Improve the Pharmaceutical Ecosystem for Patients

Pharmacy Practice in Focus: Health SystemsMay 2022
Volume 11
Issue 3

Health care policy decisions based on sound data and research are essential for addressing the challenges.

Pharmacists are a vital part of the health care ecosystem, relied on by patients to help them navigate an evermore-complex health care system.

Their first-hand knowledge about the challenges patients face at the pharmacy counter is vital to the conversation about how the ecosystem is or is not serving patients.

When I was in pharmacy school, I thought the relationship between drug company, patient, payer, and pharmacy was straightforward: Drug companies make drugs and ship them to pharmacies; patients buy health insurance from payers, who pay pharmacies for the drugs; patients obtain their drugs from the pharmacy and go home happy (Figure 1).

As any pharmacist can attest, that is not how the system works. Medications and the payments for them do not travel on a superhighway connecting the laboratory bench to the insurance company and the patient at the pharmacy counter. The system is opaque, chock-full of confusing road signs, detours, and traffic lights.

Typically, those detours do not proceed in a smooth, affordable, manner that would allow patients to benefit from the immense value pharmaceutical innovations provide (Figure 2). The complicated rules that govern this system have an enormous impact on patients. At present, patients often struggle to navigate this complex and costly system because not all the parts of the supply chain work together smoothly.

Pharmacists, with their patient-centered role in the ecosystem, are uniquely positioned to observe how the system affects patients.

They can help patients better navigate the complexities and costs they face by deepening their own understanding of how all the system parts interact.

I was honored to share this message with faculty members and pharmacists in training at the University of Mississippi School of Pharmacy in March 2022, when I visited the campus to deliver the annual Charles W. Hartman Memorial Lecture. In conversations with faculty members and students during my visit, it became clear that understanding how drugs are paid for would make them better pharmacists and help them better serve patients, even though pharmacists do not go to school to learn about reimbursement policy.

Some of the conversations at Ole Miss School of Pharmacy that excited me the most highlighted the unique perspective that pharmacy school training gives pharmacists setting them up to make key contributions to ongoing conversations about how to help this system work better for patients.

Navigating Insurance Plan Drug Benefit Designs

Understanding insurance plan drug benefit designs is increasingly important for pharmacists, so they can help patients. When people talk about the high price of a medication, they are talking about the price they paid at the pharmacy counter. The biggest influence on that out-of-pocket cost? The rules of the patient’s insurance plan.

Pharmacists across the country are already working every day to help patients navigate what are often inadequate and usually confusing drug benefits that can vary greatly. But understanding the plan rules is important for helping patients stay healthy, because navigating co-pay accumulator adjustment programs or step therapy can be detrimental to a patient’s health.

The co-pay programs can be a particular roadblock for patients to get the medicines they need. Research results have shown that patients who find out that their health insurance plans will not apply coupons to their deductibles often stop filling their prescriptions.1

Of course, many individuals have the opportunity to select a new health plan at least once a year. But the unfortunate reality is that in some cases, there is not enough transparency about the drug benefit design for many patients to know for sure whether a medication they need will be covered by insurance.

Recognizing the Flaws of the Rebate System

Another part of the system that is wholly

lacking in transparency concerns rebates.

Despite the rhetoric surrounding intermediaries, such as pharmacy benefit managers (PBMs) as cost savers, data show that the fees, rebates, and other perverse incentives do not save money but add to costs. IQVIA research results showed they pushed up US payer drug costs by 19%, or $135 billion, in 2020.

These increases come as STAT reported that the 5 largest PBMs are handling a massive sum of gross drug revenue, up 56% since 2015.2 These increases are felt by patients at the pharmacy counter. Other IQVIA findings showed 33% of drug spending in 2020 went to an entity other than the drug company that made the medicine but not to the patient.3

The impact this has on patients at the pharmacy counter is why we are glad to see the Federal Trade Commission examining the role of PBMs and what impact their fees and rebates have on net drug prices, formularies, and patient access.

The shadowy system of hidden fees and rebates is also driving up costs for the government and, in some cases, driving pharmacies out of business.

For example, take direct and indirect remuneration fees: Findings in a recent report sponsored by the American Pharmacists Association showed that by narrowing the gap between gross and net prices, Medicare Part D could save more than $18 billion annually.4

Following the Evidence to Help Patients at the Pharmacy Counter

The conversations I had at Ole Miss School of Pharmacy caused me to reflect on my journey from pharmacy school to leading the National Pharmaceutical Council (NPC) and how the patient-centered perspective of pharmacists is important in conversations on making the system work better for patients. At NPC, we will continue our mission to provide high-quality data on the value that medicines deliver to patients and society and how proposed policy solutions can affect patient access and affordability.

Frustratingly, policy conversations seem to focus too little on the impact a policy might have on patients and more on Capitol Hill insider baseball. Take the recent conversations about proposals to allow the government to set prices for drugs: The Congressional Budget Office has continued to write in its reports that government price setting will lead to fewer drugs coming to market. It is impossible to predict which drugs would not be available and for which conditions. That would have a negative effect on patients.

Further, it is unclear that patients would save money at the pharmacy counter from these price controls.

NPC’s research with Xcenda showed that just 1 in 4 health plan decision-makers surveyed would pass savings from lower-priced drugs along to patients at the pharmacy counter.5 A patient-centered view would say that making policy decisions on sound data and research is essential to helping the parts of the system work better together on behalf of patients.

It is a critical time for this work, and we need more people to join us. I have been fortunate in my career to have met mentors who helped me see the impact pharmacists could have by working at the intersection of pharmacy, research, and policy. NPC welcomes the chance to speak with pharmacists who find themselves at the intersection of their formal education and the broader health care policy conversation, and we invite pharmacists to connect with us and talk to us when planning research.6 The profession would benefit if more decision-makers adopted the patient-centric mentality of pharmacists. Keeping the North Star of that patient at the pharmacy counter in sight can help us arrive at solutions that help the health system work for patients.


John M. O'Brien, PharmD, MPH, is president and CEO of the National Pharmaceutical Council.


1. Starner CI, Alexander GC, Bowen K, Qiu Y, Wickersham PJ, Gleason PP. Specialty drug coupons lower out-of-pocket costs and may improve adherence at the risk of increasing premiums. Health Aff (Millwood). 2014;33(10):1761-1769. doi:10.1377/hlthaff.2014.0497

2. Herman B. The biggest PBMs are handling more and more of the country’s drug price negotiations. STAT. March 22, 2022. Accessed April 14, 2022.

3. The use of medicines in the US: spending and usage trends and outlook to 2025. IQVIA. May 27, 2021. Accessed April 14, 2022.

4. Deserving of better: how American seniors are paying for misaligned incentives within Medicare Part D. 3 Axis Advisors. March 7, 2022. Accessed April 14, 2022.

5. Affordability is about more than drug prices. National Pharmaceutical Council. July 21, 2021. Accessed April 14, 2022.

6. Submit a research proposal. National Pharmaceutical Council. Accessed April 14, 2022.

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