Medicare enrollees will now pay a maximum of $2,000 on out-of-pocket prescription drug costs annually as part of another provision of the Inflation Reduction Act. The limit applies to prescription drugs bought at pharmacies and through mail orders, which are covered through Medicare Part D.

Millions of Medicare enrollees are likely to see relief in 2025 when a $2,000 cap on out-of-pocket prescription drug-spending goes into effect.

Going into the new year, seniors who take prescription drugs and receive Medicare benefits are likely to shell out less for those treatments. That’s due to a provision in the 2022 Inflation Reduction Act, set to begin in 2025, which will cap out-of-pocket costs on prescriptions at $2,000 annually.

The caps are mandated by the Inflation Reduction Act. No Medicare patient will pay more than $2,000 out of pocket for prescription drugs.

A provision of the Inflation Reduction Act will cap out-of-pocket costs for prescription drugs at $2,000 per year for people with Medicare Part D.

Medicare will begin capping prescription drug costs at $2,000 annually, a move expected to save millions of Americans money on medications. (Scripps News)

Medicare will begin capping prescription drug costs at $2,000 annually from January 1—a move that's widely expected to benefit millions of Americans. Around 3.2 million Medicare recipients are expected to pay lower costs,

Starting on Jan. 1, 2025, an estimated 19 million Medicare beneficiaries will see their out-of-pocket Medicare Part D spending capped at $2,000 for the year. This annual cap will be indexed to the rate of inflation every year going forward.