Social Security, Medicare, and the Inflation Reduction Act: Ensuring Arizona Seniors Have Affordable Health Care And Economic Security

Arizonans value their health and economic security. Programs that have been around for most, if not all, of our lives – like Social Security and Medicare – as well as more recent federal laws like the Inflation Reduction Act, have been helping keep Arizonans safe, healthy, and self sufficient. However, there are new and emerging threats to these programs that could endanger what Arizonans have worked so hard for throughout their lives.

Social Security and Medicare

Social Security and Medicare are meant to ensure that people in this country can retire and age with dignity and security in their future and have access to health care. And for the last several decades, the programs have done just that. 

As people age, they become eligible to receive the Social Security and Medicare benefits they’ve invested in their whole working lives. Social Security is available to seniors who have been paying into the system, and it ensures that even after you stop working, you’re able to receive an income and take care of yourself. And Medicare is health insurance available to older adults who have been working and paying for it for years. 

What does that mean – how do they work? When you earn money at work, taxes get withheld. Some of those are income taxes, for the federal and state governments, and some of those are Social Security and Medicare taxes. The money that gets taxed for Social Security and Medicare gets put into a trust fund and after you retire, that money funds your benefits. That means that Social Security and Medicare are benefits that you have paid for and earned.

Social Security and Medicare in Arizona

Both programs currently help nearly 1 in 5 Arizonans as they age and stop working, and nearly every Arizonan will rely on these programs during their lifetime. As of December 2022, 20 percent of Arizona’s population received Social Security benefits. But when you look at those who are at least 65-years-old, that number skyrockets to 86.4 percent. That means that nearly 9 out of every 10 Arizona seniors receive Social Security benefits. And as of 2021, in Arizona, we have more than 1.4 million people who receive Medicare benefits – that’s again nearly 20 percent of the population! 

The Inflation Reduction Act Lowers Health Care Costs for Arizonans

The recently passed Inflation Reduction Act, signed into law in August 2022, has helped Arizonans on Medicare manage their health care costs. Health care costs weigh on a lot of Americans, with 1 in 4 people saying that, in the past year, they’ve either delayed or skipped medical care because it’s been too expensive. The Inflation Reduction Act can help change that. Not only did the law institute a $35 cap on the cost of insulin per month, but it will also protect seniors from paying more than $2,000 out of pocket per year for their medicines starting next year. It also allows Medicare to negotiate and lower the prices for numerous other drugs, starting with 10 initially, and moving on to more in future years.

It is estimated that the Inflation Reduction Act will slash the prices of those first 10 drugs in half. Once the lower prices take effect, estimates say that 71,000 Arizonans on Medicare will save more than $100 per month on the highly prescribed blood thinner Eliquis. The estimated 21,000 Arizona seniors who take Jardiance to help manage their diabetes will save more than $150 per month on their prescription for that lifesaving drug. The estimated 9,000 Arizonans on Medicare who take Entresto, an anti-hypertensive drug, would save nearly $300 per month on their prescriptions. And 1,000 Arizona seniors would save nearly $2,600 per month on prescriptions for Enbrel – an anti-rheumatoid drug. That is to say nothing of the $585 average that 63,185 Arizona Medicare enrollees used to pay annually for insulin, which is now capped at $35 per month. And in the coming years, Medicare will be able to lower the prices of more drugs beyond the initial tranche of 10.

The new law also changed the way that seniors can access vaccines. Because of the Inflation Reduction Act, seniors can get vaccines like the shingles vaccine – which used to cost patients an average of $77, and up to as much as $200 – for free! Arizonans who accessed their vaccines through Medicare used to pay a total out-of-pocket cost of nearly $5.5 million for their vaccines. Now they pay nothing.

Threats to Arizonans’ Retirement Security and Health Care

The Inflation Reduction Act is working to strengthen Medicare to help Arizonans who are retired. But there is a bill that has been introduced in the U.S. House of Representatives that threatens Medicare and Social Security and threatens to hurt Arizonans. The bill – H.R. 5779 – would establish a mechanism that could fast track a vote on cuts to Social Security and Medicare. As the chairman of the committee that considered this bill said, “everything is on the table.” It is clear that Social Security and Medicare could be endangered by this bill because when members of Congress tried to ensure that those programs were protected, their efforts were rejected.  

The Fiscal Commission Act is not the only threat to Social Security and Medicare. The Republican Study Committee (RSC) recently released its budget proposal for next year. A budget is a reflection of a group or society’s priorities and values, and this budget proposal clearly doesn’t value Social Security or Medicare because it seeks to cut both. It proposes raising the retirement age, meaning that you’d have to work later and wait longer to take advantage of the Social Security benefits that you’ve earned. Raising the retirement age would result in a cut to benefits for those who are receiving Social Security benefits for the first time – potentially by almost 20 percent.

The RSC budget would also change Medicare into a premium support program that could limit the health care seniors get while raising their costs considerably. The proposal would essentially turn Medicare into a voucher program, in which seniors would get a set amount of money and use that to buy insurance coverage. That means that seniors would have to shop around for insurance and hope that they can find a cheaper price than what is available to them through Medicare today. Seniors could be more vulnerable to fluctuations in the insurance market and in areas with higher health care costs, seniors would face higher insurance costs. Insurance companies could charge more for plans than the voucher seniors receive from the government and the seniors would be forced to cover the difference out of their own pocket in order to get the plan they need. The RSC budget would also erase all the savings for Medicare beneficiaries that were introduced by the Inflation Reduction Act because it proposes repealing the law entirely. If the budget proposal passes, it would strip Medicare of its power to negotiate lower drug prices and allow Big Pharma to hike prices to unaffordable levels that hurt Arizonans.

Arizonans take pride in being able to take care of themselves, and Social Security, Medicare, and the Inflation Reduction Act enable them to do that. By lowering health care costs and ensuring that Arizonans have access to the benefits they’ve been earning all of their lives, these programs ensure dignity and security as Arizonans age. New proposals that threaten these vital benefits would endanger Arizonans’ way of life.