Do health plans cover cost of insulin, diabetes medicines?

How does a health insurance policy handle the cost of insulin and other essential medications needed to manage diabetes? Are there any limitations or restrictions on the type or brand of insulin that is covered?

— Name backd on request

The industry has slowly begun to meet the specific needs of these customers. Some health insurance providers prioritize comprehensive coverage for individuals managing diabetes. These policies usually include coverage for insulin and essential diabetes medications within the prescription drug coverage section. There is also an emphasis on encouraging the use of cost-effective generic medicines where possible. However, insurance providers understand that some people may need specific brands or types of insulin for medical reasons. In such cases, they sometimes collaborate with health care providers to ensure coverage for necessary medications.

Insurance providers usually maintain a formulary, which is a list of drugs covered under their plans. Diabetes medications, including insulin, are usually part of this formulary, and may be categorized into different tiers that affect cost-sharing requirements for policyholders. To ensure that prescribed treatments are consistent with diabetes management best practices, insurance policies may require prior authorization for certain medications, including specific types of insulin.

Some insurance providers may also implement phase therapy protocols to initially promote the use of cost-effective medications. However, they remain committed to meeting patient needs when healthcare providers deem a particular medication necessary.

Policyholders are usually responsible for a portion of their medication costs, which can be in the form of co-payments or co-insurance, depending on the specific terms and conditions of the policy. Deductibles may also apply in some cases, affecting prescription coverage.

To help policyholders save money on medication costs, insurance providers often maintain networks of select pharmacies. Using these network pharmacies can lead to cost savings.

I want to buy a specific diabetes plan but I’m worried about out-of-pocket costs. What type of diabetes care plan should I buy that gives me maximum coverage?

-Name withheld on request

Out-of-pocket expenses related to diabetes are categorized under two buckets. Medical expenses and supplies one including medicines, insulin pumps, glucose monitors, and the other expenditure on medical examination/diagnostic tests such as general/specialist consultation fees, ophthalmologist consultation, HBA1c, creatinine, chest X-ray, spirometry. test, ECG, cholesterol profile, etc. The medical and diagnostic costs may vary based on co-morbid conditions such as diabetes. Some health insurance plans reimburse such out-of-pocket expenses under a Chronic Management Program. Diabetes plans may come with a co-pay and/or deductible depending on the company’s product benefit structure.

Such customers should look out for comprehensive covers, including the out-of-pocket costs, and buy a suitable product. Although only a handful of insurance companies offer such covers, it is worth investing in such a cover that takes care of the health and protection needs of such customers.

Anuradha Sriram is the chief actuarial officer, Aditya Birla Health Insurance.

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Updated: 09 November 2023, 10:46 PM IST

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