In 2022, Vice President Kamala Harris had the tie-breaking vote for the Inflation Reduction Act, and now that law could push up Medicare costs for some seniors next year.
The Senate vote was split 51-50 across party lines, and Harris cast the final vote for the law that made substantial changes to Medicare prices beginning in 2025.
“Since day one of our Administration, President Joe Biden and I have made it a priority to strengthen the middle class by lowering costs, creating jobs, and advancing opportunity,” Harris said in a statement last month. “That is why we fought to enact our Inflation Reduction Act, historic legislation that I was proud to cast the tie-breaking vote on in the Senate.”
The law aimed to reduce the costs of health care through a series of new rules for 2025.
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Those included a $35 cap on insulin as well as an out-of-pocket maximum of $2,000 for drug costs for those on Medicare. Also, for the first time, Medicare can negotiate lower prescription prices for expensive medications.
Biden’s administration has said the changes will save 19 million seniors an average of $400 yearly, but critics have said it could end up raising premiums on the average senior.
Drug manufacturers will also provide discounts throughout the year, and seniors will now be able to spread their costs over the year with a new monthly payment option.
“The Inflation Reduction Act was intended to reduce the cost of medications,” Smile Insurance CEO Chris Fong told Newsweek. “However, only some seniors will experience the cost savings.”
Insurer plans will likely need to compensate for the additional medication expenses and draw from other aspects of the plan, leading to increased premiums, co-pays and even deductibles, Fong said. Some insurers might even add additional steps to approve medications.
Newsweek also reached out to Cigna, Aetna and Humana insurers for comment via email.
Fong added, however, that Harris’ tie-breaking vote might be seen as a positive by some seniors who will associate the decision with the initial lower drug prices, regardless of the possible higher premiums.
“I think Harris’ tie-breaking vote likely will be a positive for Harris in the mind of seniors whose cost of medications excessively exceeded the $2,000 per year amount,” Fong said. “However, seniors whose medication costs were lower may have a more negative view of presidential nominee Harris.”
Democrats are likely going to tout the drug cost savings “like it’s the best thing since sliced bread,” Michael Ryan, finance expert and founder of michaelryanmoney.com, said.
“For many seniors, it might well be,” Ryan told Newsweek. “But the GOP? They’ll be all over any premium increases.”
The Republican National Committee previously spoke out on the issue: “Kamala Harris was the tie-breaking vote on both the failed $1.9 trillion stimulus and Inflation Explosion Act—both of which caused prices to rise by 20.3 percent since Harris and Biden took office,” committee spokesperson Anna Kelly told PolitiFact. “Everyday Americans don’t care which of Harris’ runaway spending proposals led to higher taxes and less money in their pockets.”
Long term, the changes could spark a major shift in the health care industry, Ryan said, but that there also could be unintended consequences. “Knowledge is power. Seniors need to stay informed and be ready to adapt. Some might see their costs plummet, while others might need to shop around for better Medicare plans.”
Medicare’s open enrollment begins October 15 and runs until December 7.
