The White House wants to give an estimated $5 billion in taxpayer money to health insurance companies in order to prevent Medicare premium increases caused, in part, by the Inflation Reduction Act (IRA) of 2022.
The controversial move is intended to stop private health insurers from raising Medicare Part D prescription drug premiums, but Republican critics argue the timing suggests the potentially illegal move is purely political.
Proposed Medicare rate increases are typically submitted during the summer and announced in September. If it moves forward, the White House’s gimmick could prevent seniors from getting alerts about prescription drug cost increases right before the November elections.
“It’s using the federal treasury for political advantage,” Sen. Bill Cassidy (R-La.) told Politico.
“This is a way for the executive branch to implement a policy which has very positive political ramifications for them, but with very sketchy legal standing,” Cassidy said.
The IRA, one of President Joe Biden’s most expensive legislative prerogatives, aimed to reduce prescription drug costs for older Americans by capping out-of-pocket expenses under Medicare — a provision that has yet to take effect.
However, the legislation has inadvertently led to a significant increase in insurance premiums for Medicare Part D plans, which cover prescription drugs. Insurance companies, now responsible for covering more of the drug costs, have submitted bids indicating premiums could triple by 2025.
U.S. Sen. Susan Collins (R-Maine) was the only member of Maine’s Congressional Delegation who opposed the IRA, while Sen. Angus King, Rep. Chellie Pingree (ME-CD1) and Rep. Jared Golden (ME-CD2) voted in favor of the omnibus package.
In response to the proposed hikes in prescription drug costs, the Centers for Medicare and Medicaid Services (CMS) introduced a three-year “demonstration project” designed to subsidize these premiums, keeping them artificially low.
The scheme is expected to escalate government subsidies from $30 per recipient per month in 2024 to $142.70 in 2025, money that will flow not to the recipients but to the insurers.
When it was originally passed, the IRA contained a provision that would allow Medicare to negotiate prescription costs. In assessing this provision, the non-partisan Congressional Budget Office (CBO) estimated that it would save Medicare roughly $288 billion over a ten year period.
In typical Congressional fashion, Democratic supporters of the bill took the projected future savings from this provision and applied the funding toward other priorities in the bill, including climate change-related policies like tax credits for electric vehicles.
While the CBO originally estimated that the green energy subsidies contained in the IRA would cost less than $400 billion over the following decade, newer estimates, including from the CBO itself, have said the actual cost could be more than twice as high.
A Goldman Sachs analysis published last year found that, because the myriad green energy tax credits offered by the IRA are more popular than the CBO assumed, the cost of those subsidies may approach $1.2 trillion.
As the Wall Street Journal wrote of the development: “The Inflation Reduction Act may go down as one of the greatest confidence tricks on taxpayers in history.”
The latest shell game with Medicare Part D premium costs, less than 100 days before Election Day, suggests the confidence trick continues.
Because it worked so well with student loans they thought they’d try it with Medicare. Just changing who pays for it, kinda like socialism.
The more they meddle the worse they make it. Get gov’t out of healthcare. How does the gov’t know how much meds or anything else should cost? They don’t!
The democrats are masters of deceit and deception . They lie to us and enjoy doing it .
The democrats HAVE TO BE DEFEATED in November .
Vote these liars out or watch the country be destroyed