To address the critical risks posed to patients from chronic shortages and rising prices of life-saving generic medications, three national foundations committed $30 million to help establish Civica Rx, a new not-for-profit generic drug company. The Laura and John Arnold Foundation, the Peterson Center on Healthcare and the Gary and Mary West Foundation each committed $10 million, joining seven large U.S. hospital systems representing approximately 500 U.S. hospitals as governing members of Civica Rx. The formation of Civica Rx was announced earlier today.
Today, the high price of healthcare services — including physicians, hospitals and prescription drugs — are at unprecedented levels, creating barriers to access for individuals who need care. Prescription drug prices continue to increase more rapidly than inflation, resulting in an expected growth in spending of 6.3 percent annually. We believe addressing the excessive prices of prescription drugs provides the most immediate opportunity for relief of exorbitant healthcare prices overall.
No one in America should have to worry about going bankrupt when they get sick or choose between filling their prescription and paying rent. We need to rebalance incentives to increase innovation and price competition and prioritize patient access and affordability. Ultimately, we need to ensure that Americans have the ability to secure the prescription drugs they need at a price they can afford.
Medicare must be allowed to negotiate directly with manufacturers on prescription drug prices to get the best deal for patients and the federal government. As the largest purchaser of prescription drugs in the country – with nearly 42 million seniors and people with disabilities accessing prescription drug coverage through its services – Medicare should be able to leverage its’ purchasing power with pharmaceutical companies to get lower prices. With nine out of 10 Americans in agreement, now is the time for immediate action.
Key steps to lowering drug prices include: • Increasing competition in the generic and biosimilar industry; • Eliminating anti-competitive behaviors by some brand-name manufacturers that block or delay competition; • Testing new reimbursement models that promote value, like outcomes-based purchasing; • Investing in comparative effectiveness research and its dissemination to understand the value of individual prescription drugs; and • Allowing states responsible flexibility to test innovative models for purchasing prescription drugs.
With 90 percent of America concerned about the high cost of prescription drugs, we must keep pressure on our elected officials to act in the nation’s interest through sustained and effective engagement.
Three common sense reforms – allowing Medicare to directly negotiate prescription drug prices with drug companies, accelerating the move to a value-based care system and requiring greater price transparency – are key to lowering healthcare costs and improving health outcomes. West Health, a family of nonprofit and nonpartisan organizations that spans research, policy and philanthropy, will convene major figures from the worlds of healthcare, business, policy and media for a national summit on how to best drive these reforms to create a system that is more transparent, competitive, affordable, person-centered, quality-driven and sustainable.
The rising cost of healthcare is a growing and major threat to our economy, our financial security and our individual health. For too long, we’ve been paying too much and not getting enough in return. The U.S. healthcare system is on an unsustainable cost trajectory. We have an urgent need to address this cost crisis so that healthcare can become more accessible and more affordable for all Americans. Now is the time.
West Health provides a variety of published reports, findings and data, as well as resources that are free and available for use.