This blog was co-authored by Senior Policy Analyst Stacey Pogue and Policy Analyst Karla Martinez.
The Inflation Reduction Act, signed into law on August 16, progresses toward health justice by making health coverage and prescription drugs more affordable for many Texans.
The Act extends enhanced subsidies for Health Insurance Marketplace (HealthCare.Gov) coverage through 2025 that have saved Texans in the Marketplace an average of $560 per year. These subsidies, first available in 2021, have made coverage more affordable for many Texans and driven record enrollment in the Texas Marketplace. In 2022, Texas saw the largest percentage increase in Marketplace enrollment in the nation — a stunning 42% to reach 1.8 million Texans. The enhanced subsidies were slated to expire at the end of 2022. By continuing them through the Inflation Reduction Act (IRA), Congress prevented 370,000 Texans from becoming uninsured and maintained affordable coverage for another 1.4 million who would have seen their premiums spike.
Enhanced Marketplace subsidies are not available to Texans caught in the Medicaid coverage gap, i.e. working but poor adults — primarily Texans of color — who earn too little to qualify for Marketplace subsidies, but too much to be eligible for Medicaid. These Texans have no affordable coverage options today because Texas leaders have refused to expand Medicaid, an action taken in 38 other states and Washington, D.C.
The Inflation Reduction Act also makes prescription drugs more affordable for seniors and individuals with disabilities who have Medicare prescription drug coverage. It caps total out-of-pocket costs for prescriptions at $2,000 a year, caps out-of-pocket costs for insulin at $35 a month, makes vaccines available with no out-of-pocket costs, and expands eligibility for Medicare’s low-income drug subsidy. On top of that, the bill lowers drug costs for both Medicare enrollees and the federal government by 1) requiring the federal government to negotiate with drug companies to lower prices on some high-cost drugs, and 2) requiring drug companies to pay rebates if they raise prices at a higher rate compared to inflation.
Every Texan celebrates the progress of the Inflation Reduction Act, which makes health coverage and prescription drugs more affordable for many Texans, but more work remains. We will continue to advocate for the Texas Legislature to close the coverage gap and reduce our state’s worst-in-the-nation uninsured rate. Regardless of race, background, gender, or zip code, every Texan deserves access to quality, affordable health coverage.