What the Inflation Reduction Act means for Arizona families
PHOENIX (3TV/CBS 5) -- Despite falling fuel prices, a disappointing inflation report Tuesday showed the consumer price index inching up 0.1% in August. On the same day, there was a celebration touting the Inflation Reduction Act at the White House.
“The American people won,” President Joe Biden told the crowd gathered on the North Lawn of the White House. “We’re going to lower prescription drug costs, lower health insurance costs, lower energy costs for millions of families, and we’re going to take the most aggressive action ever, ever, ever to confront the climate crisis and increase our energy security.”
The Inflation Reduction Act was signed into law a month ago without Republican support. As a result, new discounts for new and used electric vehicles will be available. “For most of us, this is a big deal,” Transportation Secretary Pete Buttigieg told On Your Side. “One of the biggest barriers to adopting an EV and getting the savings that come with it is that upfront cost.”
There will also be credits and rebates for energy-efficient appliances and solar panels. The White House estimates that 150,000 households in Arizona will install solar panels as a result of the incentives. EPA Director Michael Regan says the goal is to save money and energy. “We finally have the resources we need to tackle not only the climate crisis,” Regan told AZ Family, “It will create billions of dollars of grants and investments for communities that have been disenfranchised for so many years.”
The new law also targets high prescription drug costs. Medicare will be allowed to negotiate drug prices on some of the most common medications, and by 2025, out-of-pocket costs for Medicare Part D will be capped at $2,000. “They cannot pay a penny more than $2,000 a year, no matter how high their drug costs are,” President Biden vowed.
Despite its name, according to an analysis by the non-partisan Congressional Budget Office, the Inflation Reduction Act will do little to move the needle on inflation in the near term. In Arizona, the Chamber of Commerce is critical of several pieces of the law, including the provisions about medication costs.
“It does nothing to address the pressure put on everyday Arizonans right now as they’re buying goods, buying houses, paying rent. This bill does not address that. In fact, it could likely make it worse,” said Danny Seiden, the President and CEO of the Arizona Chamber of Commerce and Industry. “We’ll see less new drugs hit the market. We’ll see less of an incentive for drug companies to invest in new research and development because they just don’t have the same profits that they did before.”
On Your Side took that concern right to Health and Human Services Secretary Xavier Becerra, who countered the argument. “We believe this is going to spur innovation because it’s now going to be easier for others to compete because there are too many manufacturers that have a corner on the market,” Becerra said.
Copyright 2022 KTVK/KPHO. All rights reserved.