How Medicare’s New Senior Savings Model Makes Insulin More Affordable
Tracey D. Brown is the President and Chief Executive Officer of the American Diabetes Association and lives with type 2 diabetes.
Last week, I was honored to join the leadership of the Centers for Medicare and Medicaid Services (CMS) at the White House to announce the “Part D Senior Savings Model,” an initiative we have been working on with national policymakers. This new program will limit the cost of insulin for participating seniors to a maximum of $35 for a 30-day supply—a major victory in our fight for affordable insulin!
The program takes effect January 1st. If you are a senior on Medicare and want to participate, you’ll need to take these steps:
- Before October 15, 2020: Check on your current Part D Prescription Plan and what type(s) of insulin you are prescribed.
- Between October 15 and December 7, 2020: While your current health insurance plan may elect to participate in this program, not all do. You may need to switch plans in order to get this new benefit, and you’ll need to switch before the end of the Medicare Open Enrollment period (October 15 to December 7, 2020). You’ll be able to review all available plans using the Medicare Plan Finder, which will be updated by October 15, 2020 to show you which plans will offer the new discounts for insulin. This will allow you to compare all Medicare Advantage and Part D to can choose a plan that best suits your needs.
We know you likely have some questions about this new model—and we’re here to help. Check out our FAQ on the new model below. And remember, though this new model won’t help everybody who’s struggling to afford their insulin, it will help many of the 3.3 million seniors on Medicare who use insulin—and it’s just the first step. We will not stop fighting until insulin is affordable for all seven million who rely on it.
Frequently Asked Questions:
What is this model?
On May 26, 2020, President Trump announced a new model for Medicare Part D enrollees who purchase insulin. This model will begin on January 1, 2021. It is designed to help 3.3 million Americans affordably access insulin by capping the cost of a 30-day supply for most insulins to a maximum of $35. For enrollees who choose a model participating plan, their insulin prescription will not be subject to a deductible or any coverage gap cost increases. (Whether it’s January or December, their monthly out-of-pocket cost for insulin will be $35 or less.)
1,750 standalone Medicare Part D prescription drug plans and Medicare Advantage plans have committed to participate in this model. CMS anticipates plan options in all 50 states, Puerto Rico, and District of Columbia. Plans may be different in their offerings overall, which is why enrollees need to review all available plans during the open enrollment period that begins on October 15 and ends on December 7, 2020.
Why is this only for Part D enrollees?
The federal government cannot regulate insurance practices for commercial insurers or Medicaid, but it has authority over the way insurance works for the Medicare prescription drug benefit, which is referred to as “Medicare Part D.”
How will Medicare’s $35 per month out of pocket cap for insulin affect pricing policy for other people who rely on insulin?
This model addresses the out-of-pocket cost variability that a Part D enrollee could pay in a year and allows people with diabetes to have consistent, affordable access to this life-essential drug. Medicare policies, once established, heavily influence commercial insurance coverage plans. We hope to see commercial prescription drug plans follow with efforts to make insulin copays more affordable!
Does this mean the price of insulin is lower?
This model does not address the current list price of insulin, which is what an individual would pay if they did not have insurance coverage (though all seniors have insurance coverage). The ADA is committed to ensuring affordable access to insulin and other drugs for all people with diabetes, and there are more opportunities to advance national and state policy to serve this goal. Learn more about our advocacy efforts and get involved by visiting our Engagement Platform at diabetes.org/platform.
What about Medicare Enrollees who use an insulin pump and purchase their insulin through Medicare Part B?
This model does not cap out-of-pocket costs for Medicare Part B. Medicare Part B insulin purchases remain 20% of the negotiated Medicare cost after deductibles are met.
When does the new deal become available to patients?
This model will take effect in January 2021, at which point any senior who chooses a participating enhanced prescription drug plan will be eligible to purchase their monthly insulin prescription for no more than $35 a month.
Will my health insurance plan cover the insulin I take currently?
Each plan offers different types of insulin, so it’s important that you review your plan choices to determine what plan will be best for you.
How much will seniors actually save through this model?
Starting in January, seniors using Medicare Part D will be eligible to purchase their monthly prescription for no more than $35 a month if they choose one of the participating plans, saving an average of $446 in annual out-of-pocket costs for insulin.
Won’t people end up paying higher insurance premiums to get this lower copay deal?
While beneficiaries choosing these enhanced prescription plans may pay slightly higher premiums, they will save far more on a monthly basis out-of-pocket annually and know exactly how much they will spend each month on their insulin prescription (a maximum of $35 for a 30-day supply), rather than a percentage of the list price, which can vary.
Why can’t this occur until January?
As this Model is part of a ground-breaking Medicare shift, plans must go through a bid process to be accepted and participate for 2021. The government is working quickly to have these plans in place for open enrollment, which begins on October 1st.
When this happens, seniors will need to look for insurance plans that offer this new insulin savings program and choose their Part D insurance plan carefully, making sure that the type of plan, if they take insulin, is an enhanced prescription plan that best fits their needs. Almost all types of insulins will be available through these plans, but each plan may choose different insulins on their formulary.
In the meantime, enrollees who have encountered barriers to accessing affordable insulin can contact the manufacturers for assistance. You can learn more at InsulinHelp.org—there are programs in place to help, because no one should be without this life-essential drug.
ADA continues to advocate for zero-dollar copays for insulin and other diabetes drugs during this crisis on both a federal and state basis.
I want to get involved—where can I learn more about this model or find resources if I need help obtaining insulin?
For more information about the model, visit CMS’s website. You can also call Medicare to ask questions at 1-800-MEDICARE (1-800-633-4227). And if you are struggling to pay for insulin or know someone who is, ADA has resources to help—visit InsulinHelp.org.
Finally, consider joining our fight for affordable insulin by becoming an advocate and take action by engaging with our platform. It will take all of us to bring the price of insulin down for all who need it—and we’re just getting started.