Regulatory scrutiny will prevent drug plans managers from holding down costs for consumers
As drug coverage increases as a result of expanded health insurance and Medicaid coverage under the Patient Protection and Affordable Care Act, unnecessary regulations will increase prescription drug costs, according to a study from the National Center for Policy Analysis (NCPA).
“Sixty percent of all Americans take a prescription drug in any given year, and nearly all seniors do,” says NCPA Senior Fellow Devon Herrick. “Drug coverage is expanding rapidly and heightened regulatory scrutiny will prevent drug plan managers from holding down costs for consumers with programs such as creating exclusive networks and encouraging mail-order prescriptions.”
Herrick reviewed economic and policy literature on drug plans, as well as the literature on lobbying and government documents.
“The basic findings are that some of the regulations purported to benefit consumers actually harm them by driving up costs,” Herrick says. “Something implied but maybe not stated is special interests often promote legislation as beneficial ‘consumer protections’ that is actually designed to benefit special interests.”
Herrick says there are many barriers, regulations and practices that restrict competitive bidding among drug plan stakeholders.
“Regulations that inhibit the negotiation process between drug-makers, drug stores, and the drug plan will affect managed care organizations that insure health plan enrollees,” he says.