Drug Coupons Are A Bad Deal

As the House and Senate budgets head into conference committee negotiations, a new study reaffirms what we already know: prescription drug marketing coupons are a bad deal for health care consumers.

The study, The Cost of Drug Coupons, published in the Journal of the American Medical Association (JAMA), found that drug coupons can significantly increase both out-of-pocket costs and health care premiums for consumers. The study compared monthly and annual costs for three similar statin drugs: two brand-names which have co-pay coupons available and one generic. The brand-name version cost insurers five times as much as the generic, which in turn leads to higher health care premiums for everyone in the insurance pool.  Even with the coupon discount, the co-pay for one brand-name drug was still more expensive than the co-pay for the generic, resulting in higher out-of-pocket spending by the consumer.

Drug coupon programs can also have detrimental effects on patient health and intrude into patient privacy. When a coupon program ends, patients unprepared for sharp increases in their prescription copayments may stop taking the medication and experience nonadherence-related side effects. Some drug coupon programs also require patients to give out their personal and medical information on websites, allowing pharmaceutical companies to target those patients in the future.

Urging physicians to avoid giving out drug coupons or encouraging drug coupon use unless the patient has demonstrated financial hardship and a clear clinical indication for that particular drug, the author warns – if pharmaceutical companies have the goal of reducing cost-related nonadherence, they should find a better way to reduce drugs costs for patients experiencing financial hardship.

Pharmacies have also begun to aggressively push back on drug coupon programs due to cost concerns, according to recent article in the Wall Street Journal. Drug coupons undermine the benefit designs meant to promote the use of lowest-cost clinically appropriate products, according to CVS Caremark, which has the second-largest pharmacy-benefit business.  In an effort to counter the unnecessary use of expensive brand-name drugs promoted by coupons, CVS recently began blocking coverage entirely for 34 treatments – half of which were supported by co-pay coupons.

Repealing the drug coupon ban would raise out-of-pocket costs and insurance premiums for Massachusetts consumers and potentially cause pharmacy businesses to block coverage for certain medications at the expense of patient needs.  At a time where our state is on the cusp of payment reform to contain health care costs, weakening our current drug coupon ban would be taking a step backward, rather than forward, in creating a more affordable health care system.
-Helen Yan

 

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One Response to Drug Coupons Are A Bad Deal

  1. John says:

    This message is completely disingenuous and is embedded in political ideology. I am a lifelong resident of the Commonwealth (Quincy) and subsequent to graduating from college I received health insurance as a ‘perk’ or benefit of that company. The company subsidized roughly 2/3rd’s of the cost while I was on the hook for the remaining 1/3rd. In addition, I also had to pay deductibles & co pays. In fact, the new company I work for has gone to a high deductible plan to offset HC related costs. I pay the first $3,000.00 of all health care related costs before insurance kicks in. I pay for everything i.e. sick visit to pediatrician $150.00, CT Scan $7750.00, Annual Physical routine lab work ($383.00). These are true dollars. In addition to the HC costs, all medicines I pay upfront and in full.

    Trying to opt for the most cost effective medicine is the goal but often it is the brand that I want and am willing to pay. After all, it is my insurance that I work for, it is my condition, and it is my relationship with my physician. If I want to use a coupon then I am fully capable of reading the information and rendering a decision as to whether or not I want to either (a). take advantage of it or (b). not. In the event I take advantage of a coupon and the price subsequently goes up then I should have the ability and autonomy to speak with my HCP about my condition and determine whether or not to stay on the medicine/treatment or pursue another alternative.

    As some one who basically finances 100% of his HC I could really benefit from these coupons/vouchers but my state just bans them outright. In fact the only state in the Union that such a thing exists. It is interesting that the same folks who voted these draconian measures are the same folks who are in Southie right now at the Convention Center trying to highlight/showcase the benefits of Boston/Massachusetts from a Research/Development/Corporate investment perspective. They are literally ‘wineing and dining’ executives within industry to come to Boston and invest in Boston which makes sense to me. Leadership on Beacon Hill understands the importance of this sector in terms of our economy. Look at the juxtaposition, come here, build here, invest here, spend millions but once you have a product/service that is technically approved we are going to ‘significantly impede your ability to make profit of that product’.

