The Dangers of Health Care Cost Shifting: Not Taking Your Medicine

Employers across the US are increasing health care costs for their employees, under the theory that more out-of-pocket costs will encourage employees to use fewer services and save the plan money.

When it comes to prescription drugs, however, encouraging employees to use less is an approach that is already backfiring. Studies show that 20 - 30 percent of prescribed medications are not being filled and that 50 percent of medications prescribed for serious conditions aren’t taken as often as they should be. This has resulted in 125,000 preventable deaths and increased costs of $100 to $289 billion every year.

“When people don’t take the medications prescribed for them, emergency department visits and hospitalizations increase and more people die,” said Bruce Bender, co-director of the Center for Health Promotion at National Jewish Health in Denver.

There are lots of reasons why Americans are not taking their drugs, including lack of information and avoiding side effects. Cost barriers should not contribute to lack of adherence to prescribed medication schedules.

“When the co-pay for a drug hits $50 or more, adherence really drops,” Dr. Bender said. Or when a drug is very expensive, like the biologics used to treat rheumatoid arthritis that cost $4,000 a month, patients are less likely to take them or they take less than the prescribed dosage, which renders them less effective.

Take-Aways for Union Negotiators

Identify the top conditions that contribute to health care costs in your plan (these often include diabetes, heart disease, hypertension, and depression). Medications that manage these conditions could be exempt from increases in drug costs. Copays or coinsurance for these drugs could be reduced or even eliminated to improve adherence and lower costs overall.

Links:

Survey of Employer Benefits Finds Continued Cost-Shifting (CWA Health Care & Retirement Security Blog, September 27, 2016)

The Cost of Not Taking Your Medicine (The New York Times, April 17, 2017)