The Inflation Reduction Act- This legislation passed in 2022, unfolds over several years, and affects ALL Medicare beneficiaries and agents. The cost impact is becoming more apparent. Companies are shifting increased costs to policyholders and discontinuing agent compensation on many plan types. We are all collectively affected by and will need to adapt to these changing conditions.

Medicare Part D Redesigned: Keep in mind Part D can be a standalone drug plan many combine with a Medicare Supplement (Medigap) or can be contained within a Medicare Advantage plan. Provisions are being phased in. In 2023, copays for insulins were capped at $35, most adult vaccines went to $0. copay. In 2024, Extra Help was expanded, and the 5% coinsurance was eliminated in the “Catastrophic Phase”. In 2025, the “Donut Hole/Coverage Gap” phase was eliminated, out of pocket drug costs were capped annually at $2,000 ($2,100 for 2026), and an optional monthly payment program was introduced (sign up through your Rx plan). See CMS article: https://www.cms.gov/inflation-reduction-act-and-medicare

The federal government’s redesign sounded encouraging, yet we are seeing cost-shift consequences as expected. Medicare is attempting to preserve the Medicare fund, so they shifted costs to drug manufacturers and insurance companies. Plus, insurance companies have an added requirement to administer the new prescription payment program. To absorb these new costs in 2026, premiums, copays/coinsurances and deductibles are rising, and Rx formularies are being adjusted. Medicare Advantage plans are adjusting and cutting benefits. Some drug plans and Medicare Advantage plans are cancelling (read your ANOC!). Some companies are pulling out of the Medicare market altogether.

Medical Costs: All insurance companies have experienced high utilization by members over the last three years. Some were due to folks delaying non-essential services during the COVID outbreak. High utilization combined with record high inflation, new mandates put on insurance companies, new laws and expanded government programs is a recipe for higher-than-normal premium increases.

Increased Compliance Steps: Unethical sales behavior, scams and fraud unfortunately occur in the Medicare industry. Regretfully, instead of Medicare reprimanding the unethical sources creating the complaints (mostly call centers and lead generating companies), they took a blanket approach and put restrictions on the entire agent community, making it more challenging to help new & existing clients.

The agent community continues to work diligently to adapt to these compliance measures. Phone call recordings, required disclosures, client attestations, voice recordings or electronic documents e-signed by you via text or email are examples of things you may experience as we interact. They seem impersonal but are required. If I don’t follow them, I risk facing severe penalties and/or losing my license. Random audits may occur to ensure I’m filing these requirements for 10 years. I appreciate your understanding, patience, and cooperation as we adapt to protect you, follow the law, & protect our business so we can continue to be of service to you.

Unwanted Solicitations: Unless you initiated or gave permission for contact, these solicitors are violating laws. You can file a complaint with the FCC and be sure to register your number at www.DoNotCall.gov (or 1-888-382-1222). Also, we get reports of insurance companies cleverly soliciting their own policyholders with the goal of switching your health plan to one more profitable for the company. You’ll potentially take on more financial risks, may lose access to your providers, and inadvertently lose me as your servicing agent. Ask to be removed from marketing calls. If confused, call me with the specific name of the plan in which you are being enticed so I can advise.

A lot to absorb, yet we’ll all do our best to adapt. My best to all. Bill