The facts continue to show that, when it comes to prescription drug costs, the country is heading in the right direction. But this doesn’t mean there aren’t patients who have a hard time affording the medicines they need. In fact, we know:
- Many patients with commercial insurance have experienced a 50% increase in out-of-pocket costs for brand name medicines since 2014;
- The growth in patients’ out-of-pocket costs generally has outpaced the growth in what insurers are spending on health care; and
- Health plans are adopting perverse policies that deliberately inflate patient costs and are discriminating against those with conditions that are more costly to treat.
The insurance industry often claims that these and other schemes are necessary to help keep premiums lower for everyone else. But a new analysis shows that is not the case.
Milliman released the results of a study — commissioned by BIO — that looks at the effects of a California law limiting how much insurers could require patients to pay out of pocket for prescription drugs. The law caps patients’ co-pays at $250 per month for each prescription. Milliman examined how the law impacted premiums for health plans offered through the state’s insurance marketplace.
In a piece published by Managed Care Magazine, the team at Milliman summarizes the results of the study, and they are encouraging to say the least:
- California insurers expected that the cap on co-pays would only increase premiums by 1%;
- The co-pay cap helps patients better manage their drug costs throughout the year, avoiding the financial shock many experience when a new benefit year begins;
- Insurers in California did not expect the utilization or use of prescription drugs to increase because of the co-pay law, which suggests total spending on medicines would remain stable; and
- These results should apply to employer-sponsored health plans offered through the workplace, which is where the vast majority of Americans receive their health care.
These findings show that instead of shifting more costs onto the sickest patients, insurers should be limiting what patients pay out of pocket for medicines and that they can do so without increasing health care costs for everyone else. We know there are positive steps insurers can take right now to do just that. Two insurance companies have promised to pass along to patients the rebates the companies receive from drugmakers to help lower the cost of medicines, and one insurer even stated this commonsense approach would have a “negligible” impact on premiums.
But more needs to be done and more insurance companies need to follow suit. If they won’t, then policymakers need to ask the insurance industry why people are paying more for less coverage, get some real answers and demand better.
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