Patient and Plan Spending after State Specialty-Drug Out-of-Pocket Spending Caps.

BACKGROUND: Specialty drugs are used to treat complex or life-threatening conditions, often at high financial costs to both patients and health plans. Three states - Delaware, Louisiana, and Maryland - passed legislation to cap out-of-pocket payments for specialty drugs at $150 per prescription. A concern is that these caps could shift costs to health plans, increasing insurance premiums. Estimates of the effect of the caps on patient and health-plan spending could inform future policies. METHODS: We analyzed a sample that included 27,161 persons under 65 years of age who had rheumatoid arthritis, multiple sclerosis, hepatitis C, psoriasis, psoriatic arthritis, Crohn's disease, or ulcerative colitis and who were in commercial health plans from 2011 through 2016 that were administered by three large nationwide insurers. The primary outcome was the change in out-of-pocket spending among specialty-drug users who were in the 95th percentile for spending on specialty drugs. Other outcomes were changes in mean out-of-pocket and health-plan spending for specialty drugs, nonspecialty drugs, and nondrug health care and utilization of specialty drugs. We compared outcomes in the three states that enacted caps with neighboring control states that did not, 3 years before and up to 3 years after enactment of the spending cap. RESULTS: Caps were associated with an adjusted change in out-of-pocket costs of -$351 (95% confidence interval, -554 to -148) per specialty-drug user per month, representing a 32% reduction in spending, among users in the 95th percentile of spending on specialty drugs. This finding was supported by multiple sensitivity analyses. Caps were not associated with changes in other outcomes. CONCLUSIONS: Caps for spending on specialty drugs were associated with substantial reductions in spending on specialty drugs among patients with the highest out-of-pocket costs, without detectable increases in health-plan spending, a proxy for future insurance premiums. (Funded by the Robert Wood Johnson Foundation Health Data for Action Program.).

Patient Assistance Programs-A New Era of Law and Policy.

This Viewpoint from authors at PORTAL discusses the importance of patient assistance programs in covering the cost of prescription drugs, highlights 2 recent rulings that illustrate the substantial barriers to regulating these programs, and calls for continued evaluation of these programs' effectiveness and costs.

The Pay-Twice Critique, Government Funding, and Reasonable Pricing Clauses.

The federal government subsidizes the research and development of prescription medications. Thus, a captivating critique of expensive medications is that prices are too high because of taxpayer co-financing. This critique is often framed in terms of "paying-twice"-first for the research and second through the above market pricing of resulting products. Reasonable pricing clauses-which place some kind of pricing limitation on the exercise of license or patent rights governing a federally funded medication-are one proposed policy tool for addressing the pay-twice critique. This article provides increased analytical clarity as well as historical context to present-day debates about the privatization of federally funded research and prescription drug pricing. It makes three arguments. First, despite its pervasiveness and intuitive plausibility, the pay-twice critique is subject to differing interpretations which has important implications for the appropriateness of proposed solutions. Second, despite their initial attractiveness, the costs, necessity, and effectiveness of reasonable pricing clauses render the wisdom of this policy tool uncertain. However, third, given continued interest in reasonable pricing clauses, the NIH's previous experience with such a policy offers some useful lessons.

Creating a medical home through the 340B Drug Pricing Program.

OBJECTIVE: This study was designed to track inpatient and outpatient utilization before and after the implementation of the 340B Drug Pricing Program in a public university hospital. METHODS: Before and after design built upon administrative clinical and financial data. RESULTS: Outpatient and emergency department utilization rates increased with small increments of direct cost. Inpatient utilization decreased while inpatient length of stay increased with over three million dollars in direct cost savings. CONCLUSIONS: Improving continuity of care for patients without a usual source of care may have the effect of creating a "medical home." The 340B Drug Pricing Program may be one policy tool to improve care for the underserved while increasing outpatient utilization and decreasing inpatient utilization and costs.

The international pharmaceutical market as a source of low-cost prescription drugs for U.S. patients.

In response to increasing prescription drug costs, more U.S. patients and policymakers are importing less-expensive pharmaceutical products from other countries. Large-scale prescription drug importation is currently illegal, but the U.S. Food and Drug Administration permits individuals to bring in 90-day supplies of drugs for personal use. As patient use of foreign-bought drugs has increased, federal legislators have continued to debate the full legalization of importation. Three factors help guide whether U.S. patients and policymakers can rely on other countries as sources of imported prescription drugs: whether the safety of the product can be ensured, how the import price compares with domestic prices, and how importation might affect the exporting country's pharmaceutical market. In wealthier countries with active regulatory systems, drug safety can be adequately ensured, and brand-name products are usually less expensive than in the United States (although generic drugs may be more expensive). However, implementing large-scale importation can negatively impact the originating country's market and can diminish the long-term cost savings for U.S. consumers. In low- and middle-income countries, prices may be reduced for both brand-name and generic drugs, but the prevalence of unauthorized products on the market makes ensuring drug safety more difficult. It may be reasonable for individual U.S. consumers to purchase essential medicines from certain international markets, but the most effective way to decrease drug costs overall is the appropriate use of domestic generic drugs, which are available for almost every major therapeutic class.