High Insulin Prices Now Capped By Part D New Guidelines
High insulin prices will now be capped by new Part-D Medicare guidelines. This announcement comes from The CMS’ Center for Medicare & Medicaid Innovation — that Medicare enrollees’ out-of-pocket costs for insulin will be drastically reduced. Senior citizens will be the biggest beneficiaries of this price cap.
The Part D Senior Savings Model will cap beneficiaries’ copays at $35 for a 30-day supply of insulin for the entire benefit year. In addition, participating insurers will offer seniors prescription drug plans with supplemental insulin coverage.
High Insulin Prices: Big Savings Coming
The agency will also test how plans can use Part D rewards and incentives programs to further healthy behaviors and medication adherence.
Right now, about 33 percent of Medicare beneficiaries live with diabetes, and more than 3.3 diabetics use at least one common form of insulin. But, as recent stories have indicated, high insulin costs have lead them to rationing or just stopping to take the medicine. Either behavior eventually leads to kidney failure or heart attacks.
The CMS estimates that the federal government will save more than $250 million during a five-year period with this new plan. Within the coverage gap, drugmakers will pay a 70% discount for insulin, but the payments will be calculated before supplemental benefits are applied.
This shifts the costs from plans to drugmakers during the initial coverage period, since discounts are only available during the coverage gap phase right now.
CMS will incentivize insurers to participate by offering them additional risk protection for 2021 and 2022 if they enroll more insulin-dependent diabetics than they expect.
High Insulin Prices: Drug Manufacturers On Board
Eli Lilly, Sanofi and Novo Nordisk, the three insulin producers in the U.S. market, said that they would participate in the demonstration.
However, one should realize that while diabetics on fixed incomes will greatly benefit — nevertheless, insulin prices will still remain high. This will be a real problem for people that don’t have health insurance or for people with high-deductible plans. They will still have to pay the high list price until they meet their deductible.
Right now, it also won’t help people who are enrolled in Part D plans, if their plan sponsor decides not to participate in the model. And, at this time, this includes about 25 million people.
In the grand scheme of things, while this a small positive step, it’s a promising start to reduce the very high cost of prescription drugs. Pressure from Congress and the White House on the drug manufacturers will continue — to make life-saving drugs available at an affordable cost.