Rising Prescription Drug Costs Research Articles

Out-of-Pocket Prescription Drug Savings for Medicare Beneficiaries with Asthma and COPD Under the Inflation Reduction Act.

High and rising prescription drug costs for asthma and chronic obstructive pulmonary disease (COPD) contribute to medication nonadherence and poor clinical outcomes. The recently enacted Inflation Reduction Act includes provisions that will cap out-of-pocket prescription drug spending at $2,000 per year and expand low-income subsidies. However, little is known about how these provisions will impact out-of-pocket drug spending for Medicare beneficiaries with asthma and COPD. To estimate the impact of the Inflation Reduction Act's out-of-pocket spending cap and expansion of low-income subsidies on Medicare beneficiaries with obstructive lung disease. We calculated the number of Medicare beneficiaries ≥ 65years with asthma and/or COPD and out-of-pocket prescription drug spending > $2,000/year, and then estimated their median annual out-of-pocket savings under the Inflation Reduction Act's spending cap. We then estimated the number of beneficiaries with incomes > 135% and ≤ 150% of the federal poverty level who would become newly eligible for low-income subsidies under this policy. Respondents to the 2016-2019 Medical Expenditure Panel Survey (MEPS). Annual out-of-pocket prescription drug spending. An annual estimated 5.2 million Medicare beneficiaries had asthma and/or COPD. Among them, 360,160 (SE ± 38,021) experienced out-of-pocket drug spending > $2,000/year, with median out-of-pocket costs of $3,003/year (IQR $2,360-$3,941). Therefore, median savings under the Inflation Reduction Act's spending cap would be $1,003/year (IQR $360-$1,941), including $738/year and $1,137/year for beneficiaries with asthma and COPD, respectively. Total annual estimated savings would be $504 million (SE ± $42M). In addition, 232,155 (SE ± 4,624) beneficiaries would newly qualify for low-income subsidies, which will further reduce prescription drug costs. The Inflation Reduction Act will have major implications on out-of-pocket prescription drug spending for Medicare beneficiaries with obstructive lung disease resulting in half-a-billion dollars in total out-of-pocket savings per year, which could ultimately have implications on medication adherence and clinical outcomes.

Pursuing Value-Based Prices for Drugs:A Comprehensive Comparison of State Prescription Drug-Pricing Boards.

Rising prescription drug costs are consuming a growing proportion of state and private budgets. In response, lawmakers have experimented with a variety of policies to contain spending and achieve value in prescription drugs. As part of this series of reforms, some state legislatures have recently authorized prescription drug-pricing boards to address the high prices of brand-name prescription drugs and assess the value of those drugs. We identified state prescription drug-pricing boards in the United States, defined as any agency authorized by a state legislature to review specific drugs and pursue value-based drug prices. To describe the characteristics of the boards, we obtained public records of authorizing legislation, guidance documents, and board meeting minutes. We compared the boards' powers and responsibilities and analyzed completed pricing reviews. Six state drug-pricing boards in five states met our definition; their design varied substantially. Two of the boards (New York Medicaid and Massachusetts) have authority over drug rebates paid by state Medicaid programs, one (New York Drug Accountability Board) has jurisdiction over state-regulated commercial insurance, and another three (Maine, Maryland, and New Hampshire) oversee non-Medicaid, state-funded insurance. Three boards are authorized to require manufacturers to confidentially submit information related to the pricing and clinical effectiveness of reviewed drugs to inform value determinations. Only one board (New York Medicaid) had completed pricing reviews as of June 3, 2021. Boards' structure, scope, and statutory leverages to compel manufacturers to negotiate lower net costs are key factors that influence whether and to what extent boards can achieve cost savings for states. Though legal constraints may limit the effective reach of prescription drug-pricing boards, these agencies can enable states to address rising prescription drug costs, in part by virtue of their very existence. To overcome practical limitations, states seeking to implement similar policies can build on the experiences and designs of current boards.

Impact of U.S. federal and state generic drug policies on drug use, spending, and patient outcomes: A systematic review.

