New report reveals significant branded drug price increases and spend
Branded prescription drug spending increased 4 percent since 2016, according to a new Health of America report from the Blue Cross Blue Shield Association (BCBSA) that analyzed recent medical claims trends.
Alarmingly, while branded prescription drugs accounted for only 17 percent of total prescriptions filled, they made up 79 percent of total drug spending. Detailed findings from the report examining data since 2016 include:
- Branded patent-protected and specialty drugs accounted for most of the disproportionately large spend, increasing 5 percent and 10 percent respectively
- Generic drug spending dropped 3 percent
- Total Rx spending increased 2 percent, exceeding $100 billion annually—or more than 20 percent of overall health care spending for BCBSA commercially-insured members
Fighting rising drug costs
Regence is committed to ensuring members have timely access to safe, effective, cutting-edge prescription medicines when they need them, whether the drugs cost pennies or thousands of dollars.
One way Regence helps members combat rising prescription drug prices is with the online medication comparison service MedSavvy®*. This innovative solution enables members to conveniently compare prices, effectiveness and user reviews of thousands of medications so they can choose the right fit for their health and lifestyle.
In one example, a large Oregon employer encouraged its employees taking cholesterol medication to use MedSavvy; the campaign resulted in 11 percent of employees switching to lower-cost medications, decreasing their average cost per claim from $36.66 to $15.44. MedSavvy is currently available to all Regence members with fully-insured plans, and as a buy-up for self-insured plans.
The value of pharmacy-medical benefits integration
Another key driver behind prescription drug price growth is the nationwide trend of de-coupling Pharmacy Benefits Management (PBM) from insurance carriers. Health plan providers like Regence deliver cost savings by integrating PBM services within our health plans.
According to a two-year study from the BCBSA across 1.9 million lives, an integrated PBM and medical benefits approach resulted in:
- 11% ($330) lower annual medical costs on a per-member basis
- 9% lower hospitalization
- 4% lower ER visits
Integration also delivers a number of additional member advantages, including added safety protections such as medical adherence customer support, and a more straightforward consumer experience. Keeping pharmacy benefits integrated within our health plans is one of several policies that help Regence keep prescription drug price increases below the national average.
You can read the full Health of America Prescription Drug Costs Trend Update report here.
*MedSavvy is a separate and independent company that provides prescription comparison services for Regence Health Plan members.