Diabetes is a prevalent disease. However, it can still take many by surprise, and leave them struggling to pay medical bills.
With the complexities of the condition and the wide range of costs involved with treatment, having a financing plan is necessary. Health insurance is obviously one of the primary methods of assistance. But not everyone has the adequate coverage to cover
the costs – let alone the out-of-pocket cash to put on the counter every time out.
Opening a savings account, particularly one with high interest, could be a worthwhile investment toward consistently managing the disease today and into the future.
Diabetes at a glance
Type 1 Diabetes
A condition that keeps the body from producing enough insulin. Insulin shots are used to control blood glucose levels. Most diagnoses occur among children and young adults, which is why it is also referred to as juvenile diabetes.
Type 2 Diabetes
The most common form of the condition where the body doesn’t properly use insulin to convert sugar, starches and other food into energy.
Occurs when women experience high blood glucose levels during pregnancy. It’s usually easily managed and goes away after pregnancy.
When blood glucose levels are higher than normal, but not high enough to be diagnosed as Type 2 diabetes. A large number of Americans are living with prediabetes (1 out of 3 adults). But taking early action to manage glucose levels can prevent diabetes from forming.
People who have diabetes are at higher risk of developing the following health conditions:
- Heart disease
- Kidney failure
- Loss of lower appendages (toes, feet, or legs)
Keep in mind – these conditions occur in the case of severe complications with the disease. With consistent attention to diet and other medical treatments (like most living with type 1 or type 2 diabetes undergo), these conditions are avoidable.
Diabetes by the numbers
According to a recent report from the Centers for Disease Control and Prevention (CDC), more than 100 million U.S. adults are now living with diabetes or prediabetes. Of that, only 12% were aware that they had it. And with approximately 1.5 million new cases being diagnosed every year, the need for education and financial support is clear.
Rates of diagnosis for the following ethnic groups
- 7.4% of non-Hispanic whites
- 8.0% of Asian Americans
- 12.1% of Hispanics
- 12.7% of non-Hispanic blacks
- 15.1% of American Indians/Alaskan Natives
Breakdown among Asian Americans:
- 4.3% diagnosed were Chinese
- 8.9% diagnosed were Filipinos
- 11.2% diagnosed were Asian Indians
- 8.5% diagnosed were identified as other Asian Americans
Breakdown among Hispanic adults:
- 8.5% diagnosed were Central and South Americans
- 9.0% diagnosed were Cubans
- 13.8% diagnosed were Mexican Americans
- 12.0% diagnosed were Puerto Ricans
Underreported deaths due to diabetes
Diabetes is one of the leading causes of death in the United States (seventh as of 2015). However, studies have found that it is also among the most underreported. According to the American Diabetes Association®, only 35% of people who died with diabetes had the disease listed on their death certificate. And of that number, only 10% had diabetes identified as the cause of death.
There are a number of possible reasons for the underreported rate. But a lot points to the lack of ability to pay for adequate diagnosis and proper medical treatment.
What specific costs will someone with diabetes have to address?
If you or your child are diagnosed with diabetes, or you’re told that you have prediabetes, management and prevention take center stage. While a lot involves diet and exercise, medication will inevitably have an effect on your finances as well.
According to the American Diabetes Association® (ADA), medical costs for a person with diabetes averages out to $16,750 per year (a total of $327 billion nationwide in 2017). Of that amount, $9,601 is attributed to treatment specifically for diabetes. That’s more than twice the medical cost for people without diabetes.
Of the $327 billion nationally, $237 billion was attributed to direct diabetes medical costs and $90 billion was attributed to indirect costs – absenteeism and reduced productivity at work. Understanding the different forms of diabetes treatment, as well as the direct and indirect costs, is important for wrapping your head around plans for financing.
|Type 1 Diabetes||
|Type 2 Diabetes||
|Direct Medical Costs ($9,601/year)||Indirect Medical Costs ($90 billion nationally)|
|Prescription medication (30% of total cost)||Loss of productivity due to mortality ($20 billion nationally)|
|Hospital care (30% of total cost)||Inability to work as a result of diabetes ($40 billion nationally)|
|Routine doctor’s office visits (15% of total cost)||Reduced productivity while at work ($30 billion)|
|Other medications and supplies (25% of total cost)||Reduced productivity due to increased absences and loss of employment from diabetes ($6 billion)|
Insulin injections are one of the primary forms of medical treatment used to manage diabetes. Especially for those living with type 1 diabetes, who can’t produce insulin of their own, these types of injections are vital for survival. However, the cost for insulin has skyrocketed in recent years, leaving many in the position of having to choose between going into debt or cutting back on medication.
