Tag Archives: insights in life sciences

Pricing and Reimbursement within the US Public Healthcare System – Part Two, Medicaid

photopin_oldmanautumn_smallby Emily Fielding

The legislative changes made under the Affordable Care Act are significant for Medicaid – the state program that provides health insurance for low-income individuals. In 2010, 16.5% of Americans had Medicaid coverage, but from 2014 it is being expanded to include every individual with incomes under 133% of the Federal Poverty Level who isn’t covered by Medicare. This removes the previous requirement for dependent children for eligibility. The Center for Medicare and Medicaid Services (CMS) is a federal body that monitors the Medicaid program, but states retain the right to choose to provide the program or not. Currently, all states have it. However, only 23 states and the district of Columbia will be participating in the Medicaid expansion, which a High Court Ruling deemed optional according to the constitution. Those states with Republican Governors are those that so far refuse to enact the legislation.

All states cover prescription drugs under Medicaid, though co-payments per prescription can vary between $0.50-$5.00, and there may be limits on the number of prescriptions a beneficiary can have filled each month/year. Furthermore, drug manufacturers must enter a rebate agreement with Medicaid in order to have their products covered. Details of how much is required for each drug can be found here. Under Obamacare, this rebate has risen from 15.1% to 23.1% of the average manufacturer price for innovator drugs, and is expanded to include Medicaid delivered by Managed Care Organizations.

This means not only is Medicaid expanding in terms of number of people covered, but the costs on pharma for each individual sale are rising too. Those listed as “preferred drugs” such as antiretrovirals, atypical antipsychotics, ARBs, statins, anti-platelets etc will be most affected. Pharma is prevented for offsetting this rebate rise with a price increase, as any price increases to offset will be offset themselves by an additional rebate. Currently, 600 drug manufacturers participate in this program, facilitating access to their medications for Americans on Medicaid. These companies will still benefit from the overall increase in sales expected from having more people covered under Medicare.

REFERENCES:

Sinclair, A et al (2010) Strategic Analysis – US Pharmaceutical Market Overview, Reference number: DMHC2621, Datamonitor

DeNavas-Walt, C, Proctor, BD and Smith, JC (2012) “Income, Poverty, and Health Insurance Coverage in the United States: 2011” U.S. Census Bureau, Current Population Reports, P60-243, U.S. Government Printing Office, Washington, DC

Schlosberg, C & Jerath, S (1999) Fact Sheet: Prescription Drug Coverage Under Medicare NHelp Available from: http://www.healthlaw.org/index.php?option=com_content&view=article&id=187%3Afact-sheet-prescription-drug-coverage-under-medicaid&catid=38&Itemid=192

Pricing and Reimbursement within the US Public Healthcare System – Part One, Medicare

photopin_oldmanautumn_smallby Emily Fielding

The US Health System has historically had a very strong emphasis on the private sector. Unlike in many other developed nations, Americans do not have a choice between public and private coverage – only those who are deemed incapable of obtaining private coverage may have public coverage. The Affordable Care Act increases the pool of individuals eligible for public coverage. This means more US residents will be in a position to utilize medical services following implementation in 2014. Continue reading Pricing and Reimbursement within the US Public Healthcare System – Part One, Medicare

USA Pharma Market Overview: Valuable Impacts of Reform

by Emily Fielding

photopin_chicagoskyline_smallThere was a time that the pharma industry in the USA was touted to be “recession-proof”. However in 2010, with the country recovering from The Great Recession and the industry facing 2011’s patent cliff, there could be no denying the healthcare system was in need of major reform. When the Affordable Care Act passed that year, it became clear that the drug industry actually had potential to benefit from the increase in government involvement. Continue reading USA Pharma Market Overview: Valuable Impacts of Reform

Preparing for Conditional Marketing Authorizations

banderasby Aina Pi

Companies developing medications that meet an urgent need, but lack financial incentive, are rewarded by the European Medicines Agency (EMA) with authorization to go to market earlier than with regular products. Conditional Marketing Authorizations are granted by the EMA for products intended for seriously debilitating diseases, life-threatening diseases and emergency situations. Continue reading Preparing for Conditional Marketing Authorizations