The rising cost of health care is an issue affecting families and businesses in Detroit, across the state, and across the country — particularly the ever-increasing prices of prescription drugs.
This is clearly a problem that requires thoughtful policy making and perhaps even some regulatory changes to ensure that Michiganders and all Americans can access the prescriptions they need at prices they can afford.
The Federal Trade Commission has begun examining some of the factors likely to contribute to the rising costs of prescription drugs. While a thoughtful inquiry can be a welcome and long overdue step, it is critical that the agency direct its inquiry to market participants behind the spiraling costs of prescription drugs and examine the often arbitrary price and price increases set by major drug companies and drug manufacturers themselves.
Instead, the FTC is currently focusing its efforts on picking out the relationship between pharmacy benefit managers, or PBMs, and independent pharmacies. Through my role as Wayne County Commissioner for District 2 — and my involvement with SEIU Healthcare Michigan — I have come to gain a greater understanding and appreciation of the critical role that PBMs play in keeping prescriptions affordable and accessible.
In my experience, outcome-based coupons don’t contribute to higher costs for prescription drugs—in fact, they do the exact opposite.
Essentially, PBMs act as negotiators and liaison with major drug companies and pharmacies for nearly every type of health care plan imaginable — from union-negotiated plans to self-insured and commercial plans to government-run plans like Medicare Part D and Medicaid. In addition to seamlessly and almost instantaneously managing drug benefits, PBMs use their vast purchasing power to negotiate with drugmakers and pharmacies in order to lower prescription drug costs for everyone with health insurance nationwide.
When it comes to prescriptions, affordability is key to helping patients stay on their medication, which leads to better health. Not only does this help vulnerable or at-risk Michigan residents live healthier lives, but it also helps relieve pressure on our overburdened healthcare system. By negotiating lower prescription drug costs, RBM helps keep patients and entire communities healthier and more productive.
Conversely, if patients cannot afford their medications, they are less likely to take them on a regular basis and more likely to end up in poor health, undermining the quality of life — or even life-threatening — of Michiganders with more effort. . of pressure on our entire healthcare system. This is why PBMs are such an important part of the healthcare landscape – they advocate for patients and make prescription drugs more affordable and accessible.
SEIU uses PBM to reduce the costs of prescription drugs, and our PBM plan does just that, just like the PBMs of every Michigan health plan. Money that helps PBMs Michiganders save each year by working with health care plans and negotiating with drug manufacturers is money that can go toward college savings, retirement, increased gas costs, family vacations, or any number of other household priorities. In these turbulent economic times, PBMs help make a real difference to patients by keeping costs under control.
If the FTC is serious about tackling the real factors contributing to the skyrocketing price of prescription drugs, it should examine the price-fixing practices of big pharma and drug manufacturers. They are most defining the costs Americans pay for the vital drugs they need to live a healthier life — and in some cases, to survive.
Artificially and arbitrarily high prices and persistent price hikes—plus a host of anticompetitive practices employed by drug manufacturers—are the main reason many Michiganders pay for their prescriptions, undermining access and compliance and leading to less healthy communities. That’s what the FTC should really be looking for, not the role of PBMs, which are perhaps the single biggest driver of lowering prescription drug prices and healthcare plans nationwide.
If we are to definitively address the issue of rising prescription drug costs, we need to get to the root of the problem. We know where that is, let’s start digging.
Jonathan C. Kinloch is Wayne County Commissioner (District 2), President of the Detroit/Wayne County Port Authority and Democratic Party Chairman of the Thirteenth Congressional District.