As frustration has been mounting among groups like consumers, providers, employers and lawmakers for some time now, the system for prescription drug pricing is being described as “broken.” It’s an issue that, without government having more control over, is affecting health plans everywhere and making those much-dreaded announcements of needing to increase employee benefit contributions more and more common.
The year didn’t start off on the best foot as 35-plus companies announced price hikes with their medications shortly after 2019 began. Some generics experienced especially hefty increases, including a blood pressure med from Hikma Pharmaceuticals that experienced a cost increase of 30%.
As discouraging as this news was, we have also seen some positive developments more recently.
One glimmer of hope comes after the current administration called for drugmakers to start including the list prices for prescription drugs when running TV ads. While most companies have resisted so far, Johnson and Johnson included this info in an ad for Xarelto – a popular blood thinner that is reported to cost $450-$540 without insurance – in March. The drugmaker was one of the first to follow the government’s proposal to include prescription costs as others have claimed this would cause more confusion about prices (since the list price doesn’t factor rebates or discounts).
Another bit of good news came when Eli Lilly recently announced that it will be selling an “authorized generic” of its Humalog insulin at half the price of the brand-name version. This is a big, long-awaited breakthrough for consumers as we’ve been seeing insulin prices climb higher and higher with seemingly no end to the increases in sight.
With all that’s been going on, the Department of Health and Human Services continues to put pressure on drugmakers and propose policies that would cut prices on prescription drugs and pass more savings on to patients. But without more regulatory control, it’s hard to say how much success the government will have.
This whole situation can be especially frustrating for health plans as employers try to keep employee benefit costs manageable for their workers. It’s important to keep following the drug trends within your plan and stay on top of strategies that can help contain costs.