In 2020, prices for commonly used medications increased by more than double the general rate of inflation, the pharmaceutical industry is pointing fingers at health insurance providers instead of admitting to the greed of stockholders and corporate managers.
A report from the pharmaceutical industry is pointing fingers at health insurance providers, claiming that “(h)ealth insurance just isn’t working like it should, because insurers and pharmacy benefit managers are increasingly shifting more health care costs onto patients through high deductibles and coinsurance.”
The report, “Barriers to Health Care Access in the Patient Experience,” surveyed over 4,700 Americans to explore the barriers they face in access to health care and prescription medicines. Among the findings: 3 in 10 of those surveyed and who have health insurance have trouble paying medical bills, or their out-of-pocket costs are more than they can afford.
According to the findings, 59% of adults surveyed who have health insurance coverage would prefer paying lower out-of-pocket costs compared to paying lower premiums but consumers have reason to question the veracity of those claims.
Pharmaceutical companies had the worst reputation of all industries according to the American public as they face criticism about increases in the price of drugs, the responsibility drug manufacturers have for the opioid epidemic, and settlements that look like they are literally getting away with murder.
While their most difficult challenges include high drug costs and the industry’s role in the US opioid crisis, they are competing with other industries to avoid financial responsibility as it appears nobody is going to accept continued inaction from Congress.
The inaugural Patient Experience Survey was conducted online June 25 – July 9, 2021. The survey population, a total of 4,765 respondents, was directed at adults least 18 years of age.
However, the study was also designed to understand specific populations of interest, especially vulnerable populations (BIPOC, LGBTQX, lower SES groups) and patients suffering from chronic and other serious health conditions.
Instead of sampling these groups separately (disproportionate to their incidence in the overall population), the overall sample size was adjusted to ensure a minimum sample size of key populations,” according to the report. No margin of error was disclosed.
The survey also found that about 23% of respondents were unable to access health care during the last three months, in part attributed to the COVID-19 pandemic.
As for solutions, the report indicated respondents favored reducing deductibles by requiring more services to be covered before deductibles come in; limiting out-of-pocket costs to a certain percentage of household income; requiring insurers to cover more prescription drugs, and more predictability with out-of-pocket costs. None of the solutions identified mentioned the cost of prescription drugs.
PhRMA, the Pharmaceutical Research and Manufacturers of America, released the report earlier this month.
That the pharmaceutical industry is blaming the health insurance for too-high costs but those businesses are not willing to become punching bags.
“It’s not surprising to see another self-serving survey from PhRMA that continues to deflect from drug manufacturers’ record-breaking profits and unjustified year over year list price increases – including 15% average annual increases,” said Amanda Massey, executive director of the Colorado Association of Health Plans. “Insurance providers are committed to continuing to lower costs by ensuring proper utilization of medications and negotiating lower rates for high-value prescription drugs and medical services from hospitals and doctors.”
Perhaps no policy area exemplifies this corruption more than the issue of drug pricing.
Americans spent $535 billion on prescription drugs in 2018, an increase of 50 percent since 2010.
Those price increases far surpass inflation, with Big Pharma increasing prices on its most-prescribed medications by anywhere from 40 percent to 71 percent from 2011 to 2015.
Moreover, pharmaceutical companies receive substantial U.S. government assistance in the form of publicly funded basic research and tax breaks, yet they continue to charge exorbitant prices for medications.
But the issue goes beyond cost. In America, more than 1 million individuals suffer from Type 1 diabetes, a condition where the body cannot make insulin, which is essential for getting glucose (also known as blood sugar) into cells from the bloodstream.
Without insulin, glucose accumulates in the bloodstream, causing dangerously high blood sugar levels. Among all Americans suffering from diabetes, at least 1 in 45 have said that they engaged in insulin rationing—a tactic of using less insulin than is needed in order to make the doses last longer—as a direct result of the skyrocketing price of the drug.
