The Inflation Reduction Act & Medicare: What Long Island Seniors Need to Know for 2026

How the new drug cap, plan changes, and cost shifts may help — or hurt — your Medicare coverage

The Inflation Reduction Act (IRA) is bringing the biggest Medicare drug changes in 20 years, and as we head into 2026, the impact is becoming clearer — especially for seniors right here on Long Island.

Some seniors will save significantly under the new rules, while many others may face higher premiums, tighter drug formularies, and fewer plan choices. This guide breaks down exactly how the IRA affects Medicare Part D, Medicare Advantage, and Medigap users — with specific insight for New York and Long Island residents.

What the Inflation Reduction Act Does for Medicare in 2026

• $2,100 cap on Part D out-of-pocket drug costs (2026)
  Once you spend $2,100 on approved prescriptions, you pay $0 for the rest of the year.


• Medicare drug price negotiation begins
  The first 10 negotiated drugs see lower prices in 2026, with more added annually.


• $35 insulin cap
  Predictable insulin costs for all Medicare beneficiaries.


• Penalties for drug manufacturers that raise prices faster than inflation
  Helps slow down price hikes.


• Attempt to stabilize Part D premiums
  but New York tells a different story (more below).

Major Pros: Who Wins Under the IRA?

1. Seniors with expensive or specialty medications
   This is the group that benefits the MOST.
   Anyone taking high-cost drugs for cancer, MS, autoimmune disorders, COPD, or
   cardiovascular conditions can save $1,000–$3,000+ per year once the $2,100 cap kicks in.


2. Diabetics using insulin
   The $35 insulin cap is a life-changing cost protection.


3. Seniors who frequently hit the “donut hole”
   Because the donut hole is essentially eliminated, drug costs become far more predictable.

Major Cons: Why the IRA Is NOT a Win for Everyone

1. Rising premiums — especially in New York
   The IRA shifts more catastrophic liability onto insurance companies.
   Their response? Higher premiums and tighter plans.
   In New York, the average monthly premium for the 10 Medicare Part D plans available in 2026 is:

$101.18 per month

One of the highest averages in the country.
This means MANY Long Island seniors will pay more for plans even if they don’t benefit from the $2,100 drug cap.

2. Fewer Part D plan choices
   The standalone Part D market has shrunk by more than 50% since 2022.
   Fewer carriers = fewer options = less competition = higher prices.


3. Medicare Advantage plans cutting back benefits
   As costs rise, many Advantage plans are reducing:
   • Dental
   • Vision
   • OTC allowances
   • Transportation
   • Gym benefits
   
   We’re already seeing these cuts across Long Island for 2025–2026.
   
   
4. Most seniors will NOT hit the $2,100 cap
   About 60–70% of Medicare beneficiaries take only inexpensive generics and will never come close to reaching the cap.
   These seniors face higher premiums with little to no direct IRA benefit.

So Who Actually Benefits?

✔️ Big Winners (~8–10%)
People with very high drug costs or specialty medications.

✔️ Moderate Winners (~20–30%)
Those who use several brand-name drugs or occasionally reach the donut hole.

❌ Limited/No Benefit (~60–70%)
People taking only low-cost generics — the majority of New York and Long Island seniors.

And remember… New York’s average Part D premium of $101.18 means even low-drug-cost seniors are likely paying more under the new 2026 landscape.

How the IRA Impacts Long Island Specifically

Long Island seniors face unique challenges:

1. Higher Part D premiums than the national average
   New York’s premium average of $101.18 reflects higher operating costs, fewer carriers, and the IRA-driven reshaping of the market.


2. More plan cancellations and network volatility
   Insurers regularly adjust agreements with:
• Northwell
• Stony Brook
• NYU Langone
• Mount Sinai
This creates annual uncertainty for Medicare Advantage users.


3. Heavy specialist use on Long Island
   Because the IRA contributes to rising specialist copays, many local seniors will feel the financial impact.


4. A significant number of seniors on expensive medications
   This group will benefit from the $2,100 cap and negotiated drug prices — especially those with chronic conditions.

What Long Island Seniors Should Do Before 2026

1. Review your medications with a local expert
   The IRA’s changes affect people VERY differently based on their drug list.


2. Double-check your Medicare Advantage network
   Expect more shifts in doctor participation for 2026.


3. Compare all Part D and Medicare Advantage plans (don’t auto-renew)
   With premiums averaging over $101 in NY, you must ensure you’re in the right plan.


4. Understand whether YOU will benefit from the $2,100 cap
   Many won’t — but some will save big.


5. Don’t navigate these changes alone
   Local knowledge is your best protection.

Final Thoughts: The IRA Helps Some, Hurts Others — Get the Guidance You Deserve

The Inflation Reduction Act will unquestionably help seniors facing sky-high prescription costs. But for many others — especially across Long Island — the IRA will mean higher premiums, fewer drug plan options, and tighter Medicare Advantage benefits.

You deserve to know exactly how these changes affect YOUR plan and YOUR wallet.

I’m here to help.

Call Paul Barrett: 631-358-5793

www.paulbinsurance.com

Modern Medicare Agency — Trusted Medicare guidance for Long Island seniors.