The cost of prescription drugs will likely increase 42-57 percent for retired Americans enrolled in Medicare’s Part D prescription coverage in 2024. The reason is the manipulation of the market by government which encourages insurers to shift costs from one group of users to be borne by another.

A change in the Inflation Reduction Act, which reduces co-pays for some, especially those with chronic conditions, shifts that cost to about a fourth of Medicare recipients who exceed the threshold of the new $2000 cap and will be expected to cover 60-80 percent of their prescription costs.

Earlier reports projected slight premium declines across Part D plans next year, but the HealthView report, published in November 2023, contrasts sharply with a July projection by the Centers for Medicare & Medicaid Services (CMS), the federal agency that administers the Medicare program, 

CMS said there would be a 1.8 percent decline in Part D premiums for 2024, because of “reforms” in the Inflation Reduction Act. However, HealthView forecasts major hikes for retirees in states with large senior populations. They projected average increases ranging from $269 in Texas to $510 in New York.

The Inflation Reduction Act lowered the maximum out-of-pocket spending cap for Medicare Part D prescription drugs from $7,050 in 2023, to $2,000 in 2025, reducing co-pays for some, especially those with chronic conditions. However, financial liability will shift to insurers expected to cover 60-80 percent of costs once patients hit the new $2,000 cap.

With roughly a quarter of Medicare recipients exceeding this threshold, HealthView analysis suggests carriers will raise premiums to account for their increased coverage requirements. The higher premiums are a way for insurance companies to cover the expected increase in costs.

So, while the Inflation Reduction Act aims to lower overall healthcare costs for retirees, it may actually increase 2024-2025 Part D premiums for 75 percent of enrollees seeing no co-pay relief.

Epoch Times reports, “Americans pay for prescription drugs over 2.5 times more than other high-income nations. One in five seniors alter medication use due to high prescription costs, a May 2023 national survey found. They either skipped, delayed, took less medication, or took someone else’s medications.”

HealthView analysis shows 2024 increases could outpace the average retiree’s Social Security cost-of-living adjustment (COLA) by 70 percent – posing real financial challenges.