For years, health advocates have wanted to lower the cost of prescription drugs that have crept up and impacted people's budgets over time. Insulin, which is crucial for more than a million Americans with Type 1 diabetes, has been used as a prime example of that cost creep.
The life-saving nature of the drug and its inexpensive pricing in other developed nations have fueled demands for some kind of government relief.
This week, Congress set out to do something about it. Sort of.
The Senate on Sunday passed the Inflation Reduction Act, just 11 days after Senate Majority Leader Chuck Schumer (D-N.Y.) and Sen. Joe Manchin (D-W.Va.) announced that they reached a long-sought agreement on a spending package.
Democrats passed it using a process called "budget reconciliation," allowing them to avoid a Republican filibuster. The highlights of the bill include nearly $370 billion to fight climate change, a rule change allowing Medicare to negotiate the cost of some prescription drugs and a 15 percent minimum corporate tax.
Tucked into the bill is a provision poised to help millions of diabetic Americans: a $35 cap on out-of-pocket costs for insulin for those enrolled in Medicare — but not for those privately insured.

Who Is Covered?

The bill originally included a cap on insulin for both Medicare and private insurers at $35 a month. But because the parliamentarian, the Senate’s rules expert, ruled that the private insurer cap did not comply with the rules for the reconciliation process, Senate Republicans forced it out of the bill.
"We have an opportunity to make a difference and permanently cap insulin at $35 a month," Sen. Patty Murray (D-Wash.), the chair of the Senate health committee, said on the floor on Sunday. "This should not be a hard vote to cast."
For most Republicans, it was a hard vote. Only seven Republicans joined all of the Democrats to keep the wider cap in the bill, getting the votes in favor to 57 just short of the needed 60.
The failed vote came even as more than seven million Americans require daily insulin use. A study from Yale University found that 14 percent of people who use insulin engage in "catastrophic" spending, meaning that 40 percent of their income after paying for food and housing went to the drug.
Analysis from the Kaiser Family Foundation, a health research non-profit, found roughly one out of every five insulin users with private insurance pays more than $35 per month for the drug. Among them, half would save at least $19 per month if the broader bill went into effect, and a quarter would save at least $42 per month.
Although the cap now only applies to Medicare recipients, the impact could still be widespread. 
"This bill will strengthen health care access and lower health care costs for people across Georgia,” said Sen. Raphael Warnock (D-Ga.), who led the charge to get the insulin cap in the bill. "I’m not in love with politics. I'm in love with change — and this legislation will make real change in people’s lives."

How Much Money Is at Stake

As it stands now, capping out-of-pocket insulin costs would have the most direct impact on those enrolled in Medicare Part D, which helps cover prescription drugs. According to Kaiser, 3.3 million beneficiaries used insulin as of 2020, and their aggregate out-of-pocket spending was $1.03 billion that year.
Some beneficiaries are eligible for Part D low-income subsidies to help even more with prescriptions, but many are not eligible for the extra assistance and have to cover larger out-of-pocket costs. In 2020, Kaiser also found that the average annual out-of-pocket spending per user was $572, an increase of 76 percent since 2007.
"If a $35 monthly copay cap for all insulin products had been in place in 2020," Kaiser wrote in its analysis, "Part D enrollees without low-income subsidies would have saved $19 per insulin prescription, on average—a reduction of 35% based on average out-of-pocket costs of $54 per insulin prescription in 2020.'
Given the cost burden, a $35 cap, combined with a larger $2,000 per year out-of-pocket cap for Medicare recipients on prescription drugs, is poised to save them billions of dollars. Senate The Congressional Budget Office estimates the prescription drug provisions in the bill will save $288 billion over 10 years.
"Thanks to today’s historic vote in the Senate, millions of Americans 50-plus are one step closer to real relief from out-of-control prescription drug prices," AARP CEO Jo Ann Jenkins said in a statement after the vote. "Since AARP’s founding we have fought for older adults to have access to affordable health care — including prescription drugs. And we have been working for nearly two decades to allow Medicare to negotiate the price it pays for medications."