Estimated Impact of the Inflation Reduction Act on Out-of-Pocket Spend Among Medicare Part D Beneficiaries with Cancer
Author(s)
Aryana Sepassi, PharmD1, Nico Gabriel, MA2, Jason Zell, DO3, A Mark Fendrick, MD4, Sean D. Sullivan, PhD5, Inma Hernandez, PhD2.
1Assistant Professor of Clinical Pharmacy Practice, University of California, Irvine, School of Pharmacy & Pharmaceutical Sciences, Carlsbad, CA, USA, 2University of California, San Diego Skaggs School of Pharmacy & Pharmaceutical Sciences, San Diego, CA, USA, 3University of California, Irvine School of Medicine, Irvine, CA, USA, 4University of Michigan, Ann Arbor, MI, USA, 5University of Washington, Seattle, WA, USA.
1Assistant Professor of Clinical Pharmacy Practice, University of California, Irvine, School of Pharmacy & Pharmaceutical Sciences, Carlsbad, CA, USA, 2University of California, San Diego Skaggs School of Pharmacy & Pharmaceutical Sciences, San Diego, CA, USA, 3University of California, Irvine School of Medicine, Irvine, CA, USA, 4University of Michigan, Ann Arbor, MI, USA, 5University of Washington, Seattle, WA, USA.
OBJECTIVES: To estimate savings from implementation of a $2,000 cap on true “out-of-pocket” (TrOOP) spending for outpatient prescriptions as authorized by the 2022 Inflation Reduction Act (IRA) among Medicare Part D beneficiaries diagnosed with cancer.
METHODS: Medicare beneficiaries with a cancer diagnosis and at least one Part D claim for a prescription drug to treat cancer in 2021 were identified from a 5% random sample of beneficiaries. Part D drug expenditures were extracted and adjusted to 2025 prices using previously published methods. Estimated total annual TrOOP spend per beneficiary was estimated under two scenarios: 1) 2025 Part D design expected without the IRA; and 2) IRA design, including a $2,000 TrOOP cap. We reported the proportion of beneficiaries who would see decreases in TrOOP with IRA, and, for those who did, estimated TrOOP savings.
RESULTS: An estimated 48% of Part D beneficiaries with cancer were estimated to have annual TrOOP spend above $2,000 without the IRA. For these beneficiaries, annual TrOOP spend averaged $9,283/beneficiary without the Part D TrOOP cap. With the cap, these beneficiaries were expected to save $7,283 annually in TrOOP spend. Among these beneficiaries, with the TrOOP cap, those with hematologic cancers realized the greatest savings at an estimated $10,351 TrOOP saved per beneficiary. Without the IRA TrOOP cap, 75% of total TrOOP spend for these beneficiaries was associated with cancer medication claims. With the IRA TrOOP cap, this TrOOP spend was reduced to 25%.
CONCLUSIONS: Implementation of a Part D $2,000 TrOOP cap is expected to generate meaningful savings for Medicare Part D beneficiaries diagnosed with cancer and high TrOOP spend.
METHODS: Medicare beneficiaries with a cancer diagnosis and at least one Part D claim for a prescription drug to treat cancer in 2021 were identified from a 5% random sample of beneficiaries. Part D drug expenditures were extracted and adjusted to 2025 prices using previously published methods. Estimated total annual TrOOP spend per beneficiary was estimated under two scenarios: 1) 2025 Part D design expected without the IRA; and 2) IRA design, including a $2,000 TrOOP cap. We reported the proportion of beneficiaries who would see decreases in TrOOP with IRA, and, for those who did, estimated TrOOP savings.
RESULTS: An estimated 48% of Part D beneficiaries with cancer were estimated to have annual TrOOP spend above $2,000 without the IRA. For these beneficiaries, annual TrOOP spend averaged $9,283/beneficiary without the Part D TrOOP cap. With the cap, these beneficiaries were expected to save $7,283 annually in TrOOP spend. Among these beneficiaries, with the TrOOP cap, those with hematologic cancers realized the greatest savings at an estimated $10,351 TrOOP saved per beneficiary. Without the IRA TrOOP cap, 75% of total TrOOP spend for these beneficiaries was associated with cancer medication claims. With the IRA TrOOP cap, this TrOOP spend was reduced to 25%.
CONCLUSIONS: Implementation of a Part D $2,000 TrOOP cap is expected to generate meaningful savings for Medicare Part D beneficiaries diagnosed with cancer and high TrOOP spend.
Conference/Value in Health Info
2025-05, ISPOR 2025, Montréal, Quebec, CA
Value in Health, Volume 28, Issue S1
Code
HPR36
Topic
Health Policy & Regulatory
Topic Subcategory
Insurance Systems & National Health Care, Pricing Policy & Schemes
Disease
SDC: Geriatrics, SDC: Oncology