Medicare Beneficiaries Granted Lower OOP Insulin Costs Under Part D Senior Savings Model

WASHINGTON, D.C., The United States – The Centers for Medicare & Medicaid (CMS) announced that over 1,750 standalone Medicare Part D prescription drug plans and Medicare Advantage plans with prescription drug coverage applied to offer lower insulin costs under the Part D Senior Savings Model for the 2021 plan year.

Through this, participating plans will provide Medicare beneficiaries a wide array of insulins with a $35 maximum co-payment for a month’s supply, from the start of the year.

The model aligns with the Trump Administration’s announcement of a 13.5% decline in the average monthly basic Part D premium since 2017, to its lowest level in seven years.

The insulin model makes up for the coverage gap Part D sponsors pass on to beneficiaries in the form of higher premiums. As such, in the 2021 plan year “disincentives” will be addressed: manufactures will be allowed to continue paying their full coverage gap discount for their products and participating Part D sponsors will be required to lower cost-sharing to no more than $35 for a month’s supply of insulin.

CMS is being enabled to encourage Part D plans to offer fixed, predictable copays for beneficiaries rather than making seniors responsible for paying 25% of a drug’s cost due to the coverage gap.

According to CMS, beneficiaries who partake in the plan could see average out-of-pocket (OOP) savings of $446, or 66%, when it comes to their insulin, which will be funded by manufacturers paying an additional $250 million in discounts over five years.

Seema Verma, CMS Administrator, said, “President Trump has forged partnerships with pharmaceutical manufacturers and plans to deliver lower priced insulin to our nation’s seniors. This market-based solution, in which insulin manufacturers and Part D sponsors compete to provide lower costs and higher quality for patients, will allow seniors to choose a Part D plan that covers their insulin at an average 66 percent lower out-of-pocket cost throughout the year.”

The Part D Senior Savings Model – which was announced on March 11, 2020 – is a voluntary model that tests the impact on insulin access and care by participating Part D enhanced alternative plans offering lower out-of-pocket costs, at a maximum $35 copay for a month’s supply, for a broad range of insulins.