COUNCIL BLUFFS, Iowa and OMAHA — As the Medicare open enrollment period nears, seniors across the country are bracing for higher premiums. Some industry experts say prescription drug costs and the 2022 Inflation Reduction Act are a primary driver behind the increases.
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The 2022 Inflation Reduction Act, designed to help seniors by capping out-of-pocket prescription costs at $2,000, may have unintentionally contributed to rising premiums for all Medicare beneficiaries.
"Well, it used to be about an $8,000 'donut hole', and they reduced that down to about a $2,000 maximum out of pocket, so that $6,000 gap has got to be made up somewhere and it's increasing costs for everybody else," said Chip Monahan, an Omaha fiduciary adviser who sells Medicare plans.
The change benefits neighbors who were spending heavily on prescriptions, but Monahan explained the cost savings don't disappear entirely.
"But everybody else is paying the cost," Monahan said.
Carl Heinrich, a 94-year-old retired president of Iowa Western Community College, says he reviews his medicare plan every year with an adviser.
"I'm a pretty old guy, in my '90s. And I remember back when healthcare was not too complicated," Heinrich said. "And it seems like now, the Congress and the legislature is trying to — they say — improve, it has confused it more than ever."
The AARP championed the Inflation Reduction Act as a means of bringing down prescription costs. The organization says premium increases result from multiple factors and projects Medicare Part B plans may jump from $185 to $206.
Council Bluffs City Council Member Steve Gorman worries about the impact on neighbors living on fixed incomes.
"It's so important that we get that Medicare and Medicaid straightened out at the federal level so we can get that affordability back in our communities," Gorman said. "Those kind of prices could make them choose between paying rent, or food or medical care."
Monahan stresses the importance of talking to a professional who sells both Medicare supplement and Medicare Advantage plans before making enrollment decisions.
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