BREAKING: Trump’s money-back guarantee on Rx …
(SANDIP SHAH AND JOE BLACK, FORBES)
President Trump will soon issue an executive order to lower drug prices. The order likely will encourage federal health agencies to make greater use of “outcomes-based” contracts.
That’s great news for patients, because these contracts link a drug’s price to its effectiveness.
If a drug cures or treats patients as advertised, insurers pay the full price.
If the drug is less successful than hoped, insurers pay a reduced price or nothing at all.
Trump sides with consumers over expensive treatments that don’t work
Freed from the fear of paying for expensive yet ineffective treatments, insurers will be more willing to give patients quick access to advanced drugs while getting assurance that the drugs work.
This will improve Americans’ health and drive down long-term health care spending.
Value-based contracts have become more popular in recent years.
A quarter of health plans now have at least one value-based contract — and 30% more are currently negotiating one.
In the past, insurers often hesitated to spend money on advanced drugs.
To minimize costs, many insurers required patients to try older, cheaper drugs first. Only if those drugs failed would insurers cover the cost of more advanced medications.
Such “step therapy” delays proper treatment for patients.
Value-based contracts negate the need for step therapy. If it turns out drugs aren’t as effective as the pharmaceutical companies claim, insurers simply pay the drug companies less.
And if the drugs works, patients get better faster, saving healthcare dollars in the long-run.
Value-based contracts also can nudge insurers to cover treatments that they once flat-out denied. SEE FULL STORY AT FORBES.COM. Also of interest: Pharma Giant to Bill Taxpayers $475,000 Per Patient for New Rx