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Works Cited:

Chesak, J. (n.d.). What does insulin cost and what’s behind the skyrocketing prices? Verywell Health. https://www.verywellhealth.com/insulin-prices-how-much-does-insulin-cost-and-why-5081872

Merriam-Webster. (n.d.). Insulin. In Merriam-Webster.com dictionary. Retrieved September 14, 2023, from https://www.merriam-webster.com/dictionary/insulin

Sherry Glied and Benjamin Zhu, Not So Sweet: Insulin Affordability over Time (Commonwealth Fund, Sept. 2020). https://doi.org/10.26099/xbne-tj76

Who profits from insulin?. American Council on Science and Health. (2022, May 6). https://www.acsh.org/news/2021/11/19/who-profits-insulin-15944

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Medicare is running a pilot program capping the monthly cost of insulin, but there is no federal regulation in sight. In the absence of federal leadership, eight states have capped monthly insulin costs at between $30 and $100.

"The pharmaceutical pricing system is just rigged, and it's rigged so patients pay more each year. Competition does not drive prices down." Senator Ron Wyden of Oregon.

While the conventional narrative is that the three remaining manufacturers, which control 90% of the market, intentionally or unintentionally acting as a cartel, have allowed the price to rise. Once you follow the money as a study in JAMA Health Forum did, you realize that Senator Wyden is correct. It is a rigged and purposefully opaque system. Let's begin with a simplified flow of the money.

All those monies flowing back and forth are reminiscent of money laundering and explain much of the lack of transparency in pricing; terms of the trade further this obfuscation. Wholesale acquisition cost or WAC is what we might consider the sticker price. But only suckers pay sticker price (at least until the pandemic when cars, new or used, are scarce). For patients, the price is a combination of their out-of-pocket expenses and the cost of their insurance.

The researchers sought drug pricing information through various sources, including two recent initiatives on insulin price transparency in Ohio and Nevada. Other sources included CMS Rebate Summaries and Part D claims, Medicaid Drug Spending Reports, reports by the Drug Channel Institute (a consultancy that compiles drug data), and public filings by manufacturers and insurers.

Some of the data are more certain than others, but it provides a very insightful view of where the money goes.

As you can see, the list price, the price charged by manufacturers has been steadily increasing. Before we conclude that they are the culprits, remember that the list price is only for suckers; it has little basis in actual spending. From 2014 to 2018, the list price of 100 units of insulin rose 40% to $27.45. (There is no typical insulin dosage but we can roughly assume that 100 units represents a weeks worth of insulin)

The net price (the cost after all the deductions and taxes), the closest we can get to the actual cost of insulin, decreased 30.8% to $7.29 for those 100 units of insulin. There is a very significant price difference in the movement of insulin from the manufacturer to the patient. That price is captured in net expenditures - the money, through out-of-pocket costs, insurance premiums, and taxation that is actually spent. The difference between net expenditures and net prices is the portion taken by all intermediaries, manufacturers, wholesalers, health plans, and are real villains, pharmacies, and the pharmacy benefits managers or PBMs.

This second chart shows how the intermediaries split the spoils. Stacked graphs like this are poor visualizations of this type of information so let me put some numbers to the image.
The losers

Manufacturers received 33% less payment for their product - they receive 46.73% of the money but they have actual expenses; they actually must produce the insulin.

Insurers too have received less, a 25% reduction - their share is 10.4%

The winners

Wholesalers have increased their percentage by 75%, to 8% of the money

PBMs have increased their percentage 154% to 14.3%

Pharmacies have increased their percentage 228% to 20.4% of the money

There are further entanglements, as pharmacies and health plans can own PBMs, so we needn't emphasize their declining share. Over the period, the actual net price for insulin has risen only 3%.

"The widening gap between net expenditures and net prices suggests that increasing profits of distribution system participants are responsible for the increase in insulin costs."

How much? In 2014, the intermediaries took 16.5%, today they take 42.9%. What exactly are they doing for all that money? You needn't be a social justice warrior or a market-based libertarian to recognize that something is amiss and that we are paying a great deal of money for the transaction, not the product. Senator Wyden is correct, the system is rigged, and we should be furious.

