The chronically ill are paying an average of 105 percent more for prescription medications under silver plans offered through the Affordable Care Act health insurance exchanges than they would under employer-sponsored plans, according to a recent study published in Health Affairs.
Most employed Americans with insurance have incomes above 150 percent of poverty and are not eligible for cost-sharing reduction offered through the exchanges. If employers drop their coverage, workers could face substantially higher drug copays.
While many policymakers and insurers believe that shifting costs to patients will reduce overall health spending, that isn’t always the case. For instance, the study found that for people with four or more chronic conditions, the authors predicted that total prescription and medical spending would actually increase by nearly $300 per person on average, because they filled fewer prescriptions and, as a result, visited their doctors and the hospital more often. These high cost-sharing practices could be driving up health spending while simultaneously harming patients.
“We should reduce—if not eliminate—cost sharing for prescription drugs for patients who have manageable chronic health conditions,” Dr. Kenneth Thorpe, health policy professor at Emory University and co-author of the study, said. “That will make medicines more affordable for them and reduce long-term health care expenditures.”
Instead, ACA plans have continued to raise the out-of-pocket costs for medicines used to treat chronic diseases such as cancer and HIV. While prescription medication coverage is an essential health benefit required by ACA plans, changes are now needed to protect the chronically ill from such discriminatory practices and to control overall health spending.
“The same logic behind free preventative services under the ACA should be applied to prescription medications as well.”
This latest research is by no means an outlier; the findings are consistent with previous studies that have found prescription medications can reduce other categories of health spending. In one, the American Heart Association found that eliminating copays for heart attack survivors has the potential to help them live longer while saving almost $2 billion over the long-term.
Fortunately, some companies are realizing the short-sightedness of increasing cost sharing for certain conditions. Geisinger Health System has implemented a $0 copay prescription program for its chronically ill employees and cut medical spending in the process. In fact, for every $1 they invested in the program, they saved $1.80 over five years.
The ACA already includes similar value-based principles in other categories of spending.
“The same logic behind free preventative services under the ACA should be applied to prescription medications,” Thorpe said. “If you have diabetes and high blood pressure, it doesn’t make sense to have high—or even any—out-of-pocket costs to get the drugs that treat those conditions. You want people to take their medications.”
Patients with chronic conditions account for 80 percent of health care spending. Policymakers have an opportunity to evolve the ACA, improve access to prescription medications for the chronically ill.