As we exit 2016, we can only be certain about one fact regarding the future of health care coverage in America: big changes are ahead. Our healthcare was one of the biggest issues in a bitter Presidential campaign, and President-elect Trump has repeatedly said that he plans to replace Obamacare with something else. We’ll see what that something else is soon.
As politicians fought about the best ways to solve America’s health care challenges, we all suffered. Insurance premiums went up and also provided less coverage. Prices for many brand drugs continued their steady march upwards. There was some good news—exciting new treatments, and a bunch of expensive drugs became available as generics—but in general, 2016 was a painful year, and the prognosis for 2017 isn’t much better.
Here’s a recap.
1. More drugs lost insurance coverage.
The two largest prescription insurance companies, Express Scripts and Caremark, dropped coverage for 40 popular drugs in 2016. Most notably, medications like the popular insulin Lantus, and venlafaxine ER (Effexor XR) for depression have been dropped by Caremark. Express Scripts dropped Taltz for psoriasis, and Orencia for rheumatoid arthritis, among others, and Viekira Pak now has only limited coverage. Insurers are also restricting coverage for many of the expensive (but effective) hepatitis C drugs like Zepatier and Olysio, leaving only Sovaldi and Harvoni as options.
Overall, Caremark will be far more restrictive this year, with a total of 130 drugs excluded from coverage. In contrast, Express Scripts will only have 85 drugs excluded in 2017.
New for 2017—Caremark is dropping coverage based on excluding what they call “hyperinflationary drugs” or drugs that have seen a massive increase in cost. Think EpiPen, Alcortin A, and others you may have seen in the news this year.
2. Even more drugs went generic in 2016. Yay!
There is good news! A number of drugs went generic this year, meaning that more expensive brand name medications now have cheaper alternatives. In some instances, filling a generic instead of a brand can mean a difference of hundreds of dollars, whether you’re insured or paying cash. So this is good news for your healthcare wallet!
Here some of the major drugs that got generic alternatives in 2016:
- Gleevec (imatinib), an expensive specialty medication used to treat multiple types of cancer, went generic in February. Although the generic, imatinib, is still expensive, it does offer savings over the brand. This is a big deal—Gleevec has been very effective, and a lower cost generic will make it more accessible.
- Glumetza (metformin ER) is a popular drug used to treat type II diabetes that went generic in February. Glumetza is similar to the other type II diabetes drug Fortamet (also metformin ER), but they differ slightly in how they deliver the drug. You can read more about their similarities and differences here. Also—keep in mind that Glucophage XR has had a less-expensive generic for a few years now, and is still significantly cheaper than Glumetza or Fortamet.
- Enablex (darifenacin ER), for overactive bladder, went generic in March 2016. Although the generic, darifenacin ER, is on the pricey side, it will save consumers hundreds over the brand name.
- Nasonex (mometasone) is a popular corticosteroid used to decrease inflammation in the nose and treat the symptoms of allergies. Nasonex’s generic, mometasone, was approved in March.
- Crestor (rosuvastatin) is a major brand that got a generic alternative in April 2016. Crestor had been dropped by many insurance plans, but with the introduction of a generic alternative, consumers have been able to save big at the pharmacies for this popular statin.
- Epzicom (abacavir/lamivudine) is an antiretroviral used to treat HIV. Its generic, abacavir/lamivudine became available in October, offering huge savings.
- Benicar (olmesartan) is another major brand that became available as a generic drug this year. Benicar is a popular medication used to treat high blood pressure, and its generic, olmesartan (available only in tablet form) offers consumers a pretty substantial discount.
3. Insurance costs are going up.
You may have heard that Obamacare (Affordable Care Act or ACA) plan premiums are expected to climb by about 25% in 2017. Because so many insurance companies dropped out of the exchange markets this year, you can expect to pay an average monthly premium of $302, up from $242. Some companies are also raising rates because the premiums they charged initially were too low to cover the costs they faced. Many of these plans also offer limited coverage, especially for prescription drugs.
You can find more information on changes to ACA plans in 2017 here.
