Clinical Context

Total and out-of-pocket spending among patients with diabetes mellitus appears to be increasing, posing a risk for financial hardship for these patients and a threat to medical and nonmedical needs. Using National Health Interview Survey data from 2013 to 2017, a study by Caraballo and colleagues assessed the national scope and associated trade-offs of financial hardship from medical bills among nonelderly persons with diabetes mellitus.

One-third of Medicare beneficiaries have diabetes, and 3.1 million require insulin, but one-quarter of persons taking insulin report reducing their use because of cost. After implementation of the Affordable Care Act, patients have paid a lower percentage of a drug’s price, but these savings can be offset by simultaneous price increases. A second study by Tseng and colleagues used 2014 and 2019 Medicare formulary and pricing files to determine how patients’ out-of-pocket costs for insulin would have decreased from 2014 to 2019 because of Part D policy changes and the opposing effect of higher insulin prices on these potential savings.

Study Synopsis and Perspective

Americans with diabetes are experiencing more financial hardship from medical bills than Americans without diabetes, even when they have health insurance, new research shows.

Results from an analysis of data from the National Health Interview Survey in 2013 to 2017 on medical bills among adults ages 18 to 64 years were published in the February issue of Circulation: Cardiovascular Quality and Outcomes. Cesar Caraballo, MD, of the Center for Outcomes Research and Evaluation, Yale New Haven Health, New Haven, Connecticut, and colleagues, led the study.

Nearly 2 in 5 of the 8967 adults with diabetes surveyed reported financial hardship from medical bills, including medical debt or the inability to afford needed medical care. This hardship, in turn, was associated with high financial distress, food insecurity, cost-related nonadherence, and foregone or delayed medical care.

"Our study findings illuminate the health- and nonhealth-related consequences as a potential side effect of burdensome medical bills from diabetes mellitus management... These findings underscore the need for price transparency and clear communication with patients and their families on costs of care," said Dr Caraballo and colleagues.

"Great consideration should be taken on presenting less expensive but still effective treatment options, as well as a need to comprehend patient's insurance coverage and financial obligations in our management decision-making processes," they added.

The older Medicare population is not immune either.

Another study -- this one on costs affecting the insulin-requiring Medicare population age 65 and older -- found that provisions in the Affordable Care Act intended to reduce the effect of the Medicare Part D "doughnut hole" were counteracted by rising insulin prices.

Those findings were published in the April issue of Diabetes Care by Chien-Wen Tseng, MD, of the department of family medicine and community health, University of Hawaii, Honolulu, and colleagues.^[2]

"Lower insulin prices and other solutions are necessary to improve access to treatment for Medicare beneficiaries with diabetes," Dr Tseng and colleagues assert.

Medical-Related Financial Hardship Brings Other Issues

The 8967 adults ages 18 to 64 years with diabetes included in the National Health Interview Survey study by Dr Caraballo and colleagues would extrapolate to represent about 13.1 million individuals across the United States.

They were a mean age of 51.6 ± 10.3 years, and 49.1% were women.

Annually during the survey, 41.1%, corresponding to 5.4 million nationally, were part of families reporting financial hardship from medical bills, including 15.6% (corresponding to 2 million) reporting they were unable to pay their medical bills at all.

Inability to pay bills at all was most prevalent among persons who were low-income and uninsured (39.1%) and least common among middle- or high-income and insured (8.5%) individuals.

Nevertheless, of the 3613 adults reporting financial hardship because of medical bills, 83.2% were, in fact, insured.

In turn, among individuals with diabetes, persons in families with vs without financial hardship because of medical bills had higher financial distress (52.1% vs 25.4%), food insecurity (30% vs 12.8%), cost-related nonadherence (34.7% vs 9.1%), and foregone/delayed medical care (55.5% vs 21.6%) (all P < .001).

These associations remained significant after adjustment for sociodemographic, economic, and clinical confounders.

