This article was last updated on October 16, 2020.
Trump’s $35 insulin copay plan
As an attempt to sway older American voters, President Trump has announced that, if re-elected, he plans to lower Medicare copays for insulin to a maximum of $35 a month.
An AP-NORC poll this month found warning signs for Trump with older voters. Fifty-four percent of adults 60 and older said they disapproved of how Trump is handling his job as president, while 45 percent approved.
“I hope the seniors are going to remember it,” Trump said in hopes to gain the crucial votes of older Americans that he would need to be reelected.
Presidential debate: Trump says insulin is “like water”
In the recent Presidential debate, President Trump claimed he lowered the price of insulin to be as cheap as water. “I’m getting it for so cheap it’s like water,” he said.
While this may be the case for some Americans come next year, it is still not true for many. Here’s why.
A new $35 insulin cap is a voluntary option for the large insulin manufacturers that dominate the industry: Eli Lily, Novo Nordisk, and Sanofi. Anne Swerlick of the Florida Policy Institute said, “The system is extraordinarily fragmented and people are going to fall through the cracks.” In other words, it’s way more complicated than it seems.
More importantly, the $35 copay plan only applies to certain kinds of insulin, not the doctor-preferred modified insulins that work better. Those can cost between $500 and $1,000 for a single vial without insurance.
Many will still pay more for insulin, and those on Medicaid will pay different prices based on their state, without any clear reasoning behind the pharmaceutical companies’ pricing decisions.
Trump’s proposal
Medicare beneficiaries with prescription plans would pay a maximum of $35 a month starting next year, saving an estimated $446 annually. The nuisance of fluctuating cost-sharing amounts would be eliminated and replaced by a manageable sum.
Though the insulin benefit would be accessible to most Medicare recipients, it would be voluntary. This means that during Medicare enrollment this fall, it will be important for Medicare recipients to pick an insurance plan that provides it, such as Eli Lilly, Novo Nordisk, and Sanofi (top suppliers that were all involved in the agreement).
Seema Verma, head of the Centers for Medicare and Medicaid Services, said that 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.
But the cap on copays is expected to lead to an increase in premiums.
Importantly 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.
The cost of insulin
The cost of insulin is one of the biggest worries of consumers, as drug prices continue to climb. Millions of people with diabetes use insulin to keep their blood sugar within normal ranges and stave off complications that can include heart disease, blindness, kidney failure, and amputations. It is now known that people with diabetes also suffer worse outcomes from COVID-19.
One out of three people with Medicare have diabetes, and more than 3 million use insulin. At list prices, insulin can cost more than $5,000 a year. Although insured patients do not pay that price, they do notice a rise in their copays based on the full cost.
People who can not afford their insulin may try to cope by reducing their doses, a dangerous calculation that can put their lives in jeopardy. Do not lower your insulin dose without talking to your doctor first.
Fact check: nothing has changed
Since Trump has been in office, insulin prices have remained roughly $300 a vial. Most patients with diabetes need two to three vials per month, and some can require much more.
The early bluster from Trump on drug pricing is the latest sign that the president will campaign hard on his efforts to lower prescription drugs. In recent months, Trump has launched a digital ad onslaught that attempts to frame Joe Biden as the much-maligned drug industry’s preferred candidate. Trump brought up the issue in response to a question about his plan to replace the Affordable Care Act, which he has often touted in recent speeches but has almost no specifics.
Trump also insisted during Tuesday’s debate that he had implemented a “most-favored nations” policy that would radically lower drug prices, but that plan still hasn’t been implemented. He suggested, too, that he was letting states import drugs from Canada, but it could be months or even years before any state is ready to submit a plan to do so, under rules that were only released last week.
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What has been accomplished?
Trump has only cut insulin costs for a small subset of seniors. In March, his administration announced a plan to cap what seniors pay at the pharmacy counter at $35 a month. That perk is only available to a fraction of seniors enrolled in certain pricey private insurance plans.
Trump also signed an executive order in July that would require certain health centers to share the steep savings they receive from drug makers directly with poor patients who get their care at these health centers. However, that plan still hasn’t been enacted.
Bipartisan disagreements on drug cost
Bipartisan legislation to limit price increases and reduce costs for older people with high drug bills is pending in the Senate.
The fate of drug pricing legislation seems to rest with House Speaker Nancy Pelosi, who has a much more ambitious plan for Medicare to negotiate prices for the costliest drugs, not just insulin. Pelosi would use expected savings to provide vision, dental, and hearing coverage for older adults. Most Republicans oppose the Speaker’s approach as an expansion of government price-setting. Pelosi does not seem to be wavering.
Although the Trump administration and Pelosi’s office were in conversations last year about prescription drug legislation, the relationship between the two leaders has created much tension in the White House of late.
Medicare changes welcomed by insurers
Of the $35 insulin copay cap, 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 enrolled 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 October 15. Medicare’s online plan finder will help beneficiaries find plans that cap insulin copays.
The insulin benefit will be available in all 50 states, Washington, D.C., and Puerto Rico. Participation is voluntary for insurers and Medicare recipients.
