Insulin Access and Health Outcomes After the Inflation Reduction Act’s Out-of-Pocket Spending Caps

• In Event: Responding to High-Need Populations: Medicare Policy in Action

Abstract

Due to the high cost of insulin, over 1 million individuals in the United States skip insulin doses to save money, increasing their risk of avoidable diabetes-related complications and mortality. In a landmark policy change, the Inflation Reduction Act capped out-of-pocket costs for insulin at $35 per 30-day supply for Medicare beneficiaries in January of 2023. This project will evaluate the cap’s impacts on insulin access and health outcomes for people who use insulin, including existing disparities by race/ethnicity and income.

Our first analysis used data on 14 million insulin fills from IQVIA’s National Prescription Audit, which include 92% of retail pharmacies and 70% of mail-order and long-term care facility pharmacies, from September 2021 through April 2023. We used a difference-in-differences analysis to compare changes in outcomes for Medicare enrollees aged 65-74 years with Part D insurance (affected by the cap) with changes in a comparison group, people about to age into Medicare (aged 60-64 years without Part D insurance), before and after the cap went into effect. Before 2023, trends in monthly insulin fills were similar in the treatment and comparison group, but in starting in 2023, insulin fills increased in the treatment group by an additional 5% (21,719 fills per month, 95% CI 20,797-22,641). These data suggest that the cap increased the use of insulin.

The next phase of the project, to be completed prior to the conference, will use Medicare claims data to measure the impact of the policy on insulin out-of-pocket costs, insulin adherence, and health care outcomes (emergency department visits, hospitalization) including disparities by race/ethnicity and income. The study sample will include Part D beneficiaries who filled any insulin prescriptions in 2022, the year before the policy came into effect (an estimated 3 million people). We will use a difference-in-differences analysis changes in for people affected versus unaffected by the cap, overall and by race/ethnicity and income. The comparison group will include individuals who could not have paid more than $35 per 30-day supply of insulin in 2022 based on the characteristics of their Part D plan and enrollment in existing affordability programs, a sizable group based on our preliminary data. Finally, because insulin out-of-pocket costs were a source of revenue for insurers, we will also examine the potential unintended consequences of the policy related to insurer responses (e.g., increases in premiums, fewer covered insulins, or exit from the market for standalone Part D plans serving locations with many insulin users). These unintended consequences could undermine the policy’s intended impact on medication affordability.

We expect to find that the Inflation Reduction Act’s out-of-pocket cap improved insulin affordability, reduced insulin rationing, and improved health outcomes while decreasing disparities, but had unintended consequences that partially undermine these improvements in insulin access. Overall, this project will provide a novel analysis of a landmark policy designed to reduce out-of-pocket costs for insulin. The results will provide policymakers with the knowledge needed to design policies that promote equitable access to insulin and reduce preventable hospitalizations and mortality.

Authors

• Rebecca Myerson, Emory University
  Non-Presenting Co-Author

• Nam Hyo Kim, University of Wisconsin-Madison
  Presenting Author

• John Romley, University of Southern California
  Non-Presenting Co-Author

• Dima Mazen Qato, University of Southern California
  Non-Presenting Co-Author

• Erin E E Trish, University of Southern California
  Non-Presenting Co-Author

• Jessica Cao, University of Wisconsin-Madison
  Non-Presenting Co-Author

• Dana Goldman, University of Southern California
  Non-Presenting Co-Author