Spread out-of-pocket costs for treatment evenly through the year

In accordance with the Inflation Reduction Act, signed into law in August 2022, people with Medicare Part D plans will have the option to pay out-of-pocket costs for prescription medications in monthly installments, including a monthly limit, beginning in 2025.


Out-of-pocket costs for prescription medications should be spread more evenly throughout the benefit year.  

Congress, insurers, and other stakeholders should modify the structure of public and private insurance plans to spread out-of-pocket costs for prescription medications evenly over the course of the year so that patients can access and remain on the treatments they need. This strategy is also commonly referred to as “smoothing.”

Why smoothing will help Medicare beneficiaries access their medications

The structure of Medicare Part D prescription drug plans concentrates out-of-pocket medication costs early in the benefit year. This benefit design can have a devastating impact on patients who face high cost sharing at the beginning of the year for their essential medications.

Most patients cannot afford large out-of-pocket expenses all at once or over a short period but could afford the total cost if spread out evenly throughout the benefit year. 

As a senior, I want cost predictability. I don’t want to stay up at night wondering if my next prescription is going to cost $800.

George Valentine, Texas, living with chronic lymphocytic leukemia