High Drug Costs but Few Expectations for Change

In 2017, we spent much of our time defending the Affordable Care Act. With all the squabbling about the system we have, Washington, DC was less focused on how to improve it. The latest Kaiser Health Tracking Poll shows over half of the public (52%) wants legislation to bring down the cost of prescription drugs to be a top priority. But most people (72%) also think that prescription drug companies have too much influence in Washington. That being the case, little may come of efforts to control costs. A recent JAMA study implicates prescription drug prices (along with provider reimbursements) when finding that the United States spends twice that of other high-income countries for the roughly the same utilization of health care services. The U.S. Senate is paying attention – a new report from Senator Claire McCaskill (D-MO) shows that the top 20 brand name drugs for seniors increased an average of 12 percent every year for five years.

Massachusetts submitted a waiver request to establish a “closed formulary” in Medicaid – excluding certain brand-name drugs from Medicaid. Doing so could increase the state’s leverage in price negotiations. This is controversial and the Administration is leaning against approval, raising questions about the influence of the pharmaceutical industry (giving credence to the concerns raised by the poll).