The three major insulin makers announced in March that they would implement monthly price caps and/or lower the list price of insulin. The moves came after years of activism from diabetics and the passage of two federal laws that pressured the companies to act.
What’s it like to show up at a pharmacy and pay $1,200 for a life-saving medication? What’s it like to ration insulin?
Arlington resident Kat Schroeder knows all too well. As a type one diabetic, she relies on insulin to survive and has endured enormous stress over the years trying to maintain access to a steady supply of the expensive medication.
For years, the three major insulin makers steadily raised the prices of the life-saving medication—so much so that over a 20-year period, the cost of insulin increased by an astonishing 600%. These price hikes came as the cost of producing insulin remained stable, between $3.69 and $6.16 a vial, according to one 2018 study.
But thanks to enormous pressure from advocates like Schroeder and the actions of Democratic lawmakers, the tide has finally begun to turn.
Between March 1 and March 16, the three major insulin makers that make up roughly 90% of the market—Eli Lilly, Sanofi, and Novo Nordisk—announced that they would implement a $35 monthly cap for those with private insurance and/or lower the list prices of some of their products by between 70-78%, effective Jan. 1, 2024. Individuals without insurance will also have access to lower prices, due to the list price decreases and through patience assistance programs (though these programs are often difficult to use).
The announcements came after President Biden’s Inflation Reduction Act capped out-of-pocket insulin costs for seniors on Medicare at $35 per month. Biden’s American Rescue Plan also reformed the rules guiding the Medicaid health insurance program so that the companies would have faced a financial penalty had they not lowered their prices.
We recently interviewed Schroeder to hear her story and get her thoughts on the recent announcements.
This interview has been edited and condensed for brevity and clarity.
Dogwood: What’s it’s like living with diabetes and having to ration care?
Schroeder: In 2010 I was working for a company that offered insurance to their employees, but they failed to inform everyone of when the open enrollment period was and I had been told the wrong month. When I started, I was told, ‘Oh, it’s in July,’ and then when I went to ask about it in July, they said, ‘Oh no, it was June.’
At that point I was facing going without insurance for about a 10-month period, because my COBRA plan was expiring. I tried to call every insurance company. I went on websites, I looked at government programs. I made too much money to qualify for most of the government programs and there really weren’t any options. Even when I called and said ‘I will pay whatever,’ the companies at the time were still able to reject people just on the basis of you saying that you have a chronic illness. The minute they heard diabetes, everybody said no, which was really harrowing.
I ended up being able to survive that period through the grace of a friend who worked for a local hospital in the area. In her unit, patients were sometimes prescribed insulin while they were in the hospital, but when they would leave, they didn’t need it anymore, so they didn’t take it. She was supposed to throw those vials away, because they’re already paid for by somebody’s insurance, but she would pocket them and bring them to me.
I wouldn’t be here if it weren’t for having that access to somebody who was able to help, and I was still rationing during that time. It’s very frightening to feel like you could run out at any time of the thing that helps you stay alive and avoid a very painful death. It would’ve been financially devastating for me if I had had to go to a hospital, for example, and in the intervening years, we have a lot of diabetics who have died from insulin rationing and it can be dangerous just to do with less than what your body needs.
[Editor’s note: The Affordable Care Act banned insurance companies from discriminating against or denying coverage to people with preexisting conditions and created marketplace insurance plans, but the law did not go into effect until 2014, years after Schroeder’s experience.]
How much do you currently pay a month for insulin? What is your situation right now?
With my current insurance, I pay $105 every three months, which is $35 a month basically. They fill my insulin three months at a time, and I will pay that co-pay regardless of how much insulin I’m being prescribed. On average, diabetics use between two and six vials per month. I’m at about four vials per month at the moment. But again, I will always pay that same co-pay unless my company changes our insurance plan.
One of the things that I think has been frustrating about insulin becoming this poster child for this wider issue of drug prices is that a lot of politicians and people can’t keep straight what the difference is between a co-pay and the list price. If for some reason I need more insulin than what my prescription covers, I have to buy that at the list price.
There are a lot of people who face large deductibles at the beginning of every year. They’re also paying those out of pocket costs. I can tell you I was in that situation before with a previous employer where I had a large deductible and went to the pharmacy and had to pay $1,200 at the pharmacy counter. And there’s no option. You have to do it or you’re going to die—or incur even more debt going into an emergency medical situation.
