The Inflation Reduction Act
This legislation passed in 2022 & contained many changes involving Medicare that are unfolding over the next several years and affects all Medicare beneficiaries.

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 phased in over time. 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 will be eliminated. Out of Pocket drug costs will be capped annually at $2,000. An optional monthly payment program will be introduced where one can sign up through their Part D insurance company to spread out the costs of expensive meds. See CMS article: https://www.cms.gov/inflation-reduction-act-and-medicare

The federal government’s redesign sounds encouraging, yet in reality there may be unintended consequences. Experts suggest it may only help reduce drug costs for a very small portion of Medicare beneficiaries. 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 members who opt in. To absorb these new costs, raising premiums, copays/coinsurances, deductibles and/or reducing formularies could be a reality. Medicare Advantage plans could start cutting back on “extra” benefits they have offered in the past.

Medical Costs:
All insurance companies have experienced “high utilization” by members over the last two years. This uptick is primarily due to folks delaying non-essential services during the COVID outbreak. High utilization combined with record high inflation could be a recipe for higher-than-normal premium increases. All carriers and plan types are affected by these market conditions.

Increased Compliance Steps:
Unethical sales behavior, scams and fraud unfortunately occur in the Medicare industry. Thankfully, Medicare continues to take steps to restrict misleading advertising and marketing behavior to protect beneficiaries. Regretfully, instead of reprimanding the unethical sources creating the complaints, they took a blanket approach by putting new restrictions on the entire agent and brokerage community, making it more challenging to help both new & existing clients.

The agent community continues to work diligently to adapt to these additional compliance measures. Phone call recordings, verbal and/or written disclosures given by the agent, and client attestations that must be captured by 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 a bit 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 recordings and documents for a 10-year period. I appreciate your understanding, patience, and cooperation as we move forward to protect you and follow the law to 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 risk, 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.

My best to all,
Bill