Will all 2023 Medicare drug plans cover formulary insulin for only $35 per month (or less)?
In 2023, the Inflation Reduction Act (IRA) of 2022
introduces a provision similar to the 2021-2022 Senior Savings Model
with insulin provided at a $35 30-day co-pay throughout all phases of your
Medicare Part D plan coverage (up to the 2023 Catastrophic Coverage
phase where you will pay only 5% of the retail price never exceeding the $35 co-pay. (The IRA will eliminate beneficiary cost-sharing during the Catastrophic Coverage phase in 2024.)
However, unlike the existing
Senior Saving Model
, the new Inflation Reduction Act will expand the
insulin $35 co-pay to all Medicare Part D prescription drug plans or Medicare Advantage plans offering prescription drug coverage (MAPDs) for all Part D forms of
insulin found on a plan's formulary or drug list.
And beginning July 1, 2023, insulin
furnished through Medicare Part B durable medical equipment (DME) will
also have a monthly co-pay of no more than $35.
Finally, starting in 2026,
the United States government can begin negotiating drug prices directly with pharmaceutical companies, so the future co-pay for
insulin may be less than $35 depending on the government's negotiated price.
Question: Can a 2023 Medicare drug plan implement both the Inflation Reduction Act for $35 insulin and the Senior Savings Model for select low-cost insulin?
Yes. In 2023, your Medicare drug plan can have two different insulin savings programs - with covered insulin products never costing more than $30 for a 30-day supply.
First, as noted above, all 2023 stand-alone Medicare Part D prescription drug plans (PDPs) and Medicare Advantage plans with drug coverage (MAPDs) will offer all insulin products found on the plan’s formulary for a co-pay of $35 (or less) through all phases of Part D coverage (with insulin costs possibility reduced further in the Catastrophic Coverage phase).
In addition, about 30% of 2023 Medicare drug plans will also implement the Senior Savings Model, offering various “select” types of insulin for a $35 or less co-pay – and all other formulary insulin will still be $35 or less.
How can a Medicare drug plan offer two $35 or less co-pay insulin programs at the same time?
As an example, you may find that your Medicare drug plan may offer some "select" insulin (as noted on the formulary) for a copay of $11 at preferred pharmacies and $33 at regular network pharmacies. These select insulin products may be listed as Tier 3 drugs.
At the same time, the same Medicare drug plan will offer all additional insulin products featured on the drug plan’s formulary with a co-pay of $35. So all insulin products (other than the "select" insulins) will be listed as Tier 6 drugs.