United States Healthcare Policy Structures: Drug Pricing

Table of Contents

An elevated level of spending on prescription drugs in the United States is a growing public concern nowadays. US drug prices are among the highest in the world and largely define the overall high level of healthcare spending in the country (Sarnak, Squires, Kuzmak, & Bishop, 2017). Compared to many other nations where some policies are implemented to reduce pharmaceutical costs, including price controls on generics and related brand-name drugs, the United States has failed to address this problem at the legislative level (Wouters, Kanavos, & McKee, 2017).

The present-day regulatory system is mainly focused on drug safety, whereas the cost-effectiveness issue is not addressed (Haeder, 2019). Therefore, there is an urgent need to enact policies that would allow more efficient control of drug pricing. Such a policy can foster better access to essential medicines, decrease out-of-pocket healthcare spending, and minimize the risk of morbidity and mortality due to curable diseases.

Need for Policy Change

An increased number of patients with curable diseases who lack access to medication marks the need for policy change. In their paper, Ballreich, Alexander, Socal, Karmarkar, and Anderson (2017) provide an example of hepatitis C that is associated with the highest death rate among patients even though a highly effective drug currently exists and can almost entirely cure this disease. Unfortunately, a vast majority of people with hepatitis C cannot buy this drug since it is unaffordable for them. Overall, since many private insurers place a lot of branded drugs on high-cost sharing tiers, a wide range of essential medicines may become inaccessible for individuals, especially those with a low income.

Suggested Policy Change

The availability of generic drugs in the market, which usually cost less than brand-name medicines, is the major prerequisite for reducing drug prices in the country. Nevertheless, all previous efforts to introduce generic drug policy reform in the United States were fiercely opposed by trade groups for brand‐name drug manufacturers and clinicians whose economic interests are threatened by drug cost reductions (Wouters, Kanavos, & McKee, 2017).

The presence of generic drugs in the market is now limited since manufacturers have the rights to establish any price for their products based on patents and monopoly rights that they receive after the FDA approval and that they can extend for a prolonged period (Kesselheim, Avorn, & Sarpatwari, 2016). At the same time, the innovation of newly introduced brand-name drugs is often questionable (Twomey, 2019). The mismatch between the price and its value indicates the ineffectiveness of current cost-quality analysis systems.

Based on this, the problem of elevated drug prices may be partially addressed through the introduction of stricter drug value controls and higher competition in the drug market. These objectives may be attained through the implementation of efficient value-based drug pricing negotiation systems that mandate comparative evaluation of medications and the utilization of research evidence during payer-manufacturer discussions of prices (Twomey, 2019).

It is suggested to set prices for prescription drugs following the degree of the value they add (Twomey, 2019). It means that if a certain remedy is not different in terms of its effects than other available alternatives, it should not be priced higher even though the production costs were extensive. Additionally, such drugs should not give manufacturers a chance to exercise exclusive production rights. It means that the patent approval process requires a revision as well. As a result of better value control alone, the competition in the pharmaceutical market may increase since monopoly rights will be exercised less and manufacturers would not be able to set unreasonable prices for products that have no additional values.

Cost Implications

The introduction of a thorough and rigorous drug assessment process that involves comparative research of alternatives maybe not only time-consuming but also costly. Some additional spending would be needed to pay for the services of researchers and independent evaluators. However, since due to the suggested measure both the number of available alternatives and the number of lower-priced drugs may increase and consequently provide more people with access to essential medications, these expenditures can be considered worthwhile. Nevertheless, while stricter value controls may potentially stimulate greater innovativeness among manufacturers and lead to an improved quality of new drugs, they may also result in higher prices for some medications. As such, this secondary outcome would rather be positive, yet it demonstrates that some additional policy measures targeting other factors that contribute to elevated drug costs will still be required.

Role of a Nurse as a Change Agent

Advocacy for patients’ well-being is within nurses’ scope of practice and can be considered one of the key duties of every nurse. By regularly interacting with patients, nurses become aware of patients’ individual stories and their most vital interests that cannot be met in the present-day healthcare system. Moreover, through evidence-based practice and research, they also develop knowledge of the needs of the on-site patient population and local communities in general. According to Oestberg (2013), the communication of patients’ personal stories and results of evidence-based practice to decision-makers are only two of the effective strategies that nurses may implement to influence the legislative process.

In addition, a nurse’s advocacy may become more impactful if their actions are a part of a network’s attempts to address a healthcare policy/problem. Collaboration with other team members, as well as professional organizations and their experts on legislative issues, is important for easier involvement in the political process. Networking facilitates resource mobilization and knowledge sharing and allows building greater credibility (Oestberg, 2013). By tapping into collective expertise and own professional experience of interaction with diverse patients, a nurse can more effectively demonstrate to legislators how their decisions and actions may affect their constituents.

References

Ballreich, J., Alexander, G. C., Socal, M., Karmarkar, T., & Anderson, G. (2017). Branded prescription drug spending: A framework to evaluate policy options. Journal of Pharmaceutical Policy and Practice, 10(31), 1-11.

Haeder, S. F. (2019). . The Conversation. Web.

Kesselheim, A. S., Avorn, J., & Sarpatwari, A. (2016). The high cost of prescription drugs in the United States: Origins and prospects for reform. JAMA, 316(8), 858-871.

Oestberg, F. (2013). Getting involved in policy and politics. Nursing Critical Care, 8(3), 48.

Sarnak, D. O., Squires, D., Kuzmak, G., & Bishop, S. (2017). Commonwealth Fund. Web.

Twomey, M. (2019). . Center for American Progress. Web.

Wouters, O. J., Kanavos, P. G., & McKee, M. (2017). Comparing generic drug markets in Europe and the United States: Prices, volumes, and spending. The Milbank Quarterly, 95(3), 554-601.

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