CLEVELAND — For more than 15 years, Northeast Ohio-based Kaz Company has helped older Ohioans navigate the sometimes-difficult waters of Medicare and its supplements, matching customers with insurance carriers that offer plans that work best for them. So when the White House announced last week plans to end the Medicare Part D subsidy at the end of this year instead of next, they knew they would be hearing from those they serve.
"People, of course, panic, and we're telling them not to because this was something that was planned," said Kaz Company Founder Kathy Hirko of the subsidies that were part of the bipartisan Inflation Reduction Act of 2022.
"The premium stabilization program was supposed to be for three years," she said. "It was supposed to be for 2025, 2026 and 2027. CMS (Centers for Medicare & Medicaid Services) has decided literally at the end of July to end it at the end of 2026, so it's not extending into 2027."
Twenty-five million people rely on Medicare Part D, at an average monthly cost of $36. The Trump administration argues the subsidies are no longer needed, and that's why they are ending them a year early. Dr. Oz, the administrator of CMS, said premiums will increase by less than $10 for most Medicare recipients.
"With this happening, it could impact people's premiums, which, yes, people are panicked; they're panicked, is this going to touch my medication costs, how much is it going to cost for me to be on a standalone prescription drug plan?" she said. "Because last year's premiums went up, a lot of them by $50 a month, and so I can appreciate their concern."
She said the impact of this move isn't known yet and won't be until the Annual Notice of Change goes out to customers by the end of September. "That shows changes for plans from the current year to next year, that's where they're going to see, if it's not announced sooner, what the premium impact is going to be."
These cuts on the heels of last year's changes as part of the Republican tax bill are ones being driven home by Democrats in this year's congressional races, including the closely watched race for U.S. Senate between Republican Senator Jon Husted and Democrat Sherrod Brown, who helped pass the Inflation Reduction Act that created the subsidy.
"We've seen it over and over now, they vote to cut healthcare, they vote to throw people off insurance, they vote to cut back on Medicare, they've done nothing to pull down the cost of prescription drugs in order to give tax cuts to their corporate cronies and their billionaire buddies, and the American people are paying for that," said Brown.
News 5 reached out to Senator Husted's office for his take on the early end to the subsidy, but was told he was not available Monday after spending the day with the Acting Secretary of Labor in Toledo and traveling back to D.C. for votes.
In the meantime, Hirko invites those with concerns to reach out to her Kaz Company specialists. "They can call us even if they're not a current client, they can give us a call. If they have specific questions, we will try to answer them, and if not, when we get them, if they want us to reach out to them when we have specific answers," she said.
