Part D Senior Savings Model
AMERICAN DIABETES ASSOCIATION - October 5, 2020
Concerned about your rising out-of-pocket cost for insulin? Well you are in luck! CMS has implemented a new Part D Senior Savings Model and starting January 1, 2021 insulin will be more affordable. Contact us to find out which Part D prescription drug plans and Medicare Advantage plans in your area are participating in this model.
How Medicare’s New Senior Savings Model Makes Insulin More Affordable
Frequently Asked Questions:
What is this model?
On May 26, 2020, President Trump announced a new model for Medicare Part D enrollees who purchase insulin. This model will begin on January 1, 2021. It is designed to help 3.3 million Americans affordably access insulin by capping the cost of a 30-day supply for most insulins to a maximum of $35. For enrollees who choose a model participating plan, their insulin prescription will not be subject to a deductible or any coverage gap cost increases. (Whether it’s January or December, their monthly out-of-pocket cost for insulin will be $35 or less.)
1,750 standalone Medicare Part D prescription drug plans and Medicare Advantage plans have committed to participate in this model. CMS anticipates plan options in all 50 states, Puerto Rico, and District of Columbia. Plans may be different in their offerings overall, which is why enrollees need to review all available plans during the open enrollment period that begins on October 15 and ends on December 7, 2020.
Why is this only for Part D enrollees?
The federal government cannot regulate insurance practices for commercial insurers or Medicaid, but it has authority over the way insurance works for the Medicare prescription drug benefit, which is referred to as “Medicare Part D.”
How will Medicare’s $35 per month out of pocket cap for insulin affect pricing policy for other people who rely on insulin?
This model addresses the out-of-pocket cost variability that a Part D enrollee could pay in a year and allows people with diabetes to have consistent, affordable access to this life-essential drug. Medicare policies, once established, heavily influence commercial insurance coverage plans. We hope to see commercial prescription drug plans follow with efforts to make insulin copays more affordable!
Does this mean the price of insulin is lower?
This model does not address the current list price of insulin, which is what an individual would pay if they did not have insurance coverage (though all seniors have insurance coverage). The ADA is committed to ensuring affordable access to insulin and other drugs for all people with diabetes, and there are more opportunities to advance national and state policy to serve this goal. Learn more about our advocacy efforts and get involved by visiting our Engagement Platform at diabetes.org/platform.
What about Medicare Enrollees who use an insulin pump and purchase their insulin through Medicare Part B?
This model does not cap out-of-pocket costs for Medicare Part B. Medicare Part B insulin purchases remain 20% of the negotiated Medicare cost after deductibles are met.
When does the new deal become available to patients?
This model will take effect in January 2021, at which point any senior who chooses a participating enhanced prescription drug plan will be eligible to purchase their monthly insulin prescription for no more than $35 a month.
Will my health insurance plan cover the insulin I take currently?
Each plan offers different types of insulin, so it’s important that you review your plan choices to determine what plan will be best for you.
How much will seniors actually save through this model?
Starting in January, seniors using Medicare Part D will be eligible to purchase their monthly prescription for no more than $35 a month if they choose one of the participating plans, saving an average of $446 in annual out-of-pocket costs for insulin.
Won’t people end up paying higher insurance premiums to get this lower copay deal?
While beneficiaries choosing these enhanced prescription plans may pay slightly higher premiums, they will save far more on a monthly basis out-of-pocket annually and know exactly how much they will spend each month on their insulin prescription (a maximum of $35 for a 30-day supply), rather than a percentage of the list price, which can vary.
Why can’t this occur until January?
As this Model is part of a ground-breaking Medicare shift, plans must go through a bid process to be accepted and participate for 2021. The government is working quickly to have these plans in place for open enrollment, which begins on October 1st.
When this happens, seniors will need to look for insurance plans that offer this new insulin savings program and choose their Part D insurance plan carefully, making sure that the type of plan, if they take insulin, is an enhanced prescription plan that best fits their needs. Almost all types of insulins will be available through these plans, but each plan may choose different insulins on their formulary.
How Medicare’s New Senior Savings Model Makes Insulin More Affordable
Frequently Asked Questions:
What is this model?
On May 26, 2020, President Trump announced a new model for Medicare Part D enrollees who purchase insulin. This model will begin on January 1, 2021. It is designed to help 3.3 million Americans affordably access insulin by capping the cost of a 30-day supply for most insulins to a maximum of $35. For enrollees who choose a model participating plan, their insulin prescription will not be subject to a deductible or any coverage gap cost increases. (Whether it’s January or December, their monthly out-of-pocket cost for insulin will be $35 or less.)
1,750 standalone Medicare Part D prescription drug plans and Medicare Advantage plans have committed to participate in this model. CMS anticipates plan options in all 50 states, Puerto Rico, and District of Columbia. Plans may be different in their offerings overall, which is why enrollees need to review all available plans during the open enrollment period that begins on October 15 and ends on December 7, 2020.
Why is this only for Part D enrollees?
The federal government cannot regulate insurance practices for commercial insurers or Medicaid, but it has authority over the way insurance works for the Medicare prescription drug benefit, which is referred to as “Medicare Part D.”
How will Medicare’s $35 per month out of pocket cap for insulin affect pricing policy for other people who rely on insulin?
This model addresses the out-of-pocket cost variability that a Part D enrollee could pay in a year and allows people with diabetes to have consistent, affordable access to this life-essential drug. Medicare policies, once established, heavily influence commercial insurance coverage plans. We hope to see commercial prescription drug plans follow with efforts to make insulin copays more affordable!
Does this mean the price of insulin is lower?
This model does not address the current list price of insulin, which is what an individual would pay if they did not have insurance coverage (though all seniors have insurance coverage). The ADA is committed to ensuring affordable access to insulin and other drugs for all people with diabetes, and there are more opportunities to advance national and state policy to serve this goal. Learn more about our advocacy efforts and get involved by visiting our Engagement Platform at diabetes.org/platform.
What about Medicare Enrollees who use an insulin pump and purchase their insulin through Medicare Part B?
This model does not cap out-of-pocket costs for Medicare Part B. Medicare Part B insulin purchases remain 20% of the negotiated Medicare cost after deductibles are met.
When does the new deal become available to patients?
This model will take effect in January 2021, at which point any senior who chooses a participating enhanced prescription drug plan will be eligible to purchase their monthly insulin prescription for no more than $35 a month.
Will my health insurance plan cover the insulin I take currently?
Each plan offers different types of insulin, so it’s important that you review your plan choices to determine what plan will be best for you.
How much will seniors actually save through this model?
Starting in January, seniors using Medicare Part D will be eligible to purchase their monthly prescription for no more than $35 a month if they choose one of the participating plans, saving an average of $446 in annual out-of-pocket costs for insulin.
Won’t people end up paying higher insurance premiums to get this lower copay deal?
While beneficiaries choosing these enhanced prescription plans may pay slightly higher premiums, they will save far more on a monthly basis out-of-pocket annually and know exactly how much they will spend each month on their insulin prescription (a maximum of $35 for a 30-day supply), rather than a percentage of the list price, which can vary.
Why can’t this occur until January?
As this Model is part of a ground-breaking Medicare shift, plans must go through a bid process to be accepted and participate for 2021. The government is working quickly to have these plans in place for open enrollment, which begins on October 1st.
When this happens, seniors will need to look for insurance plans that offer this new insulin savings program and choose their Part D insurance plan carefully, making sure that the type of plan, if they take insulin, is an enhanced prescription plan that best fits their needs. Almost all types of insulins will be available through these plans, but each plan may choose different insulins on their formulary.