Source: Estimation of the Share of Net Expenditures on Insulin Captured by US Manufacturers, Wholesalers, Pharmacy Benefit Managers, Pharmacies, and Health Plans From 2014 to 2018 JAMA Health Forum DOI: 10.1001/jamahealthforum.2021.3409

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The answer is that patients profit the most; it's a life-saving and life-extending drug. But the sticker price (termed wholesale acquisition cost) keeps rising. Following the money will reveal both the lack of pricing transparency, and those who are raking the greatest share of the price increases.

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Key Takeaways

Over 37 million Americans have diabetes, a group of conditions where there is too much sugar in the blood. Of those patients, over 7 million require some form of insulin, a medication based on the naturally made hormone that helps regulate blood sugar. One of the biggest concerns for patients and healthcare providers is the rising price of insulin.

In the past decade, the cost of insulin has tripled in the United States, with out-of-pocket costs doubling. One in four patients say that they ration their insulin because they can't afford it.

Stephanie Redmond, PharmD, CDE, BC-ADM

"If someone has type 1 diabetes or if someone has had damage to their pancreas, these are instances where their body doesn't produce any insulin," Stephanie Redmond, PharmD, CDE, BC-ADM, founder of Diabetes Doctor, tells Verywell. "Without a doubt, insulin is lifesaving, and just a day or so without it will require hospitalization and could lead to death for those patients."

Live Well With Diabetes

How Has the Government Impacted Insulin Prices?

On July 24, 2020 former President Donald Trump signed an executive order that included language aimed at lowering insulin and other drug prices for Americans. This order became effective on January 22, 2021.

"As with any legal order, the devil's in the detail," Robin Feldman, Arthur J. Goldberg Distinguished Professor of Law at UC Hastings College of Law San Francisco, tells Verywell. She also noted that we are "...going to need some systemic changes to try to address the problems that are driving drug prices higher in general, and insulin prices higher specifically."

On June 16, 2021, under the Biden administration, the Department of Health and Human Services published in the Federal Register their plan to rescind this 2020 rule. They cited various reasons for doing so:

It created high administrative costs for impacted health centers.

Impacted health centers had difficulty maintaining new rules to determine patient eligibility for receiving medications at lower prices.

The new rules led to a decrease in staff available to help with critical and emergency services.

Covid-19 added additional stress to these impacted health centers.

On March 1, 2022 in the State of the Union Address, President Biden discussed capping insulin prices at $35 a month. He also mentioned lowering the prices of prescription medication.

What Factors Impact Treatment Costs for Diabetes?

People with diabetes have over two times the healthcare costs of Americans who don't have this condition. On average, the medical costs related to diabetes can reach over $9,500 per year.

One of the most influential factors driving that difference is the cost of insulin. How much people pay out of pocket for insulin depends on many variables. This includes whether they have insurance, what kind of plan they have, and coverage details such as the plan's deductible. How much and what types of medication an individual needs can also impact cost.

In her experience as a physician and pharmacist, Redmond says that most patients need about two vials of insulin per month or one to two packs of insulin pens. Each pen pack is equivalent to about one and a half vials. As of March 2022, the price for a vial of insulin ranges from $50 to over $1,000, and a pack of pens ranges from $45 to over $600.

"Prices are too high," Redmond says. "Not just for insulin but for most diabetes medications. All of it is still insanely expensive."

What Is the Cost of Insulin With Insurance?

The American Diabetes Association Insulin Access and Affordability Working Group report found that nearly half of Americans have employer-sponsored health insurance. About 20% are insured through Medicaid, and 14% are insured through Medicare. Approximately 7% of Americans purchase health insurance on their own. About 9% of Americans remain uninsured.

Diabetes is considered a pre-existing condition, which is a condition you have prior to applying for health insurance. According to research, about 1.9 million people with diabetes who didn't have insurance gained coverage after the Affordable Care Act (ACA) went into effect in 2010.

Still, having insurance doesn't mean insulin is affordable. Insured patients will often pay a copay or a percentage, rather than the list price, for their insulin. Redmond says that cost could range from $30 to $50.

In cases of high-deductible health plans, patients have to pay the list price for their insulin until their deductible is met. This could mean thousands of dollars out of pocket. "Many patients just have a problem paying that much," says Redmond.

