IRA is Expected to Cut Out-of-Pocket Costs by 28% for Women in Medicare
In 2025, the out-of-pocket cap and other Part D related provisions in the Inflation Reduction Act are projected to save women in Medicare an average of 28% in out-of-pocket costs, according to a new analysis from the Office of the Assistant Secretary for Planning and Evaluation.
If the Inflation Reduction Act (IRA) had been in place in 2020, about 733,000 women enrolled in Part D and B would have benefited from a $35 insulin cap, according to a new analysis from the Office of the Assistant Secretary for Planning and Evaluation (ASPE), which is part of the Department of Health and Human Services’ (HHS). Additionally, in 2021, about 2 million women would not have had any out-of-pocket costs for recommended adult vaccines covered by Part D if the IRA had been in place.
The Inflation Reduction Act, signed into law in 2022, will provide about 857,000 women about $1,000 or more in savings in 2025 as a result of the $2,000 cap on out-of-pocket costs under Part D, the analysis found.
Rebecca Haffajee
“Most Medicare Part D enrollees are women, and some conditions that can be effectively treated with prescription drugs are more than likely to affect women than men – such as autoimmune disorders,” ASPE’s Principal Deputy Assistant Secretary Rebecca Haffajee, said in a news release.
In 2022, 56% of Medicare enrollees with Part D coverage were women. Among Medicare enrollees, women have disproportionately higher rates of certain health conditions relative to men, including Alzheimer’s disease, asthma, fibromyalgia, osteoporosis, and certain types of cancer.
In 2025, the out-of-pocket cap and other Part D related provisions in the IRA are projected to save women in Medicare an average of 28% in out-of-pocket costs, or an average annual savings of about $128 per enrollee.
The analysis also found that women are disproportionately represented among Medicare enrollees receiving low-income subsidy (LIS) and among those whose out-of-pocket costs have gone down due to the expansion of LIS eligibility under the IRA.
Before the IRA, in order to be eligible for full low-income subsidy, an enrollee needed to have income below 135% of the Federal poverty level (or $19,683 per year in 2023 for an individual). Enrollees were eligible for partial assistance if their incomes were between 135% and 150% of the Federal poverty level. Beginning in 2024, the IRA expanded full low-income subsidy benefits to people with incomes between 135% and 150% of the Federal poverty level.
This expansion is expected to benefit women. The poverty rate among women in the United States is 13.8%; for men it is 11.4%.
The analysis also assessed the impact of the first 10 drugs chosen for price negotiation (see below), which has begun this year with new prices going into effect on Jan. 1, 2026. In 2022, about 7.7 million Medicare enrollees used one or more of the 10 drugs selected, which represents about 15% of all Medicare Part D enrollees, according to a separate research report from the ASPE. Spending on these 10 drugs grew more than three times as fast as the rate of growth in total spending on all Part D drugs.
In this new analysis, analysists with ASPE found that in 2022, more than 4.5 million women took at least one of the 10 drugs selected for negotiation. Woman in Medicare also spent $1.55 billion in out-of-pocket costs on the drugs selected for negotiation.
For two of the 10 drugs selected, women use outnumber men. For example, the share of women in Medicare taking Enbrel in 2022 is about 72% and the average out-of-pocket cost of Enbrel for women not receiving LIS subsidies in 2022 was $1,929. Women represented 59% if the use for Stelara with an average out-of-pocket cost in 2022 was $4,172. Enbrel and Stelara are both indicated to treat autoimmune disorders, which are diagnosed in women at a rate four times than that of men.
First 10 Drugs Chosen for CMS Medicare Part D Negotiation
- Eliquis (apixaban), which prevents blood clots and stroke
- Jardiance (empagliflozin), which treats diabetes, heart failure and chronic kidney disease
- Xarelto (rivaroxaban), which prevents blood clots and stroke
- Januvia (sitagliptin), which treats diabetes
- Farxiga (dapagliflozin), which treats diabetes, heart failure, chronic kidney disease
- Entresto (sacubitril/valsartan), which treats heart failure
- Enbrel (etanercept), which treats rheumatoid arthritis, psoriatic arthritis, plaque psoriasis, ankylosing spondylitis
- Imbruvica (ibrutinib), which treats chronic lymphocytic leukemia/small lymphocytic lymphoma
- Stelara (ustekinumab), which treats Crohn’s disease, plaque psoriasis, psoriatic arthritis
- Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill (insulin aspart), which treat diabetes
