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Many Medicare recipients could pay less for insulin next year under a deal The White House announced in May in an agreement worked out between insurers, manufacturers and administration.

Medicare recipients who pick a drug plan offering the new insulin benefit would pay a maximum of $35 a month starting in 2021, a savings estimated at $446 annually. Fluctuating cost-sharing amounts that are common now would be replaced by a manageable sum.

The insulin benefit will be voluntary, so during open enrollment this fall Medicare enrollees who are interested must make sure to pick an insurance plan that provides it. Most people with Medicare will have access to them.

Stable copays for insulin are the result of an agreement shepherded by the Trump administration between insulin manufacturers and major insurers, Medicare chief Seema Verma told The Associated Press. The three major suppliers: Eli Lilly, Novo Nordisk and Sanofi, were all involved.

“It was a delicate negotiation,” Verma said. Drug makers and insurers have been at odds in recent years, blaming one another for high prices. “I do think this is a big step.”

The cost of insulin is one the biggest worries for consumers generally concerned about high prices for brand name drugs. Millions of people with diabetes use insulin to keep their blood sugars within normal ranges and stave off complications that can include heart disease, blindness, kidney failure and amputations. People with diabetes also suffer worse outcomes from COVID-19.

Verma, head of the Centers for Medicare and Medicaid Services, said 1,750 insurance plans that offer drug coverage to Medicare recipients have agreed to provide insulin for a maximum copay of $35 a month next year. It will be available through “enhanced” plans that may cost more per month but offer additional benefits such as reduced cost-sharing on certain drugs. The cap on copays is expected to lead to a small increase in premiums.

Of importance for patients, the new benefit would cover a range of insulin products, including pen and vial forms for rapid-acting, short-acting, intermediate-acting and long-acting versions.

One out of three people with Medicare have diabetes and more than 3 million use insulin. At list prices, the drug can cost more than $5,000 a year. Although insured patients don't pay that, they do notice rising copays that are based on the full cost. People who can't afford their insulin may try to cope by reducing their doses, a dangerous calculation that can put their lives in jeopardy.

Medicare's prescription drug benefit is offered by private insurers, either as a stand-alone “Part D” drug plan added to traditional Medicare, or as part of a managed care plan under Medicare Advantage. The taxpayer-subsidized private plans are closely regulated by the government, but by law Medicare is barred from negotiating drug prices

Insurers and drug makers welcomed the announcement. The industry group, America's Health Insurance Plans called it an “excellent example of public-private partnerships where everyone wins.” The Pharmaceutical Research and Manufacturers of America said it's pleased to see the administration focused on lowering out-of-pocket costs for patients.

Medicare estimates that about six in 10 beneficiaries are already in prescription drug plans that will offer the new insulin benefit. Those whose plans don't offer the new option can switch during open enrollment season, which starts Thursday, October 15. Medicare's online plan finder will help beneficiaries find plans that cap insulin copays.

Contact your Medicare healthcare consultant or adviser for information on this new benefit and to ensure that your plan of choice meets these new standards.

(The Associated Press was a resource for this report.)

Kenneth Kiker, CHC spent 49 years in the insurance industry before retiring in 2011 after working in United Healthcare’s Tucson office for 6 years specializing in their Medicare division. He continues to work with Medicare beneficiaries helping them with their Medicare coverage decisions. Ken achieved his Certified Health Consultant (CHC) designation in 1990 after attending The CHC School of Marketing at Purdue University and passing a series of national program exams. Email me at kennethk40@outlook.com.