scholarly journals A Dose of Managed Care: Controlling Drug Spending in Medicaid

2021 ◽  
Vol 13 (1) ◽  
pp. 170-197
Author(s):  
David Dranove ◽  
Christopher Ody ◽  
Amanda Starc
Keyword(s):  
Managed Care ◽  
Lower Cost ◽  
Drug Spending ◽  
Drug Benefits ◽  
Drug Prices ◽  
Medical Spending ◽  
Spending Cuts

We study the effect of privatizing Medicaid drug benefits on drug prices and utilization. Drug spending would decrease by 21.3 percent if private insurers administered all drug benefits. One-third of the decrease is driven by private insurers’ ability to negotiate prices with pharmacies. The remaining two-thirds is driven by the greater use of lower cost drugs, such as generics, and is only realized in states that give private insurers the flexibility to design drug benefits. Privatization does not reduce prescriptions per enrollee and spending cuts are smaller for drugs that lower medical spending. (JEL G22, H51, I11, I13, I18, I38, L65)

Introduction

2021 ◽  
pp. 3-13
Author(s):  
Neumann Peter J. ◽  
Cohen Joshua T. ◽  
Ollendorf Daniel A
Keyword(s):  
Pharmaceutical Industry ◽  
Prescription Drug ◽  
Prescription Drugs ◽  
Health Expenditures ◽  
Drug Spending ◽  
Drug Pricing ◽  
Pricing Policies ◽  
Drug Prices ◽  
Financial Difficulties ◽  
Prescription Drug Spending

The pharmaceutical industry has produced wondrous scientific advances, but the progress has come at a cost. US prescription drug spending has increased faster in most recent years than other categories of health and now comprises roughly one-sixth of total health expenditures. Rising costs strain already stretched public budgets. Increasing patient out-of-pocket spending for deductibles and coinsurance has created financial difficulties for many individuals and their families, particularly among the sickest patients. The dueling trends of scientific breakthroughs and ever-rising spending present enduring challenges. On its own, rising spending would not be so concerning, but evidence suggests that drug prices often do not reflect the benefits they provide. Thus, there is an imperative to measure the value of prescription drugs and incorporate such measures into drug pricing policies.

OP440 Comparison Of Evidence Supporting Cancer Drug Approvals And Prices In The US And Brazil

2021 ◽  
Vol 37 (S1) ◽  
pp. 16-17
Author(s):  
Adriana Ivama Brummell ◽  
Huseyin Naci
Keyword(s):  
Overall Survival ◽  
Survival Benefit ◽  
Therapeutic Benefit ◽  
Cancer Drug ◽  
Cancer Drugs ◽  
Drug Benefits ◽  
Drug Prices ◽  
The Us ◽  
Drug Approvals ◽  
Overall Survival Benefit

IntroductionCancer drug prices are high on the policy agenda worldwide. Previous research found no association between cancer drug benefits and prices at the time of regulatory approval. Drugs approved in the US with uncertain benefits may have spill-over effects in other settings. Our objective was to compare the evidence supporting cancer drug approvals in the US and Brazil, and to examine the association between cancer drug prices and availability of added therapeutic benefit.MethodsWe matched all novel cancer drugs approved in the US from 2010–2019 to approvals in Brazil. We extracted data on pivotal study design characteristics and outcomes in the US and Brazil, and evidence supporting price approval in Brazil, including availability of added therapeutic benefit.ResultsFrom 2010–2019, fifty-six cancer drugs with matching indications were approved in US and Brazil and had their prices authorized in Brazil by December 2020. Drug were available in Brazil following a median 522 days after US approval (IQR: 351–932). In the US, thirty-four (60.7 percent) of the drugs had pivotal randomized controlled trials (RCTs) and Twelve (21.4 percent) had overall survival benefit. By the time of Brazilian approval, forty-one (73.2 percent) drugs had pivotal RCTs and twenty-two (39.3 percent) had overall survival benefit. A total of twenty-eight (50 percent) drugs did not demonstrate added therapeutic benefit over other authorized drugs for the same indication and had a median reduction from requested to approved price of 6.1 percent (IQR: 0–27.8 percent) in Brazil. The twenty-seven (48.2 percent) drugs with added therapeutic benefit had a median price reduction of 2.0 percent (IQR: 0–9.2 percent).ConclusionsHalf of new cancer drugs approved in Brazil failed to demonstrate added therapeutic benefit. The Brazilian pricing system secured considerable price reductions, ensuring that prices for medicines with no added therapeutic benefit were not higher than existing treatments for the same approved indication. Although evidence was more mature by the time of Brazilian review, pivotal studies often lacked randomization and overall survival endpoints.

