Health Insurance Daily

Pharmaceutical Cost Increases May Be Slowing

There may be a smidgen of good news for companies that worry about the skyrocketing costs of prescription drugs: Relentless growth rates may be losing steam.

Projected pharmacy-related cost increases for 2006 are in the neighborhood of 11.8 percent--still a double-digit growth rate that significantly outpaces the Consumer Price Index, but a far cry from the record levels of 18.3 percent that rocked the U.S. just three years ago.

One way employers are trying to rein in costs is by amending their lists of covered drugs. This process often entails substituting label drugs with generics, which tend to be less expensive.

Furthermore, employers are strategically identifying drugs that do not treat medical conditions per se but are widely considered to be lifestyle enhancers, such as Viagra, and changing their status.

Some companies are reducing their financial burden by asking employees who want to use these drugs to increase their share of co-payments. In some cases, employers are deciding to exclude lifestyle drugs from the list of covered medicines altogether.

To read this article in its entirety, click on Pharmaceutical.

posted by Mike @ 9:35 AM