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Oscar Health offers $3 a month drug prescriptions

The formulary includes about 100 drugs, including insulin, and is expected to expand.

Susan Morse, Managing Editor

Insurer Oscar Health is offering about 100 prescription drugs for $3 a month.

This covers the needed drugs for an estimated 90% of members and includes brand-name drugs, Oscar said.

This is a pre-deductible offering, meaning members get access to the $3 drugs regardless of whether they have met their deductible.

The $3 list is not available for catastrophic plans, small group plans, or Medicare.

The discount targets drugs for patients who have chronic conditions.

Member cost savings are expected to add up to thousands of dollars a year.

The cost of insulin medication for those with diabetes will be about $4,164 less per year for members who switch from Levemir at a cost of $350 per month to Novolin N at $3 per month.

Those needing heart disease medication will save $1,836 per year by switching from Nebivolol "Bystolic" Levemir to Atenolol.

The cost of drugs for high blood pressure can be reduced by $444 per year for members switching from Candesartan/HCTZ at $40 per month, to Losartan/HCTZ, at $3 a month.

And those needing high cholesterol medication will save $924 per year by switching from Fluvastatin to Atorvastatin.

WHY THIS MATTERS

In 2019, prices for more than 4,300 prescription drugs increased at an average of 21% year-over-year, according to Kaiser Health News.  An estimated  29% of adults skip meds because of cost and one in four Americans taking prescription drugs said those drugs are difficult to afford.

Legislators are working on mandated measures to lower prescription drug costs. The Centers for Medicare and Medicaid Services issued a rule on drug price transparency requiring pharmaceutical companies to post the list price of prescriptions in TV ads. Drug makers sued.

Insurers and state legislatures in particular are concentrating on price increases of insulin. Between 2012 and 2016, gross insulin spending per person increased by $2,841, according to the Health Care Cost Institute.

In 2016, the average cost of insulin was about $450 a month, or $5,400 a year, according to Oscar. While the drug hasn't changed dramatically over the years, it is classified differently than most drugs and has a complex manufacturing process that allows most companies to keep it out of the generic marketplace, keeping the price high.

In offering discounted insulin prices, Oscar joins a trend on drug caps, initiated either by companies or the law.

In Illinois, the governor signed into law a cap of $100 on out-of-pocket insulin prices, according to The Daily Northwestern.

Express Scripts is offering diabetes patients a $25 monthly cap on insulin.

Minnesota insurers recently announced cuts on out-of-pocket monthly spending for insulin. Blue Cross Blue Shield of Minnesota announced covered insulin would be available at no charge at the pharmacy counter for MNsure and commercially insured members. HealthPartners offers plans that cap insulin costs at $25, and there are plans to expand that soon, according to the Star Tribune.

In Kentucky, the governor, legislators, and advocates urged passage of House Bill 12, which would limit how much insurers could charge for a month's-worth of insulin medication, according to WFPL. The bill would limit commercial health insurers to $100 in copay for a 30-day supply and would forbid insurers from reducing or eliminating health coverage in response to the proposed law.

However, a Colorado law that took effect January 1 to cap out-of-pocket insulin costs at $100 per month was found to have loopholes which allowed insurance companies to charge more, The Denver Post reported. Some insurance plans were exempt from the law, including those that are self-funded through an employer.

THE LARGER TREND

Oscar said its $3 drug list will continue to evolve. Its formulary is available to individual members as of January 1 everywhere except New York, New Jersey and California.

Oscar, known for its Medicare Advantage and Affordable Care Act plans, has been expanding its business, announcing last month that it would partner with Cigna to sell fully-insured health benefits to small businesses.

ON THE RECORD

"We looked at the most common therapeutic areas for our members – and, with clinician input, we picked drugs that had the best cost and clinical effectiveness. We came up with a list of about a hundred drugs that represent 90% of the use cases that somebody might need a prescription for," said Dr. Vinod Mitta, vice president of Pharmaceuticals at Oscar. "For next year, we're going to add even more drugs to the list."

Oscar CEO Mario Schlosser said, "Solving this problem is good for business, but making sure people have access to medication at a reasonable price isn't a matter of economics, it's a matter of ethics."

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com