Benefits and Cost of a $35 Insulin Cost-Sharing Cap for Medicare Patients

Abstract

BACKGROUND: To improve insulin affordability, Congress is considering capping insulin cost-sharing to $35 per 30-day supply for Medicare patients. The potential benefits and cost of this cap are unclear. Additionally, it is unknown whether the benefits of this cap would vary between Medicare patients with type 1 versus type 2 diabetes. METHODS: We conducted a cross-sectional analysis of the IQVIA Longitudinal Prescription Database, which reports prescriptions dispensed from 92% of U.S. pharmacies, and the Optum Clinformatics Data Mart, a national claims database from Medicare Advantage patients. The IQVIA analysis included patients who only had dispensed insulin prescriptions paid by Medicare in 2019. We estimated the proportion of Medicare patients who would benefit from an insulin cost-sharing cap of $35 per 30-day supply. Among these patients, we calculated the mean annual decrease in insulin out-of-pocket spending. We summed this decrease across patients to estimate the cap's cost to the federal government. The Optum analysis included Medicare Advantage patients with diabetes and at least 1 dispensed insulin prescription in 2019. We used linear regression to compare the proportion of patients who would benefit from a $35 cap and annual savings among these patients by diabetes type, adjusting for demographic characteristics and payer type. RESULTS: The IQVIA analysis included 2,227,229 patients who only had dispensed insulin prescriptions paid by Medicare in 2019. Mean (SD) age was 69.2 (11.4) years. The $35 cap would benefit 887,051 (39.0%) of patients, lowering annual insulin out-of-pocket spending by $338, from $687 to $349. Across all patients in the sample, aggregate savings (i.e., the cap's cost to the federal government) would be $299,402,402, or a mean of $134.4 per patient. Among the 60,300 Medicare Advantage patients in the Optum Analysis, mean age was 72.6 (9.3) years; 2,686 (4.5%) had type 1 diabetes and 57,614 (95.6%) had type 2 diabetes. The $35 cap would benefit a higher proportion of patients with type 1 diabetes (64.0%) compared with patients with type 2 diabetes (59.4%). Among patients with type 1 diabetes who would benefit from the cap, annual savings would be greater ($284) compared with their counterparts with type 2 diabetes ($231; p<.001 in adjusted analyses for all comparisons). CONCLUSIONS: A $35 insulin cost-sharing cap would benefit a sizable proportion of Medicare patients using insulin and may particularly lower out-of-pocket spending for patients with type 1 diabetes. The estimated cost of this cap to the federal government would be $134.4 per Medicare patient using insulin.

Out of Pocket Spending on Insulin under $35 Copayment Caps

“…The Inflation Reduction Act (IRA), which was recently signed into law, limits out of pocket (OOP) spending on insulin to $35 for a 30-day supply for individuals covered by Medicare ( 4). Yet, despite the impending implementation of this policy, few studies have estimated projected savings for Medicare beneficiaries and potential savings for people with diabetes who are not currently included under the IRA (5,6).…”