You can also expect to see some price increases and changes in coverage if you have a Medicare plan. More plans that ever (up to 85% in 2017) will have a preferred pharmacy network, meaning they will offer the maximum savings only at certain pharmacies. There is some good news here though—the donut hole is shrinking. You’ll owe a smaller percentage of both brand and generic drug costs while in the donut hole.
You can find more specifics on 2017 Medicare plan changes here, and on GoodRx! In May, Goodrx completed a multi-year effort to analyze Medicare drug pricing and help seniors take control of their prescriptions. Read more about it here, or compare Medicare, cash, and coupon prices on GoodRx here.
Of course, many elements the ACA will likely change in 2017 when President-elect Trump takes office . . .
4. 2016 was the year of outrageous drug prices.
The EpiPen drama exploded in the fall of 2016 as outraged parents encountered insane prices for a life-saving prescription. As you may have heard, Mylan, the makers of EpiPen, have raised prices for the lifesaving drug from about $150 to $600 since 2011. There is good news on the horizon though: Mylan has discussed creating a generic alternative to Epipen, and a less expensive epinephrine auto-injector, Auvi-Q, which should return to the market soon.
Insulin prices also continue to increase, with popular options like Lantus, Humalog, and Novolog increasing by around $150 per carton since 2013. This may hit some of you especially hard with Caremark’s decision not to cover Lantus next year.
Some other sky high drug prices continue to include Daraprim, Sovaldi and other hepatitis C drugs, and treatments for very rare conditions like hereditary angioedema (HAE).
What’s in store for 2017?
As you know, Donald Trump is our new president-elect. There are almost definitely changes in prescription and health care costs, and the future of ACA plans is in question. Stay tuned!
There will be more generics released- especially near the end of the 2017. Though none of these are guaranteed, popular drugs like Viagra (sildenafil) for erectile dysfunction, Truvada (emtricitaboine/tenofovir) for HIV treatment, and the expensive epinephrine auto-injector EpiPen (epinephrine) may see more generic alternatives in 2017.
One thing we can all be sure of—it’ll be more important than ever for Americans to be smart healthcare consumers, and GoodRx will be there to help!
Happy holidays and have a happy, healthy new year!
Open enrollment for 2017 started on Tuesday, November 1 for the Affordable Care Act (ACA or Obamacare) Marketplace. If you’re one of the nearly 14 million Americans expected to sign up for a marketplace plan in 2017, it’s time to make a decision.
You may have heard that Obamacare plan premiums are expected to increase by an average of 25%, which sounds scary—but it isn’t all bad news. Below, we break down what you can expect for 2017, and what you need to know to keep your costs down.
How much will my monthly cost actually go up?
There’s no question that you could see a big increase in your plan costs for 2017. Half of you who buy plans through the Healthcare.gov exchange will see your monthly payment go up by 16% or more, with an average increase of 25%. It could be much higher depending on where you live though—Phoenix, AZ is expected to see the biggest monthly increase at 145%.
To compare: monthly premiums increased by an estimated 2% in 2015, and 7% in 2016. Not good news for 2017.
Overall, the average monthly premium for adults is estimated to be $302 next year, up from $242 this year, according to a report from the Department of Health and Human Services (DHHS).
Why are prices increasing so much?
According to the Kaiser Family Foundation, premiums are going up in some areas because insurance companies are dropping out of the market, meaning you will have fewer options this year. Some companies are also raising rates because the premiums they charged initially were too low to cover the costs they faced.
Insurers are reporting that more people are buying exchange plans than expected—and they’re using more services than predicted.
There is also speculation that the low number of young, healthy people enrolled is contributing to rising costs. In 2016, only 28% of Americans enrolled in exchange plans were in the 18 – 34 age group—and that number hasn’t really increased since 2014.
Can I choose a different plan to lower my costs?
Maybe. Around 21% of consumers shopping in the federal exchange will find plans from only one insurance company, compared with 2% in 2016.
The DHHS also reports that on average, consumers can choose from 30 total plans in their county—down from 47 plans in 2016.
