Steve Lubin spent a lot last year on insulin to control his Type 2 diabetes.<\/p>\n
A retired nurse in Philadelphia, Lubin relies on Medicare for health coverage, including a Part D plan to cover drug expenses. Yet, his out-of-pocket costs kept mounting, including a deductible of $480, monthly supplies of two forms of insulin, and higher prices once he entered the \u201ccoverage gap.\u201d His total insulin tab in 2022: $1,582.<\/p>\n
So, Lubin, 68, was cheering for the sprawling federal Inflation Reduction Act, which among other provisions called for capping insulin prices for Part D beneficiaries at $35 a month, with no deductible. He signed petitions circulated by the American Diabetes Association and the Pennsylvania Health Access Network asking Congress to approve it.<\/p>\n
\u201cMy income is definitely down from when I was working, and the expenses go up,\u201d he said. \u201cIt\u2019s difficult.\u201d<\/p>\n
Lubin also supported the bill because, after working in an intensive care unit for years, he had seen patients suffer the serious consequences of diabetes when they could not afford their prescriptions.<\/p>\n
\u201cYou\u2019d take their history and find out that they were rationing their insulin or couldn\u2019t take it at all,\u201d he recalled.<\/p>\n
In August, Congress passed the bill, and President Joe Biden signed it. Lubin\u2019s out-of-pocket insulin costs for 2023 will fall to $630. The legislation establishes other requirements to lower drug prices for Medicare beneficiaries, about three-fourths of whom have Part D plans.<\/p>\n
\u201cIt\u2019s one of the biggest changes to the way Medicare deals with prescription drugs,\u201d said David Lipschutz, associate director of the Center for Medicare Advocacy. \u201cIt signals lawmakers\u2019 willingness to take on a very powerful lobby.\u201d<\/p>\n
Some provisions took effect Jan. 1; others will phase in over several years. \u201cCollectively, these represent substantial out-of-pocket cost savings, especially for those who use expensive drugs,\u201d said Juliette Cubanski, deputy director of the Kaiser Family Foundation\u2019s Medicare policy program. They could also bolster Medicare by reducing its spending.<\/p>\n
Beneficiaries will see three significant changes in 2023.<\/p>\n
The first is the $35 monthly cap on insulin, which will affect more than 1 million insulin users who have Part D through Medicare Advantage plans or free-standing plans purchased along with traditional Medicare.<\/p>\n
From 2007-20, beneficiaries\u2019 aggregate out-of-pocket insulin costs quadrupled, even though the number of users only doubled. They spent an average $54 a month on insulin in 2020, according to a Kaiser Family Foundation analysis.<\/p>\n
The cap will save average users at least 35% and applies immediately, without requiring them to first pay the Part D deductible, which amounts to $505 in 2023. About 10% of Part D insulin users, such as Lubin, paid more than $1,300 out of pocket in 2020 and will save much more.<\/p>\n
Although all Part D plans must cap the cost, they aren\u2019t required to offer every form or brand of insulin.<\/p>\n
\u201cPeople should make extra sure their plan isn\u2019t dropping their insulin from the formulary,\u201d Cubanski said.<\/p>\n
But Medicare\u2019s open-enrollment period ended Dec. 7, and its online cost-comparison tool doesn\u2019t reflect changes mandated by the new law, which was passed after Part D plans had already set prices.<\/p>\n
\u201cPeople might have made different choices if they\u2019d had more information,\u201d Cubanski said.<\/p>\n
So, Medicare has begun a one-time special enrollment period through the end of 2023, allowing insulin users to drop, add or change Part D plans. Beneficiaries have to call the 1-800-MEDICARE number to make a switch. Counselors at State Health Insurance Assistance Programs can also help with the decision.<\/p>\n
In the second major change, adult vaccines covered by Part D, typically offered at pharmacies, are now free, without deductibles or copays, just as the flu and pneumonia vaccines (covered by Part B) have been.<\/p>\n
That will, in particular, improve access to the shingles vaccine, the most expensive adult vaccine. In 2018, the Kaiser Family Foundation reported, Part D enrollees paid $57 per dose out of pocket \u2014 and each recipient needs two doses.<\/p>\n
Although shingles risk rises with age, only 46% of adults older than 65 had been vaccinated by 2020, the Centers for Disease Control and Prevention reported. Rates were much lower among Black and Hispanic older adults.<\/p>\n
\u201cIt\u2019s disappointing because this is a spectacularly effective vaccine,\u201d said Dr. William Schaffner, an infectious disease specialist at Vanderbilt University Medical Center. Shingrix, the current vaccine, is about 90% effective, and a new study has found that its protection persists a decade after vaccination.<\/p>\n
A serious disease in itself, shingles can also cause the lingering nerve pain called post-herpetic neuralgia. \u201cIt varies from being annoying to being absolutely life-changing,\u201d Schaffner said.<\/p>\n
With Shingrix available at pharmacies without charge, \u201cthe receptivity to vaccination for older adults will increase substantially, especially among underserved populations,\u201d he predicted.<\/p>\n
Also free: hepatitis A and hepatitis B vaccinations, and Tdap, which protects against tetanus, diphtheria and pertussis (whooping cough).<\/p>\n
The third major change: When prices for drugs covered under Part D, and some under Part B, increase faster than the inflation rate, the law now requires drug manufacturers to pay rebates or face stiff penalties.<\/p>\n
Although those rebates will go to Medicare, not to individuals, \u201cif you\u2019re responsible for a portion of a drug\u2019s cost and there are limits on how much that can increase, in theory, your costs should decrease,\u201d Lipschutz said.<\/p>\n
It will take months for Medicare to determine which price increases will prompt rebates and how much the rebates will amount to. But the Congressional Budget Office has estimated this provision will save Medicare more than $56 billion over 10 years.<\/p>\n
Medicaid has employed a similar strategy since 1990. \u201cIt definitely has an effect on keeping spending in check,\u201d Cubanski said. \u201cThe hope is that it will have the same effect for Medicare.\u201d<\/p>\n