CMS Rolling Out $35 Insulin Model for Medicare Part D
The Centers for Medicare and Medicaid Services has invited Part D drug plan insurers to put in proposals for a new Part D model that would provide Medicare recipients with access to affordable insulin costing no more than $35 for a month's supply.
The new model, known as the "Part D Senior Savings Model," would be rolled out for the 2021 plan year under the CMS's plan. All Part D plan underwriters have been invited to submit applications to offer these new models.
One in every three Medicare beneficiaries has diabetes, and more than 3.3 million Medicare beneficiaries use one or more of the common forms of insulin. But, because some pharmaceutical companies have been ramping up the price of their insulin, there have been horror stories about people reducing their dosage because they can no longer afford to pay for a 30-day supply.
Reducing dosage or skipping doses can lead to serious complications, including vision loss, kidney failure, foot ulcers and amputations, and heart attacks.
The Part D Senior Savings Model would provide Medicare patients with new choices of Part D plans that offer insulin at an affordable and predictable cost where a 30-day supply of a variety of insulins on plan formularies would cost $35 or less.
The models would be available to enrollees who receive Part D coverage through stand-alone prescription drug plans (PDPs) and Medicare Advantage plans that provide Part D prescription drug coverage.
Addressing current system flaw
The CMS is paving the way for this new model by waiving a current flaw in the system that serves as a disincentive for Plan D sponsors.
While Part D insurers can currently offer PDPs that provide lower cost-sharing for brand and other applicable drugs in the coverage gap, if an insurer designs its benefit that way, it has to foot costs that the drug maker would typically pay. Those costs are then passed on to enrollees in the form of higher premiums.
Part D sponsors participating in the Part D Senior Savings Model would offer beneficiaries plan choices that provide access to multiple types of insulin, marketed by drug makers that participate in the model program.
The cost would require a maximum $35 copay for a 30-days' supply in the deductible, initial coverage, and coverage gap phases of the Part D benefit.
This would result in average savings of $446 in out-of-pocket costs for enrollees who need insulin. That's a savings of about 66% from the average cost-sharing today.
Also, by making the copay fixed, it would provide enrollees with predictability in their drug outlays, which is vital to the majority of Medicare recipients.
The CMS has also rolled out incentives to Part D insurers to coax them into participating in the model.
Through the model, the agency is also testing how participating Part D insurers can offer rewards and incentive programs to encourage healthy behaviors and medication adherence among their plan enrollees.