Yes, less choice is a bad thing. But keep things in perspective—you would likely have fewer choices with an employer-sponsored plan. According a 2015 survey, 30% of Americans with insurance through their employer were only offered a single plan from a single provider.
However—even with fewer options, you can still try to change your plan to lower your monthly costs. The DHHS report estimates that if all consumers switched from their current plan to the lowest premium plan in the same “metal” level (Silver, Gold, Bronze, or Platinum), the average 2017 monthly premium after tax credits would be $28 less than 2016.
Obviously, this could mean a decrease in your coverage as well, but if your goal is to lower your monthly premium, it’s worth considering.
What about subsidies?
Subsidies are discounts on your monthly payment meant to reduce your out-of-pocket cost if your income is under a certain amount. You qualify for these discounts if you are under 65 and making between 100% and 400% of the federal poverty level (FPL).
If you make under 250% of the FPL, you’re also eligible for reductions on silver plans—and if you make under 138%, you’re eligible for Medicaid.
84% of people buying a plan on the exchange qualified for at least some subsidy in 2016, and it should stay about the same in 2017.
What if I would rather pay the penalty?
As you probably know, there is now a penalty fee for being uninsured. Be aware that the penalty could top $700 per person or $2100 per household in 2017. In 2016, your penalty for being uninsured was 2.5% of the total household adjusted gross income, or $695 per adult and $347.50 per child. The maximum penalty in 2016 was $2085.
In 2017, the 2.5% percentage will stay the same, but the flat fees will be adjusted for inflation.
Are there ways to avoid the penalty and still not pay for insurance?
There are a few ways to claim an exemption from the penalty, including:
- The most affordable coverage available to you costs more than 8% of your household income.
- You are exempt from filing a tax return because your income is too low.
- You were uninsured for fewer than three months of the year.
- You qualify for a hardship exemption (due to issues like homelessness, bankruptcy, or eviction).
You can check for more ways to qualify and apply for an exemption on Healthcare.gov.
I want to get a plan through the exchange—what else can I do to save?
- Shop around on the exchange. More than 70% of current marketplace enrollees should be able to find a plan for $75 or less in premiums per month, after applicable tax credits in 2017. 77% will be able to find a plan for less than $100 per month (including rebates).
- Need a particular prescription, procedure, or type of care covered? Do your research—go online or call the plan provider to find out if the plan you’re considering offers coverage that will work for you.
- Find other ways to save. If you’re paying out of pocket until you hit a high deductible, GoodRx can help you compare prices, and potentially help with your prescription costs. Also consider pharmacy membership programs—many pharmacies offer free or discounted generic prescriptions (like atorvastatin, lisinopril, metformin, and some antibiotics)—and manufacturer discounts.
- Free preventive care. Vaccinations and screening for many common conditions are free for all adults, and contraceptives are free for women. Some plans will even provide breastfeeding equipment and counseling for pregnant and nursing women.
The increased cost of prescription drugs has been all over the news—and a topic for debate in the 2016 elections.
Huge price hikes for medications like EpiPen, Thiola, and Daraprim, just to name a few, have left Americans frustrated and angry. Amid the controversy, some states (including California and Ohio) are trying to address drug pricing on the ballot this fall—a bold move that other states will likely follow.
What would the Drug Price Relief Act do?
The Drug Price Relief Act (Proposition 61 in California) would cap the price any state agency or health care program could spend on prescription drugs. The cap would be set at the price paid by the US Department of Veteran Affairs—which usually receives the biggest discount.
That would mean that the cost of medications would mimic the low prices of the VA system, pricing drugs 20-24% lower than any other current government program.
What drugs are covered in the VA system?
The VA drug formulary (the drugs covered by the program) is extremely limited, which helps to reduce costs. Fewer drugs are covered, but prices are significantly better for those drugs.
What is the opposition saying?
Those who oppose the drug relief act think that this proposition could drive drug prices even higher. The fear is that drug companies will raise prices overall in order to continue profiting (or simply not sell their drugs to the VA), which could have a wider negative impact.