How Have Drug Companies Responded to Criticism?

Pharmaceutical companies have responded to criticism about high prices. For example, some companies offer discount cards. However, Redmond explains that doesn't help every patient. "You can't use them if you have Medicare, and many of them cap at $100-$150," says Redmond of the discount programs. "So if you have a high deductible of thousands of dollars, these coupons are not that helpful, because that patient may still be paying $300 out of pocket for their insulin or more until their deductible is met."

Some drug companies have assistance programs for individuals with low-income. "These are good options but take a lot of time and a knowledgeable doctor who is willing to take that time and help them with the forms," says Redmond, adding that many clinics don't have certified diabetes care and education specialists (CDCES), social workers, or care coordinators who can help.

Many insulin makers created programs in response to COVID-19. As of March 2022, these programs were still in effect:

In April 2020, Novo Nordisk began offering a free 90-day supply of insulin to patients who had lost their health insurance during the pandemic.

In May 2020, Sanofi began offering a temporary access program to patients experiencing financial hardship who qualify for a 30-day supply of their medication.

In April 2020, Eli Lilly launched its Insulin Value Program which offers a $35 copay card for individuals without insurance or for those with commercial insurance.

What This Means For You

Why Is Insulin More Expensive in America?

Three pharmaceutical companies-Novo Nordisk, Sanofi-Aventis, and Eli Lilly-control the market. "The big three produce 90% of the global insulin supply and close to 100% of the U.S. insulin supply," says Feldman. "Observers have noticed that the big three tend to mirror each other's insulin price increases. When one raises prices, the others quickly follow."

Feldman says the companies have become adept at what's called evergreening. "Evergreening involves various techniques to extend protection on a drug and block competition that can reduce prices."

Many brand name drugs have a generic that becomes the preferred, cheaper alternative. However, the Food and Drug Administration (FDA) has historically treated insulin as a drug and a biologic, which have different regulatory pathways.

Medications that are treated as highly similar to a biologic, or a medication made from living things, are called biosimilars, not generics. Biosimilars must go through a specific approval pathway.

The original brand name insulins went through the drug pathway rather than the biologic pathway. This meant competitors could not introduce a biosimilar insulin.

In March 2020, the FDA moved to label insulins as biologics, which opened the door for new biosimilars. However, hurdles remain. Feldman says that the approval process is more complicated for biosimilars than for generics, and the substitution process at the pharmacy is more difficult as well.

Robin Feldman, Professor of Law, UC Hastings College of Law San Francisco

State laws allow pharmacists to automatically substitute a generic version for drugs, but that automatic substitution is not available for biosimilars unless certain conditions are met.

"It's a huge impact," says Feldman. "Because automatic substitution is the way that generic drugs traditionally make inroads in the market and bring prices down."

The FDA approved a long-acting biosimilar insulin called Semglee in July 2021. However, patients and physicians must specifically request the biosimilar because of the lack of automatic substitution. Feldman says that historically, that doesn't happen.

Additionally, intermediaries along the insulin supply-chain can drive up costs or keep new drugs from gaining a foothold. "Existing players with large market share can use volume discounts to discourage [pharmacy benefits managers] and health plans from covering the new entrant," says Feldman.

The bottom line is that the three-company monopoly is hurting people with diabetes. "Insulin is a very old drug," says Feldman. "We've known about it for a long time. Patients shouldn't be paying through the nose for it now a hundred years later."

Insulin prices have gone up significantly over the past decade. However, the government has responded in an attempt to make this medication more accessible.

Treatment costs for those with diabetes are greatly impacted by the price of insulin. This is largely driven by the three major companies that produce it. Insurance plan details can also impact the price an individual pays for their medication.

Frequently Asked Questions

How much does insulin cost to make?

Research notes that one vial of insulin costs around $2 to just over $6 to produce depending on the specific type.

How much does insulin cost per month?

Individuals may use about two vials of insulin or one or two packs of insulin pens per month. Per month, insulin vials range from $50 to over $1,000, and a pack of pens may range from $45 to over $600.

What does insulin cost with insurance?

Cost may vary but a copay may range from $30 to over $50.

