Casey bill would expand Medicare cap on out-of-pocket drug costs to commercial health care plans

U.S. Sen Bob Casey  (D-Pa.) is introducing a bill Thursday that would cap out-of-pocket drug costs for people on commercial health insurance plans, expanding a provision in the 2022 Inflation Reduction Act (IRA) that put a limit on cost-sharing for prescription drugs for Medicare recipients. 

The Capping Prescription Costs Act would cap individual cost-sharing for prescription drugs to $2,000 annually and cap family cost-sharing for prescription drugs to $4,000 annually. The caps would apply to both group health plans and Affordable Care Act marketplace health plans. As a one-pager from Casey’s office notes, as of 2018, 173 million people under age 65 had private health insurance. 

“Prescription drug costs are like a bag of rocks tied around the necks of millions of Americans, weighing them down every single day,” Casey said in a statement Thursday, adding the new legislation would build on the success of the IRA.

Under the IRA, which President Joe Biden signed into law in 2022, Medicare recipients’ out-of-pocket prescription costs are capped at $2,000 annually beginning in 2025, and the federal government will be able to negotiate the prices of some of the more expensive Medicare prescription drugs beginning in 2026. About 9 million enrollees in Medicare’s Part D prescription drug coverage program spent $3.4 billion out-of-pocket in 2022 on the 10 drugs selected for negotiation, according to the U.S. Department of Health and Human Services.

More than 60% of adults take at least one prescription drug, according to the Centers for Disease Control and Prevention, with 36% taking three or more drugs. Out-of-pocket costs for prescription drugs rose to $63 billion in 2021, the CDC reported. 

And in 2023, health policy organization KFF found about 31% of adults taking a prescription reported not taking it as prescribed at some point over the prior year due to costs; from skipping doses to make the supply last longer, to cutting pills in half, or taking an over-the-counter alternative instead.

“Struggling families shouldn’t have to skip refills, ration prescriptions, and risk their health just to afford the medications they need to survive,” Sen. Raphael Warnock (D-Ga.), cosponsor of the bill, said in a statement.

Steven Lubin, a  retired intensive care unit nurse from Philadelphia, said he saw the need for caps on prescription drug costs during his time working with patients at the Hospital of the University of Pennsylvania.  “More than a few of them over the years were unable to afford their medications, either in full or they had to, like, ration it out, maybe a medication that they had to take two or three times a day, they only did one a day,” Lubin told the Capital-Star.

Lubin also had personal experience with the cost of prescription drugs; before the IRA capped the cost of insulin at $35, he and his wife were paying $900 per year each for insulin.

“We already have enough problems with patients remembering how to take their medications properly, stay on top of these things, but when they can’t afford it more often than not, that just makes a whole bigger problem,” which can lead to a cascading effect of multiple health care issues, Lubin added.

Casey, chairman of the U.S. Senate Special Committee on Aging and Ranking Member Mike Braun (R-Ind.) will hold a committee hearing Thursday to examine the high healthcare costs that patients are facing and highlight efforts to make care more affordable.

Update: This article was updated at 9:20 a.m. July 11, 2024, with statements from Sens. Casey and Warnock.