What are supporters saying?
Those in favor of the drug relief act believe that California’s proposition will fight the price-gouging we are seeing from pharmaceutical companies and provide better access to life-saving medications.
Who is in support of the drug price relief act?
Some of the biggest supporters of the drug price relief act include Bernie Sanders and the AIDS Healthcare Foundation but there are many others.
Will Ohio have it on the ballot this November?
No. Ohio will not be voting on a drug relief act this year. If all goes well, it might appear on next year’s ballot.
Will California have it on the ballot this November?
Yes. California will be voting on Proposition 61, the Drug Price Standards Initiative, as an initiated state statute. This means that if Proposition 61 passes it will become a new law.
More than six years after its passing, Obamacare remains controversial.
In the past few weeks, states have begun to approve premium rate increases for 2017 ACA (Affordable Care Act) health plans. (Insurance carriers need to submit their rate changes to a state commission, which can then approve or deny their request.)
So far, it’s not pretty. Average 2017 monthly premium rates for individuals will likely increase by about 25%. In some states, increases are projected to be 50% or higher. While some increases might naturally be expected, these are surprisingly high and a troubling sign for the future of Obamacare. It’s also worth noting that coverage under these plans, especially for prescription drugs, can be very limited.
In addition, a number of carriers have dropped out of the markets, decreasing competition.
There are a number of reasons for the price hikes—many reports mention that fewer young, healthy people are signing up than expected.
Many people have called for Obamacare to simply be terminated. However, it’s not that simple. There are many aspects of the program that most Americans support, such as eliminating pre-existing condition limitations and providing lifetime caps on patient out-of-pocket spending.
Also, if you ended Obamacare, what would you replace it with?
This week, Megan McArdle at Bloomberg wrote an insightful article about the challenges facing the program and potential fixes. She pointed out that any potential fixes are fraught with challenges. Some possibilities include:
- Increase subsidies. Have the government offset the rising premiums with greater subsidies. This seems unlikely to pass in our current political climate.
- Increase penalties. Some argue that Obamacare only works when everyone is signed up—both sick and healthy individuals. Current penalties for folks who don’t sign up aren’t severe, so many people just don’t bother. In theory, if more healthy people are paying premiums, it would bring down the average cost for everyone.
- Provide a public option. Create a government-run health plan to compete with the carriers and offer coverage when the private sector won’t.
- Scrap the whole thing. Republicans have talked of replacing Obamacare with a private option, with less government involvement, less regulation, and greater use of consumer-directed health savings accounts.
At GoodRx, we don’t have the answer. We do know (because you tell us) that insurance providers—both Obamacare and private plans—continue to shrink their prescription drug benefits and you’re left paying a bigger bill. While GoodRx can’t control insurance premiums, we will continue to find new ways to help consumers get the medications they need at a price they can afford.
Americans are clearly unhappy about the rising cost of prescription drugs and healthcare, and the leading 2016 presidential candidates have proposed all sorts of ideas to fix the problem. Here’s a snapshot of what the candidates have said on these important issues.
Where the Major Candidates Agree
It’s hard to imagine Clinton and Trump agreeing on anything, but they actually have some ideas in common. Here’s a summary:
- Both Trump and Clinton advocate importing prescriptions from overseas. Brand-name drugs are significantly more expensive in America than elsewhere throughout the world, as most Americans know. Both candidates propose legalizing the importation of prescriptions from other countries to help reduce the rising cost of brand drugs.(Interesting side fact: Many generics are actually the same price, or even cheaper, in America than they are in many other countries, including Canada.)
- Both Trump and Clinton support allowing Medicare to negotiate prices with drug companies. Most Americans agree that it’s outrageous that Medicare isn’t allowed to negotiate to reduce the cost of the prescriptions Medicare purchases for seniors. (Just for reference, in 2014 that cost was $143 billion). This issue seems to be one that has universal support among candidates.
- Both have called for more transparency in health prices.