The average cost for insulin as of 2015: $100-$200 per month
An average cost for insulin as of 2018: $400-$500 per month
|WIDELY USED INSULIN BRANDS AND INSULIN INJECTION TOOLS|
|Insulin||Apidra, Humulin, Lantuo, Lente, Levemin, Novolog, Novolin, NPH Insulin, Regular Iletin, Regular Insulin, Velosulin|
|Insulin Syringes||BD Ultrafine, Levemir®, Monoject, NovoFine®, Ulticare, UniFine, UltiGaurd|
|Insulin Pumps||Animas, Deltec, Medtronic|
Diabetes screenings and other medications
Along with your normal doctor’s visits, diabetes screenings are an important part of the process for identifying the disease. Specifically, if you have been diagnosed, testing your blood glucose levels will become a regular part of your life. Much of the costs for medications involved should be covered by your health insurance. And there are a number of home testing devices you can invest in to help make things more convenient and cost-effective.
|WIDELY USED DIABETES TESTING BRANDS AND OTHER MEDICATIONS|
|Blood Glucose Test Meters and Test Strips||Abbott Freestyle®, Abbott Flash, Accu-Chek Compact®, Ascensia Elite, Ascencia Breeze, Ascensia Contour, Lifescan One-Touch©, Prestige|
|Injectable Medications||Byetta (Exenatide) injection and Symlin (Pramlintide Acetate) injection, Victoza (lLiraglutide- rDNA origin) injection|
|Oral Medications||Acarbose, Avandia, Chlorpropamide, Diabinese, Glipizide, Glucophage, Glucotrol, Gylset, Meglitol, Metformin, Prandin, Precose, Repaglinide, Rosiglitazone (These drugs act in different ways to lower blood glucose levels and may be prescribed in combination with other medication.)|
Diabetes health expenditures according to group
Depending on whether you or your child has type 1 or type 2 diabetes, total expenditures can vary. Those who manage their condition at home, through diet, exercise, and home testing will have different averages than those needing regular appointments with specialists. According to the American Diabetes Association®, average total healthcare expenditures for diabetes treatment differ according to gender, race, and states with the highest populations of people diagnosed.
Non-hispanic Blacks: $10,470
Non-hispanic Whites: $9,800
States with the highest population of people with diabetes
New York: $21 billion in healthcare expenditures
Florida: $24 billion in healthcare expenditures
Texas: $25 billion in healthcare expenditures
California: $39 billion in healthcare expenditures
Options for diabetes treatment financing
In a recent online survey of 500 adults with diabetes, more than half of the participants acknowledged the medical costs involved has had a negative impact on their finances. Many also admitted to going to “extreme lengths” to cover the costs. These lengths include accruing credit card debt, borrowing money from family or friends, and tapping into a savings or retirement account. Many may feel the need to take some extra financial risks because they don’t feel as supported as they’d like. Understanding your options will help you make the most informed choices.
Government insurance, such as Medicare and Medicaid provides most of the financial assistance for diabetes care. The military also takes care of a good amount of costs for veterans. The remainder of the cost is covered by private insurance or out-of-pocket cash. According to the National Conference of State Legislatures, 46 states mandate that diabetes be covered under state insurance.
These states require coverage for diabetes treatment as well as equipment and supplies for home use (insulin, pumps, syringes, test meters). Four states do not have that same insurance mandate, however – Ohio, Alabama, North Dakota, and Idaho. Anyone with diabetes who live in any of those four states will most likely need to deal with a private insurer or explore other methods of financing.
Coverage from private insurers usually come through employer-sponsored group plans or individual health plans. Advisors would suggest going with employer-sponsored plans, because they offer higher protections due to being subsidized. On the other hand, if you are unemployed and venturing into the individual market, it may be difficult to find affordable coverage. The reason is that diabetes is considered a “high risk” disease. Insurance companies anticipate a high amount of claims, especially from those with pre-existing conditions. So it will be reflected in the pricing.
People who have diabetes but don’t have coverage that’s comprehensible enough for their needs may utilize a health savings account (HSA). An HSA is primarily useful for people with high deductibles (at least $1,350 individually, or $2,700 for family). Also, those who are a part of low-income families or don’t live in a “mandate state” may see this as a helpful tool. One big benefit of an HSA is that you take the money with you. There’s no “use it or lose it” policy like some other savings plans. Being able to set aside pre-taxed dollars to help pay for medical expenses can go along way when trying to manage diabetes.
Another way to set aside dollars for medical expenses is through a flexible spending account (FSA). An FSA is provided through your employer with a $2,650 limit. You can also use it to cover medical expenses for your spouse and dependents. One thing to keep in mind with FSA’s is that they do have an expiration period. You’re generally required to use the funds within your plan year. But your employer may offer extensions at their choosing. The benefit is, it can be used with any type of health plan. And diabetic supplies are eligible to be paid through FSA’s.
High interest savings account
If you’re not interested in dealing with your employer for coverage or a flexible spending account, a high interest savings account could be a good option to explore. It’s just like any other savings account, only with fewer restrictions. Not only are you saving for your medical needs, but your money is also making money. High interest savings accounts are opened through online banks – which means they don’t have to worry about maintaining branches all over the country. They can offer you higher interest rates, with the benefit of accessing your money whenever you want.
Unlike an HSA, a high interest savings account isn’t tied to a high deductible health plan with a dollar limit. And unlike an FSA, there’s no expiration date on when you can use your money. It removes any additional stress so you can concentrate on managing your condition properly. And as you earn interest, you can still take advantage of a number of outreach resources available for people with diabetes.
This condition can be a tough one to get a handle on, but it’s not insurmountable. Let your understanding of diabetes, your knowledge of its treatments, and your strategy for tackling costs work in your favor.