Potential Patient Risks in Drug Reform
TL/DR –
The Inflation Reduction Act seeks to lower prescription drug costs for people on Medicare by implementing a Medicare Drug Price Negotiation Program, which allows the federal government to set a “Maximum Fair Price” for certain high-use medications. Despite the intention to make drugs more affordable, Pharmacy Benefit Managers (PBMs), who decide what drugs are covered and at what cost, may reclassify these drugs to a higher payment category to recoup lost profits due to the price cap, leading patients to face higher copays or stricter coverage limits. A study showed that this could result in more than 320,000 patients stopping their medications, potentially leading to an estimated 145,000 major cardiovascular events and up to 97,000 deaths.
Inflation Reduction Act’s Impact on Prescription Drug Prices
The Inflation Reduction Act aims to lower Medicare prescription drug costs by establishing a “Maximum Fair Price” for high-use drugs. This legislation hopes to cut government spending and make medications more accessible for seniors, although the real-world impacts aren’t as clear-cut.
The Unintended Consequences
Despite the Act now setting lower drug prices, Pharmacy Benefit Managers (PBMs) like CVS Caremark, Express Scripts, and Optum Rx, who determine drug coverage and costs, aren’t bound by the same guidelines. The PBMs, who often receive significant manufacturer rebates, may increase patient out-of-pocket costs to offset lower drug prices.
Inflation Reduction Act’s Real-world Impact
The study focused on two widely used anticoagulants—Apixaban and Rivaroxaban—among the first drugs affected by the Act’s pricing. The data indicates that if PBMs move these drugs to a higher coverage tier, patients could face higher out-of-pocket costs, potentially leading to a decrease in medication adherence.
Effects on Patients
According to Dr. Robert Popovian from the Global Healthy Living Foundation, there are significant risks if more than 320,000 patients stop taking these medications. The consequences could include an estimated 145,000 major cardiovascular events and up to 97,000 deaths. These pricing changes might drive people away from life-saving treatments.
Lack of Transparency
PBMs operate under low public accountability, leading to a lack of transparency in the healthcare system. As a result, PBMs may raise patient costs directly to maintain profitability. A recent report from the Pioneer Institute found that average patient out-of-pocket costs increased by 32% across nine drugs affected by Act’s price negotiation.
What Policymakers Must Do
While the Act aims to cut drug spending, it’s critical that policymakers monitor actual patient costs, watch for cost-shifting by PBMs, ensure transparency in all costs and formulary changes, and study the impact on medication adherence and health outcomes.
Ensuring Better Patient Care
Healthcare reform should prioritize patient access to treatment. Lowering list prices is a positive step, but it shouldn’t result in higher costs and health risks for patients. Reforms should protect patients’ health and wallets.
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