Senate Passes $740B Bill To Reduce Healthcare Costs

A long-waited bill worth $740 billion to reduce the price of prescription medications and health insurance has officially been approved by the Senate. The legislation comes as a new form of the Build Back Better Act, which passed through the House of Representatives in November. However, the previous Act was far greater, amounting to $2.2 trillion. The Act may have been too optimistic as the Act did not pass through the Senate. The Act underwent a rebrand and reduction which warranted enough support from Senators to pass the law through the upper chamber of Congress. On August 7, the Biden administration announced the passage of the Inflation Reduction Act. 

Despite several alterations, the Inflation Reduction Act will encompass a multitude of areas including corporate tax, climate change, government deficit, and healthcare costs. The Inflation Reduction Act will reduce health insurance premiums to $800 for 13 million people. The bill will limit senior citizen’s out-of-pocket spending to $2000 for prescription medication annually by allowing Medicare to negotiate lower prices. Additionally, the price for insulin will also be limited to $35 for Medicare patients. Republicans had previously contended against the inclusion of a $35 price cap on insulin for those with private insurance, which resulted in its elimination. However, a separate proposal limiting the cost of insulin to $35 per month for Medicare patients remained in place. 

The legislation’s draft version, which was presented in the Senate this past month, has several mentions concerning medical equipment and diagnostics, in addition to the resources required to prepare for and respond to public health emergencies. One of the activities addressed by the budget is the development of domestic manufacturing capacity for diagnostic and medical devices. Additionally, the draft also includes a section on spending money on clinical technologies for maternal health that improve diagnostic accuracy. The investment is a component of a larger strategy to use digital technology to improve equality in maternal health outcomes.