Drug Rebates: Do Patients Really Benefit?

A large portion of patients may be paying for drugs based on list prices.​

A new study indicates that more than 50% of commercially insured patients are paying out-of-pocket (OOP) costs for prescription drugs based on list prices, rather than negotiated or discounted prices.

The use of deductibles and coinsurance has been growing in the United States and has significantly changed OOP costs for patients. While rebates from pharmaceutical manufacturers can reduce costs for insurers and pharmacy benefit managers (PBMs), a majority of patients may not be benefiting from the discounts in terms of reduced spending.

For drugs that treat diabetes, asthma, high cholesterol, and hepatitis C virus, manufacturer rebates can reduce list prices up to 55%, but patients are unable to benefit from these savings since they are being charged based on non-discounted prices, according to the study conducted by Amundsen Consulting.

“Prescriptions filled in the deductible or with coinsurance are higher than they otherwise would be if based on the discounted cost of the medicine,” the authors wrote.

Approximately 1 in 5 branded drug prescriptions filled in the United States is linked to cost-sharing based on the list price, according to the report.

For specialty medications, the authors discovered that 34% of drugs were filled in the deductible or with coinsurance, meaning that patients are responsible for more cost-sharing.

The authors also discovered that more than 50% of OOP spending on branded drugs and 90% of OOP spending on specialty drugs is the result of drugs filled in the deductible or with coinsurance, according to the study. Spending on specialty drugs was substantially higher, likely because of the costly nature of the treatments.

Prescriptions filled through the deductible may affect patient access to treatment, as these drugs are more likely to be abandoned at the pharmacy. The authors discovered that branded drugs filled in the deductible are twice as likely to be abandoned at the pharmacy compared with drugs not filled in the deductible.

Nearly 3 in 10 specialty drugs filled in the deductible were abandoned at the pharmacy counter in 2015, according to the study. This may present a significant challenge for patients with life-threatening conditions, such as cancer, who need treatment with specialty drugs.

These findings suggest that patients whose prescriptions are filled through deductibles or coinsurance may not be benefiting from manufacturer rebates and the high costs may present a barrier to treatment. Numerous other studies show that patients facing high OOP spending are less likely to adhere to their treatment regimen, which may lead to emergency department risks, hospitalization, and poor outcomes.

“Basing deductibles and coinsurance for medicines on undiscounted list prices respectively shifts more of the cost of care to the patient, unfairly penalizing sicker patients with high spending,” the authors wrote.

Payers have begun to understand the impact of using list prices to base cost-sharing on and how this may result in problems for patients, according to the study.

CVS and Express Scripts have released statements that say high deductibles for prescription drugs may negatively affect patients and that patients should receive direct rebate sharing, which is where the industry may move, the study concluded.