Op-ed: Kentucky legislators should not embrace pharmaceutical manufacturer “kickback” system
Big Pharma rang in 2021 by hiking prices on a whopping 800 drugs by an average of nearly 5 percent. These additional costs far outpace the current 1.4 percent rate of inflation and came on the heels of increases since July 2019. While affordability and economic recovery should be of paramount concern to members of the General Assembly, proposed legislation is being considered that would send even more dollars to drug companies and increase premiums.
Kentucky Senate Bill 45 and House Bill 114 would encourage a practice that is banned in federal programs like Medicare Part D. The bills would increase health premiums for working Kentuckians and small businesses by mandating health plans apply the value of pharmaceutical manufacturers’ copay cards toward an insured’s deductible. These copay cards are designed to keep insureds on higher-price drugs by removing incentives to use cheaper generic medication. Researchers from UCLA, Harvard, and Northwestern estimate that for brand-name drugs facing generic competition, these copay cards boost retail sales by 60 percent or more. And they increase spending by anywhere from $30 million to $120 million per drug.