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What Does Insulin Cost and What's Behind the Skyrocketing Prices?

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Learn about insulin prices, how much people pay per month, what drives insulin prices, and whether anything is changing after executive orders.

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ABSTRACT

Issue: There have been multiple reports of Americans who cannot afford insulin products.

Goal: To describe insulin use patterns, out-of-pocket costs, and financial burdens for American adults under age 65 with diabetes over time.

Methods: Analysis of the Medical Expenditure Panel Survey and National Health Interview Survey.

Key Findings: Uninsured Americans with diabetes are much more likely to be using less costly (and less effective) formulations of insulin compared to peers with private insurance or Medicaid. Uninsured people are also much more likely to pay full list price for insulin (68%) than the privately insured (9%) or Medicaid beneficiaries (3%). The uninsured spend more out of pocket on all prescriptions ($2,456) than the privately insured ($1,274) and are more likely to report being unable to afford prescription medicines (38% versus 10%). However, among the privately insured, insulin accounts for a significant portion of total out-of-pocket expenses.

Conclusions: Among those under age 65, increasing access to insurance coverage and the generosity of that coverage are the most important steps for increasing access to insulin. In particular, continued expansion of Medicaid and limiting overall out-of-pocket spending for those with private insurance will protect people with diabetes from high costs.

Introduction

Of the 30 million Americans who have diabetes, about 31 percent take insulin to manage the condition. Many varieties of insulin are now available, including rapid-acting and longer-acting agents. Insulin prices also vary considerably: newer, more effective, more easily administered forms of insulin are much costlier than older forms. Recently, list prices of many of the newer forms of insulin have risen rapidly, with average increases of 15 percent to 17 percent per year since 2012. For people with diabetes who are insulin-dependent, these high list prices can have tragic consequences. News stories regularly report on people who died or suffered severe complications because they could no longer afford insulin, and as many as one in four people with diabetes report rationing insulin to save money.

Governments have begun to focus attention on this problem. In May 2019, Colorado became the first state to cap insulin copayments at $100 for insured residents. In April 2019, Congress held hearings on rising insulin costs, and members from both major parties expressed a strong desire to rein in pharmaceutical prices.

Despite widespread interest in addressing insulin prices, choosing an optimal regulatory solution has been challenging because of the complex nature of insulin pricing (Exhibit 1).

Typically, insulin is sold by manufacturers to pharmaceutical benefit managers (PBMs) at a negotiated list price. Included in this list price are rebates that manufacturers pay to PBMs, which often pass the rebates along to insurers in exchange for a more beneficial placement on insurance plan formularies. The net price that manufacturers collect for the insulin is equal to the list price minus any rebates paid to PBMs, other fees paid to wholesalers, and discounts paid to pharmacies. Because many of these rebates, fees, and discounts are negotiated as a percentage of the overall list price, many of these actors have incentives to keep list prices high. As a result, list prices have increased dramatically over the past few years, although the net prices received by manufacturers have been stable or have declined. For example, between 2003 and 2016, the list price for a vial of NovoLog, a popular insulin analog, increased by 310 percent, after adjusting for economywide inflation. However, the net price received by the manufacturer, Novo Nordisk, decreased by 21 percent over the same period.

The complexity of the insulin supply chain affects different patients differently. For instance, uninsured patients pay list prices, unless they can obtain insulin from compassionate use programs established by manufacturers, philanthropic sources (for example, free clinics), or even insulin-sharing groups on social media. People with Medicaid generally pay nothing out of pocket, or a very modest copayment. Privately insured consumers under age 65 pay varying out-of-pocket prices. Some pay copayments, while others pay an insurer-established price up to a deductible as well as a coinsurance amount up to an out-of-pocket maximum.

This heterogeneous payment structure further complicates policymaking. To the extent that list prices are passed along to insured patients, reducing list prices will reduce these burdens proportionately. For those who pay high coinsurance rates or face high deductibles, limits on the structure of cost-sharing may be more effective. Finally, uninsured patients might benefit most from improving health insurance coverage.

