Cost relief may be coming for Medicare recipients who use insulin. But a proposed $35 monthly cap for those with private insurance is no longer part of the Senate’s Inflation Relief Act, which goes before the House on Friday.
The cost of insulin, which is used by people with diabetes to control their blood sugar, has become a political issue, with politicians like Vermont Sen. Bernie Sanders decrying how much Americans pay compared to people in other countries.
The highest cost for insulin is borne by those who pay for insulin themselves, either because they are enrolled in high-deductible insurance plans or because they don’t have insurance at all. The bill never offered them relief.
But an out-of-pocket cap identical to that for Medicare was stripped from the bill for those with private insurance because Democrats are trying to pass the bill by a simple majority through the reconciliation process. That requires Senate Parliamentarian Elizabeth MacDonough to vet the provisions. She said most of the health-related features were fine, but the insulin proposal for those who have private insurance, not Medicare, violated the Byrd provision, which says that issues “extraneous to the federal budget” cannot be passed by simple majority through reconciliation.
Though seven Republicans joined Democrats to protect the cap for those privately insured, it fell three votes short of remaining in the bill. Republicans who voted against the cap, like Sen. Joni Ernst of Iowa, said there are other ways to achieve lower costs for everyone who needs insulin.
If the bill makes it through the House without major revisions, Medicare beneficiaries could get other health cost breaks from the bill, too. These are the health provisions:
- Out-of-pocket spending for those with Part D Medicare drug coverage will be capped at $2,000 a year.
- Medicare can negotiate prices on 10 drugs that cost the program a lot of money and don’t have generic versions, beginning with 10 drugs in 2026, 15 in 2027 and 2028, and 20 drugs in 2029 and beyond.
- Starting next year, if drug prices rise faster than inflation, drug companies have to start paying rebates to Medicare.
- In 2024, a 5% coinsurance payment that now kicks in after someone reaches the catastrophic drug spending level of $7,050 in Medicare will end. Because drug companies set their own prices, 5% on expensive drugs can be a lot of money.
- Cost-sharing for adult vaccines will no longer be required in Medicare, and adult vaccine access will expand under Medicaid or CHIP coverage.
- For those who get their insurance through the Affordable Care Act marketplace, subsidies that were set to expire this year will be extended through 2025.
Millions on insulin
Insulin has been a hot topic in the drug-cost debate and concerns about the price of insulin are both real and widespread. In late May, the Deseret News reported that “at least three states — California, Washington and Maine — passed legislation signaling intent to tackle issues related to costs and access within their borders by having a hand in the crafting and delivery of insulin.”
The article also reported that “In March, Civica Rx, a consortium made up of health care providers, insurers and philanthropists, among others, announced its intention to manufacture insulin and distribute it without making a profit while driving price transparency industrywide.”
More than 7 million patients on private insurance take insulin daily, according to Yale University research published in Health Affairs that found 1 in 7 daily insulin users have ”catastrophic” spending on the drug. After the rent is paid and food is purchased, the study found that, at a minimum, 40% of what those folks have left is used to buy insulin.
And right now, without the cost relief the bill includes, 1 in 5 Medicare beneficiaries reach catastrophic spending on insulin, too. Medicare beneficiaries make up about half of those who fit the catastrophic spending category, the Yale researchers said.
According to the Centers for Medicare and Medicaid Services, roughly 3.3 million Medicare beneficiaries use insulin. An even greater number, about one-third overall, have diabetes, but not all are insulin-dependent.
A history of insulin published by the National Library of Medicine said it was discovered in 1922 and marked a massive breakthrough against diabetes, a disease that has been documented back to about 552 B.C. But a study in JAMA Internal Medicine says the price tag has about tripled in the past decade.
Rising prices, real worries
The Deseret News in February wrote about people who ration or skip drugs because of cost. This week, we checked back in with a couple of them to talk about the inflation bill.
Iesha Meza, 31, of Phoenix, Arizona, has watched the price change as she’s experienced buying insulin with no insurance, with private insurance and with government-funded Medicaid. At one point, an attempt to make her insulin last by rationing it put her in intensive care in a diabetic coma.
When Meza was diagnosed with Type 1 diabetes just before her 21st birthday, she didn’t know how she would afford the insulin. She takes two types that together cost about $75 a month out of pocket. Although she doesn’t have a copay now, in the past, she’s had to pay it all herself on a limited income. She knows the strain, she said, and has seen others trying to figure out if they can afford to take all the medicine they need or if they have to skip it or ration it.
Besides a cap on the cost because “we need to take this in order to live; there’s no other way around it,” she’d also like a health care system that gave doctors time to get to know patients and see what they need and what they have in order to really help them be well, she added.
Meza said she’s soon transitioning to a new job. She’s anxious to see how the insurance covers insulin.
In a written statement released Sunday, cancer patient David Mitchell, founder of Patients for Affordable Drugs Now, called the provisions before the House “game-changing.”
“It alters the trajectory of drug pricing and policy in the United States,” he said. “It finally begins to break the power of multinational drug corporations to dictate prices of brand name drugs to the American people. It marks a shift to reforming the system in order to make it work for the people it is supposed to serve — rather than the people who profit from it.”
Mitchell noted that the Congressional Budget Office estimates savings of almost $300 billion to the federal government alone.
But he told the Deseret News that he worried about those who aren’t covered by the insulin cost cap that’s likely to help Medicare beneficiaries if the bill passes.
“We were extremely disappointed,” he said of removing the insulin co-pay cap for those with commercial insurance.
Mitchell, 71, from Bethesda, Maryland, knows well what drugs can cost. His aggressive treatment for multiple myeloma, stretched now over a decade, is pricey: Four drugs he’ll likely need the rest of his life total $900,000 a year, though he only has to pay a portion of that. The out-of-pocket cost for one drug is $16,000 a year. But he feels lucky not to have refinanced his house to cover drug costs, he added.
“People with diabetes require insulin to live, and they are at the mercy of unjustifiably high insulin prices. A $35 copay cap will provide real relief to those with insurance. Four out of five adults who live with diabetes or are caregivers for someone with diabetes have gone into debt to pay for insulin. They absolutely need reform,” he told the Deseret News by email. “And after the passage of the historic Inflation Reduction Act, we will be continuing the work to pass additional reforms to lower prices for patients on commercial insurance and the uninsured, including those who rely on insulin.”