Expect More From... Advocacy!

Many of you have seen my LinkedIn post about my son’s lobbying trip to Washington, DC.   I am so proud of his fearlessness to advocate for what he believes in. Who knows where he got it?😉

It got me thinking about lobbying drug cost reductions. I can often be found listening to Congressional hearings about the causes of high drug costs. These hearings often include representatives drug manufacturers, Pharmacy Benefit Managers, academics and patient advocates, but I have never heard a testimony from an employer group.  When you look at the amount of money spent on lobbying by the pharmaceutical industry, there is no surprise why these individuals are invited to tell their story. PhRMA spent $28.3 million in 2022 on lobbying, and PCMA (Pharmaceutical Care Management Association) spent $8.7 million. There was no group representing the employer’s interest on the list.

Why is this important? 99.9% of all American businesses are small. Small businesses employ 46.4% of U.S. workers. Small businesses care about their employees, want to retain them and want to offer cost-effective benefits.  The problem is there is a direct correlation between the cost of healthcare and the cost of benefits. All the banter about the impact of high drug costs seems to ignore the impact that these costs have on the premium employers must pay for health benefits, and the cost they in turn charge their employees.  When the costs go up, the premiums go up. When the premiums go up, the employers must either increase the share they charge their employees, raise the cost of the goods they sell or reduce the benefits they offer.

I appreciate the enthusiasm to reduce the out-of-pocket costs for patients (as we saw with the ACA with the implementation of the $0 preventative copay and the Inflation Reduction Act with the capping of insulin copay to $35 per month for Medicare patients.) What is ignored in these legislations, though, is the impact on employers. These legislations don’t require that the actual cost of the drug be reduced, but rather the amount charged to the patient is reduced.  The employer is left with the balance. Now, the government is considering adding weight loss drugs to the ACA required $0 copay list. 

Although $0 patient pay seems like it would be good for the patients that need these drugs, it would be devasting to employers that seek to offer cost-effective benefits to their employees and the employees that will have their premiums go up. If we are going to start requiring these products to be covered, we need to include employers in the conversation. Without doing so, they may not be able to continue to offer benefits to their employees. We need an advocate to talk about the overall affordability of these drugs to all stake holders, cost shifting creates more significant issues downstream. If the FDA will not address a fair market price as part of the safety and efficacy review, private insurers must stand united. As Berni Sanders said, in response to a study that found to manufacturer Ozempic costs only $5, “’Millions of Americans are going to need this product’ but won’t be able to afford it, he said in the interview. Ozempic ‘is also going to have a very, very deleterious impact on the budgets of Medicare and Medicaid and private insurance.’”

This is my formal ask. Employers and their advisors, we want to bring the attention of this issue to our governmental officials. If you would like to join us, please respond to this post. We need to be unified in the approach of lowering the overall cost of care and keeping our healthcare premiums low.