Studies have examined the implications of rising insulin list prices for Medicare Part D beneficiaries, showing substantial increases in out-of-pocket spending per user. However, little is known about insulin use in people under age 65. This issue brief uses data from the Medical Expenditure Panel Survey 2014-2017 and the National Health Insurance Survey 2007-2017 to examine the relationships among insurance coverage, out-of-pocket spending, and prescription affordability and access among people ages 18 to 64, not covered by Medicare, who have diabetes. (See " How We Conducted This Study " for more detail.)

Findings

Drug Prices and Drug Use

Exhibit 2 plots the insulin prescriptions in our sample for people with full-year private insurance (both group and individual) and those who were uninsured all year. We plot the proportion of the total cost of each prescription that was paid out of pocket against the total cost of a 1,500-unit equivalent prescription (capped at $750).

We found tremendous heterogeneity in the total price and out-of-pocket cost of insulin in the market of adults under age 65 with diabetes. The total expenditure (from all sources) for a single 1,500-unit prescription of insulin can vary from $0 (typically a free sample) to more than $1,500. For 75 percent of all prescriptions filled, the out-of-pocket share of this total expenditure was less than 15 percent. About 16 percent of all people with diabetes who used insulin paid the full price of any single prescription in any year.

Half of (standardized) insulin prescriptions for privately insured patients are reimbursed at a price between $317 and $425. This is consistent with data on the list prices of common insulin types. About 1 percent of 1,500-unit equivalent prescriptions for this group have a total cost of more than $645; these are generally prescriptions for Novolog, Levemir, and Humalog.

Most insulin prescriptions filled by privately insured patients had an out-of-pocket cost between 0 percent and 20 percent of the total cost of their prescriptions. The vast majority of prescriptions filled by privately insured patients (89%) incurred less than $100 in out-of-pocket costs. Only 4 percent of privately insured patients paid the full price of an insulin formulation with a total reimbursed cost of at least $500 at any time over the course of a year (see Appendix Exhibit 2).

Although not shown in Exhibit 2, Medicaid patients used insulin formulations similar to those used by privately insured people. Very rarely did they pay more than a minimal amount out of pocket for a prescription.

The situation of uninsured patients is quite different. About half of insulin prescriptions for uninsured patients are reimbursed at a price below $190. Uninsured people are simply not using newer insulin formulations. Their prescriptions are much more likely to be for older, less easily managed forms of insulin. For people with type 1 diabetes, some of these formulations are associated with higher risk of hypoglycemic episodes, nocturnal hypoglycemia, and increased within-subject variability of fasting blood glucose. Newer insulin analogs are associated with more predictable glycemic control for both type 1 and type 2 diabetes.

Out-of-pocket spending shares are also dramatically different for uninsured patients. About 47 percent of prescriptions filled by uninsured patients were paid for 100 percent out of pocket, while about 21 percent of prescriptions filled by the uninsured had zero out-of-pocket cost. Overall, about 71 percent of insulin prescriptions filled by uninsured patients cost more than $100 out of pocket.

While privately insured people make up nearly half of all insulin-using people with diabetes ages 18-64, they constituted only 4 percent of those who paid full price for a standardized insulin formulation with a total reimbursed cost of at least $500. Uninsured people and those with a gap in coverage, who represent 17 percent of the insulin-using population with diabetes, constituted 80 percent of those who paid full price for an insulin prescription with a total reimbursed cost greater than $500 at some point during a year (see Appendix Exhibit 2).

In summary, the difference between uninsured and privately insured patients reflects two dynamics. First, uninsured people typically use cheaper, older, and, sometimes less effective, formulations of insulin than do privately insured patients or Medicaid patients. Second, while some uninsured patients are able to get prescriptions through compassionate use or discount programs, many must pay the full cost of their prescriptions out of pocket.

List Prices and Out-of-Pocket Spending for Insulin with a Total Reimbursed Cost of at Least $100

For uninsured patients, however, the pattern is quite different. About two-thirds of uninsured patients who were regular users of insulin with a total reimbursed cost of at least $100 paid full price for a prescription at any time, and those in this group paid full price for a majority of their prescriptions. The median out-of-pocket cost per prescription incurred by uninsured people using these insulin formulations was $16 but total out-of-pocket expenditures for prescription medications were much higher. On average, regular users of insulin formulations with total reimbursed costs of at least $100 who were uninsured spent about twice as much out of pocket on insulin as did those with private insurance ($1,288). In addition, one-quarter of uninsured, regular users of these insulin formulations spent more than $3,619 out of pocket across all their prescription medicines.

