August 24th, 2022 – On August 16th, President Biden signed the Inflation Reduction Act into law. As far as healthcare and health insurance are concerned, there are two groups of people who will benefit most.
- Individuals in Colorado whose income qualifies them for federal tax credits on health insurance sourced through Connect for Health Colorado: Through the end of 2025, the Inflation Reduction Act continues the expanded federal tax credits on individual marketplace plans. The tax credits have been available since the American Rescue Plan was enacted during the COVID pandemic and were set to expire at the end of 2022.
- Medicare recipients: Insulin copays for Seniors will be capped at no more than $35/month beginning in 2023. Beginning in 2025, Medicare Part D plan Out of Pocket Costs will be capped at $2,000 for covered medications. Starting in 2026, Medicare will be able to negotiate prices for higher priced medications.
The tax credit expansion is substantial for many middle class Coloradans who buy their own marketplace health insurance, as it caps premiums for benchmark plans at no more than 8.5% of income. Many lower-middle income people who earn too much to qualify for Health First Colorado (Medicaid) are able to qualify for zero premium health insurance premiums with these expanded tax credits. Get a FREE marketplace quote today!
Previously, the federal government was explicitly prohibited from negotiations prices with drugmakers for Medicare recipients and out of pocket maximums on prescriptions for Seniors are as much as $7,000 per year.