Insulin pump decision could have chilling effect

By Theresa Flaherty, Managing Editor
Friday, May 27, 2016

YARMOUTH, Maine – UnitedHealthcare’s recent decision to only cover insulin pumps provided by Medtronic is bad news all around, say industry stakeholders.

In May, the insurance giant announced it had inked an agreement with the medical device maker to serve as exclusive provider of insulin pumps to its members.

“To take away beneficiary choice over economics is not a good thing,” said Dan Gooch, owner of Pal-Med in Columbia, S.C., which offers pumps from Medtronic, Animas and Tandem. “I think we are going to see more and more of that, and more and more of the niche DME companies making a deal for a little better pricing for exclusive access to those lives that are insured.”

UnitedHealthcare contracts directly with more than 1 million physicians and care professionals, and 6,000 hospitals and other care facilities nationwide.

Smaller providers, like the Diabetic Shoppe in Charleston, Miss., already struggle to compete because they lack buying power.

“We could hardly do Medtronic to begin with,” said Peyton Brown, vice president. “It cost us more than what we were reimbursed. We had a couple of patients where we just had to eat it to keep the physician referring to us.”

Although preferred provider and product agreements are nothing new— particularly for diabetes supplies—applying a one-size-fits-all solution simply doesn’t work, especially for insulin pumps, say providers.

“It’s a personal choice,” said Gooch. “There are pumps that contain difference size insulin cartridges. A diabetic that is on a large amount of insulin would be changing their cartridges so frequently they wouldn’t want to use that particular pump.”

That, in turn, leads to worse outcomes for patients and higher costs for the healthcare system, advocates say.

“We have insurance companies screaming that patients aren’t compliant, and then they take away their determination to use the best product for their lifestyle,” said Bennet Dunlap, president of the Diabetes Patient Advocacy Coalition. “We customize how we approach technology in our daily lives, and if that gets people to use their pump more efficiently, that’s the outcome we are looking for.”

Ultimately, curtailing access to smaller medical device makers could have a chilling effect on innovation, says Bennet.

“Innovation comes from building a better mousetrap,” he said. “I think people are concerned this is going to have ramifications for CGMs, for glucometers and for other iterations of diabetes technology.”