Much of the policy attention on insulin costs focuses on people who regularly use new, more expensive insulin formulations with high list prices. Exhibit 3 shows how patterns of payment differ across insurance types among regular users of standardized insulin prescriptions with a total reimbursed cost of at least $100. These prescriptions constitute 85 percent of insulin prescriptions. About 9 percent of regular users of these insulin formulations who held full-year private insurance paid the full price for a prescription at any point during the year, most likely because they had not yet reached their coverage deductible. These costs added up across prescriptions. On average, regular users of insulin formulations with total reimbursed costs of at least $100 who were privately insured all year spent $613 out of pocket on insulin. One-quarter of privately insured, regular users of these insulin formulations spent more than $1,389 out-of-pocket across all their prescription medicines.

Variations Among Those with Private Health Insurance

There are substantial variations in the structure of private health insurance, which may have significant implications for out-of-pocket spending. Under many plans, drugs purchased before reaching a deductible must be paid at list price. Beyond this level, payments depend on plan design. According to the Kaiser Family Foundation Employer survey, 91 percent of covered workers in 2017 were in a plan with tiered cost-sharing for drugs. Depending on the tiering structure and drug tier, 21 percent to 81 percent of 2017 plans required a copayment for prescriptions (copayment-only plans), while 10 percent to 79 percent required coinsurance (coinsurance-only plans). High-deductible plans typically incorporate coinsurance above the deductible. As plans have moved to higher deductibles, there has been a trend toward coinsurance designs, which more closely tie out-of-pocket payments to list prices.

While the Medical Expenditure Panel Survey does not provide direct information on insurance design, we were able to use the patterns of out-of-pocket payments in this survey data to classify those with private insurance into copayment-only, coinsurance-only, and unclassified (not classifiable using our algorithm) groups. Consistent with other studies, the fraction of privately insured people who used insulin covered by copayment-only plans dropped from 29 percent in 2014 to 24 percent in 2017, while the fraction in coinsurance-only plans rose from 11 percent in 2014 to about 16 percent in 2017.

Exhibit 4 highlights how these variations in plan design affected spending patterns among all insulin users (regular or irregular users) and all types of insulin (costly or inexpensive). We found that people in copayment-only plans typically paid about $10 less out of pocket for each 1,500-unit equivalent prescription than people in coinsurance-only plans. Over the course of a year, this difference added up; the average person in a copayment-only plan spent about $113 less (48% less) on insulin than did the average person in a coinsurance-only plan.

Many people with diabetes also use drugs other than insulin. Those in copayment-only plans spent about 34 percent less on drugs overall than those in coinsurance plans. Finally, drugs comprise about half of total out-of-pocket costs for people with diabetes who used insulin. Across both drugs and other services, mean out-of-pocket costs for those in copayment-only plans were 24 percent lower than those in coinsurance-only plans.

Affordability

The data in Exhibit 4 highlight the potential importance of high deductibles in determining the out-of-pocket exposure of people with diabetes. To see how deductible structure might affect affordability, we used the National Health Interview Survey, which includes questions about prescription drug affordability and separates high-deductible plans from other private insurance.

Exhibit 5 shows how affordability of prescription medication varies by insurance, coverage type, and income. Affordability problems increase as income falls and are much higher among those without insurance coverage. Even among the highest income group, however, people with diabetes enrolled in high-deductible plans report greater affordability problems than those in conventional private insurance plans.

The importance of insurance coverage in promoting access is further documented in Exhibit 6, which describes how affordability has changed over time. Although insulin prices increased rapidly between 2007 and 2017, the Affordable Care Act's (ACA's) coverage expansions have reduced the share of those with diabetes in each income group who report difficulty affording prescription drugs. The greatest declines have been among people with incomes between 100 percent and 300 percent of the federal poverty level who have benefited from the ACA's marketplace-based coverage expansions. In 2017, 45 percent of those with diabetes who reported that they could not afford prescription drugs lived in the South, where many states had not yet expanded Medicaid (data not shown).

