THE PODIUM | Let patients share in the savings on pricey prescription drugs

Author: Sharon O'Hara - May 17, 2018 - Updated: May 17, 2018

Sharon O’Hara

With the gavel having fallen on the 2018 legislative session, Colorado lawmakers were once again unable to reach consensus on an effective plan for tackling the issue of high prescription drug costs. With patients spending more in out-of-pocket health care costs than ever before, let’s hope leaders on both sides of the aisle will place a renewed focus on the true sources of the problem and find meaningful solutions for patients.

As we saw this year, providing real relief to patients is a complicated task that doesn’t lend itself to snap political solutions.

At the Chronic Care Collaborative, we advocate for the one in four Coloradans living with at least one chronic disease, and are dedicated to fighting for the challenges these men, women and children face on daily basis. Access to treatment and the out-of-pocket costs for their health care needs, especially the medications essential to manage or treat their condition, are top of the list for the chronic disease community.

A positive step forward this year is the Patient Drug Cost Savings Act (HB 1284) that earned bipartisan support and was signed into law in April. The new law should provide meaningful savings for patients by allowing Colorado pharmacists to discuss cheaper options in paying for their medications, including not using their insurance at all. Today, pharmacists are often prohibited by their Pharmacy Benefit Manager (PBM) contracts from sharing this cost-saving information with patients. By allowing pharmacists to provide more accurate information to consumers, prescriptions could become more affordable to consumers.

Key to passing this bill, and to even greater progress next year, is providing legislators with the facts they need about the prescription drug supply chain — facts that often get lost in the emotion of legislative debate.

The actual price a patient pays at the pharmacy is determined by a lot of factors, including pharmaceutical manufacturers, PBMs, wholesalers, distributors, hospitals, pharmacies, and health insurance companies.

PBMs negotiate with drug makers on behalf of insurers to determine if a prescription drug is covered and how much it will cost. They secure substantial rebates and discounts on brand-name pharmaceuticals. But, as chronic disease patients in Colorado have learned to their surprise and frustration, PBMs often keep the savings for themselves and their insurer clients. If lawmakers want to make drugs more affordable, they must ensure these savings are passed along to patients.

According to the PBM Express Scripts, drug expenditures only rose by 1.5 percent between the first half of 2016 and midyear 2017. However for patients, because of the opaque supply chain and insurance plan designs with increasing high deductibles and co-insurance, the out-of-pocket prescription cost for patients continue to rise at unaffordable rates.

When we share these basic facts with chronic disease patients, or Colorado lawmakers, they’re shocked to learn that drugs are heavily discounted – but that those discounts aren’t being passed along to patients as they should be.

For instance, if a certain insulin lists for $400, a patient who hasn’t met her deductible could be on the hook for the full amount. If her insurer’s PBM secured a discount of 50 percent, the insurance company would pocket $200 from the transaction — even though the patient paid the entire list price.

We applaud our legislators for focusing on the urgent issue of medication affordability and are grateful for the success we saw this session. As they continue this debate, it’s vital that they focus on all parts of the supply chain and look for solutions that will actually reduce out-of-pocket costs for patients. This is critical if Colorado wants to launch an even more effort to lower the cost of prescription medicines.

Sharon O'Hara

Sharon O'Hara

Sharon O’Hara is executive director of the Chronic Care Collaborative (CCC), which is made up of 35 different voluntary health organizations representing a wide range of chronic diseases.