Drastic increase in drug prices has, over the years, become a topic of heated discussions, especially with price-cut on prescription drugs being on top priority on President Donald Trump’s agenda. In fact, the new secretary of health and human services, Alex Azar, has also promised to work in this regard, though the course of action remains unclear.
As the investigation over rising drug prices gains pace, the blame game between health insurers and pharma giants continue. But health insurers are taking a step further and promoting transparency in the otherwise shrouded sector.
Aetna, which is currently being acquired by CVS Health (CVS) announced that it will automatically pass on some of the rebates it receives from drug makers to its clients from early 2019. Similarly, earlier this month, its rival UnitedHealth Group Inc (UNH) promised similar discounts — ranging from few dollars to over $1000 — that would benefit close to 7 million consumers. This move by both the health insurers won appreciation from Azar.
Aetna CEO Mark Bertolini claims that the drug prices increased about 25% between 2012 and 2016. “We have always believed that consumers should benefit from the discounts and rebates that we negotiate with drug manufacturers. Going forward, we hope this additional transparency will encourage these companies to rationalize their pricing and end the practice of annual double-digit price increases,” he said in a statement.
Both Aetna and UnitedHealth are together trying to address an issue that is often raised in the drug industry. Drug manufacturers claim the discounts offered by them on treatments fail to reach the consumers, thereby altering the price consumers pay. They say the middlemen, the Pharmacy Benefits Managers (PBMs), are primarily responsible for the higher drug prices paid by customers.
Meanwhile, a study done recently on this failed to show any correlation between drug prices and rebates paid back to PBMs.
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