Madison Johnson started the “insurance gambit” nine years ago when she left her parents’ health plan. Johnson, 27, lives with type 1 diabetes. One question that constantly looms over her is how she will afford health insurance and medical supplies.
“My health insurance is my life,” Johnson said. Without insulin, she could die from ketoacidosis, a condition in which a person’s blood becomes too acidic. Still, the price of insulin skyrocketed.
The new federal deflation law, in addition to its climate and environmental components, targets some of the high health care costs affecting Johnson.
The law caps monthly insulin costs at $35 for seniors; caps prescription drug copayments at $2,000 per year for Medicare enrollees; and enables the government to negotiate prices for the most expensive prescription drugs.
The law also aims to combat climate change, allocating nearly $375 billion over the next decade to incentivize and subsidize technologies such as solar panels, help improve home energy efficiency, reduce emissions from power plants and reduce air pollution. air in low-income communities, among other things.
Johnson is the executive director of the nonprofit organization Type 1 United, which organizes camps and community programs for children and adults with type 1 diabetes. She doesn’t get health coverage through her job, so she pays $500 a month for a plan through Washington Health Benefit Exchange, the state’s health insurance marketplace.
In her current plan, Johnson pays $150 for a three-month supply of insulin. Additional equipment, such as her pump and continuous glucose monitor, cost another $200 a month. Without insurance, the insulin alone would cost more than $3,800 for a three-month supply because she uses a known brand.
High drug prices are one of the main reasons Americans drop their prescriptions or stretch their existing medications. Johnson used expired insulin to get her through periods when she didn’t have access to insurance, she said.
Most notably for Johnson, the law extends subsidies to anyone who purchases health care plans through the Affordable Care Act. The subsidies were set to expire at the end of 2022, which meant plan prices would jump and many enrollees would likely drop their coverage. Washington is one of 14 states that operate their own health insurance marketplace.
“It would have been a nightmare for all of us,” said Sen. Karen Keyser, D-Des Moines.
Medicare price negotiations will be phased in, starting with 10 drugs in 2026, an additional 15 drugs in 2027, and possibly 20 more drugs in 2029 and beyond. The negotiations will focus on drugs covered by Medicare Part D that do not have a generic option or a close alternative. Washington has about 1.4 million people on Medicare, according to the Office of the Insurance Commissioner.
The federal law coincides with other state-level actions taken against rising health care costs, Keizer said. Lawmakers in Washington passed legislation capping insulin copayments for state-funded plans at $35 for a 30-day supply earlier this year. This policy goes into effect in January and expires a year later. Does not apply to private insurances.
Those protections would not apply to Medicare enrollees, but under the Inflation Reduction Act, the $35 Medicare copayment cap also goes into effect next year.
“We’re grateful that this federal bill will now support that and extend it to Medicare patients,” Johnson said on behalf of Washington #insulin4all, a volunteer advocacy group for insulin affordability.
Keyser also led efforts to create a statewide prescription drug affordability council. Starting in 2023, this group will be able to annually negotiate prices for 24 of the most expensive prescription drugs by name each year. The state board could, in theory, make the results of the Medicare negotiations available to all Washingtonians.
“Whatever they’re negotiating with Medicare, you can count on our affordability board to push for it as well,” she said.
While the state and federal legislation is a good development, Johnson said diabetes advocates are disappointed that Republican senators have blocked the $35 cost of insulin for private insurers. She pointed out that neither federal nor state policy addresses insulin prices for uninsured people. As of February 2021, about 6% of Washingtonians do not have health insurance.
“This still excludes people who are most likely to restrict their insulin, which can lead to death,” Johnson said.