You've seen the headlines: Drug spending grows unabated Major HMOs exit Medicare market, leaving seniors without Rx drug coverage....
Rising drug costs is one of the leading problems in health care today. But it doesn't have to stay intractable, according to Stephen Neal, M.B.A., pharmacy director at The Health Plan of the Upper Ohio Valley He may have a way out of the bind we're in.
Neal's recommendation? Require patients to pick up a bigger co-pay in the form of a straight percentage, possibly as high as 30%, of the cost of their Rx. By moving to this system, patients are more likely to ask for drugs that are less expensive and employers are more likely to see their drug cost go down.
Another advantage to a fined-percentage cost-sharing system, as opposed to a $5 co-pay for generics, $10 for brands, is that it 'will address inflation and, in a fair way, allow access to all drugs by a straight percentage,' Neal explained. At present, direct-to-consumer advertising of Rx drugs is whipping up considerable patient demand for many drugs, he noted. A standardized percent based co-pay would help control supply and demand and even allow health plans to offer open formularies, preserving the American system of free enterprise, he maintained.
A shift to this system will have to take place if employers are to continue providing a pharmacy benefit to their employees, Neal believes. After all, there is no legislation requiring employers to provide pharmacy coverage, and many payers could decide to stop offering this rider if it grows to be no longer affordable, he warned. Already there are fewer managed care organizations (MCOs) extending this option to their members today than before. Citing Novartis' Pharmacy Benefit Report Facts & Figures as evidence, he reported that the number of MCOs providing a pharmacy rider for members peaked at 94% in 1996. In 1998, that figure slipped to 92.7%.
The managed care executive, who gave his remarks at the recent ASHP annual meeting in Philadelphia, expects that a percentage co-pay will develop over the next 10 years. This would be the next step in the evolution of co-pays, from a single to twotier, then three-tier system, accommodating generics, preferred brands, and nonpreferned brands, respectively.
Certainly market data show that patients are increasingly shouldering a larger share of their drug expenditures. In its latest audit of managed care subscribers whose drug benefits are controlled by formularies, market research firm Scott-Levin found that third-tier co-pays ranged from a low of $15 to a high of $50. A year ago, the minimum amount for third-tier copays was just $10.
