While some students may not have thought about prescription drug costs yet, the daunting prices loom over many Wisconsin citizens.
Citizen Action of Wisconsin recently published a report on rising drug costs, and specifically how much average prices fluctuate among Wisconsin counties.
The average deductible rate ranges from $400 to $2,500, depending on the city, according the report.
The study looked at members using the Affordable Care Act exchange’s silver plan on healthcare.gov, which is the most popular plan, Kevin Kane, lead organizer of Citizen Action said.
According to the report, Madison has the lowest rate average at $400. The report also examined a particularly expensive cancer drug called Pomalyst, where a Madisonian would pay $453.74 on average, and someone from La Crosse would be billed $5,375.19.
Kane, who compiled the information for the study, said Madison’s average is low because it has a disproportionately high number of public employees, due to workers at the Capitol.
The state public employee plan, Kane said, is similar to the way healthcare.gov operates. That means they make private insurance plans compete for them.
“Because they have so many people in their system … they have a lot of bargaining power against insurance companies,” Kane said. “They are able to negotiate better rates.”
Because the public employee plan is similar to healthcare.gov, and they are able to negotiate better rates, Wisconsin consumers could get a lot more negotiating power if everyone’s insurance operated under a healthcare.gov system, Kane said.
But David Kreling, a professor at the University of Wisconsin School of Pharmacy, said high prescription drug costs don’t necessarily come from the source of the coverage. He said if consumers are using the Affordable Care Act exchange, some people might argue it wouldn’t provide a competitive market for exchanges. It wouldn’t have to compete with other insurance companies to provide the most affordable premiums with the best coverage, he said.
Kreling said if the Affordable Care Act exchanges are predominantly targeted toward senior citizens, who use more prescription medications, people who are part of that exchange would have to pool their money into those costs, making their average premium costs higher.
“They would have to have higher premiums to make sure the collected premium money that goes in is [able] to pay off that benefit,” Kreling said.
But Kane said the silver-level plan Citizen Action’s report looked at covers all types of people — young, old, employed and unemployed. He said 70 percent of people who choose a plan from healthcare.gov pick that plan, and it is popular because it provides benefits while still being relatively cheap.
Kreling said cities besides Madison also showed a wide range of prescription drug costs across the state. Eau Claire’s average, for example, was $750, while Oshkosh’s was $2,547. Kreling said this is because competition for health insurance rates are determined by the options in each county, not throughout the whole state.
Kane suggested one way to combat the growing prescription drug costs is for legislators to mandate a cap on how much insurance companies can price a prescription drug at.
According to Jay Wadd, spokesperson for Sen. Dave Hansen, D-Green Bay, Hansen wants to draft legislation that would require drug companies to provide greater transparency in how prescription drugs are marketed, priced and sold. He also discussed legislation that would create a prescription drug rate commission requiring drug companies to defend any price increases more than 5 percent for specialty drugs.
“The high cost of prescription drugs continues to be a problem for many residents and families in Wisconsin,” Hansen said in a statement. “When drug companies are able to buy specific life-saving drugs and inflate their prices, … something needs to be done.”
Kreling suggested if a healthy young person knows they do not take a lot of prescription drugs and have a low risk of needing expensive medication, they may not want to bother investing in prescription drug insurance.
“Insurance is for low-probability events that are unpredictable, rare, but very expensive,” Kreling said. “Unless you know or have some certainty that you are not healthy and not making good, healthy choices, … then not having any coverage and concentrating on good value [generic prescriptions is a viable substitute].”
As of Oct. 15, Citizen Action reported Wisconsin is the last of all 50 states to not yet release its 2016 health insurance rates, which prevents people from planning ahead for costs, Kane said.
Not allowing consumers to see rates until the day open enrollment begins is another issue that needs to be fixed in Wisconsin’s health care market, Kane said.
