The Inflation Reduction Act: Hollywood Financing for Travis Kelce, Higher Medicare Premiums for Seniors

It would be hard to find any Medicare senior who benefits more from the Inflation Reduction Act (IRA) than NFL star Travis Kelce. According to Variety, the law that raised Medicare prescription drug premiums by 21% is also financing Mr. Kelce’s debut as a Hollywood producer.

Variety gushes that his $10 million film, “My Dead Friend Zoe,” will “be the first movie financed using President Biden’s green energy credits” and “money generated by green energy entrepreneur Mike Field’s sale of surplus tax credits,” an IRA loophole few knew existed.

Neither Mr. Kelce nor Mr. Field needed the help. Kelce earns $14 million a year from the NFL, while Field has owned eight car dealerships and developed hundreds of solar energy projects, according to his website.

The law once touted as a “sweeping health care and climate bill” is now financing indie flicks for multi-millionaires.

This kind of wasteful spending is disheartening for seniors, who get shortchanged by the IRA. Though routinely called a “climate law,” the IRA’s most popular provision has always been its promise to reduce seniors’ prescription drug costs.

Unfortunately, the law will help only one-in-ten seniors but cause most of their Medicare pharmacy premiums to skyrocket. Seniors are essentially financing much of the IRA’s pharmacy benefits themselves with higher monthly rates. Premiums are expected to rise further when the law’s $2000 limit on out-of-pocket costs goes into effect next year.

The reason seniors get stuck with the tab is that the IRA diverts over $200 billion of Medicare prescription drug savings to fund green energy. There’s not enough left over to pay for the law’s pharmacy benefits.

This may surprise most Americans, but Beltway insiders always knew what Congress meant by promising the law would reduce drug costs, empower Medicare to “negotiate” drug prices, and limit Medicare pharmacy premium increases to 6%.

In Washington, “reducing drug costs” means cutting federal spending on medicines, not necessarily lowering costs for patients. “Direct Negotiation” means making drug companies fill federal coffers with hefty rebates on high-priced drugs. The IRA’s cap on premium hikes applies only to bare-bones Medicare Part D plans most seniors avoid.

When it became clear that the law spurred the largest prescription drug premium hikes in Medicare Part D’s history, few media outlets even bothered to report it. Everyone in Washington knew the main purpose of the new drug policies was to help sell the bill to the public and finance its climate agenda, which Wall Street says will cost a trillion dollars.

Green policies usually get funded indirectly since Americans, including progressives, are notoriously unwilling to pay for them. Last year, one of California’s bluest, wealthiest areas—Sonoma County—rejected a quarter-cent tax hike to reduce local carbon emissions. Like the Affordable Care Act, the IRA took an easier path: new Medicare policies that churn out funds that can be spent elsewhere.

But don’t say the Inflation Reduction Act hasn’t helped anyone. Mr. Kelce’s new movie premiers next month at the South by Southwest (SXSW) festival in Austin. Hopefully, seniors will get in free since they helped pay for it.

Mark Merritt is President of the Proactive Strategies Group (PSG) and has held senior roles in a number of health industry groups