Source/Disclosures
Disclosures: Brown is CEO of the ADA. Hutton is vice president of regulatory and health policy for JDRF. Verma is CMA administrator.
May 27, 2020
3 min read
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Thousands of Medicare plans apply to Part D savings model capping insulin costs at $35

Source/Disclosures
Disclosures: Brown is CEO of the ADA. Hutton is vice president of regulatory and health policy for JDRF. Verma is CMA administrator.
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More than 1,750 standalone Medicare plans have applied to participate in an enhanced Part D Senior Savings Model that caps out-of-pocket insulin costs at $35 for a 30-day supply for the 2021 plan year, according to a press release from CMS.

As Healio previously reported, CMS announced the new voluntary savings model in March for participating Medicare Part D prescription drug plans and Medicare Advantage plans that will cap Medicare beneficiaries’ out-of-pocket insulin costs at $35 for a 30-day supply, from the beginning of the year through the Part D coverage gap. According to the CMS release, beneficiaries who take insulin and enroll in a plan participating in the model should save an average of $446 in annual out-of-pocket costs for insulin, or more than 66%, relative to their average cost-sharing for insulin today.

The new model is the first federal measure designed to drive down insulin costs, according to the American Diabetes Association.

“Low and predictable out-of-pocket costs for insulin are long overdue for people with diabetes,” Campbell Hutton, vice president of regulatory and health policy for JDRF, told Healio. “Today’s CMS announcement about prescription drug plans that will provide insulin for $35 per month is an important step forward for the Medicare population. JDRF will continue working urgently for long-term solutions to make insulin affordable for everyone.”

More than 1,750 standalone Medicare plans have applied to participate in an enhanced Part D Senior Savings Model that caps out-of-pocket insulin costs at $35 for a 30-day supply for the 2021 plan year.
Source: Adobe Stock

In a statement, Tracey D. Brown, CEO of ADA, said the new prescription plans will help 3.3 million older adults access more affordable insulin. With the economic impact of the current COVID-19 pandemic, prescription drug costs are becoming more challenging to bear, she said, adding that more still needs to be done beyond this “important step.”

“This is an important beginning,” Brown said in a press release. “During this time of national emergency due to COVID-19, we call on policymakers at the state and federal levels to suspend all cost-sharing for insulin and other drugs. No one who requires medication should be forced to go without during this unprecedented public health and economic crisis.”
Part D sponsors that participate in the model will offer beneficiaries Part D prescription drug plans that provide supplemental benefits for a broad range of insulins, including pen and vial dosage forms for rapid-acting, short-acting, intermediate-acting and long-acting insulins, according to CMS. Participating pharmaceutical manufacturers will continue to pay their current 70% discount in the coverage gap for their insulins that are included in the model, and based on the model’s waiver of current regulations, those manufacturer discount payments will be calculated before the application of supplemental benefits under the model, reducing out-of-pocket cost of insulin for Medicare beneficiaries.

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“This market-based solution, in which insulin manufacturers and Part D sponsors compete to provide lower costs and higher quality for patients, will allow seniors to choose a Part D plan that covers their insulin at an average 66% lower out-of-pocket cost throughout the year,” CMS Administrator Seema Verma said in a press release.

As Healio previously reported, older adults with diabetes who reach the temporary spending limit for their Medicare Part D drug plan — commonly known as the “donut hole” — often have no choice but to pay the high list prices for insulin. According to CMS, pharmaceutical manufacturer patient assistance programs can provide assistance to Part D enrollees and interface with Part D plans only by operating "outside the Part D benefit" to ensure separateness of Part D benefits and patient assistance programs.

“The patient assistance program’s assistance on behalf of the patient assistance program enrollee does not count towards a Part D beneficiary's true-out-of-pocket cost,” the agency states on its website. – by Regina Schaffer

Reference:

CMS. Pharmaceutical manufacturer patient assistance program information. Available at: https://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovGenIn/PAPData. Accessed: May 27, 2020.

Disclosures: Brown is CEO of the ADA. Hutton is vice president of regulatory and health policy for JDRF. Verma is CMA administrator.