Changes in Medication Use After Medicare Part D Annual Out-of-Pocket Spending Caps
Year: 2026
Type: article
Study design: Observational Study
Abstract: Importance: The Inflation Reduction Act (IRA) implemented annual out-of-pocket spending caps to the Medicare Part D prescription medication benefit in 2024; the caps were lowered to $2000 in 2025. It remains unclear how this policy affected medication access. Objective: To evaluate changes in prescription medication fills in the Medicare population after the implementation of the IRA. Design, Setting, and Participants: This study used data from an all-payer pharmacy database (Symphony Health Metys) to evaluate changes in quarterly prescription fills for medications reimbursed by Medicare and commercial insurance from 2022 to 2025. Using an event study, difference-in-differences framework, changes in per-capita prescriptions for medications before and after the Medicare annual out-of-pocket spending caps were implemented in 2024 were compared. Because out-of-pocket caps are most relevant for patients using expensive medications, medications were stratified based on monthly cost: low (<$100), medium ($100-$829), high ($830-$6999), and very high (≥$7000). Main Outcomes and Measures: Quarterly per-capita fills by medication. Results: Among 3053 medications covering 92.9% of gross Medicare Part D spending in 2023, 1534 (50.2%) were low cost, 882 (28.9%) were medium cost, 455 (14.9%) were high cost, and 182 (6.0%) were very high cost. After the spending caps were implemented, average medication use increased in Medicare compared with medication use in commercial insurance, with larger increases for higher-cost medications. In pre-post difference-in-differences analyses, there was no change in Medicare vs commercial use of low-cost, medium-cost, or high-cost medications. Very-high-cost medication use increased by 22.7% (95% CI, 6.0% to 42.0%; P = .01). Use of medications in Medicare increased over time in event-study analyses, although CIs were wide; by the fourth quarter of 2025, the use of medications in Medicare compared with commercial insurance increased from baseline by 4.1% (95% CI, -3.4% to 12.3%) for low-cost medications, 20.7% (95% CI, -10.7% to 63.0%) for medium-cost medications, 23.1% (95% CI, 2.7% to 47.4%) for high-cost medications, and 35.9% (95% CI, -4.1% to 92.3%) for very-high-cost medications. Conclusions and Relevance: This study found that medication use increased after implementation of Medicare annual out-of-pocket cost caps, particularly among the highest-cost medications. These results suggest that the policy substantially improved patient access to high-cost medications for Medicare-insured patients.
Source: JAMA Health Forum
Institutions: Brigham and Women's Hospital, Harvard University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: gold
Estimated APC paid: $5,000
OpenAlex ID: W7165107882