A vial of insulin, which is the only life-sustaining option for Type 1 diabetics, retails at around $300. A 2018 study commissioned by the Congressional Diabetes Caucus found that the price of insulin has doubled since 2012; in the 10 years prior, the price of insulin nearly tripled.
Despite the dangers of insulin rationing, which can lead to diabetic ketoacidosis, a fatal condition, many Americans have no other choice.
That was the case described by Antroinette Worsham, who told the U.S. House Committee on Oversight and Reform how her daughter died at the age of 22 as a result of rationing insulin due to the high cost.
Spending on insulin increased more than 470% from 2010 to 2017 – but those drugs were still profitable after manufacturers paid 89% kickbacks to pharmacy benefit managers, national drug retailers and insurance companies.
In 2020, prices for 260 commonly used medications whose prices AARP has been tracking since 2006 increased 2.9 percent while the general rate of inflation was 1.3 percent, according to a recent AARP “Rx Price Watch” report.
“It’s unfair that drug prices keep rising, even for medications that have been on the market for decades,” says Leigh Purvis, director of health care costs and access at AARP and coauthor of the reports. According to the June 7 report, the total retail prescription drug costs for the typical older American who takes four to five prescription drugs per month would be $31,000 per year — more than the $29,650 average annual income for Medicare beneficiaries.
For example, between 2015 and 2020, the annual price of Victoza, a diabetes medication, increased by 42 percent, with the price of a year’s supply rising from $7,936 to $11,300. During that same period the price of Lyrica, used to treat fibromyalgia, increased by 47 percent — from $5,827 a year to $8,562.
“AARP is calling on Congress to pass comprehensive drug reform,” says Nancy LeaMond, AARP executive vice president and chief advocacy and engagement officer. “Americans over the age of 50 use more prescription drugs than any other segment of the population. This is not a population that can afford rising drug prices.”
PhRMA members include AbbVie, ACADIA Pharmaceuticals, Inc., Aerie Pharmaceuticals, Inc., Alkermes plc., Allergan plc, AMAG Pharmaceuticals, Inc., Amgen Inc., Astellas Pharma US, Inc., AstraZeneca Pharmaceuticals LP, EMD Serono, Esperion Therapeutics, Inc., Ferring Pharmaceuticals, Inc., Avanir Pharmaceuticals, Inc., Bayer AG, Bayer Corporation, GlaxoSmithKline, Grifols USA, LLC, Horizon Pharma PLC, Biogen, BioMarin Pharmaceuticals, Inc., Boehringer Ingelheim Pharmaceuticals, Inc., Ipsen Biopharmaceuticals, Inc., Johnson & Johnson, Lundbeck LLC, amd Vifor Pharma.
Also among the PhRMA members are Bristol-Myers Squibb Company, Celgene Corporation, CSL Behring, L.L.C., Mallinckrodt Pharmaceuticals, Marathon Pharmaceuticals, Merck & Co. Inc., Otsuka America Pharmaceutical, Inc. (OAPI), Daiichi Sankyo, Inc., Eisai Inc., Vivus, Inc., Novartis Pharmaceuticals Corporation, Novo Nordisk, Inc., Orexigen Therapeutics, Inc., Sanofi, Otsuka America Pharmaceuticals (OAP), Otsuka Maryland Medicinal Laboratories (OMML), Sigma-Tau Pharmaceuticals, Inc., Sucampo Pharmaceuticals, Inc., and Sunovion Pharmaceuticals Inc.
Eli Lilly and Company, Merck Human Health Division – U.S. Human Health, Merck Research Laboratories, Merck Vaccine Division, Otsuka Pharmaceutical Development & Commercialization, Inc. (OPDC), Pfizer Inc, Purdue Pharma L.P., Takeda Pharmaceuticals U.S.A., Inc., The Medicines Company, Theravance, Inc., Sanofi Pasteur, Shionogi Inc., Vifor Pharma, Vivus, Inc. also belong to PhRMA.