Negotiating insulin costs could save billions of US dollars

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By Serena Gordon
HealthDay Reporter

TUESDAY, February 4, 2020 (HealthDay News) – If you don't need insulin, you probably haven't paid much attention to its dizzying cost, but new research shows that the exorbitant price of drugs ultimately affects everyone.

The study found that in 2017, Medicare spent almost $ 8 billion on insulin. The researchers said that if Medicare were allowed to negotiate drug prices as can the US Department of Veterans Affairs (VA). In the US, Medicare could save about $ 4.4 billion alone with insulin

"Medicare now accounts for a third of all drug spending. Legislation that allows Medicare to negotiate prices and establish a central form would help save taxpayers money," said lead study author Dr. William Feldman.

"We have just analyzed insulin, but other studies have shown that other drugs would also have savings," Feldman added. He is a researcher at Brigham and Women's Hospital and at Harvard Medical School in Boston.

The VA already has the ability to obtain discounts on medications and negotiate prices. It has also established a national form. A formulary is a list of medications that are approved to treat certain conditions. Feldman said that if a form only accepts a few medications for each condition, there is more competition and price flexibility as companies try to include their medications.

Other governments, such as Canada, use their great purchasing power to negotiate better prices. But the law that established Medicare Part D said that Medicare cannot interfere with negotiations between health plans and pharmaceutical companies, according to the magazine. Health issues. That means that Medicare Part D, by law, cannot negotiate drug prices as other governments do.

And that lack of negotiation has had a great impact on prices.

Lija Greenseid, a mother of a teenager with type 1 diabetes in Minneapolis, saw those differences firsthand when her family traveled abroad. A box of insulin pens has cost the family up to $ 700 in the United States. That same box cost $ 73 in Germany, $ 57 in Israel, $ 51 in Greece and $ 61 in Italy. (Those prices were based on 2017 exchange rates).


"It is completely outrageous what we pay here," Greenseid said.

To see what effect the ability to negotiate prices and establish a form on insulin prices in the United States could have, the researchers analyzed Medicare Part D spending in 2017. They compared insulin prices between Part D Medicare and what the VA paid for it. medicines

In total, they observed 31 different insulins.

The total insulin expense for Medicare Part D was $ 7.8 billion after the manufacturer's reimbursements. If Medicare had been able to use the same prices negotiated by the VA, it would have saved $ 2.9 billion.

If Medicare could use VA prices and a national form, the projected savings would be $ 4.4 billion, the study found.

"We were looking for a drug that existed for 100 years and should be cheaper. Medicare now accounts for a third of all drug spending. If Medicare negotiated prices, it could make a big difference in spending on medical care," Feldman said.

The findings were published online on February 3 as a letter in JAMA Internal Medicine.

Dr. Robert Steinbrook, general editor of the magazine, wrote an accompanying editorial.

"The evidence indicates that restrictions on the form and price negotiations may lower the cost of medications," he said. "There are opportunities for the federal government to save billions of dollars every year for Medicare beneficiaries."

Steinbrook said it is important for people to realize that there are effective measures that can reduce the costs of medications.

"Now is the time for Congress and the executive branch to act," he said.

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SOURCES: William Feldman, M.D., D.Phil., Researcher, Pharmacoepidemiology and Pharmacoeconomics Division, Brigham and Women & # 39; s Hospital and Harvard Medical School, Boston; Lija Greenseid, Ph.D., Minneapolis; Robert Steinbrook, M.D., editor in general,JAMA Internal Medicine; February 3, 2020, JAMA Internal Medicineonline

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