Event Recap: Curing What Ails Prescription Drugs

CareFirst recently hosted a panel discussion, Curing What Ails Prescription Drugs: Exploring Policy Solutions that are Increasing Access and Affordability. The event included opening comments by Djinge Lindsay, M.D., M.P.H., Director of Public Health, and was moderated by David Schwartz, J.D., Vice President, Public Policy & Federal Affairs. Panelists included:

• Andrew York, Pharm.D., J.D., Executive Director of the Maryland Prescription Drug Affordability Board
• Purvee Parekh Kempf, J.D., Deputy Executive Director, DC Health Benefit Exchange (DCHBX)
• Wendell Primus, Ph.D., Former Senior Policy Advisor, Speaker Emerita Nancy Pelosi

The panelists provided their thoughts on Federal and state solutions that result in lower prescription drug costs and tackling systemic barriers to accessing necessary medications. A few key themes that recurred throughout:

The IRA was a Meaningful Step Forward, but It Must be Expanded Upon

Primus kicked off the event discussing the creation of the Inflation Reduction Act and its goal: “Our cost is three to four times that of European nations [and] our hope is this shifts to other nations so Americans aren’t subsidizing others.” He noted it could potentially have a significant impact because of provisions authorizing Medicare to directly negotiate the price of certain drugs and requiring drug manufacturers to pay a rebate to the government if they increase their prices faster than the rate of inflation. However, the IRA could have a more significant impact if its applicability was expanded to include commercial markets. The precursor to the IRA – HR3 – which did apply to the commercial sector, would have saved the government approximately $500B, while the IRA only saves roughly $200B, according to the Congressional Budget Office. The IRA solely applies to the Medicare market due to a change in scope while under consideration in the Senate. He is hopeful stakeholders can form coalitions to advocate for inflation rebates and drug price negotiation to apply to the commercial market and expand the number and types of drugs subject to negotiation. He also noted how this shows there is potential to do more, and CareFirst continues to advocate for building upon the IRA to ensure we are not creating adverse incentives in the commercial market.

To Drive Affordability, We Must Look at Both Consumer Facing and Supply Side Costs

The drug supply chain in the U.S. is notoriously opaque by design. York discussed the need for additional transparency into drug prices highlighting differences in gross versus net spending and how the public does not know the true price. He noted he “doesn’t see the supply chain evolving anytime soon” and how it is easy for stakeholders to point the finger at others. While lower out-of-pocket cost-sharing helps consumers access their medications, this “may reduce some of the downward forces on drug manufacturers, so they can charge whatever they want to the payer and the health system.” To truly drive change, we need to focus more broadly than just lowering the cost for select drugs. We also need to think about how we can drive changes to the system itself to support negotiating power for payers and ensure aligned incentives across the entire delivery system. Kempf mentioned that one way to support this was through the Affordable Care Act’s lower premiums in the American Rescue Plan Act, which CareFirst advocates be made permanent. Without access to insurance, the debate on drug prices and consumer cost-sharing is irrelevant.

Meaningfully Address Disparities in Access

A key theme throughout the discussion was ensuring vulnerable communities can access prescription drugs. While reducing cost-sharing may not be a panacea due to impacts on consumer premiums, it can be an effective tool if implemented selectively to reduce disparities. Kempf noted the work of DCHBX in partnering with insurers and other stakeholders on equity-based benefit design, including CareFirst, to eliminate cost-sharing for insulin and all diabetes care recognizing the direct role access to insulin has in keeping people out of the hospital. She discussed how lowering prescription drug costs can help keep total healthcare costs down [and we] “need a change in mindset to not think about costs first but health first.” CareFirst proactively implemented $0 cost-sharing for preferred insulin for our fully insured members in 2021 to ensure cost was not a barrier. York added how important it is to think about how affordability impacts specific populations and consider affordability from a patient and health system perspective.

To learn more about CareFirst’s policy recommendations to lower the cost of prescription drugs, click here.