Introduction and Objective: The Inflation Reduction Act capped out-of-pocket costs for insulin at $35 per 30-day supply for Medicare Part D beneficiaries in 2023 in a landmark policy change. This project measures the out-of-cap policy’s association with changes in out-of-pocket costs and insulin use for Part D beneficiaries. We also test whether the policy was fully implemented: that is, did anyone still pay over $35 per 30-day supply of insulin, and if so, who?Methods: Using national Medicare Part D claims data, we measured the policy’s association with out-of-pocket costs per 30-day insulin supply, days of insulin supplied, and insulin adherence for over 1 million insulin users. To do so, we used a difference-in-differences analysis changes in for people affected versus unaffected by the cap; the unaffected insulin users already had low cost-sharing due to existing protections for people with sufficiently low income and assets.Results: Out-of-pocket costs declined by $21 per 30-day insulin fill for Part D beneficiaries after the policy, a 40% decline compared to 2022 levels. Days supplied increased by 8 days per year, a 2% increase; proportion of days supplied with basal insulin increased by 1%. Increases in insulin use and adherence were largest for insulin users with lower levels of income and assets. However, even after the 3-month grace period for policy implementation, 21% of Part D insulin users still paid over $35 for a 30-day supply of insulin. Overcharging was more common for fee-for-services beneficiaries and older beneficiaries.Conclusion: The Inflation Reduction Act’s out-of-pocket cap provided beneficiaries with lower and more stable out-of-pocket costs, resulting in increased insulin utilization and, to a lower extent, adherence to basal insulin; however, the policy was not consistently implemented. These findings can help improve the implementation of this policy and the design of future policies to boost affordability of insulin.
R. Myerson: None. N. Kim: None. A. Peters: Advisory Panel; Current; Vertex Pharmaceuticals Incorporated, Medscape. Research Support; Ended; Abbott Diabetes. Research Support; Current; Insulet Corporation, Zucara Therapeutics. Stock/Shareholder; Current; Omada Health, Inc. J. Romley: Other – I will be giving a compensation methodological presentation to J&J researchers in December, 2025.; Current; Johnson & Johnson. D. Qato: None. J. Cao: None. D. Goldman: Research Support; Current; American Heart Association, Alexion Pharmaceuticals, Inc., Amgen Inc., BioMarin Pharmaceutical Inc., Blue Cross Blue Shield of Arizona, Blue Cross Blue Shield of Massachussetts, BrightFocus, Bristol-Myers Squibb Company, California Hospital Association, Cedars-Sinai Health System, Charles Koch Foundation, CommonSpirit. Other – Research support and service on policy advisory board; Current; Edwards Lifesciences Corporation. Research Support; Current; Gates Ventures, Genentech, Inc., Gilead Sciences, Inc. Advisory Panel; Ended; GRAIL. Research Support; Current; Incyte, Johnson & Johnson, Lilly, Novartis AG, Pfizer Inc., RA Capital, Roche Pharmaceuticals. Other – Co-founder and board member.; Current; EntityRisk.
This research was funded by a grant from the National Institute of Diabetes and Digestive and Kidney Diseases (R01DK141885).
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