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Prescription Drug Price Trends

About one in four people say they have a tough time affording their prescription drugs. Prescription drug prices have been on the rise since 2017. According to Rueters, drug companies announced price increases for more than 250 medications in 2019. 

According to the Centers for Medicare and Medicaid (CMS), prescription drugs already account for 20 percent of Medicare’s spending, and with the prescription drug price trend increasing, that number will only increase in the near future. That may mean that your vital medications will cost you more.

How to Get Prescription Drug Discounts

Rising prices shouldn’t mean that you have to stop taking your needed drugs. Wouldn’t it be great if you could get a discount for your necessary medications? You can with this free discount drug card

Prescription Drug Discount Card | Medicare Plan Finder
Prescription Drug Discount Card | Medicare Plan Finder

This discount card is not an insurance plan. However, you can use your discount card to receive up to 75 percent off your prescriptions at more than 68,000 pharmacies. Simply download, print and show your card to the pharmacist when you check out to save money on your important medications.

Why Are Prescription Drug Costs Rising Rapidly?

Senior Man With Pill in Hand | Medicare Plan Finder

The prescription drug price trend may be going up due to a lack of competition for pharmaceutical companies, and mergers and acquisitions in the pharmaceutical industry.

Lack of Competition for Pharmaceutical Companies

Many major pharmaceutical companies own patents for their drugs. That means other manufacturers cannot legally create generic equivalents, and the patent holders can charge whatever they want for their products. 

Usually, manufacturers will produce generic drugs once a brand name patent expires. Some drugs are expensive to develop even with an expired patent, so that often means the original manufacturer is the only company producing their drug.

Mergers and Acquisitions in the Pharmaceutical Industry

Drug manufacturers make deals to expand their product bases. Unfortunately, when pharmaceutical companies merge, they get a lot of bargaining power. The pharmaceutical companies can demand that pharmacy benefit managers (PBM) – people responsible for contracting with pharmacies and getting drug discounts – set prices higher. Those costs get passed on to the government and ultimately to you.

Sometimes, pharmacy benefit managers merge with health plans, like in the cases of Cigna and Express Scripts and CVS and Aetna. Those mergers may actually be able to HELP you, by lowering costs due to reduced overhead and improved communication.

Medicare Prescription Drug Price Negotiation Act

One reason the prescription drug price trend is rapidly increasing is that CMS cannot legally negotiate drug prices. The Medicare Prescription Drug Price Negotiation Act is a bill that would require Medicare to negotiate prescription prices with pharmaceutical companies. It was first introduced in the House of Representatives in 2017, and re-introduced in 2019. 

Other federal and state entities are making efforts to help reduce drug prices. The Food and Drug Administration is working toward approving more generic versions of brand name medicines. Many states have passed laws requiring drug companies to justify price increases.

Medicare Prescription Drug Plans

Prescription Drugs | Medicare Plan Finder
Prescription Drugs | Medicare Plan Finder

As prices rise, you may want to consider a new form of prescription drug coverage. Original Medicare does not help pay for prescriptions, but you can get prescription drug coverage through Medicare Part D, or through certain Medicare Advantage (Part C or MA) plans.

You can still use your discount drug card along with your insurance plan. When you go to the pharmacy to pick up your prescriptions, the pharmacist can determine your cost with each option.

Medicare Part D

Medicare Part D plans are also called prescription drug plans (PDPs). You can use PDPs to cover your medication costs. Many people who have PDPs also purchase Medicare Supplement (Medigap) plans to help pay for items such as coinsurance and copays.

Even though Medicare Supplements and Medicare Advantage plans sound similar, they are actually very different. Medigap plans “fill in” the gap between what you owe and what Original Medicare covers. MA plans help pay for medical expenses. If you have questions, one of our highly trained, licensed agents will be happy to help. Your agent can help you find the right plan for your budget and lifestyle.

PDPs typically use formularies that divide medications into tiers according to their copays. For example, one plan may feature four tiers with varying expenses. The first tier may only include generic drugs and cost $5 per prescription. Tier two may include preferred brand name medications and cost $15 per prescription.

