Could this be the year California passes insulin cost control?

After falling short of passing insulin cost-control legislation in recent past sessions, the California Legislature is advancing a bill that would prohibit health plans from imposing a cost-sharing requirement on insulin, other than a maximum $35 per month copay. The current cap on insulin copays is $250.

Sponsored by Sen. Pat Bates (R – San Clemente), SB 473 would also prevent plans from requiring a deductible for equipment and supplies necessary for treating diabetes. It unanimously passed the Senate in January as well as the Assembly Health Committee this week.

 

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The bill is California’s latest attempt to lower skyrocketing insulin costs. The cost of insulin in the US has risen around 15-17% per year since 2012, despite no change in chemical composition. This cost trend is largely influenced by the administrative complexity of bringing generic versions of the drug to market and renewing patent protections every time the medication is incrementally improved.

Bates emphasized that her bill is a continuation of Asm. Adrin Nazarian’s (D – Sherman Oaks) ongoing work to try and reign in insulin costs in the state. Last year, Nazarian sponsored a bill that would have prevented health plans from placing deductibles on insulin, but it died in the Senate.

“It is my hope that we can finally get a bill on this topic across the finish line,” Bates said in the Assembly Health Committee on Tuesday.

At the 2021 Los Angeles State of Reform Health Policy Conference last September, Nazarian expressed his astonishment that California and the rest of the country has yet to make the critical drug affordable for all who need it.

“It’s kind of a shame—quite candidly—that we are where we are as a country, as a nation, as a state … and yet we’re still not addressing the critical needs of people born with a certain condition [for which] we’ve come up with the antidote.” Nazarian said.

“… [The composition of insulin] hasn’t changed for well over 80 [or] 90 years, yet the cost continually goes up and we haven’t fixed the financing portion of health care to address that ongoing, increasing cost.”

Organizations opposing the bill, including the California Association of Health Plans (CAHP) and the California Chamber of Commerce, are primarily concerned about its broader fiscal impact. According to analysis from the California Health Benefits Review Program, SB 479 would increase premiums by a total of $59,565,000 annually.

CAHP, while affirming their support of lowering medication costs for enrollees, said the bill doesn’t address the “root cause” of medication cost increases. The organization argues that it favors diabetes over other costly diseases while raising premiums for all enrollees.

“Capping copays without addressing the root cause of the price increases means that everyone would pay more,” said Jedd Hampton, Director of Regulatory Affairs at CAHP, at the committee hearing. “Whether that’s through higher drug prices, or nonadherence to critical medicines that are needed to prevent even worse, potentially avoidable health outcomes.”

Addressing this issue, Bates said, “I recognize this represents a significant change in cost sharing, but the size of the population suffering from diabetes requires that we do this.”