Ouch! Feel that jarring pain? It’s the prick of a needle advancing into your pocketbook as you stand at the pharmacy counter and realize just how much that medicine the doctor has prescribed is going to set you back. And if your prescription treats a serious illness, such as cancer, hepatitis C or cystic fibrosis, you may as well leapfrog to a mainline shunt siphoning money to the drug and insurance companies.
All in all, it is not going to be a good day. The discomfort of your illness temporarily may be overshadowed by monetary stress. This is especially true if you are a cash consumer or an insured individual saddled with a high deductible health plan.
Fifty percent of the U.S. public reported taking prescription medicines at the time of a Kaiser Family Foundation Health Tracking Poll conducted June 2-9, 2015. About 25 percent of that group said they or a family member, due to cost, had decided not to fill a prescription in the previous 12 months. Cutting pills in half or skipping doses were mentioned by 18 percent for the same reason. Among poorer households, one-third of those polled said that affording prescriptions was “difficult,” compared to 21 percent overall.
Similar findings were substantiated through polling by Consumer Reports Best Buy Drugs. That research showed that “45 percent of people regularly take a prescription drug, and on average, take between four and five medications.”
The Kaiser foundation also reported that 73 percent of polled consumers characterized prescription drug costs as “unreasonable.” Regarding causes for those perceived excessive costs, 76 percent identified pharmaceutical companies as setting the price too high, while 10 percent cited health insurance companies as requiring people to pay too much of the cost for prescriptions.
The rapid rise in drug costs is illustrated by the Health Affairs Blog, which quotes the average annual cost of cancer drugs rising from about $10,000 before 2000 to more than $100,000 by 2012. Prices for new FDA-approved specialty medicines also reportedly generated shock waves when introduced. Examples from the blog include a multiple sclerosis drug commanding nearly $55,000 per patient per year; a hepatitis C treatment of $84,000 for a single patient; and a cystic fibrosis remedy priced at $259,000 a year.
Americans paid $424 billion before discounts for prescription drugs in 2015, according to Consumer Reports. The source of that data was a report from IMS Institute for Healthcare Infomatics, a pharmaceutical industry tracking firm. The magazine’s own Consumer Reports Best Buy Drugs poll in March 2016 estimated that about 32 million Americans faced price hikes in prescription medicines averaging $63 in the previous 12 months.
Among older Americans, more than nine in 10 people aged 50+ years support allowing Medicare to negotiate for lower drug prices and “a large majority” of people say it should be legal for Americans to purchase prescription drugs in Canada and Europe. More than eight in 10 survey participants “think that drug companies make too much profit and that they should be required to publicly explain how they price their products.” Those statistics originate from a December 2015 survey conducted by GfK for the American Association of Retired Persons (AARP).
Consumer Reports cites five reasons for increasing prescription drug prices: no federal regulations on pricing; insurance companies raising deductibles; increasing monthly premiums; higher copays through tiered structures, or paying co-insurance; re-formulation of existing drugs into more expensive new offerings; shortages of generic drugs prompting large price increases; and costs of specialty drugs spread across the entire base of prescription users.
Participants in the Consumer Reports poll said they wanted to see government action to control drug prices. Specific suggested steps reported by Consumer Reports include setting a limit on out-of-pocket costs, approving more generic versions of common drugs and allowing limited importation of drugs from legitimate and less expensive Canadian and European sources (currently illegal under U.S. law).
Supporting documentation for the Safe and Affordable Drugs From Canada Act states that 16.7 percent of all health care spending in the country during 2015 went for prescription medications. Under that lawmaking, individuals would be permitted to import into the U.S. a personal supply of prescription drugs from an approved Canadian pharmacy and dispensed by a licensed pharmacist. U.S. Senator John McCain has been a co-sponsor of such legislation, which has been referred to committee.
Each brand name drug costs almost a billion dollars to bring to market, according to Jason Dykstra, pharmacist and owner of Chino Valley Pharmacy.
“That’s why we see large price tags on brand name medications,” Dykstra clarified. “They are cutting-edge, often new avenues of therapy, and with pharmaceutical representatives pushing [them], they gain popularity. There are not many brand name medications costing less than $100 a month and many sell in excess of $300 a month.”
For insurance companies, those price points could total $1,200 to more than $3,600 a year per person per medication, he noted. “This is the reason you see such high premiums for brand name medications and largely why pharmacy copays and costs are rising to patients.”
Dykstra explained that “rising prices are really attributed to health care costs going up. As health care costs increase and insurers are paying less, prices have gone up to make up for this. When it comes to pharmaceuticals, much of the increased costs are driven by insurance carriers and pharmaceutical manufacturers.”
Consumers, according to Consumer Reports, can focus on managing prescription costs by speaking with their physicians about the drugs being prescribed; shopping around and negotiating prices; checking online with GoodRx to discover for the lowest prices; purchasing prescriptions from online providers (such as healthwarehouse.com) displaying the Verified Internet Pharmacy Practices Site (VIPPS) symbol and operating within the U.S.; and choosing a health insurance plan that covers the medicines needed.
Insured patients should regularly speak with their pharmacists regarding alternative products and shop the health care marketplace to find the “median between premiums and copays,” Dykstra advised. “Higher premiums normally mean lower copays, and vice versa.”
Most cash patients “cannot afford the large price tags on brand name medications, so a regimen of generics is often seen and preferred,” Dykstra explained. “Shop the competition yearly and always take a generic when applicable.”
Dysktra said he often speaks with patients who have high copays to recommend alternatives and help them weigh their options. He claims it is “more important to live than let your medications and their costs control your life.”
“At Chino Valley Pharmacy, we do not over-inflate the price to cash customers,” Dykstra said. “I believe in fair pricing. Not taking advantage of uninsured patients is the best practice and creates loyalty. Cash patients are necessary to help bridge losses from some of the insured patients, but do not need to be taken advantage of.” QCBN
By Sue Marceau, QCBN
Photo caption:
Certified Pharmacy Technician Maureen (who prefers to go by her first name) helps a customer with a prescription purchase at the Fry’s Pharmacy checkout.
Photo by Sue Marceau
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