WASHINGTON—Today, AARP released a new report detailing the savings from an important new protection for our nation’s 56 million Medicare drug plans enrollees. The savings, thanks to a provision in the 2022 Inflation Reduction Act that AARP championed, will cap out-of-pocket prescription drug costs every year, beginning at $2,000 in January 2025. The report analyzes the number of enrollees that will benefit from the cap by state, age, gender, and race between 2025 and 2029. The findings indicate that Medicare drug plan enrollees who reach the new out-of-pocket cap will see average savings of roughly $1,500, or 56%, in 2025 for their prescription drugs.

“AARP was instrumental in Congress passing the prescription drug law of 2022 to lower prices and out-of-pocket costs for Medicare enrollees,” said Jo Ann Jenkins, CEO of AARP. “As we approach January 2025, we want every senior in America to know that, thanks to the new annual cap which limits their out-of-pocket costs, they will have more money to invest in their families, spend on their broader health needs or simply save to achieve greater financial stability.”

Other takeaways from the report include:

• Between 3 and 4 million Part D plan enrollees are estimated to benefit from the new out-of-pocket cap every year between 2025 and 2029.
• On average, approximately 1.4 million (40 percent) Medicare drug plan enrollees who reach the new out-of-pocket cap between 2025 and 2029 are estimated to see annual savings of $1,000 or more, and just over 420,000 (12 percent) will see savings of more than $3,000.
• By 2029, the share of enrollees benefiting from the new out-of-pocket cap is estimated to be 10 percent or higher in 19 states plus the District of Columbia.
• More than three-quarters of Medicare drug plan enrollees who will benefit in 2025 are between the ages of 65 and 84.

The full report and a fact sheet on the findings can be found here.

To learn more about AARP’s work to lower prescription drug prices, visit How High Rx Prices Hurt.

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About AARP
AARP is the nation's largest nonprofit, nonpartisan organization dedicated to empowering Americans 50 and older to choose how they live as they age. With a nationwide presence, AARP strengthens communities and advocates for what matters most to the more than 100 million Americans 50-plus and their families: health security, financial stability and personal fulfillment. AARP also works for individuals in the marketplace by sparking new solutions and allowing carefully chosen, high-quality products and services to carry the AARP name. As a trusted source for news and information, AARP produces the nation's largest circulation publications, AARP The Magazine and AARP Bulletin. To learn more, visit www.aarp.org/about-aarp/, www.aarp.org/español or follow @AARP, @AARPenEspañol and @AARPadvocates on social media.