Biden-Harris Administration Policies Have Lowered Health Care Costs for Working Montanans
Working Montanans, along with individuals and families across the country, depend on access to affordable, high-quality health care so they can live, work, and thrive. Too often, though, health care has been out of reach due to high costs or the impossible decisions those high costs have forced patients to make between health care and other necessities such as food or rent. The Biden-Harris Administration’s policies have lowered health care costs for working Montanans and ensured that more working people can afford and access the care they need. The Administration’s work to extend the Affordable Care Act (ACA) tax credits, lower the costs of prescription drugs, and protect Medicaid are increasing access to affordable, high-quality health care for all people. It is essential to protect and preserve this progress, so that more working people can continue to access the health care they depend on.
Enhancing and Extending the Affordable Care Act (ACA) Tax Credits
ACA premium tax credits lower monthly health insurance premiums on plans purchased through the ACA marketplaces and help people afford individual or family plans available in their state through the ACA marketplaces. As of February 2024, 19.3 million people or 93% of marketplace enrollees received premium tax credits. Currently millions of people are saving an average of $800 each year on health insurance because the enhanced tax credits were extended in the Inflation Reduction Act, signed into law by President Biden in 2022. In 2023, the tax credits lowered Marketplace premiums for an estimated 45,000 Montanans at a rate of hundreds of dollars per person on average.
These tax credits will expire after 2025 if Congress does not extend them. Experts project that if the tax credits expire, people of all ages and income levels in all states will experience a rise in their health insurance premiums and 3.8 million people will become uninsured. Some demographic groups would experience particularly high increases in their health insurance premiums if the tax credits expire. In an analysis of each state, The Center on Budget and Policy Priorities found that, for example, in Montana, a family of four with an income of $126,000 (403% of the federal poverty level), would face a premium increase of $10,545 annually. It also found that, for example, in Montana, a 60 year old couple with an income of $82,000 (401% of the federal poverty level), would face a premium increase of $21,266 a year. The Biden- Harris Administration proposed in its fiscal year 2025 budget to make the ACA tax credits that were extended by the Inflation Reduction Act permanent to protect the coverage gains of recent years and keep health care within reach of working people.
Lowering Prescription Drug Costs
The Inflation Reduction Act, signed into law by President Biden in 2022, also included historic reforms to reduce the cost of prescription drugs. Estimates show that about 54,000 Montanans will save an average of $461 each year on prescription drug costs when all the provisions go into effect. The key prescription drug provisions in the law are already helping working Montanans better afford their prescription drugs and more people will feel relief as additional aspects of the law take effect:
Free vaccines for people on Medicare Part D: Starting in 2023, the law made vaccines free for Medicare Part D enrollees. In 2023, more than 39,000 Montanans enrolled in Medicare Part D received a covered vaccine for free.
Lowering Insulin Co-pays: Starting in 2023, the law reduced Medicare co-pays to $35 monthly. This lowered insulin costs for almost 5,400 Montanans.
Capping Out-of-Pocket Costs: Starting in 2025, the law will cap prescription drug costs in Medicare Part D at $2,000 per year. This provision will apply to the almost 170,000 Montanans with Medicare Part D, bringing relief to the over 5,600 Montanans who will exceed this $2,000 limit.
Lowering Prescription Drug Prices by Negotiating Prices: Starting in 2026, lower prices negotiated by Medicare will go into effect. This will reduce prices for certain high-cost drugs and the out-of-pocket costs of people on Medicare. Montanans will see net price reductions on the negotiated drugs. For example:
The 10,000 Medicare beneficiaries in Montana who use the anticoagulant Eliquis will see the net pre-negotiation Medicare price drop from $247 for a thirty day supply to a net post-negotiation Medicare price of $123.
The 3,000 Medicare beneficiaries in Montana who use the diabetic therapy Jardiance will see the net pre-negotiation Medicare price drop from $305 for a thirty day supply to a net post-negotiation Medicare price of $152.
The Biden-Harris Administration’s fiscal year 2025 budget builds on the successes of the Inflation Reduction Act to bring lower prescription drug costs to more people. The budget would increase the pace of negotiations between Medicare and pharmaceutical companies, making more drugs eligible for price negotiation sooner after they launch onto the market. In addition the budget would extend the inflation rebates (which require drug companies to pay Medicare a rebate when they raise the prices of certain Part B and D covered drugs faster than the rate of inflation), the $2,000 out-of-pocket cap, and the $35 monthly cap on insulin co-pays to apply to the commercial market in addition to Medicare.
Strengthening Medicaid
Medicaid covers more people for affordable, high-quality health insurance coverage than any other program in this country. As of February 2024, approximately 83 million people and more than 233,000 Montana residents were enrolled in Medicaid or the Children’s Health Insurance Program (CHIP). Medicaid is a joint state-federal partnership, funded by both entities, and provides office visits and outpatient services, behavioral health services, inpatient hospitalization and emergency services, dental visits, hearing and vision services, and long-term services and supports, including home and community-based services. Forty states, including Montana, and the District of Columbia have expanded Medicaid eligibility under the Affordable Care Act. The Biden-Harris Administration’s work to date and current proposals strengthen the Medicaid program and bring high quality, affordable health care to more people:
Postpartum Coverage: Expanded access to postpartum Medicaid coverage for a full year after birth.
Covering Children: Expanded 12-month continuous eligibility for all children covered by Medicaid and CHIP.
Home and Community-Based Services: States are expected to spend almost $37 billion in federal and state Medicaid funding to enhance, expand, or strengthen home and community-based services.
In addition, the Biden-Harris Administration’s fiscal year 2025 budget includes:
Financial incentives to encourage states that have expanded Medicaid to maintain those expansions. Montana’s state legislature will debate and vote on whether or not to renew Medicaid Expansion during the 2025 legislative session.
An allowance for states to extend the Medicaid and Children’s Health Insurance Program (CHIP) existing 12-month continuous eligibility to 36 months and continuous eligibility for children from birth until age 6, to ensure more children are covered.
For people at all stages of life – from babies born with Medicaid coverage to adults counting on tax credits to better afford marketplace plans to seniors depending on prescription drugs – the Biden-Harris Administration has lowered health care costs for working Montanans. Preserving this progress is crucial to ensuring that working Montanans continue to have access to affordable, high-quality health care.
