New HHS Report Finds Major Savings for Americans Who Use Insulin Thanks to President Biden’s Inflation Reduction Act
$35 monthly insulin cap in historic law, which went into effect January 1 for Medicare Part D, would have saved 1.5 million people with Medicare an average of $500 dollars on their insulin in 2020
Today, the U.S. Department of Health and Human Services (HHS) issued a new report showing the major savings coming to people with Medicare thanks to the $35 cap on a month’s supply of insulin. The report shows that if the Inflation Reduction Act’s provision capping the cost of insulin at $35 for a month’s supply for Medicare beneficiaries had been in place in 2020, 1.5 million seniors across the country would have saved an average of $500 on insulin for the year. Through the Inflation Reduction Act – the most consequential health care law since the Affordable Care Act – President Biden is delivering on his promise to lower prescription drug costs, make health insurance more affordable, and make the economy work for working families.
The insulin provisions of this historic law went into effect January 1, 2023, for Medicare Part D. Starting July 1, 2023, under Medicare Part B, beneficiary cost sharing will be limited to $35 for a month’s supply of insulin. Researchers estimate that 1.5 million people with Medicare would have benefited from the new Inflation Reduction Act insulin cost-sharing limits if they had been in effect in 2020, with total savings to beneficiaries of about $734 million in Part D and $27 million in Part B – an average savings of approximately $500 for those Medicare beneficiaries.
“The Biden-Harris Administration is committed to lowering health care costs and increasing access to high-quality, affordable health care, and the Inflation Reduction Act is helping us do just that,” said HHS Secretary Xavier Becerra. “Thanks to this historic law, people who get their insulin through Medicare won’t have to pay more than $35 for a month’s supply. No one should have to skip or ration their insulin because they can’t afford it.”
Produced by the HHS Office of the Assistant Secretary for Planning and Evaluation (ASPE), the report includes selected findings from a recent report to congress that examined the critical role that insulin plays in the treatment of diabetes, reviewed evidence on how insulin affordability affects adherence to insulin treatment and downstream health consequences, and described policy efforts to improve the affordability of insulin.
The new report also provides information on savings by state and by demographic characteristics, including gender, race and ethnicity, and age. The states with the most people with Medicare projected to benefit from the new Inflation Reduction Act insulin cost savings are Texas (114,000 beneficiaries), California (108,000), and Florida (90,000). North Dakota ($805), Iowa ($725), and South Dakota ($725) have the highest average annual out-of-pocket savings.
In 2019, about 37 percent of insulin fills for people with Medicare required cost-sharing exceeded $35 per fill, including 24 percent that exceeded $70 per fill.
Nationally, the average out-of-pocket cost was $58 per insulin fill in 2019, typically for a 30-day supply. Patients with private insurance or Medicare paid about $63 per fill on average.
The full HHS report, “Insulin Affordability and the Inflation Reduction Act: Medicare Beneficiary Savings by State and Demographics”, is available at https://aspe.hhs.gov/reports/insulin-affordability-data-point and the Report to Congress is available at: https://aspe.hhs.gov/reports/insulin-affordability-rtc
The state-by-state estimated savings and estimated number of Medicare individuals who would experience cost savings can be found below:
Estimated Out-of-Pocket Savings If Inflation Reduction Act $35 Out-of-Pocket Insulin Cap Had Been In Effect in 2020, by State
|State||Total Number of Enrollees in Part D and B Who Would Experience Savings||Projected IRA Savings ($)||Average Annual Out-of-Pocket Savings Per Enrollee ($)|