Medicare beneficiaries are accustomed to paying more for their prescription medications. According to Kaiser Family Foundation, just about half of all drugs covered under Medicare Part D, prescription drug coverage, and Medicare Part B, medical insurance, had price increases greater than inflation between July 2019 and July 2020.
Diabetic beneficiaries have been hit even harder. Most beneficiaries inject insulin, which is covered under Part D. A review of plans in 2020 showed that copayments for insulin in a Part D drug plan ranged from $2 to $200.
Things started changing in 2020 when the Centers for Medicare and Medicaid Services launched the Senior Savings Model, a voluntary cap of $35 on injectable insulin. Not all plans or insulins were in the model, but it was a start.
However, beneficiaries who use an insulin pump were left out in the cold. The savings model did not apply to them, so they can pay considerably more. Medicare covers the pump and insulin as durable medical equipment under Part B, medical insurance. For those who have Original Medicare, this is subject to the Part B deductible and then a 20% coinsurance. (A Medicare supplement plan (Medigap policy) will cover the coinsurance.) Medicare Advantage plan members pay the plan’s deductible (if it has one) and the 20% coinsurance. This coinsurance translates to an average out-of-pocket cost of $54.26 a month, which means some pay considerably more.
Cost savings in the new year
The Inflation Reduction Act provides relief for every Medicare beneficiary who uses insulin, no matter the type. Effective January 1, 2023, Part D insulin will be capped at $35 a month. (Once you enter insulin and the dose in the Medicare Plan Finder, an alert pops up to let you know this.) For those who use insulin pumps, the amount they pay will be no more than $35, effective July 1.
Just as with the Senior Savings Model, this new provision does not apply to oral medications to control Type 2 diabetes or non-insulin injectable medications.
Insulin costs have been an unnecessary drag on many lives for a long time. It’s heartening to see the tide turning, however slowly.