Studies from Cornell University Further Understanding of Managed Care (IRA Reforms To Medicare Part D Reinsurance Were Associated With Plan Exits And Higher Premiums, 2024-25): Managed Care

2026 JUL 22 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- Fresh data on Managed Care are presented in a new report. According to news reporting from Ithaca, New York, by NewsRx journalists, research stated, “The Inflation Reduction Act (IRA) of 2022 altered the financing of prescription drug purchases for more than fifty-five million Medicare beneficiaries. Before 2025, the federal government contributed 80 percent of expenditure after a beneficiary exceeded a threshold, but beginning in 2025, this share was reduced to 20 percent.”

The news correspondents obtained a quote from the research from Cornell University, “We studied the effect of the reinsurance reforms on exit, premium, and benefit design for free-standing Medicare Part D plans. We found that after the reforms, previous reinsurance payments became a strong predictor of plan exit. In a first look at the 2025 Medicare Part D Premium Stabilization Demonstration, we found that plans with higher pre-IRA reinsurance were more likely to receive the demonstration’s targeted subsidy. However, plans with higher pre-IRA reinsurance increased premiums substantially in 2024 and 2025, even after the demonstration subsidies. Finally, we found no significant relationship between pre-IRA reinsurance and benefit design outcomes (for example, coverage and out-of-pocket spending).”

According to the news reporters, the research concluded: “Together, our findings highlight the role of reinsurance reform in recent Part D market volatility.”

This research has been peer-reviewed.

For more information on this research see: IRA Reforms To Medicare Part D Reinsurance Were Associated With Plan Exits And Higher Premiums, 2024-25. Health Affairs, 2026;45(7):741-749.

Our news journalists report that additional information may be obtained by contacting Colleen M. Carey, Colleen M. Carey, Cornell University, Ithaca, New York.

(Our reports deliver fact-based news of research and discoveries from around the world.)