Trends in Medicaid Reimbursements for Insulin From 1991 Through 2014

Insulin is a vital medicine for patients with diabetes mellitus. Newer, more expensive insulin products and the lack of generic insulins in the United States have increased costs for patients and insurers.

To examine Medicaid payment trends for insulin products. Cost information is available for all 50 states and has been recorded since the 1990s.

A time-series analysis comparing reimbursements and prices. Using state- and national-level Medicaid data from 1991 to 2014, we identified all patients who used 1 or more of the 16 insulin products that were continuously available in the United States between 2006 and 2014. Insulin products were classified into rapid-acting and long-acting analogs, short-acting, intermediate, and premixed insulins based on American Diabetes Association Guidelines.

Inflation-adjusted payments made to pharmacies by Medicaid per 1 mL (100 IU) of insulin in 2014 US dollars.

Since 1991, Medicaid reimbursement per unit (1 mL) of insulin dispensed has risen steadily. In the 1990s, Medicaid reimbursed pharmacies between $2.36 and $4.43 per unit. By 2014, reimbursement for short-acting insulins increased to $9.64 per unit; intermediate, $9.22; premixed, $14.79; and long-acting, $19.78. Medicaid reimbursement for rapid-acting insulin analogs rose to $19.81 per unit. The rate of increase in reimbursement was higher for insulins with patent protection ($0.20 per quarter) than without ($0.05 per quarter) (P<.001).Total Medicaid reimbursements peaked at $407.4 million dollars in quarter 2 of 2014. Total volume peaked at 29.9 million units in quarter 4 of 2005 and was 21.2 million units in quarter 2 of 2014.

Between 1991 and 2014, there was a near-exponential upward trend in Medicaid payments on a per-unit basis for a wide variety of insulin products regardless of formulation, duration of action, and whether the product was patented. Although reimbursements for newer, patent-protected insulin analogs increased at a faster rate than reimbursements for older insulins, payments increased for all products we examined. Our findings suggest a lack of price competition in the United States for this class of medications.