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Health

Proposed insulin price cap poses test for Dems

A Senate deal to cap the cost of insulin at $35 a month for individuals with private insurance and Medicare poses a new test of whether Democrats can make good on campaign pledges to rein in drug costs.

Why it matters: With most of President Biden’s health agenda still stalled in Congress, the plan unveiled on Wednesday could be a politically appealing way to limit out-of-pocket costs for more than 37 million Americans with diabetes.


Yes, but: The legislation from Sens. Jeanne Shaheen (D-N.H.) and Susan Collins (R-Maine) needs the backing of every Democratic senator and 10 of the chamber's Republicans, who've been critical of drug price caps.

  • The plan also doesn't guarantee lower list prices for insulin and could instead shift more of the cost to payers, resulting in higher premiums.
  • A spokesperson for America’s Health Insurance Plans says the draft raises serious concerns and could "undermine successful, competitive private-market solutions."

Zoom out: Insulin is a tempting target for pricing reforms. Per-unit U.S. prices for the life-saving medication in the U.S. are seven times those in comparable countries, per the Peterson-KFF Health System Tracker.

  • The Senate plan would encourage manufacturers to cut list prices while preventing insurers and pharmacy benefit managers from collecting rebates on those insulins whose costs are limited to the 2021 net prices for Medicare Part D or equivalent levels.
  • But there are cost concerns. A House insulin price plan would lead the government to lose almost $4.8 billion in revenue over a decade while spending would rise $6.6 billion over that period, according to congressional scorekeepers.

What we're watching: Shaheen and Collins are likely to modify their proposal to make it more appealing on cost grounds.

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