All these adverse factors were significantly greater among persons with vs without diabetes in the survey.

In summary, after adjustment for known confounders, individuals with vs without diabetes were at greater risk for overall financial hardship (adjusted odds ratio [aOR] = 1.27), high financial distress (aOR, = 1.14), food insecurity (aOR = 1.27), cost-related nonadherence (aOR =1.43), and foregone/delayed medical care (aOR = 1.3).

Stuck in the Doughnut Hole: Rising Insulin Prices

Meanwhile, the study by Tseng and colleagues examined Medicare Part D coverage, which applies to the 3.1 million beneficiaries who require insulin (type 1 and type 2 diabetes).

In the Part D coverage gap (also referred to as the "doughnut hole") -- which dates back to the Medicare Modernization Act of 2003 -- beneficiaries pay a percentage of the drug's price until they reach the point of catastrophic coverage.

To minimize that burden, the Affordable Care Act incrementally reduced beneficiaries' cost-sharing during the gap, from 100% of the drug price in 2010 to 25% in 2019. At the same time, manufacturers were required to provide greater discounts during the gap, reaching 70% by 2019.

Tseng and colleagues analyzed 9 insulins, including the top 5 by 2017 Part D spending ($8.2 billion or 62% of Part D insulin expenditures), averaging monthly and out-of-pocket cost requirements across plans nationwide, with cost projections based on 50 U/d and no other medications.

From 2014 to 2019, the average annual insulin price rose 55%, from $3819 to $5917.

Monthly out-of-pocket cost for insulin in the covered (predoughnut) phase rose 18%, from $49 to $58. Accounting for all Part D phases, the projected yearly out-of-pocket cost for insulin increased 11% from $1199 to $1329.

In contrast, if insulin prices had not risen and instead remained at 2014 levels, annual out-of-pocket cost would have dropped 19% to $967 because of lower coinsurance in the gap.

This was not uniform, though. Lantus^® pens had the lowest price increase (19%), and for that, the annual out-of-pocket costs dropped by $167; however, if the price had not risen, patients would actually have saved $292.

With Levemir^®, which had the greatest price increase (165%), annual out-of-pocket costs increased by $992 instead of falling by $297 had the price remained unchanged.

In 2019, 8 of 9 insulin prices exceeded $4800 annually, with patients' projected out-of-pocket costs surpassing $1000 under a standard Part D plan.

Of concern, Tseng and colleagues said, "Insulin list prices continue to rise, driven by multiple complex factors including manufacturers competing by offering greater proprietary rebates to pharmacy benefit managers for formulary placement.

"Since measures to close the Part D gap were fully implemented in 2019, future price increases will not be counteracted unless new policies are enacted to reduce patients' cost-sharing," they concluded.

US prices for insulin have come under intense scrutiny in recent years. Around a quarter of patients with diabetes are said to ration use of this medication -- which, for persons with type 1 diabetes, is essential for life -- because of high costs.

Patients and parents of children with diabetes have long protested, and some states have started to cap prices: most recently, Illinois, which has said that no person covered by state-regulated commercial health insurance plans should pay more than $100 per month for insulin.^[3]

Caraballo and Tseng have reported no relevant financial relationships.

Clinical Implications

• Nonelderly patients with diabetes have a high prevalence of financial hardship from medical bills, with harmful health and nonhealth-related consequences, according to an analysis of National Health Interview Survey data from 2013 to 2017 by Caraballo and colleagues.
• Strategies to lower patients’ out-of-pocket cost by closing the Medicare Part D coverage gap were mostly outweighed by higher insulin prices, according to an analysis of 2014 and 2019 Medicare formulary and pricing files by Tseng and colleagues.
• Implications for the Healthcare Team: The healthcare team should in patient care meetings implement management decision-making processes. The team should collaborate to determine individualized patient needs and consider patients’ insurance coverage and financial obligations.

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