Senate Passes Inflation Reduction Act
August 8, 2022
On Sunday, August 7, 2022, the Senate passed The Inflation Reduction Act, a $700 billion package, which includes some major healthcare changes. This scaled-down version of the Build Back Better Act includes:
- Extending the Affordable Care Act health insurance subsidies until 2025
- Allowing Medicare to negotiate lower prescription drug prices of certain costly medications administered in doctors’ offices or purchased at the pharmacy. The Health and Human Services secretary would negotiate the prices of 10 drugs in 2026, and another 15 drugs in 2027 and again in 2028. The number would rise to 20 drugs a year for 2029 and beyond.
- Capping out-of-pocket cost at $2,000 per year for Medicare beneficiaries starting in 2025.
- Introducing a new 15% minimum tax on income that corporations report to their shareholders (known as “book income”). This will generally apply to companies with a billion dollars or more in profit.
The measure to cap insulin at $35 per month under private insurance was stripped from the bill because it did not comply with the reconciliation process. That meant that it would need 60 votes to pass as opposed to a simple majority. It failed at 57-43.
The bill now goes to the House of Representatives where it is expected to pass.
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