Democrats’ Midterm Focus on Affordability
As the midterm elections approach, Democrats have made affordability a primary focus of their campaign. In this final stretch before voters head to the polls, Republicans have an opportunity to challenge them on the rising costs associated with the Medicare prescription drug reforms enacted in 2022, which passed without any support from Republican lawmakers.
The Inflation Reduction Act vowed to lower prescription drug prices, promising savings for taxpayers. One aspect that has helped seniors is the cap on their out-of-pocket expenses for medications. However, the overall costs didn’t magically vanish; they just shifted to different parts of the program, leading to a situation where anticipated federal savings are now expected to result in losses.
The Trump administration has a chance to amend the shortcomings in how this law is being enforced. Still, Congress needs to tackle the funding issues embedded within the legislation. It’s not fair for Democrats to campaign on affordability without facing scrutiny for the increased costs that their own legislation has produced.
Initially, the Congressional Budget Office (CBO) predicted that the law’s measures—such as drug-price negotiations and inflation rebates—would reduce federal deficits by approximately $129 billion from 2022 to 2031. However, the latest forecasts suggest that these provisions will actually add to deficits during that time frame. The anticipated savings from negotiations and rebates have fallen short, while the financial burden of the Democrats’ alterations to Part D has exceeded expectations. What was supposed to shrink federal deficits is now set to expand them.
The spending outlook is even bleaker. CBO now estimates that the costs of Part D will surge by about $700 billion more from 2026 to 2035 than previously thought, with roughly $550 billion of that increase stemming from new data from insurers’ bids for 2026. Among various factors, the CBO pointed to the Democrats’ benefit reforms as a significant contributor to these higher bids, although it couldn’t pinpoint the exact impact of these changes on overall spending increases.
Seniors are also facing reduced choices. The number of stand-alone prescription drug plans for those on traditional Medicare has dropped dramatically, falling from 766 in 2022 to just 360 in 2026—a decline of over 50% within four years. In states like Florida and Texas, low-income beneficiaries may find themselves with only one benchmark plan available at no premium for 2026. For seniors seeking affordable medication coverage, having fewer plans means limited options.
Moreover, the plans that remain are often covering fewer medications in some categories. Research focusing on 59 brand-name drugs across competitive categories revealed that the average percentage of individuals in stand-alone plans with coverage for those drugs fell from about 47% in 2024 to 36% in 2026. As choices diminish and medication coverage narrows, seniors now have to pay more before their plans begin to share the expenses.
The average deductible for stand-alone plans increased from $425 in 2024 to $544 in 2026, meaning that seniors must cover more costs at the pharmacy counter before their insurance kicks in.
Meanwhile, in Washington, the situation seems more manageable as the government has delayed premium increases by shifting more expenses to taxpayers. Before any offsets, the premium growth cap established by the law has added $33 billion to subsidy costs from 2024 to 2026, alongside an additional $10.7 billion due to a separate stabilization program during 2025 and 2026.
These subsidies may create an illusion of relief, but they ultimately leave taxpayers with a larger financial burden. Fixing Part D calls for both the Trump administration and Congress to take action.
The Trump administration should utilize its regulatory powers to adjust how the Drug Price Negotiation Program establishes prices, including excluding generic prices from calculations for the Maximum Fair Prices of negotiated drugs.
However, it cannot make sweeping changes through regulation alone. Congress needs to address the allocation of costs among the government, insurers, and drug manufacturers in Part D. The aim should be to shield seniors from crippling medication expenses while ensuring a variety of plans remain available and keeping taxpayers’ exposure to a minimum.
Achieving this in a lame-duck session is probably a long shot. Democrats would likely have to help amend a law they are still promoting as a success. Republicans should press Democrats to justify their resistance to voters.
Now is the time for Republicans to highlight the increased costs and diminished choices of Part D to voters while ballots are being cast. They should ensure that every Democrat touting affordability commit to assisting in the program’s repair once Congress reconvenes.
Democrats were eager to take credit for the overhaul of Part D, and they should also be part of the solution to make it better.