    But, those folks at the Convention Center right now know all too well that the profits derived from those companies commercially viable products is good news for the Commonwealth. When companies invest they generate revenue for the city/state and stimulate local economies. They put the good folks from Local 88, Local 22, Local 7 to work for years transforming projects that took the old dilapidated NECCO building on Mass Ave to Novartis’ North American Research and Development Headquarters’ (which is truly state of the art). In excess of 1,200 PhD’s work on advanced therapeutics amidst 1,000,0000 square fee of lab space. Think of the economic impact of this one Swiss company on the City of Cambridge and the State of Massachusetts. We lead the way the way in terms of innovation which spurs our growth/prosperity.

    In Massachusetts, >400 Pharma/BioTechnololy companies exist. I am in the business and I could maybe name 15. Bottom line, is the remaining 400 companies are small (often less than 10 people) working on some sort of theoretical construct related to a specific gene, pathway, tumor, etc, Despite unwavering commitment these companies often fail because it takes 10/15 years to get something from theoretical construct, proof of concept, and clinical testing etc. Profits need to be generated to reinvest in innovation which I find holds the key to the future survival and prosperity of our system.. We need to develop smarter diagnosis mechanism(s) which will allow us to intervene more aggressively with better therapeutic outcomes keeping people of out of the hospitals and in the workplace.

    Lastly, the ‘Coupon Ban Bill’ to me epitomizes why I am so frustrated with the political system in this state. In the end, it did not save one dollar, in fact drug spending went down mainly in light of market dynamics. In addition, Massachusetts has long been heralded for leading the nation in ‘generic utilization. So, why did we do it? Why did we impose burdens on the same companies we are trying to lure here? Doesn’t make sense unless you consider the political undercurrents.

    Unfortunately, after bussing in the 1970’s the Democratic party (once noble and mighty) was hijacked by the Liberal academic elitists. These folks are almost always white – traditionally do not come from here (have no solid roots)- and live a lifestyle that does not even remotely come close to the way they portray themselves to live. In other words, just like Sen. Kennedy and Judge Arthur Garrity didn’t put their head on a pillow in the City of Boston. The Same goes for these folks, at the end of the day they make their way to Brookline, Wellesley, Lincoln, Weston into their 4,000 square foot home and send their children to all white Prep Schools just like they did. They are frauds!!

    They use social issues to fund their social utopia solely to make them selves sleep better at night. They ‘legislate’ on our behalf because they are the ‘enlightened one’s’ the educated class, the folks that went to Harvard. They really feel that they need to create policy based on academic research because us the ‘middle class’ are too stupid to figure it out. Example: The gift ban bill. My health insurance, my condition/disease, my relationship with my doctor PLEASE let me make the decision as to whether or not I want to use a coupon. Get out of my life….stopping raising taxes and go create some (private) jobs. Then we peel back the onion on these folks and it is a real shit show up there. Last three Speaker’s of the House went down in felonious indictment(s), Galluccio, Marzilli, Wilkerson, Turner, Tierney’s wife….the show goes on. I am a life long resident but getting really tired and these ‘liberal academic elitists’ who run this party need to be exposed…..

    This Coupon Ban Bill is a joke!! I always felt the best kept secret in Medicine is the fact that the insurance companies (which by the way fully support the ban) incentivize physicians, groups, and integrated health care delivery systems to write generics. The public has it all wrong, they think that doctor’s benefit from prescribing a branded more expensive product. That is simply not the case. Strict federal laws/statues strictly do not allow in any way/shape/form a physician to benefit from prescribing an expensive branded product. In fact, the physician’s and groups do get incentivized to write a generic (they do!!). Think about that, a physician writes a product for a certain condition and the insurance company is dangling a carrot above his/her head saying if you write the cheaper/older product often inferior product I will split the profits we saved at the end of the year. Interesting, that no one of this blog cares about that!!! Less than 1-2% of consumers know that…at a minimum a disclosure statement should be mentioned. We pay so much for Health Insurance approximately $`15,000.00, we eat right, we exercise and when it is time for me to receive benefits I hope they are the best options available….

    John
    (Quincy Ma. 02169)

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