Minnesota Fights Back Against Rising Insulin Costs

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Pharmacy Times, February 2022, Volume 88, Issue 2

Alec Smith Insulin Affordability Act provides citizens with a long-term solution to diabetes expenditures.

The average individual with diabetes will spend approximately $16,752 per year on medical expenditures, with $9601 attributed to diabetes, according to the American Diabetes Association.1

This is estimated to be 2.3 times more than an individual without diabetes may spend each year on health care costs. The rising cost of insulin tends to be a major problem associated with these expenditures, causing many individuals with diabetes to ration supplies or refuse to purchase needed medications. To combat this, Minnesota has passed the Alec Smith Insulin Affordability Act to provide its citizens with hope and a long-term solution.

Alec Smith was 26 years old when he died after rationing his insulin.
He was unable to afford the medication after he aged out of his parents’ health insurance policy. Smith’s average monthly expenses, including insulin and testing supplies, totaled $1300. Unfortunately, this is not an uncommon occurrence for many individuals with diabetes. After this tragedy, the Minnesota Legislature started looking into insulin costs and found that out-of-pocket expenses had tripled in the prior decade.2 The bill passed with an astounding 111-22 vote, and Governor Tim Walz signed it into law in April 2020.

The Alec Smith Insulin Affordability Act regulates insulin costs in 2 parts: continuing and urgent need. The urgent need part allows eligible individuals who are in urgent need of insulin to get a 1-time, 30-day supply of insulin from their pharmacy for a $35 co-pay.3 Normally, this applies once per a 12-month period. However, some patients may qualify for an additional 30-day supply. The continuing need part applies to manufacturers and says the manufacturer must provide insulin for 1 year to eligible patients and give the option to renew annually. A 90-day supply is provided to the patient for a maximum co-pay of $50. Patients with insurance may opt into a manufacturer’s co-pay program if it provides a better value. If a manufacturer refuses to participate, it may be fined
up to $3.6 million per year of noncompliance, and that may double
in the second year.2

To qualify for the urgent need part, the patient must demonstrate an urgent need for insulin, meaning the patient has less than a 7-day supply of insulin and will likely have significant health consequences if that supply runs out. The patient must live in Minnesota and not be enrolled in Medical Assistance or MinnesotaCare, must pay more than $75 each month for insulin, and must present identification proving Minnesota residency.3 If the patient is younger than 18, the legal guardian or parent is responsible for providing proof of residency. A second 30-day supply is granted if the patient is waiting for Medical Assistance or MinnesotaCare coverage to begin, or if the patient’s application for continuing need has been denied and they are waiting for a response to an appeal from the Minnesota Board of Pharmacy.

To receive continuing need, the patient must be a Minnesota resident, have a family income that is equal to or less than 400% of the federal poverty guidelines income, not be eligible to receive health care through most federally funded programs, not be eligible to receive prescription drug benefits through the US Department of Veterans Affairs, and not be enrolled in Medical Assistance or MinnesotaCare. Having insurance does not exclude a patient from receiving continuing need. However, if out-of-pocket costs are less than $75 for a 30-day supply, the patient is ineligible.

Each insulin manufacturer provides programs to satisfy the continuing need part of the act and provides additional assistance to patients. For example, Eli Lilly and Company’s Lilly Diabetes Solution Center assists patients in creating solutions to insulin-related financial hardship. Direct assistance is provided through discount programs, nonbranded insulin, and savings cards.4 Eli Lilly also encourages product donations directed toward patients who meet its eligibility requirements. Novo Nordisk and Sanofi provide similar programs.

As favorable and valuable as the act may be, there has been opposition
from the Pharmaceutical Research and Manufacturers of America (PhRMA). The day before the act went into effect, PhRMA filed a lawsuit claiming the act violated the US Constitution. “Minnesota is forcing insulin manufacturers to give their product to state residents for free, without any compensation from Minnesota in return,” PhRMA said in the suit.5

A US District Court judge dismissed the case on March 15, 2021. “I’m gratified the court saw through Big Pharma’s meritless challenge to the law,” Minnesota Attorney General Keith Ellison said in a statement.6

Conclusion

The Alec Smith Insulin Affordability Act provides hope for patients with diabetes who are unable to afford soaring insulin costs. To adapt to a diverse patient population, the act includes relief for both long-term and urgent situations provided by manufacturers and pharmacies. It is evident the act has been adapted to provide maximum benefit to improve health care outcomes, but not all share that belief. Although there has been resistance from PhRMA, affordable health care is considered essential, thanks to the advocates who did not see Alec Smith’s death as an acceptable casualty of the insulin crisis.

Katelyn M. Skeeters is a PharmD candidate at the University of Kentucky College of Pharmacy in Lexington.

Joseph L. Fink III, JD, DSC (HON), BSPharm, FAPhA, is a professor of pharmacy law and policy and the Kentucky Pharmacists Association Professor of Leadership at the University of Kentucky College of Pharmacy in Lexington.

References

1. American Diabetes Association. Economic costs of diabetes in the U.S. in 2017. Diabetes Care. 2018;41(5):917-928. doi:10.2337/dci18-0007

2. Minnesota House passes Alec Smith Insulin Affordability Act. Minnesota House of Representatives. April 14, 2020. Accessed January 12, 2022. https://www.house.leg.state.mn.us/Caucus/ View/DFL/29389

3. Minnesota insulin safety net program. Minnesota Board of Pharmacy. Accessed January 12, 2021. https://mn.gov/boards/pharmacy/insulinsafetynetprogram/

4. Lilly Minnesota insulin safety net program. Eli Lilly and Company. Accessed January 12, 2021. www.lilly.com/resources/minnesota-insulin-safety-net- program

5. Edwards K, Haavik E. ‘This fight is not over’: insulin affordability act goes into effect as pharmaceutical industry sues. KARE11. July 1, 2020. Accessed January 12, 2021. www.kare11.com/article/news/local/kare11-sunrise/alec-smith-insulin-affordability-act-in-effect-last-minute-lawsuit-filed/89-7e8d4bec-a6ee- 4b77-8ff1-5971cf8a07ce

6. Big pharma’s challenge to Minnesota’s affordable insulin law is dismissed. Bring Me The News. March 16, 2021. Accessed January 12, 2022. bringmethenews.com/minnesota-news/big-pharmas-challenge-to- minnesotas-affordable-insulin-law-is-dismissed