Affordable Care Act and Your Prescription Drug Costs

Since its enactment, the Affordable Care Act (ACA) has impacted the pharmaceutical industry, making it a challenge to find ways to control health care costs. Drug costs have increased and may continue to do so. Looking at past trends can help individuals and businesses better understand how to predict and manage future costs.

DRUG COSTS HAVE INCREASED SINCE ACA

According to IMS Health, in 199the US spent a paltry $40.3 Billion on prescription drugs compared to $329.2 Billion spent in 2013 (IMS Health Study: Spending Growth Returns for U.S. Medicines, April 25, 2014). Prescription drugs obviously make up more of our overall health care costs than they did in the past and thus warrant our attention.

Medications used to treat complicated conditions and illnesses like cancer not only cost more than other medications – they are also being used more. As advances in science make them more effective, doctors prescribe them more. Since the ACA, more people have access to these life-saving medications. While these changes are beneficial, they are also costly.

PRESCRIPTION COST AND SPENDING ARE LIKELY TO CONTINUE TO INCREASE

Traditional and specialty prescription spending both increased in 2014, 6.5% and 30.9% respectively. Specialty drug spending is projected to increase by over 20% each year through 2017, according to The Express Scripts Lab (The 2014 Drug Trend Report, March 2015, https://lab.express-scripts.com/drug-trend-report/). In fact, almost half of the drugs approved by the Food and Drug Administration in 2014 were specialty drugs. New medications are patented, allowing them to command a higher price until the patents expire.

HEALTH PLANS ARE TRYING TO TAKE CONTROL OF SPIRALING COSTS OF PRESCRIPTIONS

Health care programs are attempting to control costs by excluding certain drugs or requiring members to try less expensive options first to prove that the most expensive medication is necessary. Some programs increase deductibles (individual, family, or separate prescription deductibles) that members pay. As a result of these tactics, your doctor may not be able to immediately prescribe you the medication he or she feels would be the most beneficial.

SO WHAT CAN YOU DO?

Employers can consider Medical Therapy Management programs to improve adherence and results. Employer Group Waiver Plans, part of Medicare Part D, can provide a way to manage costs for Medicare-eligible retirees. Employers can also collaborate with Third Party Administrators and Pharmacy Benefit Managers to manage costs and receive rebates or discounts on prescription spending. Finally, small businesses can join forces to negotiate better prescription drug prices than would be possible on their own.

Individuals can diligently request generic or similar-yet-cheaper drugs, especially as their personal burden of the cost of drugs increases. The internet and new apps on the market also give consumers the information they need to make better decisions and receive direct rebates or coupons. Lastly, mail-order is another popular way for individuals to save money – receiving 90-day supplies makes individuals eligible for a reduced cost.

More Resources:  https://www.healthcareadvisorca.com/resources

Terry saves employers and employees money by identifying best valued benefits, allowing employers to focus on managing business and giving employees a piece of mind. Help Business and individuals determine the right kinds of insurance they need, at a price that’s right for them. Provide compliance oversight for government legislation, including ERISA, COBRA, and PPACA. Access human resource assets to optimize business continuity, reviewing EOB’s to ensure correct billing and keeping up with technology-electronic enrollment.

Terry Denesha   |  HIP Insurance Advisor                                                

Compliance – Health Reform – Employee Benefits                                

Cell:  661.201-0571   |   Bakersfield, Ca  93306      

[email protected] | Lic.0F98081