Rising Prescription Costs are a problem for employers and employees alike.
Along with almost all other health-related costs, prescription drug prices continue to rise each year, causing more strain on employers’ benefit costs with what seems like automatic annual increases. Not to mention the out-of-pocket costs employees absorb as well. According to Consumer Reports, around 30% of Americans saw a spike in their out-of-pocket costs for regularly received medications. Over a third of those people had to pay more than $100 in drug price increases.
The Primary Prescription Cost Drivers
While there are ultimately many factors that contribute to increasing drug costs, here are some of the biggest reasons:
Brand drugs have patent protection, and this allows pharmaceutical companies to set prices however they choose, often at the expense of employers and employees. Brand drug manufacturers also spend a tremendous amount of money on advertising; just turn on your TV, and you’ll see an Ad; this drives consumer demand and utilization.
Specialty drugs are synonymous with high costs because they exist to treat complex diseases, including cancer, chronic illnesses, rheumatoid arthritis, multiple sclerosis, and more. Often costing around $1,000 a month on average, these drugs have resulted from years of research, and most have complicated manufacturing processes, which is what drives these very high costs. However, the good news is that the drugs are very effective when used properly and, in some cases, even curative. The number of new specialty drugs developed and FDA approved has grown significantly but still only makes up just 2% of all prescriptions but alarmingly account for nearly 50% of all pharmacy spending.
These issues are complex and daunting, and it may seem like nothing can be done, but by utilizing expert advice and guidance, you’ll have a better chance at bending this cost curve while still providing great pharmacy benefits!
How to Control Rising Prescription Costs?
At Crumdale, we are experts in insurance and pharmacy benefits. We understand these cost drivers and, more importantly, can help deploy strategies and provide options that allow employers and employees access to better managed and lower cost but comprehensive pharmacy benefits.
Immediate Cost-Containment Solutions
With our in-house pharmacy benefits division, Transformation Rx, we agnostically ensure clients get the most transparent and competitive prescription benefit solutions to control rising Rx costs. We make sure you have a choice of various options through our coalition offering. We have signature-ready contracts with multiple market-leading pharmacy benefit managers (PBMs). We’ve used our purchasing power and market expertise to negotiate lower drug prices and maximize rebate yields while optimizing contract provisions to benefit our clients.
We proactively consult with our clients, oversee the selected PBM and help design a pharmacy benefit plan focused on controlling prescription costs and improving health outcomes. This also includes innovative and unique Specialty Pharmacy cost-containment solutions that are clinically based and backed by our decades of experience managing high-cost claims as a stop-loss and reinsurance carrier.
At Crumdale Partners, our goal is to keep money in employers’ pockets and provide improved insurance and PBM experiences for brokers and businesses. Contact us to experience cost containment and custom insurance plan design with flexibility, stability, and protection.