Asking the Right Questions About Our Health Care System Costs

With health news headlines focused on drug prices, the Senate Committee on Health, Education, Labor and Pensions is holding a hearing today titled, "The Cost of Prescription Drugs: How the Drug Delivery System Affects What Patients Pay." Academic and policy experts are scheduled to testify about how drugs get from manufacturers to patients and how that process impacts a drug’s price.

This certainly isn’t the first time that the federal government has considered these issues, which is why we felt it was important to repost our blog from November 2014:

“The issue of drug costs is a pressing topic and, at the National Pharmaceutical Council (NPC), we welcome the discussion, but all health costs need to be on the table. In too many ways, the current health care system isn’t working and fails to put value on what patients need most—progress over process. While the health care system is rapidly evolving today, it remains fundamentally fragmented, leaving stakeholders with a scattershot understanding of costs, value and patient benefit.

"For example, under typical health benefits, patients pay a greater share of pharmaceutical costs than any other health care service they receive.[i] They face a far smaller share of hospital and physician costs (which are sometimes negotiated), a structural leftover from the way health care worked in the earlier part of the 20th century, when we had far fewer drugs available to treat or prevent disease. That leaves all stakeholders with a skewed view and challenge in assigning how we should spend health care dollars to derive the most positive impact for patients.

"… [This is] a good opportunity for all stakeholders—consumers, patient advocates, health care professionals, employers, payers, policymakers and manufacturers—to question outdated approaches and make room for new solutions, innovative thinking and true collaboration. To achieve that aim and generate meaningful outcomes, those who participate will need to look across the entire health care system and ask the right questions, such as:

• "Has pharmaceutical innovation brought value and made a difference to patients?
• "How do costs for pharmaceuticals compare to all other health care costs? How do we pay for these overall health care costs? What share of overall health care costs should patients pay?
• "How do we ensure patients can access treatments they need and still foster a sustainable environment of innovation?"

We hope that stakeholders will ask similar questions at the hearing today. It’s an important conversation, but it should be the start of a much larger discussion about all aspects of health care.