Re-import drugs from Canada and other recommendations to states struggling with high Rx costs
States, like consumers, are struggling with skyrocketing prescription drug costs. They’re footing part of the bill – to the tune of $20 billion a year – through Medicaid, public employee and prison health care programs.
To help ease the damage to state budgets, the National Academy for State Health Policy (NASHP) convened a group of state policy experts to put forth solutions for out-of-control prescription drug prices. In their new report, the NASHP Pharmacy Costs Work Group landed on a wide-range of proposals – 11 in all – that include everything from market-based solutions to strengthening regulation and oversight.
Among the top proposals:
- Increase price transparency. Transparency could take on many forms. It could mean requiring drug makers to disclose their pricing analysis. Or it could mean implementing price justification requirements when a drug price increases a certain amount.
- Re-import more affordable drugs from Canada. In simple terms, that means buying back from Canada drugs that were made in the United States. The report suggests that states could act as wholesalers and request a certification from the federal government that would allow them to demonstrate the safety and authenticity of drugs and re-import them.
- Pursue return on investment pricing strategies. Bottom line: States could negotiate drug prices by factoring in how much a specific drug could help reduce overall health care costs over time.
- Protect consumers against misleading marketing. This proposal is meant to address coupon programs run by pharmaceutical companies, which reduce out-of-pocket costs to consumers but don’t drive down the total cost of a drug to insurers or states. The report notes that drug coupons can “steer patients toward high-priced drugs despite the availability of clinically-comparable, lower-cost alternatives.” The policy proposals range from banning the use of coupons to requiring clearer labeling on the terms of use of coupons.
The NASHP report is meant to serve as a policy toolkit for states, not as a prescriptive outline of proposals.
“This is another example of where states can be innovators,” said Trish Riley, Executive Director of NASHP. “Big national health reforms have often followed the states’ leads and now they are committed to leading the way on reining in drug prices.”
In Oregon, a legislative work group has spent nearly a year working on legislation to control drug costs. The proposals include variations on some of the recommendations listed in the NASHP report.
“It’s a good starting point for discussion,” Jesse O’Brien, policy director of the consumer advocacy group OSPIRG told the Portland Business Journal. But he questioned whether the proposals do enough to address the “underlying driver of prescription drug costs.”
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