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The Deadly Costs of Insulin
June 10, 2019

The Deadly Costs of Insulin


Danielle K Roberts is a Medicare insurance expert and co-founder at Boomer Benefits, where she and her team help thousands of baby boomers with their Medicare supplemental insurance every year. Via online webinars and video email courses, she has taught the basics of Medicare to new beneficiaries across 47 states. Danielle is also a member of the Forbes Finance Council where she writes about the costs of healthcare in retirement.
In an era when healthcare is extremely expensive, there are many opinions on how involved our federal government should be in bringing drug prices down. However, there is one particular drug-pricing crisis that many can agree needs to be addressed sooner rather than later: the insulin crisis.

For decades now, insulin prices have been soaring to new heights. Heights that the founders and creators of the drug, Frederick Banting and Charles H. Best, likely never imagined would be reached.

In his run for the presidency, President Donald Trump campaigned on the promise to lower the cost of overpriced prescription drugs. Since taking up his position in the Oval Office, Trump has been working to negotiate pricing with big-name pharmaceutical companies. Some of these companies have compromised under pressure and have agreed to lower drug costs.

Unfortunately, insulin is not one of the drugs that has seen any significant price reduction yet.

That’s not to say that few insulin manufacturers and insurance carriers haven’t done their part by inching towards lowered insulin costs. Cigna’s pharmacy benefit manager, Express Scripts, recently announced they will help nearly 700,000 patients with diabetes by lowering their insulin cost to $25. Sanofi, one of the dominating insulin manufacturers of the world, also has plans to engineer a similar program called Insulins Valyou Savings Program that supposedly will bring insulin costs down from $347 per month to $99 per month.

These proposals and others like them are coming about simply because the price of insulin doesn’t make sense logically, financially, or morally.

Painting the Bigger Picture

The fact that only 700,000 patients will be affected by Cigna’s lowered insulin costs is astonishing when you look at the big picture. According to the CDC, over 30 million Americans suffer from diabetes. That means that Cigna’s proposal will help a whopping 2.3% of patients with diabetes.

What about the other 29.3 million patients who are paying anywhere from $300 to $800+ a month for their necessary insulin?

Back in 1996, when Eli Lilly’s Humalog first came out, the price for a 1-month supply of insulin was $21. As of 2001, that exact vial’s price increased by $14 to $35. Now, in 2019, that vial is said to be around $275. That is a 1200% increase on the original price.

Since 1996, the value of the dollar has only decreased by roughly 62%. So, why has the price of insulin increased so much over the years? The world may never know since pharmaceutical companies continue to hold their tongue when asked about it.

However, as of March 2019, Lilly has launched a generic version of Humalog (insulin lispro). One vial of this generic insulin is half the price of its brand-name alternative. It seems that Eli Lilly is moving in the right direction as far as adding more generics to the list of available insulins.

How Does This Affect Medicare Beneficiaries?

Although the current proposed plans by Cigna and Sanofi won’t affect Medicare beneficiaries, perhaps the additions of generic options will. As of right now, there are few generic insulin options and Medicare Part D plans are not required to offer them all.

Many beneficiaries find that they are able to afford their insulin costs through their Medicare Part D plans until they reach the donut hole.

In the Medicare Part D donut hole, technically called the coverage gap, beneficiaries pay a percentage of drug costs – 25% for brand name and 37% for generics. Because most insulins available today are brand-name drugs, 25% of the total drug costs will likely be what a Medicare beneficiary pays in the donut hole in 2019.

Many beneficiaries admit to ordering insulin from Canadian pharmacies where the pricing is more manageable. To put it bluntly, the same vial of Humalog that costs nearly $300 here costs $32 in Canada.

Since older Americans suffer the most from diabetes, Medicare beneficiaries should have an easier time accessing less expensive insulin options.

The Reality of Insulin Costs

Due to the bankrupting effects of insulin costs, many people feel forced to ration their monthly prescriptions. Many stories have been published about people who do this and later suffer the ultimate sacrifice: death.

Alec Raeshawn Smith

Let’s look at Alec Raeshawn Smith’s story, which has been widely covered by the media. Smith was a young man diagnosed with diabetes at age 24 who died at age 26 when trying to ration his expensive insulin. Smith worked as a manager at a local restaurant. His position didn’t allow him the luxury of an employer health plan.

Once he received his surprising diagnosis of type 1 diabetes, he quickly started researching insurance plans. What he found was devastating. For plans that his doctors accepted, he was looking at a potential $450 monthly premium. That alone was more than what he was paying out-of-pocket for his diabetes supplies at the time.

As the need for supplies and insulin grew, Alec found himself spending more than $1000 per month to manage his disease when his salary was just shy of $3000 per month. Faced with this nearly impossible task, he administered less insulin than he truly needed.

Shortly after, his family was burdened with the death of a son and brother.

Meaghan Carter

USA Today shares Meaghan Carter’s story, which is also compelling. As a nurse who was diagnosed with type 1 diabetes, Carter knew how to manage her disease. However, she too lost her life due to rationing her insulin.

Carter had a diabetes kit full of supplies laying near her when she was found in her Ohio apartment. Within the kit, there were 2 of her preferred insulin vials drained of the last drop and a partial vial of Walmart’s insulin, which may have been less effective for her.

Stories similar to these continue to circulate the world wide web. However, there are also success stories about people who have been lucky to obtain help with insulin costs. One woman, after tweeting about her $524 bill for 2 of her daughter’s insulin vials, received $8000 in a GoFundMe campaign from fellow tweeters.

We can give kudos to Eli Lilly’s company, for it has started a helpline called the Lilly Diabetes Solution Center to help people with paying for their insulin. The center provides information on ways to afford insulin and helps people with coupons to reduce the cost of their expensive insulin. One #insulin4all activist, Michelle Fenner, reported that she received a coupon from the helpful helpline that brought her son’s monthly insulin cost down to $95 from the enormous $900 that it was.

Change Is Required

If we don’t put an end to unnecessarily high insulin costs, many more people will lose the fight against diabetes. The fact that some manufacturers have begun to apply changes to the system shows that there may be a light at the end of the tunnel.

No matter who sits in the White House after the 2020 election, the crisis that is insulin costs, should be acknowledged and fixed as soon as possible.  

 
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