Editorial Roundup: South Dakota

Yankton Press & Dakotan. August 9, 2022.

Editorial: Insulin Cap: Why Is There Resistance?

What’s the argument against capping the price of insulin for people with private insurance?

It’s a timely question amid the negotiations over the wide-ranging Inflation Reduction Act (IRA), which wound up passing the Senate Sunday but only after the insulin cap for private insurance policyholders failed to survive.

Insulin is a lifeline for many people with diabetes — it’s essential to their health and, indeed, their lives. According to a Yale University report, 30 million Americans have diabetes, and 7 million of them need insulin.

But Americans, by a staggeringly wide margin, pay the highest price in the world for a unit of insulin. According to a Rand Corporation survey last year, the average unit price for insulin in the U.S. was $98.70, while Japan was in second place at just $14.40 per unit. Canada was third at $12 a unit.

“The differences were especially stark when the researchers looked at rapid-acting insulin, which makes up about a third of the U.S. market,” the Rand report said. “Its average price in other countries was just over $8. In America, it was $119.”

Thus, the $35 cap proposed in the IRA, which would profoundly impact those Americans struggling to pay for insulin, would still leave this nation with the highest insulin price in the world. But at least it would be within sight of what everyone else pays.

The insulin cap proposal for private insurance fell three votes short of passage in the Senate — it needed 60 votes to overcome a filibuster. Forty-three senators, all Republicans (and including the Senate delegations from both South Dakota and Nebraska), voted against it. However, the cap will apply to those on Medicare, one in three of whom have diabetes, and 3.3 million of them need insulin

Why is U.S. insulin so expensive?

According to ABC News, one big issue — and this is a familiar economic refrain in this country — is that there are only three insulin manufacturers in the U.S.: Eli Lilly, Novo Nordisk and Sanofi. “They’ve been historically raising their list prices for their respective products in lockstep with one another,” according to Dr. Jing Luo, a professor of medicine at the University of Pittsburgh. “There hasn’t been a lot of pricing pressure.”

There are also a lot of regulatory hurdles that must be cleared for other firms to enter into production.

The cap for those on private insurance was dumped because, according to USA Today, Republicans argued that such a cap should be separate from the large IRA reconciliation bill that deals with numerous health issues, as well as climate and economic matters. It was pulled out when the Senate parliamentarian ruled it didn’t fit within the rules of bill reconciliation, and the insulin proposal died on its own. However, senators will likely get their chance to vote on it again soon, according to Senate Majority Leader Chuck Schumer.

Also, since America’s insulin is so spendy, a $35 cap would be expensive for the federal government to cover. That’s something that we’ll likely hear more about when this debate returns. (Of course, it’s already expensive for the consumers, so there’s that.)

Given that, one could argue that California may be taking the best approach on this. There, Gov. Gavin Newsom has announced the state will manufacture its own insulin and sell it close to cost.

The bottom line is, America has the most exponentially expensive insulin in the world, which seems to suggest the rest of the world has apparently figured out how to produce this medication in a cost-efficient manner for betterment of all who need it. Or there’s simply more profit-taking going on here.

Either way, this country must figure this insulin price issue out, because maintaining this devastating status quo is madness and life-threatening.