Why is insulin so expensive? Find out what’s behind the rising costs of insulin and what can be done to potentially reverse it.
Do you have diabetes? Do you know someone with diabetes? In July of 2017, the Centers for Disease Control and Prevention (CDC) reported that more than 100 million American adults have diabetes or prediabetes. If you’re one of them, you could visit Zakka Lab to learn more about diabetes.
Diabetes control involves either oral medication and/or diet management or insulin. If the body doesn’t produce insulin, it must receive manufactured insulin to control the blood sugar level. Without insulin, the blood sugar level will rise and the body will die.
Many people want to know why is insulin so expensive. This isn’t an option for diabetics. Keep reading to find out what’s behind the rising cost of insulin.
The Cost of Insulin
In 1923, Frederick Banting, Charles Best, and James Collip discovered and invented insulin. Banting would not put his name on the patent. He felt it was unethical for physicians to make a profit for creating a life-saving product.
Colllip and Best sold the patent for insulin to the University of Toronto for $1. Their goal was to make insulin affordable to everyone who needed it.
Dr. Kasia Lipska from Yale University testified before Congress in April 2019. She stated that a vial of insulin cost $21 in 1996. Today, it costs $275.
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Why Is Insulin So Expensive?
While public outrage over the price of insulin rises, so does the cost. Between 2002 and 2013, Americans saw the cost of insulin almost triple. It has risen 55% since the first quarter of 2014.
Thus, if you were a diabetic in 2014, you paid about $450 per month for your insulin alone. This does not include the cost for blood and urine test strips, syringes, alcohol wipes, pump supplies, and more.
Good Rx also reported that long-acting insulin’s cost rose about 6% from 2018’s 4th quarter to August 2019. Inhaled, ultra-rapid-acting insulin increased 8% during this time. Total health spending is projected to rise by about 5.5% per year over the next decade.
Thus, without change, insulin costs alone will rise above the total health spending costs.
Factors That Contribute to Rising Insulin Cost
Deane Waldman, MD, MBA, is a distinguished senior fellow in healthcare. She works with the Texas Public Policy Foundation in Austin, TX. She states that third-party businesses have “muddled” patient care.
Waldman says the third-party entities include the government, health insurers, and pharmacy benefits management (PBM) companies. These groups interfere with the practitioner’s ability to provide the best care. They control which medications can be prescribed to patients.
Waldman goes on to say, “This whole third party in between the doctor and the patient is not only jacking up the prices astronomically, we can’t do what we think is best for our patient….”
Many people believe insurance companies pay for everyone’s medications and individuals only pay a co-pay. The truth is that insurance companies don’t pay for all prescriptions. And, if you don’t have insurance, then obtaining a prescription may be almost impossible.
Competition Among Pharmaceutical Companies
The ADA says there are several stakeholders involved before the insulin gets to the patient. This includes PBMs, pharmacies, health insurance plans, and employers.
Today, there is no set price for any type of insulin. The patient pays the amount negotiated by the stakeholders. The final cost incorporates prices, rebates, and fees.
The top three PBMs are CVS/Caremark, Express Scripts, and OptumRx according to Medical Economics in May 2019. The ADA states that these companies administer about 70% of the market.
The ADA also states that PBMs loyalty is to the health insurers and employers, not the patients.
PBMs work with pharmaceutical companies to get lower prices and discounts on certain medications. The PBMs then decide which medications they will add or remove from their formulary (list of approved medications).
Pharmaceutical companies must compete to get their medications on the PBMs formulary. They lower prices and provide rebates to the PBMs. These discounts do not impact the amount paid by patients.
Manipulation of Patents
When a drug’s patent expires, companies with a generic alternative are waiting in line. These generic medications cost less.
Waldman states that pharmaceutical companies may adjust their drugs when the patent is almost expired. This allows them to extend the patent or get a new one. Thus, generic manufacturers are kept out of the market.
Pharmaceutical companies receive criticism for this practice. Yet, they aren’t prevented from doing it.
Using Technology to Increase Patient/Provider Communication
When a person with diabetes can’t afford to buy their insulin, they start making choices. The Journal of the American Medical Association reported that about 30% of patients ration their insulin. This study showed that rationing insulin is “frighteningly” common.
Dr. Kasia Lipska from Yale University stated, “…we have to advocate for change because the status quo is simply cruel and not acceptable.”
Some clinicians now use internet technologies to increase communication with patients. Mobile friendly web-based technology now receives real-time data. This information can be accessed at any time by patients and providers.
If patients have difficulty getting their insulin, they can call their provider or access a web-based system. With this knowledge, the clinician can make referrals for assistance.
Ways to Get Affordable Insulin
Some diabetics can find resources to help get the insulin you need. Pharmaceutical companies Eli Lilly, Sanofi, and Novo Nordisk provide patient assistance programs.
These benefits are only for those who qualify. You must not have health insurance and have an annual income of less than $36,000 per year.
You may also be able to get a discount of up to 40% off the pharmacy price. Contact Blink Health and Inside Rx to learn about their insulin programs.
The Juvenile diabetes Research Foundation provides several non-profit patient sources for insulin assistance programs:
- Partnership for Prescription Assistance
- The National Institute of Diabetes and Digestive and Kidney Diseases
Tell your healthcare provider if you have any concerns about paying for your insulin. Look online for more resources. Get help and don’t ration your insulin.
Do You Rely on Insulin?
If you or a family member has diabetes, you understand that insulin isn’t a choice. Yet, diabetics across the U.S. continue to agonize over the issue of why is insulin so expensive.
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