Complexity in the pharma world leads to public attn

Recent NY Times front page article criticizing on the emerging of 4th tier co-insurance revealed a national problem that worries many in our aging population. Instead of paying a fixed copay of $10.00 for preferred generic and $20.00 for a preferred brand, patients are asked to pay 25% of the actual cost of drugs which can translate to a $500.00 out-of-pocket copay.  Fortunately (or not), the concept of co-insurance is generally applied to a class of high-cost-low-utilization drugs called Specialty Pharmaceuticals, or generally known as Biologics.   Biologics are used to treat various cancers, rheumatoid arthritis, multiple sclerosis and other diseases where success rate can be increased by 50% if used properly. However, the annual out-of-pocket expense can range up to $50,000 per patient per year! By 2020 specialty pharmaceuticals will account for about 37 percent of total drug expenditures (Caremark 2007 Drug Trend Report).

Insurance companies are just trying to survive…and so are we.