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The Inflation Reduction Act is Hurting Medicare Access and Increasing Patients’ Costs

This week, the largest not-for-profit health insurance provider in Missouri, Blue KC, announced it will leave the Medicare Advantage market at the end of 2024. The organization cited “heightened regulatory demands and rising market and financial pressures” as reasons for exiting the Medicare market.

 

Put simply: The unintended consequences of the Inflation Reduction Act strike again.

 

Much of the new demands and pressures for Medicare Advantage stem from the IRA, which dramatically changed the structure of the program, particularly for coverage of medications. Limits on beneficiary spending and caps to prescription medication prices are positives for patients, but those costs don’t disappear. Increasing liabilities and caps lead to few pathways for plan solvency. The IRA also limits premium increases to cover those additional costs.

 

As KC Blue’s Medicare Advantage decision shows, the IRA will force insurers to withdraw from the program or only serve areas where beneficiaries can afford to pay more. That means fewer coverage choices for beneficiaries, less competition in the marketplace and higher costs as a result. That’s neither patient friendly nor sustainable for the health care ecosystem.

 

This issue won’t be unique to Missouri. Experts expect more announcements this summer about Medicare Advantage and Part D plans exiting the market because of IRA ripple effects. That means millions of beneficiaries will have to shop for a new, more expensive or more limited plan because of a law that hurts innovation and availability of transformative health care. 

 

This is just the latest sign of the IRA’s compounding disruptions to coverage and access, and it’s another example of why policy reform is necessary to avoid harming patients and people working in healthcare who rely on and contribute to medical advances every day.

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