Unbiased Analysis of Today's Healthcare Issues
Leah Rand and Aaron Kesselheim have an interesting commentary in Value in Health reviewing some of the challenges of implementing international reference pricing (IRP) in the U.S. IRP would set drug prices in the U.S. as no higher than a basket of drug prices in other developed countries. This issue is of particular interest due…
Reference-based pricing seems like an attractive option. Basically, health insurers pay some amount (e.g., the lowest price, median price, average of lowest X prices) for a given service. If patients want a higher priced option, they must pay the difference. The approach assures patients have access to care but makes patients responsible if they don’t…
A number of politicians have called for the ability to import drugs from Canada and other developed countries. For instance, Bernie Sanders said: “I believe we should be able to import into the United States from Canada, and from other countries, FDA-approved medicine, which would substantially lower prices.” However, Canada does not want the U.S.…
Many European countries use external reference pricing (ERP) to help set their drug prices. External reference pricing caps the prices of drugs at some average or weighted average of the drug price in other countries. The comparison countries typically are either in close proximity or of similar GDP/capita level. The advantage of reference pricing is…
To reduce utilization of pharmaceutical products, many countries have opted to use reference pricing. Reference pricing is a system where patient coinsurance payments depend not only on the price of the drug but also the price of alternatives therapies. As the name indicates, reference pricing sets patient coinsurance rates as the difference between the drug’s…
What percentage of your prescription drug costs should your insurance company cover? You may say “100%, of course!” However, if health insurance cover all pharmaceutical costs this will drive up premiums. One solution to this problem is reference pricing. If generics are available for $10 and name brand drugs are available for $100, the…