I’m fortunate enough now to be far enough along in my career that I don’t have to stress as much about the financial burden, but I think most of us very much remember what it feels like to be in that situation where you’re choosing between housing or medication or food or medication. I can tell you that a lot of times insulin rationing doesn’t just mean that you are taking less insulin than what your body needs, it means that you’re starving yourself because food requires insulin to be properly processed by your body.
In March, the three big insulin manufacturers all announced they’re going to either implement co-pay caps or decrease the list price, or both. What was your reaction to those announcements?
My first reaction was disbelief and the next feeling I had was anger. We’ve watched a number of our community die over this issue, and that was very much just a cost of doing business for these companies. There are human lives on the line and they didn’t care as long as they were raking in profits. This decision could have been made at any point.
There’s a little bit of distrust for me on the part of these manufacturers because I don’t know if you’ve ever tried to navigate a patient assistance program, but it’s very difficult and they intentionally design it to be difficult because they want to be able to say that they’re helping, but they don’t actually want to provide that material help.
In addition to that, it feels a little bit like this is only happening because of the very hard work that advocates have put into making this drug a poster child for this issue and because the companies are afraid of federal regulation. We recently introduced a bill to the Senate called the Insulin for All Act, which would actually enact a federal price cap [at $20 per vial] and it feels like the companies are taking the wind out of our sails by saying, ‘Oh, we’ve already addressed this.’ Meanwhile, there’s no regulation in place to prevent them from doing the exact same thing over again when the rest of the population says, ‘Oh, this has been addressed, it’s been fixed.’
There’s also a lot of speculation that this is coming as a result of earlier legislation. I know that the Inflation Reduction Act did quite a bit to address some broader drug pricing issues, but actually there was also the American Rescue Plan of 2021, which is eliminating these rebate caps in Medicaid, and so what that was going to probably mean for these insulin manufacturers is that anytime somebody on Medicaid needed a vial of insulin, they would have to pay the difference between the list price and what Medicaid had approved back to Medicaid.
This is very much not a benevolent move from these insulin manufacturers. It’s very much a long-term calculation of how they can continue to have the system that they have now without intervention, and it doesn’t really help anybody right this second. We’re still facing people who are in desperate need of medication for the rest of the year.
You mentioned the Inflation Reduction Act and the American Rescue Plan. Those laws seem to be working as intended because they’re forcing these companies to actually do something. Are you glad to see that? Given where things were five years ago or a decade ago, do you feel like things are on the right track?
While I’m very much distrustful of the companies themselves, it’s a huge win for the community. There’s a very big difference between paying $70 a vial for the medication you need and $315 a vial, and while that price point will still be inaccessible for some, it will be much easier for us to provide financial relief or to help our community navigate those gaps.
I’m very happy that the announcements were made. Every little bit helps and I think while we still have a lot of work to do, it is a big deal that this is happening.
You’ve said you are in a better place and professionally enabled to afford these things. But will those changes affect you and your ability to secure insulin at a lower cost or without worrying as much?
Definitely. Right now, as a person who’s using insulin pump therapy, I only take one kind of insulin, and that is one of the brand names that is being reduced. So if next year I’m having a period of insulin resistance where I’m going through my medication faster than planned, then yeah, I’m potentially only paying $70 to fix that gap. And yeah, it is still a big deal. It makes things a lot easier for me if I’m not faced with these decisions at any point of, ‘Do I have to drop a grand at the pharmacy?’
But they’re only changing the prices on a few of these brands of insulin. For diabetics who rely on the brands for which prices aren’t being reduced, those people will still be paying the exorbitant prices that we pay today. So it’s sort of like, yeah, this will affect me, but I think about everybody else who is not able to take advantage of those changes.
Is there anything else I haven’t asked you about that you want to share?
I’ll give it another shout out to the Insulin For All Act that was introduced by Senator Bernie Sanders (D-Vermont) and Representative Cori Bush (D-Missouri). That would be a true federal price cap for insulin. I want bigger changes to the healthcare system, but selfishly, I’d like that one to get more traction and we need people to put pressure on their representatives to get more conversation going around that and start moving it through the legislative process.
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