High Cost of Prescriptions
The cost of many prescription drugs continues to be in the news as well as the topic of conversation with lawmakers. The costs vary greatly between insurance plans as well as even pharmacies. Furthermore, the cost of prescriptions varies tremendously between countries. For example, Humira, an injectable medication for arthritis would cost, on average, $1,362 USD if your physician was in the United Kingdom. If it was being prescribed in Switzerland, your cost would be about $822 but here in the United States, the average monthly cost is $2,669.
Most countries have a government agency which decides if a new medication is even worthwhile. If not, it won’t be allowed to be sold, and if there is value, the price is negotiated. Not so with the United States.
The only negotiation that takes place in our country is individual states and insurance companies negotiate, but they hardly have the numbers that an entire county might purchase.
There is one especially large health insurance plan in the United States: Medicare, which covers about 55 million Americans over the age of 65. But federal law expressly prohibits Medicare from negotiating drug prices or making decisions about which drugs it covers. Instead, Medicare is required to cover nearly all drugs that the Food and Drug Administration approves. This means that Medicare must cover drugs that aren’t an improvement over what currently exists, so long as the FDA finds they’re safe for human consumption.
There is some control, as Medicare plans do have formularies which may not offer all of these expensive medications, yet the appeals process can let some of the high-priced medications sneak through.
The result of this system is that Americans spend $858 per person on prescription drugs. That’s about twice as much as Australians and three times as much as the Dutch.
There are ways for us to combat the cost of drugs. The use of generic drugs is your first line of defense on the high cost of medications. When a patent expires, there is a process to allow medications with the same formulation of the active ingredients to be made available by other drug makers, and for the more popular medications, competition does reduce the costs. Furthermore, websites, such as www.goodrx.com provides coupons to lower your costs. The website will even take your zip code and shop to see which local chain pharmacies will accept the coupon with costs comparisons.
Insurance plans do negotiate prices, and typically, this is the least expensive way to get your medications, but check first to see if a coupon is a better deal. It often is. If a generic medication is not on your plan’s formulary, you may find that paying cash will be less than using your insurance.
Harry P. Thal, MA, is a licensed insurance broker in California (0621106) and 27 other states. His offices are in Kernville. He is a member of the Society of Certified Senior Advisors and Past-President of the Kern Association of Health Underwriters. He may be reached at 760-376-2100, e-mail firstname.lastname@example.org or visit him on the web at www.harrythal.com.