Report: Insured patients pay for drugs based on list price, not discounted rate


Out-of-pocket spending on prescription drugs has more than doubled over the past 10 years, and insurers are not passing drug savings on to customers according to an analysis from the Pharmaceutical Research and Manufacturers of America.

In the past, most insured patients paid a fixed copay when picking up their prescriptions, but insurance plans have been trending toward coinsurance, which requires patients to pay a percentage of the drug’s retail price.

Additionally, more plans require patients to meet a deductible before kicking in on prescriptions, leading to much higher out-of-pocket costs for patients.

“Between 2012 and 2016 alone, the share of commercial health plans requiring patients to meet a deductible for prescription medicines increased from 23 percent to 49 percent,” the report states.

Most insurers have patients pay coinsurance on discounted rates for medical services from an in-network doctor or hospital, but don’t apply the same standard for prescription drugs, despite receiving major rebates from biopharmaceutical companies that drop the price for such drugs by 30 percent to 55 percent.

According to the report, a patient with a high-deductible plan paying $350 a month for insulin could end up spending hundreds of dollars more a year on drugs than their insurance provider.

“In many respects, our current marketplace for medicines works for patients, but we need to ensure patients receive more of the benefit of price negotiations between biopharmaceutical companies and payers,” said PhRMA CEO Stephen J. Ubl. “Insurance companies should share the discounts they receive with patients in the form of lower out-of-pocket costs, similar to care received at an in-network hospital or physician’s office.”

The report found prescriptions subject to deductibles are twice as likely to be abandoned at the pharmacy counter, with 23 percent of brand-name medicines not being picked up after being processed by a pharmacy.

Also, patients are less likely to take medicines as prescribed when subject to a deductible, which can lead to emergency room visits and otherwise avoidable hospital stays.

Payers have recognized asking patients to pay cost sharing based on undiscounted list prices can be problematic. Recent statements from two large pharmacy benefit managers acknowledged high deductibles for medicines put patients in a “very difficult position” and that passing along discounts and rebates to patients should be considered as a “best practice.”

Drew Wilson

Drew Wilson covers legislative campaigns and fundraising for Florida Politics. He is a former editor at The Independent Florida Alligator and business correspondent at The Hollywood Reporter. Wilson, a University of Florida alumnus, covered the state economy and Legislature for LobbyTools and The Florida Current prior to joining Florida Politics.


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