Type 1 Diabetes and the Affordable Care Act: The Perspective from the Joslin Clinic

Doctors at Joslin Diabetes Center think America’s emerging healthcare system will greatly benefit those with complex, chronic disorders like type 1 diabetes.

There have been many criticisms of the Affordable Care Act (also called the ACA or “Obamacare”) and how it’s currently working. According to the Kaiser Family Foundation, only 41 percent of Americans have a favorable view of the law. However, the real value of the ACA may not be what it’s doing in the present, but the way it is turning gears to change healthcare in the near future.

Robert Gabbay, M.D., Ph.D., Chief Medical Officer of the Joslin Diabetes Center, recently published an editorial article in the journal Diabetes Technology and Therapies outlining how the ACA is set to improve care for type 1 diabetes patients and complex type 2 cases.

Medical costs for type 1 diabetes are estimated at nearly $10,000 a year, compared with $3,580 a year for those without the disease. For type 1 patients requiring at least one hospitalization, the average yearly cost skyrockets to almost $26,000.

“It’s beneficial to the patient, both in terms of their health and the cost of care, to focus on preventative therapies,” says Dr. Gabbay. Doctors and other members of the diabetes team need to be more easily reimbursed for shorter, “in-between visits” to check on a patient’s insulin dosing, monitor new technology like an insulin pump or a CGM, or answer minor questions through a virtual visit or over the phone.

“Most of the time these are things endocrinologists are already doing,” says Dr. Gabbay. “But it’s difficult to bill this sort of care to the insurance company.”

A new type of reimbursement plan, called “bundle payments,” may make it easier for doctors to oversee patients without in-person visits or unnecessary procedures and tests.

Bundle payments are an all-encompassing lump sum paid to physicians by the insurance company. Early adopters are calling them “care packages” rather than a reimbursement.

Getting a bundle payment is like paying a travel agent for an all-inclusive trip with lots of options, flexible activities, and an overall lower price for basics like hotels, car rentals, and airplane tickets—rather than paying each vendor individually at a much higher price. Instead of paying piecemeal for each lab test, office visit, or procedure, care providers will have personalized goals to meet for each patient.

“The care will be tailored to suit each patient’s needs,” says Dr. Gabbay. If your physician needs to remotely monitor your new pump data every other week and follow up over the phone, but doesn’t really need you to come in for a full workup for a few months, they will be able to follow that plan and still get reimbursed

There is concern, however, that bundled payments may induce a laissez-faire attitude towards patients. If everything is covered up front, what compels care providers to deliver anything above the bare minimum of care?

Dr. Robert Gabbay, Chief Medical Officer of Joslin
Dr. Robert Gabbay, Chief Medical Officer of Joslin

“It’s a valid point,” says Dr. Gabbay. “However, more and more  payers  are measuring patient outcomes. Doctors are being incentivized for quality outcomes rather than the quantity of procedures they administer.”

In the case of diabetes, patient health and cost-reduction go hand in hand. If a patient has well controlled A1C levels, normal blood pressure and good cholesterol, they greatly decrease their risk for complications and pricey hospitalizations. If doctors can prevent the need for emergency care, those funds can be re-distributed at the end of the year and reinvested for improved services.

This could mean allocating funds for better remote care options like virtual visits, supporting new self-care technologies, and creating group-based clinic and lifestyle intervention programs.

“It’s a much more fluid way of managing healthcare costs,” says Dr. Gabbay. With this new model, providers can use insurance payments for innovative treatments and shift funds to the patients that need them most.

The key will be whether organizations make the appropriate investments in better diabetes care and reinvest savings to support many previously under-reimbursed activities such as weight loss programs and phone consultations. If diabetes care providers can prevent costly diabetes complications, they save money for everyone—patients, insurance agencies, employers, and the hospitals themselves.

“If it’s utilized correctly this could change diabetes from a cost center into a cost savings,” says Dr. Gabbay. It’s a win-win; patients are healthier and over-stressed hospitals save money down the line. Hopefully, healthcare centers will understand the value of controlling complex, chronic diseases like diabetes and take advantage of the new, innovative models supported by the Affordable Care Act.

Do you need help managing your diabetes? Learn more about the Adult Clinic at Joslin Diabetes Center.


  1. Please dont try to tell us how well this is working for diabetics (and family members with other issues). Though our premium in 2013 was $1000 per month for two, and we have subsidy now, we are actually no better off. We had to select where to put our money, and what to leave off. In order to have labs (blood work and other tests) 100 percent paid, we had to leave things out somewhere else. Our DME is now fifty percent. Pump supplies are the same. Every time we have to have a CT scan, MRI, physical therapy, cardiac testing, we pay 30 percent co-insurance. Though we may have paid $1000 per month before, we did not pay for most of those things. Our HMO loses primary care physicians left and right. If you even find one, you end up with a P.A and never meet the doctor.
    No, not better off. Tryiing to afford tests, and pump things, with no real clue what it will cost until we either make a million calls to gather financial information or take our chances when we go to pay.
    It’s much much more complicated, and stressful. Premiums and costs simply needed to be reigned in. That would have helped.

  2. I wonder when Medicare will cover the CGM. I am age 77, living alone with type 1 diabetes for 43 years, since diagnosed with sudden onset type 1 in 1971 at the age of 34. Medicare now does not cover any part of the cost of the CGM.

  3. The ACA ‘Cadillac Tax’ has meant that my employer has cut benefits every year and the employee costs have gone up as well. Increased deductibles, increased out of pocket maximums, and lowered %covered for all costs except ‘well care exams’ – which diabetic checkups are not. This year, my pharmacy formulary dropped Humalog and only covers Novolog. So I have to stop using the insulin that works for me, that I have figured out how my body responds to, and change to another insulin – that is not exactly the same – because almost 100 years after discovery – there is still no generic insulin.

    And why was Humalog dropped?

    Savings of 31 cents a bottle.

    Novolog is $239.75 and Humalog is $240.06.

    Thank you to the ‘Affordable’ Care Act.

  4. Please tell me why, if novolog is cheaper, our insurance refuses to carry it. There is no regulation that I can find with regards to insulin. It is almost as if they are saying Diabetes is a lifestyle disease, therefore if you don’t manage your lifestyle and have to take insulin, you will be penalized. That is so absurd. Type 1’s have no choice and nothing they do will alleviate their need for insulin. My son is type 1 and allergic to Humalog. And yet the insurance company has refused to cover Novolog at the same rate as Humalog – so this year, without warning, they have changed our co-pay from $70 to $612.00. To add insult to injury, they took the entire amount out of our checking account without notifying us (along with the co-pay for his strips – at $504.00). There is no reasonable explanation for this except that Obamacare has given them the green light to charge whatever they want whenever they want. This year we would have been better off to pay the fine and rely on NovoNordisks sliding payment for those not covered. It is ridiculous.

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