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The Inflation Reduction Act Comes for Medicare

It will cut benefits and increase premiums, upsetting millions of elderly voters.

By Casey B. Mulligan and Tomas J. Philipson

Nov. 21, 2022 6:41 pm ET

President Biden has accused Republicans of scheming to cut Medicare. In fact it is his signature legislation, the Inflation Reduction Act, that will lead to benefit cuts and premium increases for seniors. Medicare’s popular drug-coverage program is headed for a painful amputation.

The private plans participating in Medicare’s prescription-drug program, known as Part D, currently draw on three sources of revenue to finance prescriptions: out-of-pocket payments from patients, premium payments made by plan members, and subsidies from the federal government. In 2025, under the Inflation Reduction Act, both government subsidies and out-of-pocket payments by patients are scheduled to be cut sharply. The difference will have to be made up by premiums. But the statute inhibits this third revenue source, which is also subsidized, from increasing more than 6%. 

https://www.wsj.com/articles/the-inflation-reduction-act-comes-for-medicare-ira-elderly-voters-payments-benefits-cuts-revenue-losses-subsidies-11669060307

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