Lubbock Times

House Budget Committee Chairman Jodey Arrington (R-TX) and Senate Budget Committee Ranking Member Chuck Grassley (R-IA) have formally requested an analysis from the Congressional Budget Office (CBO) regarding a new Medicare Part D Premium Stabilization Demonstration program. This request was directed to CBO Director Phillip Swagel, with the aim of understanding the budgetary impact of what they describe as a taxpayer-funded bailout intended to mitigate flaws in the Inflation Reduction Act (IRA).

Joining Arrington and Grassley in this request were Senate Finance Committee Ranking Member Mike Crapo (R-ID), House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA), and House Ways and Means Committee Chairman Jason Smith (R-MO). The members expressed concerns over the Biden-Harris Administration’s plan to allocate billions of taxpayer dollars to large health insurance companies to lower seniors’ Part D premiums artificially.

The IRA, which was signed into law two years ago on August 16, 2022, introduced significant changes to the Medicare Part D prescription drug benefit at an estimated cost of nearly $30 billion over ten years. These changes are set to take effect in 2025. According to Arrington and Grassley, these policy shifts have led Medicare prescription drug plan sponsors to increase seniors' Part D premiums while reducing plan choices for 2025.

In response, on July 29th, the Centers for Medicare and Medicaid Services (CMS) announced a new demonstration program aimed at stabilizing premiums. This program will provide federal funds to large health insurers to reduce seniors' Part D premiums by applying a uniform reduction of $15 to the base beneficiary premium. It also establishes a year-over-year limit of $35 on how much a plan’s total Part D premium can increase and adjusts risk corridors, thereby shifting financial liability from insurers to taxpayers.

Arrington criticized Congressional Democrats for what he described as rushed policymaking in passing the IRA, which he claims has resulted in increased premiums for America's seniors. He emphasized that this new demonstration program is an attempt by the Biden-Harris Administration to conceal rising premiums ahead of November elections by funneling billions of taxpayer dollars directly into large insurance companies.

The letter concludes with House Budget Committee Republicans seeking comprehensive insights into how this new demonstration program will impact federal spending amid what they call an extensive executive spending spree under the Biden-Harris Administration.