By Katherine Swartz, USA TODAY
August 8, 2022
WASHINGTON – Senate Democrats were able to keep the out-of-pocket price for most insulin at $35 per month through the Inflation Reduction Act they passed Sunday and sent on to the House. But millions of diabetics still will pay more after Republicans amended the measure to exclude private insurers.
The Senate parliamentarian decided on Sunday that the cap on private insurers was not in line with the rules of reconciliation, the budgetary process which allowed Democrats to pass the bill without Republican support in the evenly divided Senate.
Republicans pushed to limit the cap to Medicare only, a vote that required 60 senators to overcome. Seven Republicans sided with Democrats to keep the provision on private insurers in place, but it fell short – 57-43 – meaning the cap will not apply outside of Medicare assuming the House passes the bill.
Republicans who voted against the cap on private insurers argued the Senate should decide on the cap separate from the larger reconciliation bill, which includes a variety of measures on climate and taxation in addition to pharmaceutical pricing.
The seven Republicans who voted to keep the cap on private insurers were Susan Collins of Maine, Cindy Hyde-Smith of Mississippi, Josh Hawley of Missouri, John Kennedy and Bill Cassidy of Louisiana and Lisa Murkowski and Dan Sullivan of Alaska.
While the cap for Medicare recipients is still a win Democrats have long pushed for, letting private insurers continue to decide what they charge is a setback for those in diabetic community advocating for across-the-bard price controls.
President Joe Biden called for the $35 cap in his State of the Union Address in March, and senators twice this session have sought to cap insulin costs. Sen. Raphael Warnock, D-Ga., sponsored a bill in February, and Sen. Susan Collins, R-Maine, and Sen. Jeanne Shaheen, D-N.H., led a bipartisan effort in June targeting both Medicare and private insurers. Neither of those bills reached the floor.
Out-of-pocket cap prevails for Medicare
One in three Medicare recipients has diabetes, with over 3.3 million who rely on insulin. The savings from this $35 co-pay cap could amount to hundreds of dollars per year, according to Carmen Balber, the executive director of Consumer Watchdog, a non-profit, consumer advocate organization.
“Diabetes is a common malady in the United States and insulin is a drug that consumers have to take for their entire lifetime. Allowing the drug industry to manipulate pricing on a drug like insulin that keeps diabetics alive is unconscionable,” Balber said.
A Yale University study found that 14% of insulin users spend 40% or more of their income on insulin.
Insulin prices in the U.S. have skyrocketed in the past decades while other countries’ prices remained stable. A study conducted by the Rand Corporation in 2018 found that the average cost of insulin per unit in the U.S. was $98.70, compared to $12 in Canada and $7.52 in the United Kingdom.
“It’s pure capitalism,” Balber said.
“Because insulin is so necessary, they’re able to charge more for it. It’s an example of the market dysfunction that we see in the drug industry, that companies can raise prices that will, wildly beyond the pace of inflation, and get away with it,” she said.
In a press conference following the bill’s passage, Sen. Majority Leader Chuck Schumer said the Inflation Reduction Act takes a significant step to lower prescription drug prices, including insulin, following years of effort.
“Ever since I got to the Senate in 1999 we’ve been trying to do this, and finally we have in a major way,” Schumer said.
He called the Medicare insulin cap a “big, big win for millions of seniors” who rely on Medicare.
Insulin users on private insurance left without cap
Nearly one-third of those insured through a small employer and one-fifth insured through large employers pay more than $35 a month for insulin, according to analysis from the Kaiser Family Foundation.
“There are lots of moderate and lower income people covered by private insurance, and they are not going to benefit from this,” said Richard Frank, a senior fellow in economic studies at the Brookings Institute.
“Maybe when the insulin issue isn’t part of a larger thing that is as partisan as the Inflation Reduction Act was, then clearer thinking might prevail, and a free-standing bill that fixes the rest of the insulin problem potentially could could pass,” he said
In a tweet on Sunday, Sen. Ron Johnson, R-Wis., who voted with Republicans against the cap – said the amendment amounted to a “Democrat ‘gotcha’ vote.”
“In reality, the Dems wanted to break Senate rules to pass insulin pricing cap instead of going through regular order. They put this in a bill it wasn’t allowed in, all for show,” he tweeted on Sunday.
