The Inflation Reduction Act and Its Impact on Medicare Coverage for Insulin
The Centers for Medicare and Medicaid Services (CMS) have introduced a Special Enrollment Period (SEP) for people with insulin to change their Part D coverage, ensuring they are not paying more than $35 each month for their insulin products. This move comes as part of new legislation signed by President Joe Biden last fall, the Inflation Reduction Act, which includes policies to cap the monthly cost of insulin at $35 and reduce the cost of other diabetes drugs for those on Medicare. The legislation aims to address the rising costs of insulin and other diabetes medications and make them more affordable for people with diabetes.
As of Jan. 1, 2023, Medicare can’t charge more than $35 for a one-month supply of each Part-D covered insulin, regardless of whether or not you have met the deductible. This cap applies to several diabetes drugs and insulins, including Lantus, Jardiance, Novolog, and Trulicity. If you use a disposable insulin patch pump, you’ll continue to get your insulin through your Part D plan, and the insulin for your pump won’t cost more than $35 each month for each covered insulin product. However, the pump is not subject to the $35 cap and may cost more than $35.
If you pay more than $35 for any month’s supply of insulin between January 1, 2023, and March 31, 2023, your Part D plan must reimburse you within 30 calendar days for the amount you overpaid. Plans have until March 31, 2023, to update their systems to ensure that you’re not charged more than $35.
The Medicare Plan Finder is a helpful tool that can assist you in comparing and selecting prescription drug plans. However, the $35 insulin copay cap was not included in the premiums and copays set on the Medicare Plan Finder, as it was signed into law after they were established. As a result, the CMS has created a Special Enrollment Period for people who use insulin.
Medicare beneficiaries can change their Part D coverage until December 31, 2023. If you use a covered insulin product and want to be in a different Part D plan for 2023, you can change your coverage one time between now and December 31, 2023. Call 1-800-MEDICARE if you take insulin and want to change your plan. Your true out-of-pocket costs will carry over from your old plan to your new one.
In addition to the cap on insulin costs and the SEP for Medicare beneficiaries, the Inflation Reduction Act also includes low-income benefits. Medicare beneficiaries who make between 135% and 150% of the federal poverty level ($18,347 to $20,385 for a single person) can access additional discounts through the Extra Help program. Starting in 2024, eligible people will have a set, low out-of-pocket cost for each prescription, which could save them an average of $300 a year on out-of-pocket costs, according to government estimates.
These changes to insurance coverage for insulin are significant and represent a step forward in making diabetes medications more affordable for people with diabetes. The CMS hopes that the $35 insulin copay cap will provide financial relief to millions of Americans who rely on insulin to manage their diabetes.
By creating a Special Enrollment Period, the CMS aims to ensure that Medicare beneficiaries have access to affordable coverage for their insulin products. The low-income benefits provided by the Extra Help program will help those who struggle to afford their diabetes medications, and the set, low out-of-pocket cost for each prescription will make budgeting for medications more manageable.
