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Cancer research

Estimated True Out-of-Pocket Cost Changes From the Inflation Reduction Act on Medicare Part D Beneficiaries With Cancer

Strategic Insights

— 1 min read

Research conducted at the University of California has estimated that implementation of a $2000 cap for outpatient prescriptions as authorized by the 2022 Inflation Reduction Act (IRA) would generate a meaningful reduction in out-of-pocket costs for high-cost Medicare Part D beneficiaries who received a diagnosis of cancer. The study, published in the journal Value in Health, found that 42% of Part D beneficiaries with a diagnosis of cancer were predicted to have annual out-of-pocket costs of more than $2000 without the Part D cap. With the cap, these beneficiaries were expected to experience an average annual reduction of $8486 in out-of-pocket costs.

Key Takeaways:

  • Researchers at the University of California estimated that 42% of Part D beneficiaries with a diagnosis of cancer would have annual out-of-pocket costs of more than $2000 without the $2000 cap.
  • Implementation of the Part D $2000 cap is expected to generate a meaningful reduction in out-of-pocket costs for high-cost Medicare Part D beneficiaries who received a diagnosis of cancer.
  • The reduction in out-of-pocket costs was estimated to be an average of $8486 per beneficiary per year among those with annual costs above $2000.
  • Beneficiaries with hematologic cancers were expected to experience the greatest reduction in out-of-pocket costs, with an estimated reduction of $10,846 per beneficiary.

Statistics:

  • 42% of Part D beneficiaries with a diagnosis of cancer were predicted to have annual out-of-pocket costs of more than $2000 without the Part D cap.
  • The average annual reduction in out-of-pocket costs for beneficiaries with annual costs above $2000 was estimated to be $8486.
  • Beneficiaries with hematologic cancers were expected to experience an estimated reduction of $10,846 in out-of-pocket costs per beneficiary.

Sources:

  • Estimated True Out-of-Pocket Cost Changes From the Inflation Reduction Act on Medicare Part D Beneficiaries With Cancer. Value in Health, 2025;28(10):1526-1531.
  • University of California, Division of Clinical Pharmacy, University of California, San Diego Skaggs School of Pharmacy and Pharmaceutical Sciences.
  • Elsevier Science Inc. (Publisher of Value in Health journal)

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