Lowering Prescription Drug Costs, Enhancing Access and Improving Quality

Posted December 11, 2009 at 1:31pm

[IMGCAP(1)] At a time when the focus should be on reducing the cost of health care, the independent drug store lobby continues to peddle an agenda that would destroy proven cost-containment tools that unions, large employers and Medicare rely upon, and drive premiums higher for working families, seniors and the disabled. These include:• Prohibiting unions and employers from creating benefit designs that encourage generic utilization and other cost-saving tools.• Forcing patients to pay a new 20 percent co-insurance fee for both brand and generic drugs, eliminating the numerous free or reduced-cost drug programs available to those suffering from chronic conditions.• Mandating that unions and employers increase payments to drug stores.• Adding new barriers to prevent consumers from using more convenient options such as home delivery.Pharmacy benefit managers utilize cost-savings tools for more than 210 million Americans with health coverage provided through Fortune 500 employers, health insurance plans, state benefit plans — including the state of North Carolina — labor unions and the Medicare prescription drug benefit, or Part D. In Part D, PBMs have played a key role in slashing overall program costs by generating high levels of generic utilization, offering a broad choice of drugs, access to more than 60,000 pharmacies and attaining a continually high rate of beneficiary satisfaction. Due in part to the PBM model, the Medicare Trustees reported that Part D has come in 40 percent below original cost estimates. Even one-time Part D critics such as former Vermont Gov.Howard Dean (D) now concede that Part D has “worked out very, very well.— While PBMs support policies that empower payers to make informed health care purchasing decisions, we oppose so-called transparency proposals that would give drug stores and drug makers access to competitive information that would empower them to charge higher prices.The Federal Trade Commission has already explored this issue and concluded that this would increase, not decrease, costs for consumers. The Congressional Budget Office also has examined this issue three times since 2003 and has never concluded it would save Medicare or taxpayers money.More than 30 states have considered and rejected such proposals.For those truly interested in reducing prescription drug costs, we’d point to several policy options that would get the job done: allowing biogenerics to come to market removing Medicare’s barriers to prescription drug home delivery and eliminating Medicare’s “protected classes— rules, which allow “me-too— brand-name drug makers to charge higher prices to America’s seniors. Mark Merritt is president and CEO of the Pharmaceutical Care Management Association.