I've actually seen this first hand. Not for the insulin itself, but the SUPPLIES. Many insurance co. force their insured to pay out of pocket for a lot of the supplies.
My wife went to an estate sale in the neighborhood and they had a box full of various supplies that the deceased was previously using. She took it for free, they were going to throw it away. I told her it was illegal to resale it, but we could try to track down people that might need it. I joined facebook groups, went on craigslist, and within seconds almost I had people begging for the materials. The small box we had contained supplies worth well over 4k new, but we were able to help people by donating it to some of them.
Broke my damn heart, some people re-use single use supplies for MONTHS because they cost so much each. I could only give the supplies to a few, because I didn't have that much.
It shouldn't be this way. I had a friend in the 90's that moved to Germany with his wife because he couldn't afford his diabetic supplies even back then. Germany covers it 100%.