Coming Changes in Legislation
Important legislation has recently been passed through Congress this summer. The most recent bill to pass the House this summer was the Inflation Reduction Act (HR5376) which passed on a party-line vote 220-207 after the Senate passed the measure on a 51-50 vote margin with Vice-President Harris casting the tie-breaking vote. The President has signed the bill, and this legislative package is now law.
The provisions of the Railroad Retirement law stipulate that the U.S. Department of Labor, Bureau of Labor Statistics issues the Cost-of-Living Adjustments based on the rise of the Consumer Price Index from the previous year. The U.S. Department of Labor, Bureau of Labor Statistics determines the cost of living. A cost-of-living adjustment becomes effective for the corresponding period of the current year.
Because of projected high inflation, the cost-of-living increase could be around 9.6 % to 10.1 % by 2023. The July, August, and September Consumer Price Index (CPI) showed inflation up over 8.5 % in the last 12 months.
The bill is designed to address inflation by lowering the national deficit with new revenues collected from the richest corporations and wealthiest citizens with incomes over $400K per year. Tax cheats and unfair loopholes will change and supposedly force them to pay their fair share of taxes like the rest of the tax-paying citizens.
This law also changes a system that works for the pharmaceutical industry with record profits for their executives and shareholders. At the same time, patients struggle to afford the drugs they need to stay healthy and stay alive. It will finally repeal the 2003 Medicare Prescription Drug and Modernization Act. This law prohibited Medicare from negotiating lower drug prices with the pharmaceutical industry on behalf of Medicare beneficiaries. Beginning in 2023, this new law will finally empower Medicare to start dealing directly with the pharmaceutical industry for the price of prescription drugs.
Other changes in this bill will: Cap seniors’ out-of-pocket spending for Rx drugs at no more than $2000 per year (2025) and ensure that beginning in 2023, Medicare patients will pay no more than $35 per month out of pocket for their insulin. Starting in 2026 and beyond, insulin will be priced at $35 per month or 25% of the drug’s new negotiated price, whichever is lower. This provision will benefit one in three beneficiaries who suffer from diabetes, a total of over 3.3 million Americans who use one or more of the common forms of insulin. Currently, there is no cap on spending for Rx drugs seniors buy at pharmacies.
Beginning next year, primary medical diagnoses, such as cancers, will never again mean paying tens of thousands of dollars out of pocket for just one drug.
Beginning this fall, any drug corporations that increase their drug prices faster than their inflationary cost must pay the amount that exceeds inflation back to Medicare. This will end their long-standing practice of raising their prices yearly, often at more than twice the inflation rate.
This provision will help reduce the amount seniors pay for their drugs and strengthen the Medicare program’s finances. Kudos to NARVRE and our members for contacting Congress to finally get this issue addressed and set into motion by passing this legislation. This should be front and center for all seniors on election day (Nov 8th). For over 85 years, we have been reporting to you on the many changes that occur in Washington D.C. These days, the issues are crucial. We plan to continue to PROTECT, PRESERVE, and PROMOTE your best interests by reaching out to those in Washington that can make a genuine difference and supplying you with the information you need to help us by contacting these people and letting your voice be heard.
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