The Metamorphosis of Managed Care: Implications for Health Reform Internationally

2010 ◽  
Vol 38 (2) ◽  
pp. 352-364 ◽  
Author(s):  
Marc A. Rodwin
Keyword(s):  
Managed Care ◽  
Medical Care ◽  
Private Insurance ◽  
For Profit ◽  
Medical Spending ◽  
Professional Control ◽  
Medical Markets ◽  
Access To Medical Care ◽  
Medical Economy ◽  
Private Actors

Many writers suggest that managed care had a brief life and that we are now in a post-managed care era. Yet managed care has had a long history and continues to thrive. Writers also often assume that managed care is a fixed entity, or focus on its tools, rather than the context in which it operates and the functions it performs. They overlook that managed care has evolved and neglect to examine the role that it plays in the health system.This article argues that private actors and the state have used managed care tools to promote diverse goals. These include the following: increasing access to medical care; restricting physician entrepreneurialism; challenging professional control over the medical economy; curbing medical spending; managing medical practice and markets; furthering the growth of medical markets and private insurance; promoting for-profit medical facilities and insurers; earning bounties for reducing medical expenditures; and reducing governmental responsibility for, and oversight of, medical care. Struggles over these competing goals spurred the metamorphosis of managed care internationally.

Prescription Drug Priorities under the Biden Administration

2021 ◽  
Author(s):  
Kyle A. Gavulic ◽  
Stacie B. Dusetzina
Keyword(s):  
Health Care ◽  
Health Insurance ◽  
Prescription Drug ◽  
Prescription Drugs ◽  
Insurance Coverage ◽  
Public Support ◽  
Economic Downturn ◽  
Drug Spending ◽  
Drug Prices ◽  
Prescription Drug Spending

Abstract In January 2021, the incoming Biden administration will inherit urgent priorities to curb health care spending and expand health care coverage to millions of Americans while also addressing the COVID-19 pandemic and resulting economic downturn. Among these competing priorities is the issue of access to and affordability of prescription drugs. Here, we outline Biden’s plan to directly lower prescription drug spending for payers and patients and to expand access to prescription medications through improved health insurance coverage. These policies could provide important financial protections for Americans against high prescription drug prices. Despite widespread public support for addressing prescription drug prices, many of Biden’s plans rely on Congressional action, which will be complicated by the narrow majority held by Democrats in the House and an evenly divided Senate. However, there may be other opportunities to reduce prescription drug spending and improve health insurance enrollment among the uninsured. While directly lowering drug prices would provide the most widespread savings for payers and patients alike, any successful effort to increase the number of Americans enrolled in health insurance or render it more affordable will still likely effectively lower patients’ out-of-pocket costs and improve access to prescription drugs.

scholarly journals Managed Care and the Growth of Medical Expenditures

1998 ◽  
Vol 1 (1) ◽  
Author(s):  
David M. Cutler ◽  
Louise Sheiner
Keyword(s):  
Managed Care ◽  
Hospital Cost ◽  
New Technologies ◽  
Preliminary Evidence ◽  
Medical Expenditures ◽  
Medical Spending ◽  
Long Run ◽  
Technology Leaders ◽  
Cost Growth ◽  
Cost Reductions

We use data across states to examine the relation between HMO enrollment and medical spending. We find that increased managed care enrollment significantly reduces hospital cost growth. Although increased spending on physicians offsets some of this effect, we generally find a significant reduction in total spending as well. In analyzing the sources of hospital cost reductions, we find preliminary evidence that managed care has reduced the diffusion of medical technologies. States with high managed care enrollment were technology leaders in the early 1980s; by the early 1990s those states were only average in their acquisition of new technologies. This finding suggests managed care may significantly affect the long-run growth of medical spending.

scholarly journals Drug Pricing Transparency: The New Retail Revolution

2017 ◽  
Vol 52 (2) ◽  
pp. 155-159 ◽  
Author(s):  
Kaitlyn N. Dana ◽  
John B. Hertig ◽  
Robert J. Weber
Keyword(s):  
Health Care ◽  
The United States ◽  
Pharmacy Services ◽  
Drug Spending ◽  
Drug Pricing ◽  
Patient Centered ◽  
Pricing Policies ◽  
Drug Prices ◽  
Pharmacy Leaders

As spending on medications in the United States increases with each passing year, the need for drug pricing transparency by manufacturers also increases. Drug spending, excluding rebates and discounts, was $309.5 billion in 2015, up 8.5% from 2014. Drug pricing transparency has been a topic of debate across the health care system. This column reviews the issue of drug pricing and emphasizes the need for transparency in this area. We will discuss factors that influence drug pricing, policies and ways to reduce the rising costs of drugs, and the role of pharmacy leaders in managing this problem. A multitude of factors are driving the country to spend more and more on medications; pharmacy leaders can employ various strategies to counteract this escalation of drug prices. After reviewing this article, the pharmacy director will have an increased ability to address drug pricing issues with stakeholders as they develop patient-centered pharmacy services.

scholarly journals A Dose of Managed Care: Controlling Drug Spending in Medicaid

2017 ◽  
Author(s):  
David Dranove ◽  
Christopher Ody ◽  
Amanda Starc
Keyword(s):  
Managed Care ◽  
Drug Spending
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