Prescription drugs contribute to increased healthcare expenditures in the United States (U.S.). Use of generic drugs has been recognized as an effective tool to control rising prescription drug costs. This study aimed to evaluate the impact of U.S. federal and state generic drug policies on drug use, spending, and patient outcomes. A systematic search was performed in June 2017, using PubMed, Web of Science, PsycINFO, and Business Source Premier. Search was limited to published articles in English language, including human subjects in the U.S., and with at least one outcome measure related to health service utilization, spending, or patient outcomes. Thirty-four studies constituting seven key policy domains were included. Medicaid/Medicare Prior Authorization (PA) policies (n = 4) led to increased generic use, reduced patient and payer's spending on prescriptions without causing deterioration in patient's health-related quality of life. Medicare prescription plan's generic drug benefits (n = 4) had impact on increased generic use and generated savings, but the limited access to branded drugs may increase medication use gaps and risks of hospitalizations. State generic substitution laws (n = 3) caused increased generic use and cost savings for both consumers and states. Medicare/Medicaid coverage cap policies (n = 3) were associated with increased patient's out-of-pocket spending (OOP) and reduced prescription spending for payers. Policies lowering cost-sharing (n = 7) were associated with increased patient's medication use and adherence, but the impact varied by therapeutic classes. Existing evidence evaluating Medicare Part D (n = 12) suggested decreased prescription spending for beneficiaries and Medicare. Generic gap coverage reduced patient's OOP and Medicare spending. Finally, early evidence showed reduced consumers' OOP prescription spending after the ACA (n = 2). Federal and state policies regarding generic drugs have resulted in reduced spending for consumers and payers. However, the overall impact on patient outcomes remains unclear.

Barriers to Ensuring Access to Affordable Prescription Drugs.

High and rising prescription drug costs have become a preoccupying policy problem in the United States. Notwithstanding broad, bipartisan interest in finding effective policy solutions, several aspects of the drug affordability problem make it an uncommonly difficult one to solve. This article reviews the moral, market, and political factors contributing to the difficulty. Among the moral problems is lack of agreement about how to weigh the fundamental tradeoff involved in regulating drug prices-affordability versus incentives for innovation-and about what constitutes a fair price. Market-related factors include the lack of price transparency and a myriad of perverse incentives in the system through which prescription drugs are supplied to patients. Finally, current policy choices are constrained by past political compromises, and an atmosphere of scandal focusing on egregious instances of price gouging has made rational deliberation about fixes to deeper problems in the system difficult.

Frontline Physicians Flex Medicine’s Muscle on Capitol Hill Regarding Patient Care

A coalition of physician organizations, including APA, presented a united front on Capitol Hill to encourage reforms important to physicians and their patients.

Pharmacy Benefit Management Companies: Do They Create Value in the US Healthcare System?

Pharmacy benefit management companies (PBMs) perform functions in the US market-based healthcare system that may be performed by public agencies or quasi-public institutions in other nations. By aggregating lives covered under their many individual contracts with payers, PBMs have formidable negotiating power. They influence pharmaceutical insurance coverage, design the terms of coverage in a plan's drug benefit, and create competition among providers for inclusion in a plan's network. PBMs have, through intermediation, the potential to secure lower drug prices and to improve rational prescribing. Whether these potential outcomes are realized within the relevant budget is a function of the healthcare system and the interaction of benefit design and clinical processes-not just individually vetted components. Efficiencies and values achieved in price discounts and cost sharing can be nullified if there is irrational prescribing (over-utilization, under-utilization and mis-utilization), variable patient adherence to medication regimens, ineffective formulary processes, or fraud, waste and abuse. Rising prescription drug costs and the increasing prevalence of 'high deductible health plans', which require much greater patient out-of-pocket costs, is creating a crisis for PBM efforts towards an affordable pharmacy benefit. Since PBM rebate and incentive contracts are opaque to the public, whether they add value by restraining higher drug prices or benefit from them is debatable.

Rising prescription drug costs have helped reduce expensive costs of hospitalisation and physician services in the US.

Rising prescription drug costs have helped reduce expensive costs of hospitalisation and physician services in the US.

