Summary

The passage of the Inflation Reduction Act of 2022 addressed the cost of prescription drugs for Medicare beneficiaries, but those beneficiaries may have to pay greater shares of their overall health costs in retirement because of the financial condition of the Medicare program and cutbacks to employment-based retiree health programs. To project how much Medicare beneficiaries may need to save to have a reasonable chance of meeting their health care spending requirements in retirement, this Fast Fact explores EBRI’s simulation model that incorporates recent changes to Medicare Part D enacted by the Inflation Reduction Act of 2022 and also tests varying assumptions about Medicare Advantage and Medigap plans.