Policy Implications

Our analysis suggests that the most important factors affecting the affordability of insulin for people under age 65 with diabetes are the availability of coverage and the form of that coverage. While rising insulin list prices are a serious problem for those who must pay full price for insulin prescriptions, people with adequate coverage - that is, those in low-deductible, copayment-only plans - are often shielded from these price increases.

The single most important policy factor affecting access to affordable insulin for adults ages 18-64 is Medicaid expansion. People with diabetes who can enroll in Medicaid are protected both from high out-of-pocket costs for insulin and from high costs for other dimensions of their care.

For those with private insurance, the structure of that insurance matters a great deal. Enrollees in copayment-only plans are better protected than are those who pay coinsurance for drugs. However, because plans typically include deductibles and out-of-pocket maximums that apply to all care - and because people with diabetes typically need medications other than insulin as well as regular medical services - it is not enough to focus only on the coverage structure for insulin prescriptions. Instead, to ensure adequate financial protection for people with diabetes, policymakers will likely need to address cost-sharing for all types of care.

How We Conducted This Study

We analyzed Medical Expenditure Panel Survey (MEPS) and National Health Interview Survey (NHIS) data from 2014-2017 and 2007-2017, respectively. We then broke these years into three periods: 2014-2017, 2010-2013, and 2007-2009. From the MEPS, we merged the full-year consolidated files, which contained demographic and insurance information, with the prescribed medicines files, which contained information about drug-specific spending. We then took these files and kept all observations of insulin prescriptions to calculate the distribution of insulin out-of-pocket and total costs, both per prescription and overall, for holders of various insurance types in each period. We inflation-adjusted all cost dollar amounts to 2017 dollars, the final year included in our study, and excluded prescriptions to individuals younger than age 18 and older than age 64, or to Medicare patients.

Insulin is sold in varying package sizes and dosages. To facilitate comparisons, we standardized our costs to the cost of a standard 1,500-unit equivalent prescription, using the MEPS variables for drug quantity and strength, and MEPS variables for quantity and strength units. We excluded prescriptions when drug quantity and strength were recorded as unknown.

We report all dollar estimates in 2017 dollars, the final year of our analysis. In some of our analyses, we restricted our sample to regular users of insulin, whom we define as those who filled the equivalent of four or more 1,500-unit equivalent prescriptions for insulin in a year, each with a total reimbursed cost of at least $100 or $500.

To classify private insurance holders into copayment-only, coinsurance-only, and unclassified groups, we looked at out-of-pocket spending on each individual prescription. We defined copayments as any out-of-pocket payment between $5 and $100 that was a multiple of five. Coinsurance payments were defined as any out-of-pocket payments that were not copayments and that accounted for less than 50 percent of the total costs paid out of pocket. We then defined all out-of-pocket payments as payments where the total cost of the prescription was paid completely out of pocket, and we defined zero out-of-pocket payments as prescriptions where the out-of-pocket cost was equal to zero.

For the NHIS files, we merged the sample adult files, person files, and family files from each of the aforementioned periods. The sample adult files contained information about drug affordability and diabetic status, the person files contained insurance information, and the family files contained information about income. After merging these files, we restricted the sample to those who reported being told they had diabetes, and then we examined the relationship between familial income and insurance status in this group.

Acknowledgments

We would like to thank Elbert Huang for his help with deciding how to best standardize insulin prescriptions for comparison.

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Not So Sweet: Insulin Affordability over Time

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New York University researchers explore variation in insulin prices and out-of-pocket costs for people with and without health insurance, and how those with inadequate coverage struggle to afford insulin. An important factor in ensuring affordable access to insulin is living in a state that has expanded Medicaid.

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Example Sentences

These examples are programmatically compiled from various online sources to illustrate current usage of the word 'insulin.' Any opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Send us feedback about these examples.

Word History

New Latin insula islet (of Langerhans), from Latin, island

1914, in the meaning defined above

The first known use of insulin was in 1914

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Merriam-Webster unabridged

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a protein pancreatic hormone secreted by the beta cells of the islets of Langerhans that is essential especially for the metabolism of carbohydrates and the regulation of glucose levels in the blood and that when insufficiently produced results in diabetes mellitus... See the full definition