November 30, 2005

Coverage of Medicine Co-Payments

The Wall Street Journal had a good article on how people are getting their co-payments (for partially insurance-covered medicines) covered by non-profit groups that are funded by drug companies.

Here is a short excerpt of the article:

Ms. Oliva, who earns about $40,000 a year managing a clothing store in Long Beach Island, N.J., pulled out her American Express card that day in September and paid, unsure where she was going to find the money for the next week's supply. Fortunately, the nurse at her doctor's office found help for her from a charity, Patient Services Inc., which picked up her drug co-payments -- $3,800 for a six-week course of treatment.

The twist: The money for her co-payments came from Schering-Plough Corp., the drug's maker.

To cope with rising medical costs, insurers are requiring patients to pay higher premiums and co-payments for drugs. While poor uninsured patients can often get expensive medicine free from drug companies, people with insurance are increasingly finding it difficult to afford these drugs. In response, drug companies are giving money to charities that are specifically set up to help patients pay such costs.

On the negative side, critics contend that

"The efforts,... are a short-term fix that doesn't address the underlying problem: the soaring cost of ultra-expensive drugs. They argue that by paying patients' premiums or co-payments, drug companies are shifting most of the price of these medicines to the patients' insurers, who in turn spread the cost onto the other people they cover.

"This is not a sustainable level of spending," says Alan Garber, chairman of the Medicare Coverage Advisory Committee and director of the Center for Health Policy at Stanford University. "The idea of making drugs available to people who can't afford it is very appealing, but the net effect is for the drug company to appropriate most of the gain."

More Information: Patient Services, Inc.


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