Summary

Starting Jan. 1, Medicare will cap annual out-of-pocket prescription drug costs at $2,000, as mandated by the Inflation Reduction Act.

This cap, applying to Medicare Part D drugs, is expected to provide significant relief to millions, especially cancer patients, who often face unaffordable medication costs.

Previously, patients could spend over $7,000 annually before catastrophic coverage. Around 3.2 million enrollees are projected to save by 2025, with many seeing savings over $1,000.

While some argue $2,000 remains high, advocates see this as a critical step in easing financial burdens for retirees on fixed incomes.