- Both want to increase innovation and reduce time-to-market for new prescription drugs.
Where the Candidates Disagree
Donald Trump hasn’t provided many details regarding his plan for healthcare, but he has some specific proposals that would impact healthcare costs and services in this country. Specifically:
- Repeal Obamacare. Trump wants to repeal Obamacare (the Affordable Care Act or ACA) and restore free market principles. He believes the ACA has caused runaway healthcare costs, higher premiums, and fewer choices, among other issues. He has promised to repeal Obamacare on “day one” of his administration.
- Insurance. While anti-Obamacare, he still supports the mandate that everyone be required to have health insurance (and also said no one should be required to have insurance). He wants to change current laws to allow the sale of health insurance across state lines, stating that increased competition will drive down prices. He also wants to allow insurance premiums to be tax-deductible.
- Immigrants. Trump blames illegal immigrants for high prescription prices, saying it costs $11 billion annually to insure them.
Hillary Clinton, by contrast, has posted extensively about her plans to expand Obamacare and tackle the high cost of prescription medications. She was very vocal during the EpiPen price controversy during the summer of 2016 when she demanded an explanation from the manufacturer. Here’s a summary of Clinton’s positions:
- Defend and expand Obamacare & Medicare. Expand the program, and let Americans 55 and older buy into Medicare.
- Costs. Reduce co-pays, deductibles and out of pocket limits, especially for patients with chronic conditions. She proposes a limit of $250/month per person, and says it will help 1 million Americans annually.
- Advertising. Prohibit the pharmaceutical industry from advertising directly to consumers.
- Limits. Require drug companies that get taxpayer support to invest in research, not marketing, and limit “excessive” profits.
- Brand drugs. Clinton has proposed penalties to drug manufacturers who raise drug prices without justification, as well as government intervention to find other manufacturers or solutions when a brand-name drug increases in price.
- Patents. Reduce patent protection for specialty drugs from 12 years to just 7, so Americans can get access to generics quicker. Also prohibit the practice of letting drug companies pay to delay the expiration of drug patents.
- FDA. Clear out the FDA backlog of unapproved drugs.
Both candidates have made claims which appear to be factually inaccurate.
In a March 2016 debate, Trump claimed the government could save “hundreds of billions of dollars in waste” through negotiating prescription drug prices. However, the annual budget for Medicare Part D is less than that amount.
In a January 2016 advertisement, Clinton’s campaign claimed that drug prices have doubled in the last seven years. While brand name drugs have increased in price, generic drug prices have actually dropped significantly. The average increase for all drug purchases, while hard to measure, is likely not double.
What about the other presidential candidates?
Other presidential candidates may be less well known, but they’ve touched on healthcare reform.
Jill Stein (Green Party)
Stein believes strongly in the role of the government to provide quality healthcare for Americans. From her campaign website: “(Jill will) establish an improved ‘Medicare For All’ single-payer public health insurance program to provide everyone with quality healthcare, at huge savings.” Her plan would eliminate co-pays, premiums and deductibles, as well as any limitations whatsoever. Her platform does not indicate how these expanded benefits would be funded. Like Clinton and Trump, she also wants to use bulk purchasing negotiations by the government to reduce the cost of prescriptions.
Gary Johnson (Libertarian Party)
Johnson does not specifically mention drug prices on his campaign website. Typically, libertarian candidates prefer market forces to legislation, so one could presume that he would generally be against new laws or interference with the private market. Gary believes “the government should never regulate prices of private businesses.” While not directly related to prescription drugs, Johnson also advocates legalizing the use of marijuana.
Where does GoodRx stand? What’s the right answer?
The best candidate to tackle high drug prices is . . . nah, we’re not going to go there.
Providing quality, affordable healthcare is a very complicated problem, and it likely requires more than a bunch of campaign promises to solve. The solution requires big changes to the way our system currently works—Congress, insurance companies, employers and, yes, patients will all have to reset expectations.
Regardless of which candidate wins, we’ll continue to do our part to help Americans understand the system and find ways to afford their healthcare.