Montpelier, Vt. – Governor Phil Scott today announced that the federal Inflation Reduction Act will help mitigate rising health care costs for many Vermonters, particularly those on Medicare and who buy health plans on Vermont’s health insurance marketplace. The Act is expected to be signed into federal law by the President this week.
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“The pandemic and inflation have both stressed the health care system and increased the costs of care,” said Governor Scott. “While this federal legislation will help us fight back against these rising costs, my Administration is also committed to working with the Legislature and health care providers to stabilize the system, make cost increases affordable and sustainable, and reduce the percentage of Vermonters’ income spent on health care so they can get ahead.”
The Act also includes key initiatives to control rising prescription drug costs, which will cap out-of-pocket costs for Vermonters. Starting in 2025, Vermonters who are on Medicare – including most of Vermont’s senior citizens over the age of 65 – will not pay more than $2,000 per year for prescription drugs. Beginning in 2023, they will not pay more than $35 per month for insulin, a medication used to treat diabetes.
In addition, Vermonters who are covered by Medicare or Medicaid can receive all recommended adult vaccines for free beginning next year.
“This federal legislation will help seniors afford the prescriptions vital to their health and well-being and will increase subsidies for Vermonters of all ages who buy insurance plans through Vermont’s health insurance marketplace. This should offset most of the recently announced premium increases, which will help stabilize our health care system,” added Governor Scott
Young adults are traditionally the most likely to be uninsured, often due to their risk tolerance and insurance costs. The Vermont Household Health Insurance Survey estimates the number of uninsured Vermonters aged 25-34 fell 10% from fall of 2018 to fall of 2021, resulting, in part, from additional federal dollars reducing the cost of insurance for Vermonters. The Act extends these federal dollars to help eligible Vermonters pay for health insurance premiums through 2025.
Subsidies currently help about 23,550 Vermonters who purchase insurance through Vermont’s health insurance marketplace, Vermont Health Connect. Vermonters saved nearly triple the national average through premium assistance, according to a September 2021 report by the Center for Consumer Information and Insurance Oversight. Vermonters who enrolled in the first year that subsidies were available saw their premiums decrease by $186 per month, or 62%.
“We can be proud that Vermont has among the highest rates of insured people in the nation,” said Jenney Samuelson, secretary of the Vermont Agency of Human Services. “It is vital that Vermonters keep their health coverage while we work to stabilize our health care system, a top priority as we emerge from the pandemic.”
“In partnership with other states, Vermont urged Congress to extend subsidies beyond their current planned expiration at the end of this year to help Vermonters continue to afford health insurance,” said Andrea De La Bruere, commissioner of the Department of Vermont Health Access. “Affordable health premiums are a cornerstone of access to health care.”
These subsidies have already infused more than $30 million dollars to lower health insurance premiums for Vermonters across a wide range of income levels. For example, an individual earning $25,000 could have their entire premium subsidized. Families with higher incomes could see an 80% discount on their plan.
ABOUT THE INFLATION REDUCTION ACT
The Inflation Reduction Act (H.R. 5376), passed by Congress and expected to be signed by President Biden this week, includes a series of measures aimed at reducing cost pressures on Americans, including through prescription drug reform, health care subsidies, tax rebates and credits for energy costs, and more. Click here to view more details at www.congress.gov.