Extensions Of Intellectual Property Rights And Delayed Adoption Of Generic Drugs: Effects On Medicaid Spending

Rising prescription drug costs present a critical policy issue for Medicaid. Generic substitution can reduce costs, but the effects are undercut by extensions of intellectual property (IP) protection, elevated generic prices, and low substitution rates. Using Medicaid prescription data for amoxicillin/clavulanate, metformin, and omeprazole, we calculated the savings that could have been realized if generic drugs had been available and fully substituted at their lowest cost when IP protection first expired (an average delay of twenty-six months). The delay in availability, elevated prices, and slow uptake of generic alternatives for these three drugs alone cost Medicaid 1.5 billion dollars in 2000-2004.

The Impact of a Three‐Tier Formulary on Demand Response for Prescription Drugs

A large number of health plans and employers have adopted three‐tier prescription drug formularies in an effort to control rising prescription drug costs. We assessed the behavioral response to three‐tier adoption by estimating econometric models of the probability of selecting drugs assigned to the third tier with the highest co‐payment requirement and changes in expected out‐of‐pocket (OOP) spending. We concluded that implementation of the three‐tier formulary resulted in some shifting of costs from the plan to enrollees and some bargaining power gained for the payer, with plan savings from manufacturer rebates a likely result.

Medicaid Cost Containment And Access To Prescription Drugs

States have been intensifying their efforts to control rising prescription drug costs in their Medicaid programs. This study examines the effects of five Medicaid cost containment policies on enrollees' perceptions of their ability to get prescription drugs. The results show that enrollees in states that have implemented all or almost all of these five policies have greater problems getting prescription drugs than enrollees in other states encounter. In terms of specific policies, prior authorization and mandatory generic substitutions had the largest effects on access to prescription drugs.

APA Opposes Restrictions On Medicare Psych Meds

APA Opposes Restrictions On Medicare Psych Meds

Prescription Drug Costs for the Poor and the Elderly

Rising prescription drug costs have led to attempts to limit reimbursement and increase patient cost-sharing, as well as to proposals for expanding

The effect of new and continuing prescription drug use on cost: A longitudinal analysis of chronic and seasonal utilization

To provide basic information about 2 factors contributing to rising prescription drug costs--utilization trends and product selection. Prescription drug costs have risen sharply in recent years, and continued growth is expected. There is little consensus about appropriate cost-management strategies, in part because quantitative data on the causes and implications of increased drug costs are lacking. This study followed 463,820 continuously enrolled adult (> or = 18 years of age on January 1, 1996) utilizers of 15 chronic or seasonal therapeutic classes for 2.5 years (January 1996 through June 1998) using a pharmacy benefit manager's multiple-payer claims database. Outcome measures included (1) change in utilization rate, (2) relationship between new use and utilization growth, (3) stability of the treated population (ie, mostly long-term use vs high rates of turnover), and (4) product mix changes (ie, cost per dispensed day for 1996 vs 1997 and for new vs continuing users, controlling for inflation). Of the 463,820 utilizers, 97% were commercially insured and 3% enrolled in Medicare risk plans; 40% were enrolled in managed care and the remainder covered by indemnity insurance. Rates of growth and turnover varied substantially by class. The highest 2-year utilization rate change was 66.7% for antihyperlipidemic agents; change was < 10% in only 3 classes. Across classes, an average of 38.7% of 1997 users were new (ie, no use in 1996) and an average of 34.0% of 1996 users were dropouts (ie, no use in 1997). Utilization growth depended heavily on treatment continuation; classes with high dropout rates (eg, antirheumatic, antiasthmatic) did not have high growth rates, even with high rates of new use. In most classes, costs were not higher for new than for continuing users. In some classes, however (eg, antipsychotic, antidiabetic), both new and continuing users increased their use of newer, more expensive products. Because factors underlying rising prescription drug costs vary by therapeutic class, cost-containment strategies should address these differences. Further research is needed to assess the clinical and economic costs and benefits of rapid growth in the utilization of certain therapeutic classes.