The 25 largest drug companies enjoyed annual average profit margins of 15% to 20%, compared with average profit margins of 4% to 9% for the largest non-drug companies, the report found. Meanwhile, pharmaceutical and biotechnology revenue jumped 45% from 2006 to 2015 as drug prices soared, according to a recent report from the Government Accountability Office. Deductibles for family plans are even higher. The average health-insurance deductible for individuals with employer-provided coverage reached $1,505 last year, compared with just $303 in 2006, according to the Kaiser Family Foundation. The only thing that’s clear is who loses. “There are no good guys here,” said Geoffrey Joyce, a pharmaceutical economist at USC. Pharmaceutical companies are doing everything possible to avoid price cuts. Their coupons allow them to maintain absurdly high prices as a starting point for their dealings with insurers, and to stick insurers with bloated costs. The insurers and pharmacy benefit managers, they’re obviously making out like bandits.īut drug companies win no points for upstanding behavior. It’s hard not to suspect, though, that they’re both motivated by self-interest rather than patient welfare. Ubl, president of the Pharmaceutical Research and Manufacturers of America, said in a statement.īoth sides make fair points. “Co-pay accumulator programs are nothing more than an insurance scheme that leave patients financially exposed while benefiting payers’ bottom lines,” Stephen J. But it’s also correct that coupon programs are a direct response to insurers repeatedly jacking up people’s co-pays and deductibles.ĭrug companies argue that they’re just trying to level the playing field as patients shoulder a greater share of healthcare costs. “Co-pay coupon programs hide the true impact of rising prescription drug costs.” “The true issue remains that drug pricing continues to skyrocket, with no clear explanation on how those prices are set,” she said. Cathryn Donaldson, a spokeswoman for America’s Health Insurance Plans, an industry group, said coupons are nothing more than “a marketing scheme leveraged by Big Pharma to keep drug costs high for everyone.” Vivian Ho, a healthcare economist at Rice University, said pharmaceutical companies will feel no pressure to lower drug prices, particularly for expensive specialty drugs, unless patients are unable to afford them.Ĭo-pay accumulators allow insurers and the pharmacy benefit managers that haggle on their behalf to maintain economic leverage in negotiations with drugmakers, she said.ĭrugmakers’ coupons, Ho said, “encourage overutilization of high-priced drugs.” However, healthcare experts caution the situation is more complicated than that. It would appear that co-pay accumulators allow insurers to double dip: They get their full co-pays and they get to extend the duration of patients’ deductibles. HealthNet didn’t respond to a request for comment. “It shouldn’t matter to them who’s paying my deductible, as long as it’s being paid.”
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