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Here We Go Again (But In a Good Way)

February 12, 2018
"We achieved the lowest drug trend since we began measuring drug trend data in 1993.” That’s one of several positive takeaways from a new report on drug spending issued this week by Express Scripts, one of the nation’s largest pharmacy benefits managers.

Often referred to as PBMs, these drug cost middlemen negotiate rebates from drugmakers on behalf of insurers and employers, and their reports on drug spending reflect what’s happening in the real world. In its most recent report, Express Script notes:

  • Total per-person drug spending increased 1.5% for patients in commercial plans, due to a 0.7% increase in drug use and a 0.8% increase in prices; and

  • For those with insurance through the exchanges established by the Affordable Care Act, total drug spending per-person decreased 3.3%, thanks to a more than 4% decrease in drug prices.

Plans serving Medicare and Medicaid beneficiaries also experienced slow and stable change in drug spending. But the good news gets better. Express Scripts also notes, “Nearly half of our commercial plans saw their drug spending per beneficiary decrease in 2017.”

It’s like I’ve said before: The trend on prescription drug costs is heading in the right direction. In fact, this latest report reaffirms what we’ve seen repeatedly from other sources, including the Centers for Medicare & Medicaid, Altarum Institute and Kaiser Family Foundation. It’s déjà vu all over again.

What’s unfortunate — in fact, what’s outrageous — is that insurance companies refuse to pass along the benefits of lower drug spending to patients. Double-digit insurance premium increases are becoming the norm for many families, and as CNBC reported:

While health plans saw lower spending on drugs, plan members did not necessarily share in those savings. Consumer out-of-pocket costs held steady in 2017. The average plan member on a high-deductible plan spent $268 out of pocket last year, while those in standard commercial plans paid $200.”

It’s no wonder then that 82% of respondents in a new survey cited costs as the reason for being dissatisfied with their health plan, according to America’s Health Insurance Plans (AHIP). Many feel they are paying insurers more and more yet getting less and less in return. The survey also revealed a majority of respondents believe its most important for a health plan to cover prescription drugs, including treatments for chronic illnesses and rare diseases. Yet stories continue to surface of insurers putting up road blocks to drug coverage or discriminating against patients in desperate need.

Policymakers are absolutely right to look for ways to ensure prescription drugs remain affordable and accessible for patients. Indeed, positive steps are being taken to do just that. Any future action on drug costs must be based on the facts and look at the whole health care system. Otherwise, the trend for drug spending can remain stable, but many patients will continue to struggle with out-of-pocket costs they can’t afford.