New Medicare cap on prescription costs goes into effect Jan. 1

A new $2,000 cap on out-of-pocket spending on medications for Medicare Part D beneficiaries goes into effect in 2025, potentially saving seniors hundreds of dollars annually.President Joe Biden calls this a game changer.Juliette Cubanski, of the Kaiser Family Foundation, said, "That's a really big deal for people with Medicare since most folks on Medicare live on relatively low incomes."The cap is part of the Inflation Reduction Act, which Congress passed and President Biden signed into law in 2022.The White House estimates that 19 million seniors and people with disabilities on Medicare will save an average of $400 per year.President Biden says, "This week, we take another step closer to an America where everyone can afford the quality health care they need."Research from AARP shows that 82 percent of Americans age 50 and older believe prescription drugs are too expensive.Juliette Cubanski adds, "Having to pay even hundreds of dollars in some cases but certainly thousands of dollars out of pocket for medications is a real burden and led to many people being able to unafford their prescriptions and having to go without."PhRMA, a group representing pharmaceutical research companies, acknowledges the cap as an important step but argues that other parts of the law, like price-setting provisions, could reduce access to medicines for seniors and those with disabilities.