug bills.

Seniors and People with Disabilities will save billions of dollars by allowing Medicare to Negotiate Prices for High-Cost Drugs. By bringing down the cost of these drugs, the legislation will save billions of dollars for both Medicare beneficiaries, who will see reduced out-of-pocket costs, and the federal government.

The Act will require companies to pay Medicare a rebate if they increase drug prices faster than inflation, which will achieve billions more in savings for the federal government.

More than 270,000 Tennesseans with Marketplace coverage are saving around $720 annually from the American Rescue Plan subsidies that the Inflation Reduction Act would continue.

Those savings increase to thousands of dollars per year for some middle-income older people who would otherwise face very high premium burdens.

Part D of the act will enhance financial projections for Medicare beneficiaries with conditions such as cancer, multiple sclerosis, and lung disease. This phase will start in 2024, with the $2,000 out of pocket cap taking effect in 2025.

For more information on the act visit the IRS’ webpage for the Inflation Reduction Act of 2022.