The Inflation Reduction Act caps costs for Medicare patients on insulin. Where the push for broader relief stands

Personal Finance

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A new legislative package signed into law by President Joe Biden on Tuesday is a big win for Medicare patients who struggle to cover the cost of insulin to manage their diabetes.

But the bill, called the Inflation Reduction Act, falls short of applying those cost controls to the broader patient population who rely on insulin.

The bill limits insulin copays to $35 per month for Medicare Part D beneficiaries starting in 2023. Notably, seniors covered by Medicare also have a $2,000 annual out-of-pocket cap on Part D prescription drugs starting in 2025. Medicare will also now have the ability to negotiate the costs of certain prescription drugs.

“We’re very excited that seniors are going to see these cost savings,” said Dr. Robert Gabbay, chief scientific and medical officer at the American Diabetes Association.

But the changes fall short of the broader applicability to diabetes patients who are covered by private insurance.

“We’re glad for the victory we have, but there’s more work to be done,” Gabbay said.

Why insulin relief was limited to Medicare patients

Democrats pursued the Inflation Reduction Act through a process called budget reconciliation, or a simple party majority.

In that process, the Senate Parliamentarian ruled broader insulin reform for non-Medicare patients could not be included in the legislation. Senate lawmakers then sought 60 votes in order to keep it in the bill. But they fell short with just 57 votes, as 43 lawmakers opposed it.

The result was a disappointment, Gabbay said. Legislation capping the cost of insulin, or the cost of care to people with diabetes, has already been passed in 23 states and Washington, D.C.

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“We were hoping that now is the time to go national and really have a comprehensive law that would protect all people with diabetes in the U.S.,” Gabbay said.

The American Diabetes Association plans to continue to advocate for relief for more patients, including the INSULIN Act, which calls for capping monthly insulin costs for a broader patient population.

“We hope that that can come to Congress this fall,” Gabbay said.

Senate Majority Leader Chuck Schumer, D-N.Y., also expressed his intention to bring the proposal up for a vote again in the coming months.

What Medicare beneficiaries on insulin can expect

For patients age 65 and up who rely on insulin, the Inflation Reduction Act is a “game changer,” Gabbay said.

More than 8 million people in the U.S. rely on insulin to manage their blood glucose levels, and if they stop taking the medication for a few days, they could die. “It’s deadly serious,” Gabbay said.

Yet as the year progresses, some Medicare patients tend to get nervous about a coverage gap known as a “donut hole” and may try to ration their insulin, he said.

The high costs of insulin result in 14% of patients having “catastrophic” levels of spending on the treatment, according to recent research from Yale University. For Medicare patients on insulin, catastrophic spending affects one in five patients, the research found.

Starting in 2023, the Inflation Reduction Act will cap the cost of insulin for Medicare beneficiaries at $35 per month and will include those who use insulin pumps.

Medicare beneficiaries who pay more than $35 per month after the legislation is initially enacted will be reimbursed, according to the American Diabetes Association.

For patients struggling to cover insulin, the American Diabetes Association provides resources that may help curb those costs at Insulinhelp.org.

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