Medicare Part D Checklist | Medicare Plan Finder
Medicare Part D Checklist | Medicare Plan Finder

Medicare Advantage Prescription Drug Plans 

Medicare Advantage plans are privately owned insurance policies that cover everything Original Medicare covers, but they can offer additional services including vision, hearing, and dental. Certain MA policies called Medicare Advantage Prescription Drug (MAPD) plans offer medication coverage.

Like PDPs, MAPDs use a formulary that lists every covered drug and separates them into tiers. The difference is that MAPD plans come with only one monthly premium for your covered services, and it includes prescription drugs.

Medicare Over-the-Counter Drug Coverage

Many people use over-the-counter (OTC) drugs along with their prescription medications. Like with prescription medications, Original Medicare does not cover OTC drugs. However, certain MA plans help pay for OTC medications. Some plans feature a pre-paid card that allows you to purchase covered items such as bandages and cold medicine.

How We Can Help You With Rising Prescription Drug Prices

The prescription drug price trend may continue to rise. You can save money by downloading the discount drug card or enrolling in a Medicare plan that includes prescription drug coverage

Your agent can help you find a plan that not only includes all of your prescriptions, but covers the additional services you need. Call us at 833-438-3676 or contact us here to learn more today.

Contact Us | Medicare Plan Finder
Contact Us | Medicare Plan Finder

What is the Cigna and Express Scripts deal?

Cigna and Express Scripts announced their 54 billion dollar merger in March of 2018. Cigna provides coverage to 95 million beneficiaries around the world and Express Scripts helps fill 1.4 billion prescriptions annually. The goal of this merger is to create both affordable and personalized healthcare for consumers.

Cigna and Express Scripts Merger Close Date

On December 18, 2018, Cigna and Express Scripts received approval from New Jersey, the final state needed to move forward. The deal closed two days later on December 20, 2018. Cigna plans to start offering new products to its customers including access to Express Scripts pharmacy in 2019.

Cigna’s CEO, David Cordani, believes the deal with Cigna and Express Scripts will allow Cigna to offer additional benefits to customers while monitoring their prescription usage and medical costs. Cordani said in a statement that the addition of Express Scripts provides a “more integrated approach that addresses the whole person.” While doing this, Cigna strives to improve affordability and increase drug price transparency.

What is Express Scripts?

Express Scripts is a pharmacy benefit manager (PBM). A PBM acts as a middleman between pharmaceutical companies and consumers. They negotiate drug pricing from the pharmaceutical companies for pharmacies. Their role can also include operating mail orders, ensuring patient compliance, managing distribution, negotiating rebates, processing claims, and managing formularies.

PBMs are one of the largest proponents of lowering drug costs. PBMs started as a benefits card and mail-order pharmacy in the 1970s and are responsible for the shift in demand from brand-name drugs to generics. Express Scripts is the country’s largest PBM. OptumRx, CVS, and Express Scripts together control 72% of the U.S. pharmacy benefit manager market. OptumRx is a part of United Healthcare, and CVS purchased Aetna on November 28, 2018. Express Scripts was the final, stand-alone PBM at this size.

Express Scripts provides great benefits to beneficiaries like you. They allow you to pick up your prescription at your neighborhood pharmacy or have it shipped to your home quickly and conveniently. They can also alert you of any drug recalls, price out your medications, and schedule automatic refills for you. Plus, Express Scripts is more than just a PBM and pharmacy – they are a dedicated team of pharmacists, nurse, and advocates who work to give you the personal care you deserve.

How will the Cigna and Express Scripts deal impact you?

This deal was formed amid the CVS and Aetna deal which was finalized in November 2018. Insurance companies have started looking for alternative ways to adapt to the ever-changing health care industry. We expect to see many more deals like this over the next few years. Walgreens and Humana are already rumored to be in talks about merging. These deals are proof that health companies need to respond to customer demand.

It will take time for new plans to be implemented and the results are speculative at this time, but the Cigna and Express Scripts deal is a great example of how Medicare and the healthcare industry can evolve. Amazon has been rumored to be entering the pharmaceuticals business which could lead to increased competition. This may result in lower costs and streamlined services for you. As competition increases, companies will provide additional benefits to keep your business.
If you have any questions or concerns about your Medicare coverage or prescription drug plan, our agents are happy to help! Call us at 833-438-3676 or fill out this form to get in contact with a licensed agent.

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